Aereo’s Antenna Arrays and Streaming of Broadcast Programming to Individual Subscribers Found Infringing

by JD Supra Perspectives
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Citing Aereo’s “overwhelming likeness to the cable companies targeted by the 1976 amendments”, the majority found that Aereo is not just an equipment supplier and that it “performs” the broadcasted works...

In a 6-3 decision, on June 25 the Supreme Court reversed a Second Circuit decision, to find that Aereo’s service, offering individual subscribers internet access to broadcast television programming, is infringing. 573 U.S. ___ (2014).  Aereo uses a massive array of dime sized antennas with associated transcoders and data storage, which capture over-the-air programming signals and allow the individual subscriber to stream to itself selected programming over the internet. This was found to be a public performance by Aereo of the copyrighted programming. Having no authorization for the performance, Aereo is an infringer.

The majority opinion by Justice Breyer (with Justice Scalia, Thomas and Alito dissenting) looked to the Transmit Clause of 17 U.S.C. §106(4), which defines a particular aspect of the public performance right, and to the Congressional history of that clause. In particular, the opinion noted that the majority saw in the enactment of the Transmit Clause in the 1976 Copyright Act a clear intention to overrule the Court’s prior Fortnightly and Teleprompter cases, which had allowed cable TV to transmit broadcast TV signals. Citing Aereo’s “overwhelming likeness to the cable companies targeted by the 1976 amendments”, the majority found that Aereo is not just an equipment supplier and that it “performs” the broadcasted works.

Moving on to the “publicly” part of the exclusive right, the majority noted that Aereo’s system makes an individual copy for each subscriber of the program the subscriber requests,  in the course of passing on the signals with a few seconds delay relative to the original broadcast. However, it concluded that the Transmit Clause suggests that an entity may transmit a performance through multiple, discrete transmissions, and thereby reach a public. Likewise, the majority felt the Transmit Clause contemplated a “public” made up of viewers not “situated together, spatially or temporally”.

Facing an issue raised in oral argument, the majority addressed the concern that its interpretation of the Transmit Clause would impose copyright liability on new technologies Congress did not intend to cover. It viewed its ruling as limited and pointed out that a performance only occurs with a transmission that “communicates contemporaneously perceptible images and sounds of a work.” This would exclude a simple file download, not done by streaming. It further pointed out that remote storage services for copies already lawfully acquired were a different matter than the Aereo facts.

The dissenters have already signaled the difficulty of drawing lines in the digital content playing field...

The dissent relied on a copy shop analogy and saw Aereo as just offering a device by which a subscriber was enabled to perform an action where the subscriber, not Aereo, chooses the content. The dissent noted that the sole question was whether Aereo was a direct infringer, not whether it might be viewed as secondarily liable. The dissent felt that Aereo lacked the volitional conduct requirement of secondary infringement cases such as Fox Broadcasting Co. v. Dish Network LLC, 747 F. 3d 1060 (CA9 2014).  They also saw technical distinctions between Aereo and the systems in the Fortnightly and Teleprompter cases.

For broadcasters and copyright owners of broadcast content, the decision represents a major win. Although the majority took pains to confine its decision to the Aereo facts, it is inevitable that new technologies will be tested against generalizations of the majority’s reasoning. So we can expect the decision to be used by creative analogy in future cases involving the ever-growing and changing uses of digital content. The dissenters have already signaled the difficulty of drawing lines in the digital content playing field.

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