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American Broadcasting Cos., Inc. v. Aereo, Inc.

In light of Supreme Court’s recent decision that defendant Aereo, Inc., engaged in public performances under Copyright Act by capturing over-the-air broadcast television content and live streaming content to subscribers over Internet, district court preliminarily enjoins Aereo from engaging in live or near-live retransmission of plaintiff television networks’ content to Aereo subscribers.

Defendant Aereo, Inc., provides a service through which it captures over-the-air broadcast television content on thousands of small antennae and streams the content to its subscribers over the Internet almost simultaneously with the initial broadcast. Following an earlier 6-3 decision by the United States Supreme Court that Aereo engaged in public performances under the Copyright Act by retransmitting the plaintiff broadcast television networks’ programming (read our summary of the Supreme Court decision here), the case was remanded to the Southern District of New York for further proceedings consistent with the Supreme Court decision, including a ruling on the networks’ motion for a preliminary injunction.

When the matter was first before the district court, the plaintiffs sought a preliminary injunction covering retransmission of their copyrighted programming while that programming is still being broadcast. In defense, Aereo argued that its retransmission of plaintiffs’ copyrighted programming did not constitute a public performance under the Copyright Act because of the way in which its service made individual copies of the programming from individually designated antennae at the direction of its users. The Supreme Court rejected this argument. On remand, however, Aereo interposed additional arguments in opposition to the networks’ motion for injunctive relief, and plaintiffs asked the district court to broaden the scope of the preliminary relief beyond what they earlier sought.

First, Aereo argued that it should be considered a “cable system” entitled to a compulsory license under § 111 of the Copyright Act. Second, Aereo argued that it should be considered a conduit entitled to the safe harbor protections of § 512 of the Copyright Act. Third, Aereo argued that preliminary injunctive relief should be denied because the networks were unable to demonstrate imminent, irreparable harm. Finally, plaintiffs contended that the scope of the preliminary injunction should be expanded to cover all retransmissions of their copyrighted content, regardless of when those retransmissions occur.

The district court found that the plaintiff networks waived any procedural objection to the court’s hearing these additional arguments, but it rejected each of Aereo’s additional arguments. The court first held that the Supreme Court, although it compared Aereo’s service to a cable television system, did not hold that Aereo’s service was a cable television system for purposes of the Copyright Act’s compulsory license. The Supreme Court also did not overturn other Second Circuit precedent in WPIX, Inc. v. ivi, Inc., which held that a service that retransmits television programming over the Internet does not constitute a cable system for the purpose of the compulsory license under § 111 of the Copyright Act. The district court also rejected Aereo’s efforts to distinguish ivi based on what Aereo claimed to be the limited geographic reach of Aereo’s services, stating that the geographic reach of Internet retransmission services was but one of many factors the Second Circuit considered in concluding that the § 111 compulsory license does not cover Internet retransmission services.

Second, § 512 of the Copyright Act provides a safe harbor to Internet service providers that act as a conduit for infringing material without storing, caching, or providing links to such material. Aereo failed to demonstrate that it satisfied the statutory requirements for the safe harbor by, among other things, showing that it had implemented a policy to terminate repeat infringers using its service.

Third, Aereo failed to challenge earlier factual findings by the court that the networks would be irreparably harmed absent an injunction against Aereo. In any case, because the Supreme Court’s ruling established that the networks were likely to succeed on the merits of their infringement claim, the balance of hardships tipped in favor of the networks. Accordingly, the court preliminarily enjoined Aereo from transmitting broadcast programs to its subscribers while the programs are still airing.

The court stopped short of enjoining Aereo from allowing subscribers to watch entirely time-shifted retransmissions of the copyrighted content, however, as this was beyond the scope of the preliminary injunctive relief that plaintiffs originally sought. The court acknowledged that the plaintiff networks “may have a valid argument that the Supreme Court’s reasoning casts doubt on any distinction between near-simultaneous and fully time-shifted retransmission of copyrighted works for purposes of determining whether Aereo performs publicly,” but it noted that the Supreme Court was careful to limit its holding to the case that plaintiffs had decided to put before the court (i.e., a preliminary injunction request involving near-simultaneous retransmissions) and that there may be factual and legal nuances unique to fully time-shifted retransmission that have yet to be fleshed out. Accordingly, the district court declined to resolve the issue of whether fully time-shifted retransmissions violate the public performance right at this preliminary stage of the litigation, holding plaintiffs to their earlier decision to seek a preliminary injunction limited in scope to enjoining retransmission of their copyrighted works while the works are still being broadcast.