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When does a copyright owner's exclusive public performance right extend to retransmissions of television broadcasts that embody the copyrighted work? The defendant in ABC v. Aereo, 2014 U.S. LEXIS 4496 (June 25, 2014) [an enhanced version of this opinion is available to lexis.com subscribers], attempted to distinguish itself from conventional cable television companies by capturing over-the-air television signals on individual antennae dedicated to individual subscribers and then retransmitting the broadcast over the Internet to the requesting subscriber after a brief delay. In a split decision that relied heavily on public policy and broad inferences regarding congressional intent, the Supreme Court applied the "if it quacks like a duck" approach, disregarding the defendant's technological ingenuity and holding that the defendant was acting as a thinly-disguised cable television company, and that its unauthorized retransmissions were infringing public performances. In other words, Aereo did not just build a better antenna; it functioned as an unlicensed broadcaster. Because the Court's rationale is unclear, the decision fails to resolve uncertainty regarding the lawfulness of remote DVR systems and "cloud" services that store and retransmit content at the request of individual users. However, the decision is a clear victory for broadcasters and copyright owners.
I. Background For a monthly fee, Aereo transmitted broadcast television to its New York City subscribers over the internet without the consent of the parties that own the copyright in the television programs. In an attempt to avoid liability for the unauthorized public performance of copyrighted works, Aereo modeled its system after a system which the Second Circuit held to be non-infringing in Cartoon Networks LLP v. CSC Holdings, Inc., 536 F.3d 121 (2d Cir. 2008) (the Cablevision case) [enhanced version]. As a crucial step in this strategy, Aereo recorded a unique copy of each broadcast requested by a subscriber, and began streaming that copy to the requesting subscriber just a few seconds after the recording commenced. A. Aereo's Technology Aereo placed thousands of small antennas on its Brooklyn rooftop in order to pick up broadcast signals from local New York television stations. When an Aereo subscriber selected a television program to watch or to record, Aereo's antenna server assigned an individual antenna to that subscriber for the duration of the program. While the antennas operated independently of one another, at any given time several of them might be receiving the same broadcast simultaneously if multiple subscribers had requested it. If the subscriber wished only to record the program for later viewing, Aereo would record the program and then store that unique copy for the subscriber, who could request playback of his or her unique copy at a later time. Alternatively, if the subscriber wished to view the broadcast in real time, Aereo would still record a unique copy of the broadcast as it was captured by the antenna, but it would begin playing that copy back to the subscriber after short delay (approximately 6-7 seconds). Thus, the subscriber could begin watching the program while it was still being recorded. As a result, while the user could view the broadcast almost in real time, the user was actually watching a playback of his or her unique copy. B. Decisions Below Several copyright owners sued Aereo for infringement of the reproduction right, infringement of the public performance right, and contributory infringement. The plaintiffs then moved for a preliminary injunction barring Aereo from transmitting programs to its subscribers while those programs were still being broadcast. The district court denied this motion, and the Second Circuit affirmed, holding that, under Cablevision, Aereo's transmissions were not public performances. District courts in two other circuits, however, have examined the same system and found that the unauthorized transmissions were public performances. See Fox Television Stations, Inc. v. BarryDriller Content Sys., 915 F.Supp.2d 1138 (C.D. Cal. 2012) [enhanced version]; Fox Television Stations, Inc. v. Filmon X LLC, 2013 U.S. Dist. LEXIS 126543 (D.D.C. Sept. 5, 2013) [enhanced version].
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