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Aereo Copyright Saga Continues in Massachusetts District Court
Practical Law Legal Update 6-545-9165 (Approx. 5 pages)
Aereo Copyright Saga Continues in Massachusetts District Court
by Practical Law Intellectual Property & Technology
| Published on 18 Oct 2013 • USA (National/Federal) |
On October 8, 2013, in Hearst Stations, Inc. v. AEREO, Inc., the US District Court for the District of Massachusetts denied a Boston television station's motion for a preliminary injunction against the internet television company, Aereo. This decision is the latest in a line of recent opinions concerning whether Aereo's internet rebroadcast system violates over-the-air television broadcasters' public performance rights in their programs.
On October 8, 2013, the US District Court for the District of Massachusetts issued an opinion in Hearst Stations, Inc. v. AEREO, Inc. denying the plaintiff Hearst Stations, Inc. (Hearst)'s preliminary injunction request against AEREO, Inc. (Aereo). The court also denied Aereo's motions to transfer and stay the proceedings. The court ruled that Hearst failed to show a likelihood of success on the merits of its claim that Aereo's internet rebroadcast service violates its exclusive rights under Section 106 of the Copyright Act to publicly perform, reproduce, distribute and prepare derivative works based on its copyrighted programming.
Background
Hearst owns 29 broadcast stations, including WCVB, a Boston-area television station. Aereo offers subscribers access to over-the-air television broadcasts through its websites using antenna and digital video recording (DVR) technology to retransmit these broadcasts. Through Aereo's service, subscribers select and view current and future-scheduled television programs on their internet-connected devices, including internet-ready televisions, computers, laptops and mobile devices.
Aereo's service combines DVR technology with antennas to receive, record and transmit incoming television broadcast signals. Aereo assigns the antennas only to one subscriber at a time, either on an assigned-as-needed or dedicated-unit basis. As a result, not more than one Aereo subscriber may select a television program for transmission by an Aereo antenna at any given time.
Aereo formally launched in Boston on May 15, 2013. Hearst filed suit and moved for a preliminary injunction. On July 16, 2013, Aereo moved to transfer the case to the Southern District of New York.
Outcome
In its opinion, the District of Massachusetts denied Hearst's motion for a preliminary injunction against Aereo, ruling that Hearst failed to show that it had a likelihood of succeeding on its claims that Aereo infringed WCVB's exclusive rights to:
- Transmit its works to the public, because, as the US Court of Appeals for the Second Circuit reasoned in Cartoon Network LP v. CSC Holdings, Inc. (Cablevision), one-to-one, private retransmissions of television programs are not public performances, even if made simultaneously to multiple individual viewers.
- Reproduce its copyrighted work or authorize others to do so, although the court suggested that discovery could disclose reflects the requisite "volitional conduct" by Aereo in enabling users to record WCVB’s programs to violate Hearst's exclusive reproduction rights.
- Distribute its copyrighted programs to the public, because Aereo's technology does not allow users to download, but only to stream, these programs, which involves performing the programs rather than distributing any program copies.
- Prepare derivative works, because there is no legal authority for Hearst's argument that Aereo's technology creates a derivative work merely by converting programs from their original digital format to a digital format compatible with internet streaming.
The court also denied Aereo's motions to transfer and stay the case pending resolution of its transfer motion.
Exclusive Right to Publicly Perform
In finding that Aereo did not infringe WCVB's exclusive public performance right, the court analyzed the following provisions of Section 101 of the Copyright Act:
- The "Transmit Clause."
- The definition of "public performance."
The "Transmit Clause" defines "to perform a work publicly" as "to transmit or otherwise communicate a performance or display of the work to . . . the public, by means of any device or process," whether the performance is received in the same place or in separate places or at the same or a different time." Section 101 defines "to perform," in the case of audiovisual works, as "to show its images in any sequence or make the sounds accompanying it audible."
The District of Massachusetts noted that Second Circuit is the only circuit court that has addressed whether technology that allows users to record copies of over-the-air television broadcasts on remote servers and view the programs over the internet violates broadcasters' exclusive public performance rights. The Second Circuit in Cablevision and WNET, Inc. v. AEREO, Inc. (WNET, Thirteen) held that this type of technology does not infringe television broadcasters' performance rights because the technology creates a unique copy of the programs viewers wish to record and each viewer can only view the unique copy that is generated at his or her request.
Hearst urged the court to follow the district court opinions in Fox Television Systems, Inc. v. BarryDriller Content Systems, PLC and Fox Television Systems, Inc. v. FilmOn X LLC, respectively, that reached a contrary holding based on these courts' reasoning that what makes a transmission "public" under Section 101 is not the intended audience of any single copy of the program, but rather, the intended audience of the initial public broadcast. Rejecting these precedents, the District of Massachusetts instead followed Cablevision in reasoning that the view that Aereo's transmissions of WCVB's programs through individually-assigned antennas are private, rather than public, performances reflects a better reading of the statute.
Exclusive Right to Reproduce
In ruling that Hearst did not show that it was likely to succeed on its claim that Aereo directly infringed WCVB's exclusive reproduction right, the court agreed with the Second, Third and Fourth Circuits, which require proof that the accused infringer engaged in "volitional conduct" that is close and causal to alleged copyright infringement, and did not merely provide users with a copy-enabling technology. However, the court reasoned that whether Aereo exhibited the required volitional conduct presents a closer question than the issue of its public performance of WCVB’s programs, and that discovery could disclose that Aereo infringed WCVB’s right to reproduce these works.
Practical Implications
The district court's adoption of the Second Circuit's reasoning in WNET, Thirteen and Cablevision adds the decision of a district court within the First Circuit to both:
- The continuing rift between the circuits concerning whether multiple, one-to-one streaming of over-the-air television programs over the internet constitutes a public performance for purposes of establishing copyright infringement.
- Support for the Second, Third and Fourth Circuits' requirement that a copyright claimant show the accused infringer's volitional conduct to prove a direct infringement of the claimant's exclusive reproduction right.