Aereo: OK Then, We’re a Cable Company
Lisa Shuchman, Corporate Counsel
July 10, 2014 | 0 Comments
Aereo Inc., the video-streaming service the U.S. Supreme Court ruled last month was violating copyright law by using dime-sized antennae to broadcast television content to subscribers, has spelled out a new plan for its survival, one that ironically uses an argument put forth by the Court.
The American Broadcasting Companies v. Aereo decision sent the case back to the U.S. Court of Appeals for the Second Circuit, where U.S. District Judge Alison Nathan must now decide whether to issue the preliminary injunction broadcasters had sought or allow Aereo to keep operating in some other form. After the high court ruling, Aereo temporarily suspended its service.
In a joint letter sent to Nathan on Wednesday by lawyers for Aereo and the broadcasters, Aereo argued that it should be allowed to continue its operations because the court had determined Aereo qualifies as a cable system. “If Aereo is a ‘cable system’ as that term is defined in the Copyright Act,” the company’s lawyers wrote, “it is eligible for a statutory license, and its transmissions may not be enjoined (preliminarily or otherwise).”
The Court in fact did hold that Aereo is “substantially similar to,” “has an overwhelming likeness” to and “is for all practical purposes a traditional cable system.”
Aereo is now saying it is adopting the cable system business model, even though it had previously argued it was not a cable system. And if it is willing to pay licensing fees, then it is allowed under the Copyright Act to retransmit copyright programming, the company says.
But in the joint letter to Nathan, the broadcasters called Aereo’s argument “astonishing.”
“Aereo never before pled (much less litigated) Section 111 [of the Copyright Act] as an affirmative defense. Whatever Aereo may say about its rationale for raising it now, it is astonishing for Aereo to contend the Supreme Court’s decision automatically transformed Aereo into a ‘cable system’ under Section 111 given its prior statements to this court and the Supreme Court.”
Aereo also said if the judge does not accept its argument, any injunction issued should be limited to “the simultaneous or near-simultaneous streaming of over-the-air television programs.”
The broadcasters, however, insisted that they be granted an injunction to prevent further violations of their public performance rights.
“That is the most important next step, given the Court’s ruling that Aereo has been violating plaintiffs’ exclusive rights to publicly perform their works for over two years, during which time plaintiffs, as this Court held, have suffered irreparable harm,” the broadcasters’ lawyers wrote.