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>>The Showdown Shapes Up: Broadcasters, Aereo, Aereokiller, and FilmOn X

The Showdown Shapes Up: Broadcasters, Aereo, Aereokiller, and FilmOn X

Prof. Rodney A. Smolla, Duke University School of Law
February 4, 2014

On Jan. 10, 2014, the Supreme Court granted the petition for certiorari filed by broadcasters in ABC, Inc. v. Aereo, Inc., in a case that puts in play the American television broadcast industry as we know it.  The petitioners in the case are American Broadcasting Companies, Inc., Disney Enterprises, Inc., CBS Broadcasting Inc., CBS Studios Inc., NBCUniversal Media, LLC, NBC Studios, LLC, Universal Network Television, LLC, Telemundo Network Group, LLC, WNJU-TV Broadcasting LLC, WNET, THIRTEEN Productions, LLC, Fox Television Stations, Inc., Twentieth Century Fox Film Corporation, WPIX, LLC, Univision Television Group, Inc., The Univision Network Limited Partnership, and the Public Broadcasting Service.  This is a formidable grouping, essentially constituting the owners of the lion’s share of copyrighted news, information, and entertainment content shown on television in the United States.

The case is fascinating, and is easily susceptible to a seductive but ultimately errant and misguided sympathy for the upstart Aereo, cast as David against the network Goliaths.  Aereo uses antennas of about the size of a dime to retransmit to Aereo’s paid subscribers broadcast signals it picks off the air.  Aereo does not pay broadcasters for this retransmission.

Broadcasters argue that Aereo’s model is a free-riding exploitation of their copyrighted works, and that the retransmission constitutes a “public performance” of those works.  Aereo counters with the argument that because Aereo creates an individual dime-sized antenna for each of its subscribers, it is not engaged in any public performance, and its model does not infringe on any interest of the broadcasters protected by the Copyright Act.

The broadcasters seek to overturn the decision of the U.S. Court of Appeals for the Second Circuit in WNET, Thirteen v. Aereo, Inc.,1 which sided with Aereo.  The briefs of the parties and their supporting amici are due on Feb. 25, 2014, and the Court may hear oral argument in April and render a decision by the end of June.

In related developments, parallel litigation in the District of Columbia and in California involving technologies similar to Aereo has been temporarily suspended pending the Supreme Court’s decision.  Federal district courts in the District of Columbia and in the Central District of California issued injunctions against FilmOn X (formerly known as “Aereokiller”), which uses technologies similar to Aereo.  Those decisions were briefed and argued in the District of Columbia and Ninth Circuit courts of appeal.  On Jan. 23, the D.C. Circuit ordered the appeal before it held in abeyance pending the Supreme Court’s decision in ABC v. Aereo.  The Ninth Circuit did the same thing four days later.  FilmOn X, with its two cases now in suspended animation, filed a motion on Jan. 31, 2014, to intervene in the Supreme Court.  Whether or not the Supreme Court allows FilmOn X to intervene, the decision on the merits in ABC v. Aereo will likely resolve the copyright question for Aereo and all its fellow travelers.

The Media Institute filed an amicus brief in support of the broadcasters’ Petition for Certiorari, on which I served as author and Counsel of Record.  Later this month, The Media Institute will file a brief on the merits in support of the broadcasters.

The Media Institute’s brief relies heavily on the superb legal analysis of Professor Jane Ginsburg, who has incisively and persuasively demonstrated why the Second Circuit got it wrong in Aereo, just as it got it wrong in its antecedent misstep in Cartoon Network LP, LLLP v. CSC Holdings, Inc.,2 in which the Second Circuit held that Cablevision’s “remote DVR” service, through which customers could select programs to store on Cablevision servers individualized for each customer for later viewing, did not constitute a “public performance” under the 1976 Copyright Act.  As The Media Institute’s submissions to the Supreme Court have and will maintain, the Second Circuit’s decisions in Aereo and Cartoon Network effectively provide an instruction book for how to circumvent the Copyright Act for unlicensed profit.  Any parasitic business seeking to make money from the copyrighted works of another without obtaining a license should design a technological system in which the transmission may be characterized as sent to only one subscriber.3  Such an understanding of the Copyright Act, The Media Institute argues, makes no sense under the literal text and animating policy purposes of the Act.

Legal analysis aside, amicus briefs at their best seek to enrich the perspective of Supreme Court justices by providing a broader sense of the economic and social forces in contest.  In ABC v. Aereo, a case that may pivot on highly technical and legally esoteric interpretations of what the Copyright Act means by “public performance,” how the justices process that battle over definition and syntax may be influenced by the broader economic and social realities at stake.

In that battle, Aereo has going for it the romance of the pirate, the clever swashbuckling outlaw who outsmarts the established commercial and legal order to beat the system.  There’s a little pirate in all of us, just as there’s a little David in all of us, and the mythical power of the scrappy clever guerrilla warrior taking it to the man will always retain some hold on our romantic instincts.

Yet there are good underdogs and bad underdogs.  David has the combined power of ancient biblical resonance and Malcolm Gladwell’s latest New York Times bestseller David and Goliath behind him.  Yet both the Bible and Malcolm Gladwell must acquiesce in the time-tested judgment of those societies entrusting in the rule of law that not all rebels and underdogs are good guys.  “Pirates,” for whatever devilish hold they have on our rebellious juvenile spirits, are often bad guys.

The Media Institute’s position in the Supreme Court, which I embrace in my own voice and as The Media Institute’s Counsel of Record, is that by any realistic economic and social measure, Aereo and its cousins are pirates, and bad guys.  They are clever, to be sure.  And a part of us is drawn to that cleverness.  But it is one thing to create a novel, movie, or amusement park on the romance of the pirate, and another to order the rule of law in just society on principles of parasitic exploitation.  Against that measure, for my own measure, and that of The Media Institute, the equities in Aereo are easy.  As I have stated on behalf of The Media Institute, if a picture tells a thousand words, a thousand antennas tell the picture.  Aereo’s bizarre engineering, employing thousands of antennas to do the work of one, reveals to all what is really going on.   As Judge Denny Chin observed in his dissent from the panel decision in the Second Circuit:

The system employs thousands of individual dime-sized antennas, but there is no technologically sound reason to use a multitude of tiny individual antennas rather than one central antenna; indeed, the system is a Rube Goldberg-like contrivance, over-engineered in an attempt to avoid the reach of the Copyright Act and to take advantage of a perceived loophole in the law.4

As I see it, Aereo and it fellow travelers thought they had found a loophole that made their actions, which were by any fair measure nothing but piracy, legal.  Loopholes, however, ought be narrowly construed, at least when their primary beneficiaries are parasitic pirates.  American society has wisely invested much in the social utility and abiding public interest in the viability of local broadcast television stations.  “Broadcast television is an important source of information to many Americans.”5  Federal policy has long favored the preservation of broadcast television in America, recognizing that “by tradition and use for decades now it has been an essential part of the national discourse on subjects across the whole broad spectrum of speech, thought, and expression.”6

It is difficult for me to conjure any cogent public policy rationale favoring Aereo and Aereo-like pirates in their quest to make free-riding bucks from the creative energies and capital investments that actually generate the creative works the pirates seek to expropriate.  I hope the Supreme Court sees it the
same way.


By |2018-07-04T13:34:40+00:00February 4th, 2014|Intellectual Property Issues|Comments Off on The Showdown Shapes Up: Broadcasters, Aereo, Aereokiller, and FilmOn X