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March 10 --The U.S. Court of Appeals for the Second Circuit's determination that Aereo Inc.'s service does not result in a public performance relied on a fundamental misunderstanding of what the relevant “performance” was, the United States argued in an amicus curiae brief submitted in support of a group of broadcasting companies in their copyright infringement case against Aereo, Am. Broad. Cos., Inc. v. Aereo, Inc. U.S. No. 13-461, amicus brief filed 3/3/14).
The government brief was one of 15 amici briefs filed in support of the broadcasters, who filed their merits brief on Feb. 24. Both the government and the broadcasters said the Second Circuit failed to recognize the extent to which a set of 40-year-old Supreme Court cases had been overturned by the 1976 Copyright Act. The Second Circuit also misunderstood the interplay between the terms “performance” and “transmission” when it determined that a copyrighted broadcast was not publicly performed when it was retransmitted to numerous subscribers--albeit through different transmissions, the broadcasters and the government both argued.
Analysis of other amici briefs in support of the petitioners, as well as analysis of briefs submitted on behalf of neither party that worry about how the Supreme Court's eventual ruling could upend the cloud computing industry, will be forthcoming.
Aereo's brief is due March 26 and oral argument is set for April 22.
Initially filed in March 2012 (56 PTD, 3/23/12), this lawsuit challenges Aereo's service--which assigns each paying subscriber a separate dime-sized antennae to capture over-the-air broadcasts--as violating the broadcasters' exclusive right to “to perform the copyrighted work publicly.” 17 U.S.C. § 106(4). A determination of whether a work is publicly performed relies on the “transmit clause” of Section 101 of the Copyright Act, where “publicly” is defined to mean:
(1) to perform or display it at a place open to the public or at any place where a substantial number of persons outside of a normal circle of a family and its social acquaintances is gathered; or
(2) to transmit or otherwise communicate a performance or display of the work to a place specified by clause (1) or to the public, by means of any device or process, whether the members of the public capable of receiving the performance or display receive it in the same place or in separate places and at the same time or at different times.
17 U.S.C. § 101.
The Southern District of New York held, WNET v. Aereo Inc., 871 F. Supp. 2d 281, 2012 BL 12619, 102 U.S.P.Q.2d 1853 (S.D.N.Y. 2012)(135 PTD, 7/16/12), and the Second Circuit affirmed, 712 F.3d 676, 2013 BL 87728, 106 U.S.P.Q.2d 1341 (63 PTD, 4/2/13), that Aereo's retransmission over the Internet of copyrighted television programming to individual users was not a public performance. Those holdings relied on Cartoon Network LP v. CSC Holdings Inc., 536 F.3d 121, 87 U.S.P.Q.2d 1641 (2d Cir. 2008) (151 PTD, 8/6/08), the case commonly known as Cablevision. In that case, the Second Circuit determined that the device that was alleged to be infringing had been designed to make transmissions to only one subscriber, and thus the court found that there was no public performance within the meaning of Section 101.
The government and the petitioners argued that Cablevisionwas wrongly decided, in part because it failed to grasp the extent to which Congress sought to broaden the definition of “to the public” when it enacted the 1976 Copyright Act. That argument takes as a basic premise that two Supreme Court decisions from the 1960s and 1970s were explicitly overturned by the 1976 Act. In TelePrompTer Corp. v. Columbia Broad. Sys., Inc., 415 U.S. 394, 181 U.S.P.Q. 65 (1974), and Fortnightly Corp. v. United Artists Television, 392 U.S. 390, 158 U.S.P.Q. 1 (1968), the Supreme Court held that cable TV providers could collect free, over-the-air broadcast signals using their antennas and then retransmit those signals to their cable TV subscribers.
“The 1976 Act overturned those decisions, making clear that a company can 'perform' copyrighted works within the meaning of the Copyright Act even when it simply retransmits broadcast signals to consumers who could have acquired them for free over the airwaves,” the government said in its brief. “Like cable, satellite, and Internet streaming services that retransmit local broadcast signals to consumers using other means, respondent therefore is 'performing' the broadcast programs within the meaning of the Copyright Act.”
Cablevision did not cite either Fortnightly or TelePrompter. However, the Second Circuit distinguished those cases from Aereo's service when it affirmed the district court's denial of a preliminary injunction below. In those cases, multiple users were sharing a single television antenna, the Second Circuit said. In a footnote, the court said:
When Congress drafted the 1976 Copyright Act, it intended that such transmissions be deemed public performances. But, as discussed below, Congress clearly believed that, under the terms of the Act, some transmissions were private. The methodology Congress proscribed for distinguishing between public and private transmissions is the size of the potential audience, and by that methodology, the feed from Aereo's antennas is a private transmission because it results in a performance viewable by only one user.
Although Congress plainly included that language to underscore the breadth of the clause, and to confirm what does not matter when determining whether a performance has been transmitted or otherwise communicated “to the public,” the Second Circuit instead construed it as the key to substantially narrowingthe statute.
Moreover, by determining that a transmission is to the public only if it is “capable” of being seen or received by multiple members of the public, the Second Circuit “renders a significant part of the language from which it is purportedly derived entirely superfluous,” the broadcasters argued. The broadcasters' petition said:
Congress said explicitly that an alleged infringer is transmitting a performance to the public even when “members of the public capable of receiving the performance or display receive it … at different times.” 17 U.S.C. § 101 (emphasis added). Of course, it is essentially impossible for two people to receive the same transmissionof a performance “at different times.”
Another “fundamental flaw” in the Second Circuit's construction of the transmit clause is that its decision turned on the fact that individual members of the public received a particular “transmission,” and not on the fact that a “performance” was being broadcast to numerous members of the public. After noting that the two terms “are each defined terms with their own distinct meanings,” the broadcasters said: “Had Congress intended liability for infringement to turn on whether each distinct transmission of a performance is accessible to the public, it would have been easy enough for Congress to say so.” But:
Congress referred to “the performance or display” and not “the transmission” precisely because it sought to capture someone who is transmitting the same performance (e.g., the Super Bowl) to the public, even if members of the public are watching it in the privacy of their homes, even if they are watching it at different times.
By focusing on whether Aereo's service resulted in a transmission capable of being received by more than one party, the Second Circuit created a copyright regime in which infringement is determined by the accused device's design rather than the device's ability to retransmit copyrighted broadcasts to numerous subscribers. The 1976 Copyright Act “made crystal clear that the precise details of the 'device or process' by which the public receives the performance--whether through a particular kind of transmission or through other means of communication, whether at the same time or different times--do not matter,” the broadcasters argued. “What matters is whether an alleged infringer is transmitting or otherwise communicating a performance or display of a work to the public 'by means of any device of process.' ”
The government, after reciting the relevant portion of the transmit clause, said, “the term 'performance' encompasses both the transmission or communication to the eventual viewer or listener and any underlying performance that is transmitted or communicated.”
Indeed, the “transmission of a performance is itself a performance,” the government said. In this case, the government noted that Aereo's service results in the transmission of a broadcast that was itself a performance that was originally performed by the local broadcaster.
“By transmitting those performances to the public, respondent performs the copyrighted works publicly, even though each of respondent's transmissions goes to a single subscriber,” the government said.
Both the government and the broadcasters said that a recognition that the Second Circuit's reasoning in Cablevision was wrong does not necessarily mean that the result in that case was wrong.
Both briefs readily distinguished the remote storage DVR at issue in Cablevisionfrom Aereo's service here on the grounds that the defendant in Cablevisionwas a licensed provider of the content in question. Accordingly, Cablevisioncould potentially survive on the grounds that the system made a fair use of the copyrighted content, even if Cablevision's interpretation of the transmit clause was rejected, the government said.
How the transmit clause or other portions of the Copyright Act should apply to a licensed provider that offers a remote storage DVR service such as the one at issue in Cablevision, and specifically to the playback of a time-shifted recording to a single subscriber's set-top box in the home, is a question different from the one presented in this case.
Here, Aereo has no license, and as a result “the Court can and should decide this case narrowly by holding that respondent's retransmission service falls squarely within the scope of the public-performance right defined by the 1976 Act,” the government said.
The government's brief was submitted by Deputy Solicitor General Edwin S. Kneedler. Solicitor General Donald Verrilli Jr. and Principal Deputy Solicitor General Ian Gershengorn are recused from the case. The broadcasters' brief was submitted by Paul D. Clement of Bancroft PLLC, Washington, D.C.
To contact the reporter on this story: Tamlin Bason in Washington at firstname.lastname@example.org
To contact the editor responsible for this story: Naresh Sritharan at email@example.com
Text of petitioners' merits brief available at http://pub.bna.com/ptcj/130461PetBrief.pdf
Text of government's amicus brief available at http://pub.bna.com/ptcj/130461GovBrief.pdf
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