Aereo Loses the Supreme Court Battle



Guest blog post by Rachelle M. Llontop. Rachelle is a summer associate in the Washington, DC office of DLA Piper. She attends the American University Washington College of Law and will graduate in 2015.

Earlier today the United States Supreme Court reversed the Second Circuit’s decision in WNET, et. al v. Aereo, Inc., holding that Aereo’s streaming television service infringes copyright holders’ exclusive right to perform a copyrighted work publicly under the Transmit Clause of the Copyright Act of 1976.  The high-profile case stemmed from Aereo’s service, which functioned by using thousands of tiny antennae to receive over-the-air television broadcasts. The signal received by each individual antenna was then retransmitted to a specific subscriber over the Internet.  Plaintiffs, a collection of several networks, filed for a preliminary injunction against Aereo, claiming that Aereo’s retransmissions were a prohibited public performance of copyrighted works.  On April 1, 2013, the Second Circuit Court of Appeals affirmed the District Court’s denial of plaintiffs’ preliminary injunction.

In a 6-3 opinion authored  by Justice Breyer, the Court reiterated that when Congress amended the Copyright Act in 1976 to expand the definitions of “perform” and “transmit,” its purpose was to protect copyright holders’ exclusive rights to perform works in light of emerging technologies. As a result, although innovative in its attempt to circumvent the prohibitions in the Transmit Clause of the Copyright Act, Aereo’s transmission of television programming to innumerable individual subscribers constituted a public performance even though each transmission was discrete and resulted from individual subscribers’ choices.  This decision is different than prior court interpretations of the Transmit Clause such as Cartoon Network LP, LLLP v. CSC Holdings (known as the “Cablevision” decision), which had previously been interpreted to allow companies to retransmit television programming to consumers so long as the transmissions were discrete and initiated by the consumer.

Ultimately, the Court has taken the position that regardless of the fact that the technology behind Aereo’s service appears to comply with the law, the resulting service itself still infringes rights-holders copyrighted works. In light of this decision, it is clear that Aereo will be unable to continue doing business using its current model. Absent licenses from copyright owners, other similar retransmission services now also appear to be at risk of facing infringement claims.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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