Broadcasters Snap Aereo’s Winning Streak

A Utah Court shuts down Aereo’s video service in Utah and Colorado.

CEO of Aereo Chet Kanojia speaks at the Bloomberg Panel & Reception during the 2012 Tribeca Film Festival at the Bloomberg - 713 Lexington on April 23, 2012 in New York City. 
National Journal
Feb. 20, 2014, 7:27 a.m.

A Utah Court handed broad­casters their first ma­jor vic­tory in their leg­al battle with the on­line video ser­vice Aereo, two months be­fore the Su­preme Court will hear a sim­il­ar case.

Aereo uses thou­sands of tiny an­ten­nas — one for each sub­scriber — to stream and re­cord over-the-air TV sig­nals to users, sidestep­ping the ex­pens­ive re­trans­mis­sion fees that cable com­pan­ies pay broad­casters to dis­trib­ute their con­tent. But the U.S. Dis­trict Court in Utah told the on­line video start-up to shut­down its ser­vice in Utah and Col­or­ado on Wed­nes­day, say­ing it was “in­dis­tin­guish­able” from cable TV. 

“Based on the plain lan­guage of the 1976 Copy­right Act and the clear in­tent of Con­gress, this court con­cludes that Aereo is en­ga­ging in copy­right in­fringe­ment of Plaintiffs’ pro­grams,” Judge Dale Kim­ball wrote. “Des­pite its at­tempt to design a device or pro­cess out­side the scope of the 1976 Copy­right Act, Aereo’s device or pro­cess trans­mits Plaintiffs’ copy­righted pro­grams to the pub­lic.”

The court gran­ted Aereo’s re­quest to put the law­suit with Fox and loc­al broad­casters on hold un­til the Su­preme Court hears the case, set for April 22.

The on­go­ing leg­al battle is es­sen­tially about wheth­er Aereo’s per­form­ances are pub­lic or private. 

Broad­casters — in­clud­ing Dis­ney, CBS, NB­CUni­ver­sal, Fox, and Uni­vi­sion — have been try­ing to bring Aereo down since it launched in March 2012, su­ing the com­pany in mul­tiple jur­is­dic­tions for steal­ing their con­tent.

But Aereo Founder and CEO Chet Kan­ojia con­tends it does not vi­ol­ate copy­right law be­cause its per­form­ances are private, a view re­cently af­firmed by the U.S. Court of Ap­peals for the 2nd Cir­cuit. Kan­ojia was dis­ap­poin­ted by the Utah court’s de­cision to fol­low a “dif­fer­ent path.”

“Con­sumers have a fun­da­ment­al right to watch over-the-air broad­cast tele­vi­sion via an an­tenna and to re­cord cop­ies for their per­son­al use,” Kan­ojia said in a state­ment after the Utah court or­der. “The Copy­right Act provides no jus­ti­fic­a­tion to cur­tail that right simply be­cause the con­sumer is us­ing mod­ern, re­motely loc­ated equip­ment.”

This is a ma­jor set­back for Areo which, un­til now, has aver­ted in­junc­tions in New York and Bo­ston in sim­il­ar law­suits. With Kan­ojia’s bless­ing, the broad­casters ap­pealed the 2nd Cir­cuit Court’s de­cision to the Su­preme Court, which de­cided to take the case last month.

Aereo began of­fer­ing its ser­vices in Utah in Au­gust, and in Den­ver in Oc­to­ber. The start-up cur­rently op­er­ates in 10 cit­ies, and plans to ex­pand after rais­ing $34 mil­lion in fund­ing last month.

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