Aereo Wins Round One Against Broadcasters; Judge Rejects Injunction & Allows Service To Live

from the how-do-you-define-your-antenna dept

Thu, Jul 12th 2012 11:01am — Mike Masnick

We've been covering the ridiculous legal fight over Aereo for a few months now. If you don't remember, Aereo is a company that offers -- for a fee -- to let people watch over-the-air broadcast TV (not cable, so just the small number of broadcast stations) online. Basically, what they do is set up antennas in a building in Brooklyn -- with one antenna per customer -- and then connect that antenna to the internet so the person can watch. The TV broadcasters flipped out and sued.

As we've noted, in essence, this is another lawsuit that asks the question: do the copyright rules change depending on the length of your cable. That is, we know that it's legal to put up an antenna yourself and watch what you get. That's how broadcast TV works. We also know that it's almost certainly legal (it hasn't directly been tested) to take the legal TV you are accessing and then place-shift it so you can watch it over the internet (like with a Slingbox). So, if you combine those two things, why would it suddenly be illegal? The only real difference is that the antenna and the place shifting device sit in Aereo's building rather than in your own home. So, it's just that the "cable" length between the users and the devices is longer. Why should the length of the cable determine whether something is infringing or not? In a few related legal cases, the rulings have been mixed.

There was the ivi case, where the company offered a very similar service, but went with a different legal theory (relying on compulsory licensing rules)... which has so far been shot down in court. Then there was the Zediva case which relied on a very similar theory, but with DVDs (i.e., the company had a separate DVD player for each customer and let you watch movies streamed from that individual player). In that case, the court issued an injunction and the company shut down. Finally, there's the Cablevision ruling in which the TV guys went after Cablevision for offering a remote DVR feature. In a somewhat convoluted, but important, ruling, it was found that a remote DVR could be legal and non-infringing.

While the networks seriously argued that anything that caused anyone to think about cancelling their cable subscriptions could be illegal, the judge in the Aereo case, Alison Nathan, has refused to grant a preliminary injunction (basically doing the opposite of what happened in the Zediva ruling). Zediva was in a different court (and only reached the district court level anyway) so that ruling had little direct influence here. The Cablevision ruling, however, was pretty clearly instrumental in saving Aereo from being shut down.

Much of the ruling focused on what seems like a relatively tangential question: whether Aereo is really creating an individual antenna for each customer, or if it's just building a giant single antenna. More or less, it's a question of whether or not each individual antenna works with the others to better capture the signal. This is also known as a totally stupid debate. I mean, if you were to step back and just look at this from a common sense standpoint, you'd say the fact that Aereo has to set up a different antenna for each customer is pretty stupid. There's no technical reason to do so, only a legal one. It is an expense that serves only to satisfy a legal demand, which is by definition an inefficiency introduced into the market for no reason other than to keep lawyers happy.

But, here, the judge ruled that the individual antenna theory applies, and thanks almost entirely to the Cablevision ruling, there's no reason to issue a preliminary injunction. The networks tried some bizarre theories about why Cablevision didn't apply, but the judge saw through all of the attempts at misdirection:

Despite this creative attempt to escape from the express holding of Cablevision, for the reasons discussed below this Court finds itself constrained to reject the approach Plaintiffs urge. Contrary to Plaintiffs' arguments, the copies Aereo's system creates are not materially distinguishable from those in Cablevision, which found that the transmission was made from those copies rather than from the incoming signal. Moreover, Plaintiffs' attempt to distinguish Cablevision based on time-shifting fails when confronted with the reasoning of that case, particularly considering that the Second Circuit's analysis was directly focused on the significance of Cablevision' s copies but did not say one word to suggest that time-shifting played any part in its holding.

From there, the ruling goes into a wonderfully thorough debunking of the networks' attempt to ignore the ruling in Cablevision and a detailed explanation for why Aereo is quite similar to Cablevision. In the end, the judge also bars the preliminary injunction due to the lack of irreparable harm if the service keeps going for the duration of the trial. The court actually says that it can see how there is a clear case that the networks could suffer irreperable harm, in the form of losing viewers and advertisers -- but that since that "harm" is a longterm one, there's little reason to issue an injunction right now. Separately, the court recognizes that an injunction would almost certainly be "irreparable harm" for Aereo, as it would effectively be a death sentence (as was the case with Zediva). Either way, however, the level of detail the court uses in laying out why Aereo is so similar Cablevision does not bode well for the networks' overall case.

This case is far from over, but in round one, the networks' key argument appears to have taken quite a beating.

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Filed Under: broadcasting, dvr, place shifting, television
Companies: aereo, cablevision, ivi, zediva

39 Comments

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Designerfx (profile), 12 Jul 2012 @ 11:17am

corrections
do the copyright rules change depending on the *legnth* of your cable / length.

fyi Mike.

Let's hope this cable length debacle ends with Aereo, that would certainly be nice. Then again if it does you know broadcasters will push for a new law to prevent it anyway.
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John Doe, 12 Jul 2012 @ 11:18am

Think of the antenna manufacturers..
...they have children too. Think of the children.
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PlagueSD (profile), 12 Jul 2012 @ 11:21am

To paraphrase the late, great George Carlin..

"Selling is legal...Consentual sex is legal. Why isn't selling consentual sex legal???"
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Anonymous Coward, 12 Jul 2012 @ 11:55am

"If broadcasters can�t beat pay TV, then Lazard Capital Markets� Barton Crockett says maybe it�s time to join them by ditching their transmitters and becoming cable channels. Sure, they�d lose about 10% of the population that depends on free, over-the-air TV. �But these are mainly lower income homes worth little to advertisers,� Crockett says. �And the offset is that broadcasters could potentially sell their licenses for other purposes, like mobile broadband, and reap a windfall.�

http://m.deadline.com/2012/07/aereo-lawsuit-local-tv-lawsuit-retransmission-consent/

Perhaps this will lead to the death of free OTA tv. If you can't beat them, take your ball and join the enemy.
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Anonymous Coward, 12 Jul 2012 @ 12:04pm

It would have been nice if you actually explained why this case went this way and the Zediva case went the other way. I know you jumped at the chance to sell your "length of the wire!" argument, but there really is a good reason the cases came to different conclusions. A little *actual* analysis. Just sayin'.
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gorehound (profile), 12 Jul 2012 @ 12:05pm

Re: Think of the antenna manufacturers..
I used all sorts of Antennas for most of my life as I was born in 1956.Living in Portland, Maine and right near Downtown I have never been able to pick up a decent Analog Signal and Digital Signal just never picked up at all.
At least from my childhood in the late 50's till 1985 I could always pick up some kind of usable Signal throughout the various places I lived in the Boston Area.
I tried Antenna here in P-Land and tried different kinds.
MAFIAA will find a way to stop Aereo and any other innovative idea.
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Anonymous Coward, 12 Jul 2012 @ 12:05pm

So, how is this not simply retransmission? Aereo does in fact retransmit the signal and charges a fee yet doesn't pay for content. It's not the consumer doing it, but Aereo. That is the difference in my mind.
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Anonymous Coward, 12 Jul 2012 @ 12:13pm

"If broadcasters can�t beat pay TV, then Lazard Capital Markets� Barton Crockett says maybe it�s time to join them by ditching their transmitters and becoming cable channels. Sure, they�d lose about 10% of the population that depends on free, over-the-air TV. �But these are mainly lower income homes worth little to advertisers,� Crockett says. �And the offset is that broadcasters could potentially sell their licenses for other purposes, like mobile broadband, and reap a windfall.�

http://m.deadline.com/2012/07/aereo-lawsuit-local-tv-lawsuit-retransmission-consent/

Perhaps this will lead to the death of free OTA tv. If you can't beat them, take your ball and join the enemy.
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Anonymous Coward, 12 Jul 2012 @ 12:14pm

Re:
Sorry for double post, accidently hit back button and mobile browser.
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Em, 12 Jul 2012 @ 12:16pm

About time
It's about time to change the dominance of the cable companies on the expensive packages. I'm already getting more and more friends who don't have cable at home. The internet already has a lot of interesting free or cheap shows out there. I've been following shows on Tvphoon.com for a few weeks, they have a pretty unique concept.
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Anonymous Coward, 12 Jul 2012 @ 12:16pm

Re:
Backup YOUR critique with a little analysis, just saying.
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Ron (profile), 12 Jul 2012 @ 12:21pm

Look Out
I see if Aereo wins this case and offers this service. I can see them selling this tech to the cable giants so that it will again allow them to offer local channels without paying through the nose to the broadcasters. This tech couls very well be used for OTA radio as well.
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Anonymous Coward, 12 Jul 2012 @ 12:23pm

Re:
and charges a fee yet doesn't pay for content.

Well, someone who received the broadcasts via their own antenna wouldn't pay for the content either, unless you count buying and operating an antenna as "paying for content".
Aereo is just charging for the convenience of not having to operate your own antenna.
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Anonymous Coward, 12 Jul 2012 @ 12:34pm

Re: Re:
I will gladly do so later when I have free time. My point, though, was that if you're going to write a blog post about the decision, and if you're going to compare the two cases, then it makes sense to talk about what the courts actually said. Look at the court's actual reasoning, together with the law, and then explain how the two cases relate. Hint: the "how long the cord is!" argument is not indicative of the actual law or reasoning being used in these cases. If Mike wants to write about IP law, then he should take some time to discuss the actual law.
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Jake (profile), 12 Jul 2012 @ 12:35pm

Re:
If you read the decision it comes down to the fact that the end user is not paying for the content, they are paying to rent equipment. The networks argument is that the transmission counts as a public performance of their work, but the court calls BS and basically says that since only the user requesting the show is the only one that can view it, it is not a public performance. I am not a lawyer though so I could have read it wrong, but that is what I am getting from it.
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Anonymous Coward, 12 Jul 2012 @ 12:35pm

Re: Re:
And Aereo is capturing the signal and retransmitting it for profit. There'd be no question that this is a retransmission case if Aereo used one huge antenna and retransmitted to a bunch of subscribers. They are attempting to avoid retransmission fees by using a forest of tiny antennas to accomplish the same thing.
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Hephaestus (profile), 12 Jul 2012 @ 12:36pm

Time to start a new version of Zediva in Brooklyn. :D
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Anonymous Coward, 12 Jul 2012 @ 12:46pm

Ummm WHAT?!?!?! The TV broadcasters are sending out the signal for anybody with an antenna to receive and watch for free already. Why would they really care if I am located in this town or another town. If anything the broadcasters should be thrilled after all their viewership would increase and therefore allow them to charge more for ads. If they really don't want people with an antenna to watch their broadcast then don't transmit it in the clear. What's next? Radio broadcasters suing auto manufactures because they are allowing people to listen to their broadcast while driving?
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Anonymous Coward, 12 Jul 2012 @ 1:02pm

Wasn't there a ruling that said anything sent in the clear over airwaves was fair game? I believe this came about in the 80's due to people setting up antenna's or satellite dish's to receive cable TV that was sent over the air. In response the cable TV companies started to scramble their signal. Would this ruling not apply here? Once it enters the airwaves it should be fair game and I should be able to pick it up and send it out again. Of course if I send it via RF over the airwaves I have to follow the FCC rules on RF transmission. In this case it is being sent out over an internet connection so the FCC would not be involved.
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Anonymous Coward, 12 Jul 2012 @ 1:10pm

Re:
They don't care that people are watching their station on the Internets, what they care about is not having done it first.....and now they are loosing out on the profits because they sat on their fat asses and didn't innovate. I bet if they do manage to shut them down, that the broadcasters come up with an overpriced paywalled alternative service that no one will use, kind of like those stupid news services,,, idiots...
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Matt, 12 Jul 2012 @ 1:29pm

Re: About time
Thanks for the link, it's a great site.
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Anonymous Coward, 12 Jul 2012 @ 1:52pm

Re:
Again, Aereo is seeking to avoid retransmission fees by using tiny individual antennas instead of a great big one. Aereo is RETRANSMITTING the signal for a profit, yet doesn't want to pay anything for the content they're being paid to deliver.
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StrikeRevenge, 12 Jul 2012 @ 2:24pm

Re: Sexy legal
Seems to be legal in many places eHarmony, Match.com, Las Vegas, etc...
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Lozine, 12 Jul 2012 @ 3:00pm

Re: Think of the antenna manufacturers..
I'm sorry son, we can't have food. They dont need my antennas anymore...
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Anonymous Coward, 12 Jul 2012 @ 3:07pm

Re: Re: Re:
The obvious conclusion there is actually the opposite of what you're suggesting though. If the difference is the size and number of antennas that's a ludicrous difference and obviously both should be free.
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Anonymous Coward, 12 Jul 2012 @ 3:10pm

Re: Re: Re:
There are several giant articles on the legal arguments in the Zediva. Maybe try clicking on the link to them? Here, I'll make it even easier to find for you: https://www.techdirt.com/blog/?company=zediva
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Big Al, 12 Jul 2012 @ 3:46pm

Maybe only one giant antenna but...
"or if it's just building a giant single antenna."

That 2cm is mine, the next 2cm is yours...
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Anonymous Coward, 12 Jul 2012 @ 4:12pm

Re: Re: Re: Re:
Not sure why you think Aereo should be able to rebroadcast a signal over the internet and not pay a retransmission fee like a satellite or cable company who pays to broadcasts the same signal. Can you elaborate?
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JMT (profile), 12 Jul 2012 @ 4:25pm

Re:
"Aereo does in fact retransmit the signal and charges a fee yet doesn't pay for content."

Why should anyone have to pay to retransmit something that is available to anyone free of charge? Aereo are charging for a service, not the content.
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Anonymous Coward, 12 Jul 2012 @ 5:10pm

Re: Re:
No one would buy the service without the content.

The satellite and cable providers pay broadcasters to retransmit content to its subscribers. How is Aereo doing anything different? Why should they not pay?
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mr bill, 12 Jul 2012 @ 6:09pm

pay broadcasters to retransmit content
Maybe the question should be why are cable/satellite companies paying to retransmit OTA content. Maybe there is a rule that cable/satellite companies are required to provide local OTA broadcasts.
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Anonymous Coward, 12 Jul 2012 @ 6:21pm

This case is just fucking retarded... These trolls need to be fined to the max for wasting the courts time.
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Anonymous Coward, 12 Jul 2012 @ 7:35pm

Re:
"The TV broadcasters are sending out the signal for anybody with an antenna to receive and watch for free already."

No, what they are concerned about is that (a) it gets very close to a cable or sat system, and they have to license use, and (b) that the signal gets delivered to people who are outside of the broadcast area (violating licensing agreements with local affiliate stations).

Further, they are concerned that the DVR feature will be used to deliver that content without commercials, killing their business model (and of course, shooting the golden goose, which is something nobody ever wants to address).
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Anonymous Coward, 12 Jul 2012 @ 10:29pm

Re: Re:
Nope. In the context of the relevant codes, "retransmission" has an extremely specific meaning. It's quite complicated, but it has to do with the rules the FCC uses to ensure that cable television can't unfairly compete with local broadcast television stations.

One of the arguments at hand was whether or not what Aereo is doing counts as "retransmission" under those rules, and the judge just ruled that it doesn't. Obviously, it's legal to buy a TV antenna, nail it to the side of your house, and to use it to watch TV. It's also legal to rent that antenna from a company, and have them put it on the side of your house for you. Claiming that Aereo is "retransmitting" the signal is just as facetious as claiming that a network router is "retransmitting" a song when you listen to internet radio.
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mattarse (profile), 13 Jul 2012 @ 2:25am

Re: Re: Re:
Simply because the content providers get no additional money from radio shack when I buy an antenna from them and put it on top of my set.
Would it be different if I rented the antenna from radio shack?
My apartment owner doesn't pay the content providers for renting me the apartment where I put the antenna. Why should this company have to pay them for renting me space in their warehouse?
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Anonymous Coward, 13 Jul 2012 @ 5:48am

Re: Re: Re: Re:
I've read them. Mike keeps making his stupid "length of the cable" argument, even though that argument isn't being made by either side. Why? Because it's stupid, and it's not the law. Mike apparently doesn't understand the actual law (what's new?), so he turns to his stupid interpretation of it.
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Chris Hoeschen (profile), 13 Jul 2012 @ 8:15am

Re: Re:
So basically what you are saying is this is nothing more than felony interference of a business model. After all it was the broadcasters that setup the model of charging for free content (humm you can't compete with free, really?) and it is the same broadcasters that are upset that someone else is watching that content over the internet. Oh and the "Aereo is not paying for that content" statement, Aereo is paying EXACTLY what you and I would pay for it ourselves.

So tell me why should cable/sat companies pay for free content just so they can enabled more viewers to watch that content? That same statement has been said in the comments several times but what is never said why it should be that way. And don't use the old fall back argument of "but its the law." Laws can and do change all the time. Instead of repeating the same statement over and over thinking that will change people's mind lets bring out the reasons why? Why was this setup to begin with? What purpose did it serve then? Does it still serve the same purpose? Is it hindering other features or services?

This is just stupid, plain and simple. The content is sent OTA and is designed to be picked up and consumed by as many people as possible for free. This service is only allowing more people to pickup and consume that very same content.
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Anon #41, 13 Jul 2012 @ 10:39am

Re: Re: About time
Talking to yourself much?
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Ninja (profile), 16 Jul 2012 @ 7:54am

Every time I read about ppl discussing basically about the length of the cord I chuckle. I think we should give them a cord long enough so they can hang themselves collectively and spare us of further stupidity.

In the end they are suing because they are losing control of what demographics are watching their content so advertisers might get cautious when buying ad windows for that particular region. The solution is quite simple (and it's probably a better business model too): offer a stream yourself and let the ppl choose where they are (like youtube lets you change your region and even suggests based on your ip). It's another form of revenue over what should be free.

I won't hold my breath.
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