Quasi-Broadcasting And Copyright – End Of An Aereo?

In a highly anticipated decision, the Supreme Court on June 25, 2014, issued an opinion that ruled that web-based TV streaming service Aereo violated copyright law by providing a service substantially similar to cable television without clearing copyrights to transmit the streamed program content. Aereo enabled its subscription viewers to watch or record over-the-air TV programming by renting antennas and digital storage spaces. Subscribers used online controls to operate their designated antenna within Aereo's facilities. The content they selected was transcoded to a digital signal and sent to their own dedicated space on Aereo's hard drives. From there, subscribers could stream the programming live or save it permanently onto Aereo's servers. Subscribers could access their live or recorded content from anywhere in the world via the Internet. Aereo maintained that its television streaming service resembled other services that courts have determined to be non-infringing, and thus legal in a line of cases beginning with Sony Corp. of America v. Universal City Studios (Betamax). In that case, the Supreme Court reasoned that Sony had a right to sell Betamax video tape recorders because they had substantial non-infringing uses, including "time-shifting," or recording programming for one's personal viewing at a later time. Similarly, in Cartoon Network v. CSC Holdings (Cablevision), the Second Circuit ruled that Cablevision's remote storage DVR systems were legal. The systems enabled consumers to record television shows to Cablevision's servers for their personal viewing at a later time. The court reasoned that "volitional conduct is an important element of direct liability." Cablevision, 536 F.3d 121, 131 (2d. Cir. 2008). It concluded that "by selling access to a system that automatically produces copies on command Cablevision more closely resembles a store proprietor who charges customers to use a photocopier on his premises, and it seems incorrect to say, without more, that such a proprietor "makes" any copies when his machines are actually operated by his customers." Cablevision, 536 F.3d at 132. Accordingly, the court held that Cablevision was not liable for infringing copies that the DVR system recorded on its servers. Aereo apparently designed its technology in a manner aimed at avoiding volitional conduct. Specifically, Aereo allotted storage space to each subscriber on which to record whatever content they wanted. Moreover, Aereo...