Appeals Court Agrees: Aereo’s TV Streaming Service is Not a Copyright Infringement

By Joseph Mandour on April 8, 2013

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Los Angeles – A 2nd Circuit Court of Appeals Judge affirmed an earlier decision allowing Aereo to stream live local programming to its customers via internet and its app.  The lawsuit was brought against Aereo last year by three of the major broadcasting networks, including ABC, CBS, NBC, and Telemundo and PBS.  The networks sought an injunction to prevent Aereo from transmitting the television shows, believing Aereo would need a license to continue its services.

Aereo conceded that it would be copyright infringement if it was broadcasting the shows from a single antenna to a public audience.  But instead, Aereo is leasing a separate antenna to each customer for that customer’s own private home use.  So, Aereo is making an end run around the copyright law by using its individual antennas to receive the free local signal and then upload the transmission to the internet for its customer.  For a relatively small fee ranging between one dollar per day and eighty dollars a year, Aereo houses all of the small antennas leased by its subscribers in a warehouse.  Aereo believes this is the difference between it and other companies who provide streaming through the internet.

A dissenting opinion was presented by Judge Denny Chin who commented that Aereo’s technology was “a sham.”  Chin pointed out that Aereo had found a loophole in the system by using a lot of small antennas instead of one large one.  Chin went so far as to say, “The system is a Rube Goldberg-like contrivance, over-engineered in an attempt to avoid the reach of the Copyright Act and to take advantage of a perceived loophole in the law.”

The National Association of Broadcasters (“NAB”) said it was “disappointed” with the 2nd Circuit’s decision, agreeing with Chin.  Dennis Wharton of the NAB will be meeting to confer on the subject and review its options.

The fear held by the broadcasting companies is that this move will create a chain reaction with cable companies who will also avoid paying broadcasting fees.  However, as Attorney John Bergmayer, of the organization Public Knowledge pointed out, “We all agree that people are allowed to buy an antenna.”  According to Public Knowledge’s Mission Statement, it “preserves the openness of the Internet and the public’s access to knowledge; promotes creativity through balanced copyright; and upholds and protects the rights of consumers to use innovative technology lawfully.”

Although Aereo currently only operates in the five boroughs of New York City, it plans to expand its service to Atlanta, Boston, Chicago, Detroit, Houston and Washington, D.C. and then to at least 15 other cities.

 

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