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IP/Entertainment Case Law Updates

Fox Television Stations, Inc. v. BarryDriller Content Systems, PLC

California district court grants TV networks’ motion for preliminary injunction against internet streaming service, finding that, contrary to decisions by courts in the Second Circuit, streaming transmissions of copyrighted content likely infringed networks’ exclusive right to public performances.

Plaintiffs, broadcast television networks including Fox Television Stations, NBC, ABC, and CBS, moved for a preliminary injunction to enjoin defendants from offering plaintiffs’ copyrighted content through defendants’ internet and mobile device streaming services. The district court granted plaintiffs’ motion, finding that plaintiffs established a likelihood of success on the merits of their claim that defendants’ service violated plaintiffs’ right of public performance.

Defendants did not deny that they retransmitted plaintiffs’ copyrighted programming but argued that, under the Second Circuit’s decision in Cartoon Network LP, LLP v. CSC Holdings, Inc., 536 F.3d 121 (2d Cir. 2008) (“Cablevision”), they did so legally because their transmissions were private, not public. In Cablevision, the Second Circuit held that the internet transmission of a copy of a work made at the direction of and solely for use by a single user is not a public transmission, reasoning that the transmission must be public for the transmitter to infringe the public performance right. The court declined to follow the Second Circuit, reasoning that Cablevision’s focus on the transmission was misplaced because, under the Copyright Act and Ninth Circuit precedent, the concern is with the public performance of the work, irrespective of whether the transmission is publicly performed. Defendants’ service operated by receiving a broadcast with an antenna assigned to a single subscriber, and then retransmitting that separately-received transmission over the internet to that particular subscriber. The court rejected defendants’ “unique-copy transmission argument” and held that defendants’ transmissions were public performances that infringed plaintiffs’ exclusive right.

The court also found that plaintiffs would suffer irreparable harm absent an injunction because defendants’ service threatened to damage plaintiffs’ ability to negotiate favorable licensing agreements with retransmission broadcasters, damaged plaintiffs’ goodwill with their licensees, competed with plaintiffs’ ability to develop their own internet distribution, and harmed plaintiffs’ position in negotiations with advertisers. These harms are irreparable, according to the court, because they are neither easily calculable, nor easily compensable, and because defendants (which were start-up companies) would likely be unable to satisfy a large statutory damages award.

The court also found that the balance of factors favored plaintiffs because, to the extent they were likely to succeed on the merits of their copyright infringement claim, defendants had no equitable interest in continuing an infringing activity. The public interest also would be served by an injunction upholding copyright protections and preventing infringement.

While plaintiffs sought a nationwide injunction, the court held that principles of comity prevented the entry of an injunction that would apply to circuits with conflicting law, and therefore limited the geographic scope of the injunction to cover the Ninth Circuit only.

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