Supreme Court Invalidates Aereo’s Streaming Service, Finding Existing Copyright Law Applies To The New Technology Of Internet Retransmission Of Television Signals

The recent rapid development of the Internet and other new modes of communication has raised significant questions about whether existing copyright laws adequately protect the rights of content creators.

On June 25, 2014, the United States Supreme Court answered those questions in the affirmative, at least in the area of Internet retransmission of broadcast television signals in the matter American Broadcasting Cos., Inc. v. Aereo, Inc., 573 U.S. ____ (2014). In a 6-to-3 opinion authored by Justice Stephen Breyer, the Court reversed the Second Circuit Court of Appeals and decided that Respondent Aereo, Inc.'s transmission of over-the-air broadcasts to its network of subscribers constituted a public performance of copyrighted works owned by Petitioners (a group of television producers, marketers, distributors and broadcasters), within the meaning of the Copyright Act's "Transmit Clause" (17 U.S.C. § 101), thereby infringing Petitioners' exclusive right to perform their copyrighted works publicly.

The decision marks the death knell for Aereo's way of doing business and, at the same time, reassures the television broadcast industry that its programming content will be protected, at least as against unauthorized use by cable companies and their equivalents.

For a monthly fee, Aereo had provided a service to its network of subscribers permitting them to access and watch television programs over the Internet. It did so by utilizing a network of thousands of small antennae from which Aereo would designate one antenna for each particular subscriber who selected a program to view from the broadcasts available on Aereo's website.

Rather than sending the broadcast directly to the subscriber, Aereo would save the digital data captured by the subscriber-specific antenna to a subscriber-specific folder on Aereo's hard drive, creating in essence a "personal" copy of the transmission. Finally, Aereo would stream the content chosen by the subscriber to the subscriber over the Internet.

Petitioners brought suit against Aereo for copyright infringement in the U.S. District Court for the Southern District of New York, seeking a preliminary injunction, arguing that Aereo's business model directly infringed Petitioners' exclusive right to perform their copyrighted works publicly. The district court denied the preliminary injunction. Reasoning that Aereo's transmission of broadcast content did not constitute a public performance under the Transmit Clause because...