In what is certain to be a landmark cyber law decision, the U.S. Supreme Court agreed to hear argument in a copyright infringement case pitting traditional TV Broadcasters against on-line streaming video. (American Broadcasting Companies, Inc., et al., v. Aereo, Inc., Docket 13-461) The Court will decide whether a company “publicly performs” a copyrighted television program when it retransmits a broadcast of that program to thousands of paid subscribers over the Internet.
As noted in the case, founded in 2010, Aereo Inc. provides over-the-air television to paid subscribers through Internet connected smart phones, tablets, and laptops. Its technology is currently supported on iPad, iPhone, AppleTV, and other similar platforms.
Aereo rents to subscribers a tiny TV antenna located in a data center near the subscribers. The antenna is connected to a remote DVR in the same data center. The subscriber controls both the antenna and DVR from an Internet-connected device. When the subscriber tunes to a channel, the device instructs the antenna to tune to that channel and start recording the programming to the DVR. This lets the subscriber pause and rewind the program while watching. A program may be saved for future viewing and a subscriber may schedule future recording of programs.
Barry Diller, an Aereo Board member, has called Aereo’s “the first potentially transformative technology that has the chance to give people access to broadcast television delivered over the Internet to any device, large or small, they desire.”
In March 2012, a consortium of Broadcasters (including ABC, CBS, Fox Television, Univision, and others) sued Aereo. In their view, an Aereo retransmission is a “public performance” of an otherwise copyrighted work protected under Sections 101 and 106 of the Copyright Act of 1976. The Second Circuit Court of Appeals rejected that argument, and the providers have now appealed to the U.S. Supreme Court.
The Broadcasters say, in their Petition for Writ of Certiorari, that the case “presents questions of copyright law that profoundly affect, and potentially endanger, over-the-air broadcast television…(And that,) the broadcast television industry has invested billions of dollars producing and assembling high quality and creative entertainment and news programming in reliance on (copyright law), which prevents retransmission services from free-riding on broadcasters’ investments and provides broadcasters with incentive for further investment and innovation.”
In its January 10, 2014 press release, Aereo’s Founder and CEO Chaitanya Kanojia, says that “(t)his case is critically important not only to Aereo, but to the entire cloud computing and cloud storage industry.” He also says that “(t)he challenges outlined in the broadcasters’ filing make clear that they are using Aereo as a proxy to attack Cablevision itself and thus, undermine a critical foundation of the cloud computing and storage industry.
In examining the Aereo model in connection with the Broadcaster’s initial motion for a preliminary injunction, the District Court examined the Copyright Statute in light of Cartoon Network LP, LLLP v. CSC Holdings, Inc., 536 F.3d 121 (2d Cir. 2008). In that earlier Second Circuit case, broadcasters challenged Cablevision’s “Remote Storage” Digital Video Recorder system (“RS-DVR”), using a technology akin to both traditional, set-top digital video recorders, like TiVo (“DVRs”), and the video-on-demand (“VOD”) services provided by many cable companies. The Second Circuit reversed and vacated the judgment of the district court because each RS-DVR playback transmission was made to a single subscriber using a single unique copy produced by that subscriber, which did not constitute performances “to the public.”
In its Amicus Curiae Brief supporting the Broadcasters Petition, the Washington Legal Foundation argues that the Second Circuit’s reasoning is faulty. The holding it says “threatens to eviscerate the public-performance right by holding that the relevant inquiry “is the potential audience of a particular transmission, not the potential audience for the underlying work or the particular performance of that work being transmitted…In other words, because every Aereo subscriber receives an individual transmission from a unique subscriber-associated digital copy of the same” performance, no violation occurs.”
Oral argument will be heard later this Spring. What should prove as one of the more interesting decisions to be rendered this Term will follow shortly thereafter. Assouline & Berlowe is following this case closely.
Stay tuned!
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Partner Carl H. Perdue, Esq.
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