Aereo ruling divides US appeal judges


A US appeals court has rejected copyright owners’ attempts to ban Internet TV streaming site Aereo – but one judge said the service clearly breached US copyright law.

In a 2-1 decision on Monday, the US Court of Appeals for the Second Circuit upheld a ruling denying a preliminary injunction against Aereo, which allows subscribers in New York City to watch and record live TV.

Companies including Fox and Disney sued Aereo last year for infringing a number of rights. The US District Court for the Southern District of New York denied an injunction, saying the plaintiffs were unlikely to win the case. The plaintiffs appealed.

Judges Droney and Gleeson at the US Court of Appeals relied on a case from 2008 called Cablevision, in which Cablevision, a cable television system, was sued after it split live TV streams into two, storing a second stream and making it available for later use.

In the Cablevision case, the US Court of Appeals found that the second stream did not infringe public performance copyright, saying that only the subscriber requesting a copy of a broadcast could view it – and no-one else.

On Monday, Judges Droney and Gleeson said that like in the Cablevision case, when an Aereo customer watches or records a programme, Aereo’s system creates a unique copy of it and assigns it only to that user.

The judges added: “When an Aereo user chooses to watch the recorded programme, whether (nearly) live or days after the programme has aired, the transmission sent by Aereo and received by that user is generated from that unique copy. No other Aereo user can ever receive a transmission from that copy.”

They concluded: “Plaintiffs have not demonstrated that they are likely to prevail on the merits on this claim in their copyright infringement action. Nor have they demonstrated serious questions as to the merits and a balance of hardships that tips decidedly in their favour.”

But Judge Chin, who originally ruled against Cablevision but was subsequently reversed by the US Court of Appeals, wrote a dissenting opinion in the Aereo case, arguing that the site was “in clear violation of the Copyright Act”.

In particular, Chin disagreed with the comparisons between Cablevision and Aereo, noting that Aereo’s lack of a licence meant it was infringing public copyright.

He said: “Its decision [Cablevision], in my view, conflicts with the text of the Copyright Act, its legislative history, and our case law.”

The Aereo case is expected either go back to the New York district court for a full trial or to be re-heard en banc, which would require the full US Court of Appeal (10 judges) to assess it.

“Although rare – en banc only happens once or twice a year – it does happen. I wouldn’t rule this out,” said Bruce Ewing, partner at Dorsey & Whitney LLP. “In Aereo, we have one judge who is unhappy and, although the other two relied on Cablevison, there was no ringing endorsement of the case.” 

Asked whether he thought the case would be heard en banc, Ewing said: “I don’t know. The question is whether the Cablevision case was rightly decided and, if it was, was this case [Aereo] different.”

He added: “Eventually, the Supreme Court will have to address this or Congress will need to amend the Copyright Act. The same issues have arisen again within a few years and there are a number of similar services relying on Cablevision, so it’s inevitable.”

In Europe, the Court of Justice of the EU, ruling on a dispute over the TVCatchup website in March, found that Internet streaming companies must obtain broadcasters’ permission to re-transmit their copyrighted works to the public.

This article was first published on 05 April 2013 in World IP Review

denny chin, aereo, us court of appeals, denny chin, dorsey and whitney, bruce ewing

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