This summer we reported on a U.S. Supreme Court ruling that held that Aereo Inc.’s broadcast television Internet streaming service constituted an unauthorized public performance in violation of the U.S. Copyright Act. As background, prior to that ruling, Aereo’s business allowed subscribers to watch broadcast television programs on the Internet, within seconds after the programs were broadcast over the air. The technology that allowed for this involved thousands of tiny antennas that tuned into selected broadcasts, and ultimately transmitted the data over the Internet to the subscriber’s computer.
In reaching the conclusion that Aereo “performed” copyrighted works in this process, the Court held that Aereo’s activities were substantially similar to those of community antenna television (CATV) systems. This may have raised the question in your mind as to whether Aereo could continue operating by simply taking advantage of the statutory compulsory licensing scheme that gives cable television companies an automatic license to broadcast content. It certainly did raise that question for Aereo. In any event, the U.S. District Court in the Southern District of New York has now answered!
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U.S. District Judge Alison Nathan answered this question in the negative, when the court issued an injunction that bars Aereo from retransmitting television broadcasts while they are still airing. American Broadcasting Companies, Inc. v. AEREO, INC., Dist. Court, SD New York 2014. In its ruling, the court found Aereo’s claims that the U.S. Supreme Court’s decision allowed Aereo to operate using a compulsory license “unavailing,” stating:
Aereo’s argument suffers from the fallacy that simply because an entity performs copyrighted works in a way similar to cable systems it must then be deemed a cable system for all other purposes of the Copyright Act… The Supreme Court in Aereo III did not imply, much less hold, that simply because an entity performs publicly in much the same way as a CATV system, it is necessarily a cable system entitled to a § 111 compulsory license… Stated simply, while all cable systems may perform publicly, not all entities that perform publicly are necessarily cable systems, and nothing in the Supreme Court’s opinion indicates otherwise.
Thus, Aereo’s attempt in this case to ”turn lemons into lemonade,” as the court characterized it, was a fail. Only time will tell if future creative attempts will be made to allow companies with similar technologies to successfully navigate the complexities of the U.S. Copyright Act.