Supreme Court TV On the Internet

Source: Associated Press

In one of the biggest copyright decisions of the past quarter century, the United States Supreme Court ruled June 25 that the TV antenna company Aereo violated copyrights owned by broadcast companies through its use of technology to stream live broadcasts to the Internet.

In a 6-3 ruling, the court said the company violated copyrights owned by TV broadcasters, marketers, and distributors whose programs the company streamed.

“This ruling appears sweeping and definitive, determining that Aereo is illegal,” the Washington D.C. lawyer, Tom Goldstein, wrote on SCOTUSblog. Lawyers who followed the case closely said the ruling could have further implications for the way content is delivered online.

As we have reported before, a decision in favor of Aereo could have also had implications for cable and broadcast companies in other markets like the EU although different laws made such a scenario still unclear. While the court’s decision is a major blow to Aereo, which will likely go out of business, the court was clear to not infringe on other Internet based technologies such as cloud computing.

Aereo’s technology uses tiny high-definition antennas to pull in broadcast TV from the airwaves, which is then transferred over the internet to any device. Aereo argued that it was legal because its service was no different from a company that rents HD antennas and DVR equipment to customers.

As Goldstein wrote on SCOTUSblog, “The essence of the Aereo ruling is that Aereo is equivalent to a cable company, not merely an equipment provider.”

In his opinion, Justice Stephen Breyer wrote:

“Viewed in terms of Congress’ regulatory objectives, these behind-the-scenes technological differences do not distinguish Aereo’s system from cable systems, which do perform publicly. Congress would as much have intended to protect a copyright holder from the unlicensed activities of Aereo as from those of cable companies.

Addressing concerns that ruling against Aereo could stifle technology, the court ruled that it didn’t believe its decision would “discourage the emergence or use of different kinds of technologies.”

Breyer was joined by Chief Justice John Roberts as well as Justices Anthony Kennedy, Ruth Bader Ginsburg, Sonia Sotomayor, and Elena Kagan.

Writing for the dissent, Justice Antonin Scalia made the case that the company did not violate copyrights because it is users who select the content they watch. Scalia, a conservative member of the court, wrote that Aereo is essentially a “copy shop” to a degree of involvement that isn’t sufficient to make it liable for copyright infringement. He was joined by Justice Clarence Thomas and Samuel Alito.

Scalia wrote in his dissent:

“Unlike video-on-demand services, Aereo does not provide a prearranged assortment of movies and television shows. Rather, it assigns each subscriber an antenna that — like a library card — can be used to obtain whatever broadcasts are freely available. Some of those broadcasts are copyrighted; others are in the public domain. The key point is that subscribers call all the shots: Aereo’s automated system does not relay any program, copyrighted or not, until a subscriber selects the program and tells Aereo to relay it.”

The court also went out of its way to address concerns that ruling against Aereo could stifle technology. The court ruled that it didn’t believe its decision would “discourage the emergence or use of different kinds of technologies.”

That was a major concern for industries outside of television, which the court was clear to address, saying it would not affect other cloud storage services, like Dropbox or Apple’s iCloud, as many people feared.

Breyer’s majority opinion, for its part, said the cloud was not on trial in this case: “We have not considered whether the public performance right is infringed when the user of a service pays primarily for something other than the transmission of copyrighted works, such as the remote storage of content.”

Aereo had no comment on the decision as of press time, but the small New York startup has said in the past it was betting the entire company on the case.

Despite Aereo likely going out of business, however, the legal questions are likely to surface again.

As Scalia pointed out: “The Court vows that its ruling will not affect cloud-storage providers and cable-television systems, but it cannot deliver on that promise given the imprecision of its result-driven rule.” He mocked the majority’s finding that Aereo resembles a cable company, saying it would “sow confusion for years to come.”