Networks Go After Barry Diller Personally For The Insult Of Investing In Aereo

from the getting-desperate dept

Mon, Apr 23rd 2012 12:24pm — Mike Masnick

It's amazing just how desperate the TV networks appear to be getting. We've already discussed how they've sued Aereo, the company that sets up individual antennas to get over the air broadcasts, and then streams them over the internet to people's homes. But, now they appear to be going after Barry Diller personally for investing in Aereo. They've subpoena'd info from him directly including:

All documents concerning Aereo or the Aereo service, including without limitation (i) communications with or about Aereo, the Aereo service or Aereo’s business plans, (ii) presentations or other documents received from Aereo, and (iii) documents or communications concerning the potential impact of Aereo or the Aereo service on broadcast television networks and stations, or the producers of broadcast television.

Diller is fighting this (as you can see below) but it's a pure intimidation technique to go after those "in the fold" who invest in disruptive innovation. We saw it a decade or so ago when some major labels sued Bertelsmann -- one of their own who broke ranks to invest in the original Napster. Investors are supposed to be protected from the actions of the companies they invest in, but the dying entertainment industry folks play nasty, and they especially seem to hate it when one of their own becomes forward looking, rather than playing their myopic game. In this case, they haven't sued yet, but it's clear they're going on a fishing expedition to embarrass and annoy Diller, who (of course) came out of Hollywood in the past.

Update: Looks like Diller's already lost this part of the legal fight, which is unfortunate. Intimidating investors from funding innovative companies -- the kind of companies that actually can help move the industry forward -- isn't going to help anyone. Amazing how short-sighted Hollywood can be.

Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.

Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.

While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.

–The Techdirt Team

Filed Under: barry diller, intimidation, streaming, television

54 Comments

If you liked this post, you may also be interested in...

Reader Comments

Subscribe: RSS

View by: Time | Thread

This comment has been flagged by the community. Click here to show it

Anonymous Coward, 23 Apr 2012 @ 12:26pm

When you tapdance on the edge of a legal cliff, don't be shocked if you fall off. Diller knows better, but he does it anyway.
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 12:34pm

Re: really?
Wow, straight in there aren't you?!

Do you guys get paid to keep refreshing the TD homepage so you ca be the first to post on the most recent 'disagreeable' article/post?
[ link to this | view in thread ]
J. Onikache, 23 Apr 2012 @ 12:36pm

I still hate that name!
"You serve me and I'll serve you;
Swing your partners, all get screwed.
Bring your lawyer and I'll bring mine;
Get together, and we could have a bad time."

So sang George Harrison.

Gotta love american "industry" these days.

ROFL.
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 12:37pm

Re: Re: really?
Broadcast legal rights are more important than cute technological consumer solutions.
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 12:40pm

Re: Re: Re: really?
A priori? I don't think so.
[ link to this | view in thread ]
gorehound (profile), 23 Apr 2012 @ 12:41pm

I am so fed up with Hollywood and the whole MAFIAA.
Do not buy their stuff new and do not go to a Theater.
MAFIAA is permanately censored from my wallet.My money should and will go to more deserving INDIE than a bunch of greedy assholes.
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 12:43pm

If the courts were interested in true justice they'd not only rule in Diller's favor, they'd give the Networks a massive punitive fine to be paid to Diller, plus charge them for all the court costs the state and Diller had. This goes against established law for over 100 years to sue people for investing in a business, even one that breaks the law.
[ link to this | view in thread ]
E. Zachary Knight (profile), 23 Apr 2012 @ 12:43pm

Re:
More like:

When you tapdance within the confines of fair use, don't be shocked if you get sued by some copyright maximilist.

I know you copyright maximilists think that anything fair use is the same thing as copyright infringement, but there is a huge difference.
[ link to this | view in thread ]
Mega1987 (profile), 23 Apr 2012 @ 12:47pm

Well... that's one way to kill innovation... cut off it's funding...

Good job... for another attempt in Innovating our world... J@ck@$$3$
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 12:47pm

Re:
What, pray tell, is he 'on the edge of a legal cliff' of? What law? Be specific. He's not even being accused of anything, he's being subpoenaed.

It's telling that you think it's reasonable to shutter operations merely for operating close to a legal line over something as silly as copyright. You're tap-dancing on the edge of a revealing-your-true-strategy-to-create-significant-chilling-effects cliff.
[ link to this | view in thread ]
That Anonymous Coward (profile), 23 Apr 2012 @ 12:53pm

So unhappy with just buying laws that make no sense, they have moved on to trying to harass people who might fund innovation.

Imagine if they took all of the money they were burning on these childish cases and actually hired people to innovate their systems.
[ link to this | view in thread ]
This comment has been flagged by the community. Click here to show it

Anonymous Coward, 23 Apr 2012 @ 12:54pm

Diller is fighting this (as you can see below) but it's a pure intimidation technique to go after those "in the fold" who invest in disruptive innovation. . . . In this case, they haven't sued yet, but it's clear they're going on a fishing expedition to embarrass and annoy Diller, who (of course) came out of Hollywood in the past.

LMAO! No nuance. No facts. Just faith-based FUD. You do not know that this is a "pure intimidation technique," but you claim it is so uncategorically. You claim that the purpose of this is "to embarrass and annoy Diller," but of course you're just making this up too.

Absolutely made-up bullshit, Mike. Where's all the nuance you promise us? ROFLMAO.
[ link to this | view in thread ]
More Hound, 23 Apr 2012 @ 12:55pm

@Gorehound
I am so fed up with Hollywood and the whole MAFIAA.
Do not buy their stuff new and do not go to a Theater.
MAFIAA is permanately censored from my wallet.My money should and will go to more deserving INDIE than a bunch of greedy assholes.

I'm with you all the way, bro. Who wants to feed the dinosaurs?
[ link to this | view in thread ]
Machin Shin (profile), 23 Apr 2012 @ 1:00pm

Re: Re:
Well you see that is their goal. They draw a line and say not to cross it so you stay on your side but come right up to the line. They then attack you for being near the line saying your evil and just want to cross the line.

If you then say ok well I will just stay back here away from that silly line they sneak up and say, "Ahh see we were right and sense your not using this area anyways we are going to move the line over to right beside you."

They then repeat this process over and over and over until there is nothing left for them to take.
[ link to this | view in thread ]
Androgynous Cowherd, 23 Apr 2012 @ 1:01pm

Trade secrets
They sought "communications about Aereo�s business plans", "presentations or other documents received from Aereo", and "documents or communications concerning the potential impact of Aereo or the Aereo service on broadcast television networks and stations, or the producers of broadcast television"?

Seems to me that they basically are using a subpoena as a way to legally get ahold of a competitor's trade secrets, not just to copyright-bully that competitor.

It occurs to me that, more generally, the legal process and, particularly, subpoenas and discovery, could be abused to peek at competitors' trade secrets. Are there any safeguards in the legal system against such fishing expeditions? If so, why have they failed to operate in this case?
[ link to this | view in thread ]
Machin Shin (profile), 23 Apr 2012 @ 1:02pm

Re: @Gorehound
What I hate is that when you boycott these morons they just add that into the "money lost to piracy" column and move on. They are too blind to see that they are loosing more money to upset customers than to piracy.
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 1:08pm

Re: Re:
"What, pray tell, is he 'on the edge of a legal cliff' of? What law? Be specific. He's not even being accused of anything, he's being subpoenaed."

The company is essentially trying to bypass broadcasters, cable companies, sat companies, and other REGULATED businesses by offering direct to consumer re-transmission of live tv - and I think it might include a DVR style function.

It's very close to the end on any number of areas, copyright being only one of them. The FCC would have a field day with this one.
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 1:11pm

Re: Re: Re:
Great, but what does that have to do with making a business investment?
[ link to this | view in thread ]
Chris Rhodes (profile), 23 Apr 2012 @ 1:11pm

Re:
I only count two uses of the troll word-of-the-day.

You need at least a couple more "nuances" in there to be compliant. Get to it!
[ link to this | view in thread ]
Another AC, 23 Apr 2012 @ 1:20pm

Re: Re: Re: really?
No sarcasm mark so I'll assume this is a legit statement.

You're missing something there:

"Broadcast legal rights are more important than cute technological consumer solutions" to broadcasters

Similarly, it is also true that:

"Cute technological consumer solutions are more important than broadcast legal rights to consumers"

It's all relative my friend... but a neat trick nonetheless.
[ link to this | view in thread ]
Richard (profile), 23 Apr 2012 @ 1:21pm

Re:
When you tapdance on the edge of a legal cliff, don't be shocked if you fall off. Diller knows better, but he does it anyway.

This is the "legal" equivalent of the tactics of the extremists in the animal liberation front in the UK - and you support it. It doesn't say much for your morals.
[ link to this | view in thread ]
Baldaur Regis (profile), 23 Apr 2012 @ 1:23pm

Wait for it...
Aereo provides a service consisting of:

one dedicated antenna per subscriber to pick up OTA transmissions (individuals can buy these)...

a dedicated DVR located on Aereo property (individuals can buy these also)...

provides access to this equipment...over the internet.

And the MPAA has made it pretty clear what they think about anything done 'over the internet'.
[ link to this | view in thread ]
John Fenderson (profile), 23 Apr 2012 @ 1:27pm

Re: Re: Re:
The company is essentially trying to bypass broadcasters

How are broadcasters being bypassed? It looks to me like, if anything, this extends the reach of broadcasters.

Are you arguing that if I put an antenna up somewhere and use it from many miles away I am "bypassing broadcasters"?
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 1:29pm

Why does the government-industrial complex get special exclusive broadcasting privileges anyways. Abolish their government established broadcasting monopolies. They aren't being regulated in the public interests anyways, they are being regulated in the sole interests of commercial government established monopolists. This needs to end.
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 1:30pm

Re: Re: Re:
I say we abolish the FCC. No one is entitled to government established broadcasting monopolies and that includes the FCC/government-industrial complex. These things aren't being regulated in the public interest and they should be.
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 1:31pm

"Update: Looks like Diller's already lost this part of the legal fight, which is unfortunate. Intimidating investors from funding innovative companies -- the kind of companies that actually can help move the industry forward -- isn't going to help anyone. Amazing how short-sighted Hollywood can be."

Wow, you almost threw your back out trying to spin this one Mike. "innovative company"? This is just another "own your own DVD player in our office" type idea that isn't innovative, it's just not within the scope of the law. The company is attempting to make new law, and anyone investing in a company that is very likely to face legal challenges such as this is taking a risk.

Innovative? Hardly.
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 1:32pm

Re: Re: Re: Re:
"How are broadcasters being bypassed?"

That's not even a relevant question, how is the broadcaster-government complex entitled to government established monopoly power over these spectra. The government should represent the public with how spectra are regulated and they aren't doing so.
[ link to this | view in thread ]
Keii (profile), 23 Apr 2012 @ 1:33pm

Re:
"The company is attempting to make new law"
Irrronyyy
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 1:35pm

Re: Re: Re:
What's the old guard afraid of, then?

Why not just let these guys build their business and then get smacked down by the FCC? Why waste their own time and money stifling this service?

I think the old guard's increasingly worried about their own relevance(which, BTW this service actually has a chance of increasing).
[ link to this | view in thread ]
illuminaut (profile), 23 Apr 2012 @ 1:43pm

Re:
A consumer boycott large enough to make a dent is unrealistic and would just be used as extra fuel in the debate of why they need new legislation ("See, sales are down dramatically, PIRACY!")
What needs to happen in the music industry is a boycott by the artists. If the popular artists refuse to sign deals with the major labels and sell directly to the consumers (or use a co-op label) then the tides are really turning. I think this is just a matter of time, too. SOPA became so toxic that no politician wants to be associated with it. Artists, too, should be distancing themselves from the industry.
In the film industry it is slightly more complicated and it will take longer to bypass the gatekeepers, but I believe it is possible.
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 1:45pm

Does Diller have the resources to take a good for the goose, good for the gander approach and subpeona the broadcast company CEO's demanding depositions as well as digging into the records of their major investors. As long as it seems relevant the judge would probably allow it in discovery even if he has no intention of ever actually looking at it.
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 1:47pm

Re: Re:
Unidirectional government established broadcasting monopolies for commercial purposes shouldn't even exist. If someone wants to communicate a commercial message it should be on a level playing field, ie: using spectra that everyone can legally use equally. Those with exclusive government established broadcasting (or cableco) privileges have an unfairly granted unlevel playing field to their advantage by the government and their broadcasting monopolies need to end. Then, most of these meritless and stupid monopolist losers would die the death they deserve because their lack of merit could never succeed in a free market. In the mean time they are being nothing but an oppressive hindrance to the rest of us by stealing the benefits that we would get from being able to exercise our natural right to use those spectra and communicate with them as we please.

I hope these government established broadcasting and cablco monopolists die for subjecting us to their oppression for so many years (ie: brainwashing us, censoring important information and viewpoints and being selective about what messages they deliver, being one sided about the messages they deliver and only delivering messages in favor of their meritless plutocracy, like pro-IP messages). We are way worse off because of them (ie: 95+ year copy protection lengths and the terrible effects of retroactive extensions and the fact that they don't even bother mentioning that but they are quick to falsely claim that infringement is so bad). These people have been nothing but a pure commercial, selfish burden on society and they do not deserve any government established monopolies.
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 1:49pm

Re: Re: Re:
(die as in their business, not them personally).
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 1:55pm

So, what exactly happened to the company absorbing liability for its shareholders? If I invest in Company X (say a major company like Coca-Cola), and that company is found guilty of certain criminal charges, does that mean that I as an investor am liable? Does this change if I'm putting up venture capital? Does it matter if I did due diligence and believed in good faith that the company was acting legally and ethically?

Depending on how far the courts take this, it seems like it could be a dangerous ruling...
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 2:01pm

Re: @Gorehound
"Do not buy their stuff new and do not go to a Theater.
MAFIAA is permanately censored from my wallet.My money should and will go to more deserving INDIE than a bunch of greedy assholes."

You do realize that the resulting lack of sales will be counted as "due to piracy" and 70% growth in indies is never acknowledged.
[ link to this | view in thread ]
Jeremy2020 (profile), 23 Apr 2012 @ 2:03pm

So if I invest in a company I now have legal obligation to ensure they are not breaking the law?

So since I can invest in all the major studios, I assume that their account books will be on the way shortly sowe can ensure they are up to legal standards.

Afterall, just investing makes me legally liable so I must have the right to review whatever aspect of their business I need to to uphold my new responsibility.
[ link to this | view in thread ]
Grae (profile), 23 Apr 2012 @ 2:05pm

Re:
3/10

You hit all the right talking points but were too obvious.
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 2:05pm

Re: Re:
"... Artists, too, should be distancing themselves from the industry."

With 450 million subscribers, this is why Mega became a threat.
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 2:06pm

Re:
You need a reason to dig, not some random act. FAIL!
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 2:10pm

Amazing how short-sighted Hollywood can be.

"Amazing?" You keep using that word. I do not think it means what you think it means.
[ link to this | view in thread ]
Grae (profile), 23 Apr 2012 @ 2:12pm

Re: Re:
""The company is attempting to make new law"
Irrronyyy"

Indeed. 8/10 to the AC for weaving that one in.
[ link to this | view in thread ]
Not an Electronic Rodent (profile), 23 Apr 2012 @ 2:15pm

Suggestion?
Can a button be added to collapse an entire comment thread by any chance?
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 3:11pm

Re: Re: Re:
I said 'he' not 'aero.' However, since you brought it up, a single antenna for every user with no broadcasting is hardly a 're-transmission' of anything. DVR style functions are legal, time shifting is fair use and all that, and obviously so so I have no idea why you'd even bring that up.
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 3:14pm

Re: Re: Re:
As horrible as I find the current system of broadcast rights I don't think a 'level playing field' where everyone can broadcast on any frequency they wish at whatever power they wish would be any kind of solution.

Cable monopolies, however, I couldn't agree more. They were built with public money and now they want to gouge the public for use of 'their' pipes. Fuck that noise.
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 3:18pm

Re:
It is pretty insane the number of wickets you have to weave through to make this work legally when it should be a simple matter of just making it available.
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 3:21pm

Re: Re:
What a cleverly worded all caps argument, even has it's own exclamation point. How convincing!
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 3:31pm

Re: Re: Re: Re:
"where everyone can broadcast on any frequency they wish at whatever power they wish would be any kind of solution."

This is not what I necessarily said. I said that commercial broadcasting should only be done on spectra where everyone is equally regulated, that is, everyone follows the same rules, not that there should be no regulations whatsoever. and I didn't say that all spectra should be unregulated and publicly usable. Different spectra can be allocated with different regulations, some spectra could be allocated for anyone to use almost freely so long as they don't interfere with other spectra and other spectra can be used by everyone equally with power limitations. Some spectra can be allocated specifically for things like GPS, time of day and weather condition broadcasting, it can be run by the government. Some spectra can be allocated for cell phone (and emergency call) use.

The point is that all unidirectional commercial broadcasting should be done on spectra where everyone follows equal rules, not that there should be no rules.

"Cable monopolies ... were built with public money"

Some of them were built with public money (depending on the city, but most any public money that went into it was city money), some of it was built with private money. But that's besides the point, most of the cable infrastructure was built well over 40 years ago and the value of the rights of way far exceed the costs of building this infrastructure. Either the government (mostly local governments) should allow competitors to use the existing infrastructure or they should allow them to build new infrastructure.

Most of the telco infrastructure was built with public money and competitors are sometimes allowed on it (though lobbying by AT&T and others try to restrict competitors even on this). Luckily, AT&T and others have been updating much of it with fiber optic lines, thanks to competition from Time Warner and other cable companies.
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 3:32pm

Re: Re: Re: Re: Re:
time of day, weather condition, and emergency broadcasting *
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 3:43pm

Re: Re: Re: Re: Re:
The public really needs to understand and appreciate the audacity of what the government-industrial complex has done.

The public has given up their right to send messages over these spectra, something we absolutely should have every right to do, for the exclusive private commercial interests of others (the government-industrial complex) in exchange for ... not being allowed to record, modify, and redistribute that which is broadcasted? We have every right to use that spectra however we please, the government has absolutely no right to tell me that I can't broadcast information over these spectra, and not only does the government-industrial complex tell me that I can't broadcast information over these spectra, they then have the audacity to tell me what I can and can't do with information that is broadcasted over that spectra? The nerve. This is utterly unacceptable, these thugs shouldn't even be allowed to tell me that I can't freely broadcast something over these spectra as I please, and that we have reached a stage in society where we so naturally take their oppression for granted shows how much of a disfavor these selfish thieves have been to us.
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 4:44pm

Re:
I have faith in the legal system
I pray to the legal sytem
I give praise and homage to the almighty judge and executioner
I drink and break bread with my fellow, brethren
All praise the legal system
in the name of the father and son and the holy dollar, amen
[ link to this | view in thread ]
Anonymous Coward, 23 Apr 2012 @ 4:53pm

Re: I still hate that name!
"You serve me and I'll serve you;
Swing your partners, till they're blue.
and a nit nat padiwack
give a dog a bone
this hung man went strolling home"
[ link to this | view in thread ]
zippy, 23 Apr 2012 @ 5:24pm

As Hard Harry would say, "Steal the air!" Best we take his advice and seize what should be rightfully ours.
[ link to this | view in thread ]
chris (profile), 23 Apr 2012 @ 5:29pm

Re: Re: Re: Re:
Great, but what does that have to do with making a business investment?

Look, they're oly trying to ruin Diller's life. Is that so wrong?
[ link to this | view in thread ]
techflaws.org (profile), 23 Apr 2012 @ 9:44pm

Re:
it's just not within the scope of the law

So place-shifting isn't allowed?
[ link to this | view in thread ]