Judge Denies Request to Shut Down Aereo

Networks pledge to "continue to fight to protect our copyrights and expect to prevail on appeal"

By John Eggerton & George Winslow -- Broadcasting & Cable, 7/11/2012 6:43:02 PM

A Federal judge in the Second District of N.Y. has denied a request for preliminary relief in a major lawsuit against the Aereo.

The Barry Diller-backed subscription service provided mobile users access to broadcast signals in New York City for a monthly subscription. In response broadcasters sued Aereo citing copyright violations because the company did not get their permission to retransmit the signals or pay them for their content.

The decision was clearly a lost battle for broadcasters, though the war is not over.

"Based on the evidence at this stage of the proceedings," said Judge Alison Nathan of the U.S. District Court for the Southern District of New York, "the Court finds that Aereo's antennas function independently. That is to say, each antenna separately receives the incoming broadcast signal, rather than functioning collectively with the other antennas or with the assistance of the shared metal substructure."

The judge also found no appreciable difference between Aereo and Cablevision's remote DVR, which the Second Circuit court of appeals concluded did not violate copyright protections. In fact, the court relied heavily on that precedent, with the judge saying that without that decision, plaintiffs -- broadcasters -- would likely have prevailed in their request for a preliminary injunction.

"Contrary to Plaintiffs' arguments," said the judge," the copies Aereo's system creates are not materially distinguishable from those in Cablevision, which found that the transmission was made from those copies rather than from the incoming signal. Moreover, Plaintiffs' attempt to distinguish Cablevision based on time-shifting fails when confronted with the reasoning of that case, particularly considering that the Second Circuit's analysis was directly focused on the significance of Cablevision's copies but did not say one word to suggest that time-shifting played any part in its holding.

"Plaintiffs have not shown a likelihood of success on the merits," the judge ruled. "And although they have demonstrated that they face irreparable harm, they have not demonstrated that the balance of hardships decidedly tips in their favor. As such, the Court DENIES Plaintiffs motion for a preliminary injunction."

"Today's decision shows that when you are on the right side of the law, you can stand up, fight the Goliath and win," said Aereo CEO Chet Kanojia.in a statement. ""This isn't just a win for Aereo, it's also a significant win for consumers who are demanding more choice and flexibility in the way they watch television. We said from the start that we believed that a full and fair airing of the issues would reveal that Aereo's groundbreaking technology falls squarely within the law. We are grateful to the court for its thoughtful and measured approach to this matter. Today's decision should serve as a signal to the public that control and choice are moving back into the hands of the consumer - that's a powerful statement."

 

"The Court stated that '[t]he overall factual similarity of Aereo's service to Cablevision...suggests that Aereo's service falls within the core of what Cablevision held lawful,' said Kanojia. "In the decision, Judge Nathan went on to say that '[i]ndeed, in light of this Court's factual determination that each antenna functions independently, in at least one respect, the Aereo system is a stronger case than Cablevision.'

In response to the ruling, the plaintiffs in the suit, which include WNET, Thirteen, Fox Television Stations, Inc, Twentieth Century Fox Film Corporation, WPIX, Univision Television Group, Inc., The Univision Network Limited Partnership and Public Broadcasting Service, issued a statement saying:

"Today's decision is a loss for the entire creative community. The judge has denied our request for preliminary relief -- ruling that it is ok to misappropriate copyrighted material and retransmit it without compensation. While we are disappointed, we will continue to fight to protect our copyrights and expect to prevail on appeal."

 

 

"Today's decision represents only a preliminary finding and we remain confident that the courts will ultimately find in our favor and block Aereo from infringing our copyrighted broadcasts," said NBCU. "Importantly, the court clearly determined that Aereo's business is irreparably harming broadcasters and content creators. We intend to appeal in order to ensure that local and national broadcasters can continue to serve the communities across the country that rely on them for local and national news, sports and entertainment. "

"We are pleased that Judge Nathan reached the right result in this case," said John Bergmayer, an attorney with Public Knowledge, which supports Aereo. "The court is correct that the Cablevision precedent likely means that Aereo's service is perfectly lawful."

"There is much to quibble with in the court's decision," he added. "In particular, the court misunderstands the public interest and other arguments put forward by Public Knowledge and others. Broadcasters are granted exclusive access to the public airwaves to make a free service available to all viewers, and should not abuse this privilege with anti-competitive lawsuits. Nevertheless, this victory by Aereo is a win for video innovation."

In the decision, Nathan talked about the public interest arguments of Public Knowledge and others, and was not persuaded.

"[They] argue that the public interest would be disserved by an injunction because the public has an interest in the availability of the broadcast and the free receipt of Plaintiffs' content in the marketplace of ideas," said the judge of Aereo and its supporters. "This argument is not persuasive, as there are numerous other methods through which the public can lawfully receive access to Plaintiffs' content, including standard broadcast transmission, cable television, and licensed internet streaming sites, among others. There is a logical gap-one that Aereo and amici [its supporters] fail to bridge between any public interest in receiving broadcast television signals generally and the public interest in receiving them from Aereo's particular service."

The judge was not buying Aereo backers' argument that the service was simply increasing access to free TV.

"Amici argue that there is a public interest in the free access to and reception of broadcast television.T he Court notes, however, that even setting aside the other lawful methods through which consumers may access broadcast television even in Aereo's absence, Aereo is a business and does not provide "free" access to broadcast television," said Nathan.

"Moreover, although this argument carries some force to the extent that there is a public interest in access to television broadcast over the free public airwaves and Aereo facilitates such access, it cannot be afforded substantial weight because it proves too much. The same logic would support a finding that the public interest favors imposing no copyright restrictions on any form of redistribution of Plaintiffs' broadcast television, as unrestrained piracy of that content would also increase public access to content broadcast over the free public airwaves. For example, distributing over the internet an infringing bootleg copy of a television program that was initially broadcast on the public airwaves increases access to that program. Amici's argument thus bears an unacceptable resemblance to advocacy that copyright infringement of broadcast television is generally in the public interest, a point on which this Court cannot agree."