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Sept. 9 --A streaming video service cannot convert public performances to private performances by arranging its system to maintain a separate mini-antenna for each subscriber, the U.S. District Court for the District of Columbia ruled Sept. 5 (Fox Television Stations, Inc. v. FilmOn X LLC, D.D.C., No. 1:13-cv-00758-RMC, 9/5/13).
Granting a preliminary injunction, the court rejected the reasoning of the U.S. Court of Appeals for the Second Circuit that having a separate antenna for each user was akin to each user having his or her own antenna at home.
FilmOn Networks USA of Beverly Hills, Calif., operates a service that retransmits over-the-air broadcast television channels over the internet to FilmOn subscribers, allowing them to watch programs on computers and mobile devices. FilmOn's facilities incorporate thousands of small antennas and each subscriber is assigned one of the antennas.
A group of broadcasters and programmers sued FilmOn, alleging copyright infringement and moved for a preliminary injunction. The plaintiffs argued that FilmOn's services were infringing, citing Fox Television Sys., Inc. v. BarryDriller Content Sys., PLC, No. 12-6921, 2012 BL 340990 (C.D. Cal. Dec. 27, 2012) (02 PTD, 1/3/13).
BarryDriller held that such services infringed because transmissions of copyrighted content do not have to be literally “public” in order to infringe a copyright holder's right of public performance. This ruling is currently on appeal to the U.S. Court of Appeals for the Ninth Circuit.
FilmOn, however, appealed to the reasoning of Cartoon Network, LP v. CSC Holdings, Inc., 536 F.3d 121, 2008 BL 162181, 87 U.S.P.Q.2d 1641 (2d Cir. 2008) (151 PTD, 8/6/08), which held that if there is a one-to-one correspondence between a transmitter--here represented by the tiny antenna--and a viewer, then there is no infringement of a public performance right.
Other rulings within the Second Circuit have echoed this reasoning, such as American Broadcasting Cos., Inc. v. Aereo Inc., 874 F. Supp. 2d 373, 2012 BL 173494, 103 U.S.P.Q.2d 1774 (S.D.N.Y. 2012) (135 PTD, 7/16/12), and WNET, Thirteen v. Aereo, Inc., 712 F.3d 676, 2013 BL 87728, 106 U.S.P.Q.2d 1341 (2d Cir. 2013) (63 PTD, 4/2/13).
According to this line of cases, the one-antenna-per-subscriber setup was analogous to each subscriber having his or her own in-home device.
To perform or display a work 'publicly' means--
(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.
Looking at the legislative history, the court noted that a report on the original legislation by the U.S. House of Representatives “emphasized the broad reading intended for 'device or process,' stating that the definition of those terms is meant to include 'all kinds of equipment for reproducing or amplifying sounds or visual images, any sort of transmitting apparatus, any type of electronic retrieval system, and any other techniques and systems not yet in use or even invented.' ”
By making available Plaintiffs' copyrighted performances to any member of the public who accesses the FilmOn X service, FilmOn X performs the copyrighted work publicly as defined by the Transmit Clause: Film On X “transmit[s] … a performance … of the work … to the public, by means of any device or process.”
To the extent that there might be some ambiguity in the plain text of the statute, the court said that the legislative history also supports a broad reading of those terms. The court rejected the argument that maintaining a separate mini-antenna for each subscriber avoided any public performance:
First, this is a charitable description of FilmOn X's arrangement; while each user may have an assigned antenna and hard-drive directory temporarily, the mini-antennas are networked together so that a single tuner server and router, video encoder, and distribution endpoint can communicate with them all. The television signal is captured by FilmOn X and passes through FilmOn X's single electronic transmission process of aggregating servers and electronic equipment. This system, through which any member of the public who clicks on the link for the video feed, is hardly akin to an individual user stringing up a television antenna on the roof. Moreover, every broadcast of a television program (whether cable, satellite, over-the-air, over the internet, or otherwise) could be described as “generated from the same copy”--the original source.
Furthermore, the court said, combining several different kinds of devices in order to create a “private” performance was ineffective in the face of Congress's broad understanding of “device or process.”
The court concluded that “nothing about the 1976 Act or its legislative history suggests that Congress intended a commercial entity that rebroadcasts copyrighted material for consumption by the public, such as FilmOn X, to avoid liability for infringement of the copyright holders' exclusive right to public performance.”
Thus, the court found, the plaintiffs had established a likelihood of success on the merits of its infringement claim. Furthermore, the court found a likelihood of irreparable harm in the absence of injunctive relief.
Conceding that some degree of loss of revenue might be recoverable in the form of damages, the court noted evidence proffered by the plaintiffs that there were several categories of harm that would not be so easily remedied: “Harm to their ability to negotiate with advertisers; damage to their contractual relationships and ability to negotiate with authorized retransmitters; interference with their proprietary and licensed online distribution avenues, such as their own websites, Hulu.com, and Apple's iTunes; and the loss of control over the distribution and quality of their copyrighted programs.”
Furthermore, the court found that the balance of the harms and the public interest favored imposition of a preliminary injunction. Thus, the court granted the plaintiffs' motion for a preliminary injunction, barring unauthorized retransmission of the plaintiffs' content, except in the area of the Second Circuit, where the U.S. Court of Appeals for the Second Circuit's law conflicted with the instant holding.
The broadcasters were represented by Paul March Smith of Jenner & Block LLP, Washington, D.C.; and Robert Alan Garrett of Arnold & Porter LLP, Washington, D.C. FilmOnX was represented by Jaime W. Marquart of Baker Marquet LLP, Los Angeles.
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