The Supreme Court decided the Aereo case (decision here) and, if I can brag a little, the decision was pretty much what we predicted here after the oral argument – a relatively narrow decision finding that there is a public performance of the broadcast television signals retransmitted by Aereo as part of their service. The Court looked at the service, and concluded that it effectively does what a cable system does with broadcast television stations – it takes their signals off the air and transmits them to the public, and charges a fee for doing so. The only meaningful difference with Aereo for purposes of the decision was that it did not get the broadcasters permission to retransmit their signals. Because its performance of the television stations’ signals was not authorized, the Court concluded that the service had violated the rights of the copyright holders, and remanded the case to the lower courts to finalize decisions which will presumably stop the retransmission of station signals unless Aereo gets permission from the TV broadcasters.
The decision was a 6-3 vote of the Court, with the dissenters adopting Aereo’s position that it was not the service that was making the performance, but each individual user, and thus the performance was a private one for which no permission of the copyright holder is necessary (akin to turning on the TV and performing its programming to yourself in your living room, or singing to your family in the car). The dissenters, led by Justice Scalia, looked at three principal reasons for their conclusions that the majority missed the boat – (1) The statutory provisions and legislative history cited by the majority did not support the decision; (2) Aereo’s technology is different from cable as it sends one signal to one individual when the individual asks for it, as opposed to a cable system which is always sending all the TV signals to its subscribers, and (3) There was no volitional conduct by Aereo to infringe on copyrights – all the conduct actually seeking any infringing content was that of the users (going so far as to suggest that, while Aereo may not have violated the public performance rights of the copyright holders, it might still be contributorily infringing on their copyrights by encouraging the infringement by users). The majority dismissed these complaints, for many of the same reasons that we have written about before (as summarized below).
First, as to the dissent’s contention that the Copyright Act revisions in 1976 (which made clear that cable made public performances of a television signal when it rebroadcasted that signal) did not clearly cover Aereo, the majority found that the statutory language defining a public performance clearly did cover what Aereo was doing. That language, which was also cited by the District Courts in Utah and DC who addressed Aereo or its imitator FilmOn X (see our summaries of their decisions here and here), states that there is a public performance when a service:
Transmit[s] or otherwise communicate[s] a performance…of a [copyrighted] work…to the public, by means of any device or process, whether by members of the public capable of receiving the performance…receive it at the same time or at different times
As we wrote when analyzing the Utah and DC cases, that sure seems to fit what Aereo is doing, as the majority seemed to agree.
As to the dissenter’s second argument, that the technology is different, the majority concluded that whether the signals were all pushed to users at once, or only when demanded by the user, really made no significant difference to the decision in the case. It was functionally the same for the TV stations, the service (Aereo or the cable provider) and to the TV station whose signal was transmitted – the user turns on its receiving device and he or she gets the TV station’s signal. What was not said in the majority decision was that even some cable systems, in order to save bandwidth, have adopted a system where they only push in the last mile to the home what the consumer demands, yet there has been no argument that they are not publically performing the TV signals they retransmit. The consumer gets what he or she wants by turning on their viewing device, and whether the pipe is full with multiple signals (only one of which is watched) or just with the single signal that is demanded (with the other signals available on demand) should make no difference for copyright purposes.
The final argument from the dissenters about volition is the one with which I have the most trouble, and it is one which the majority spends little time discussing. The dissenters seem to argue that Aereo is passive and does nothing but essentially lease equipment. But that seems to be far from the truth. A user cannot pick its tiny antenna or take it from Aereo’s rooftop and use it independently – it only works in combination with many other tiny Aereo antennas and with its processing systems that takes the signals and digitizes them. The antennas are not passive ones picking up just any old signal that might be receivable in the NY area – but instead Aereo has provided a menu of the available stations – and those stations are limited to the NY market stations (even though a TV antenna in NY might be able to receive over the air signals of stations from other markets). And, for putting this system together, Aereo gets a monthly fee. As the majority concluded, it works like a cable system, and thus should be treated as a cable system for purposes of determining if there is a public performance for which they need permission.
This is a narrow decision, as the Court emphasizes, and because of the unique facts of this case, should have little impact on cloud computing or other new technologies. While many tech publications seem to already be predicting doom, this decision, in the limited circumstances to which it applies, should have little impact on services that are not just trying to design a system seemingly only for the purpose of evading copyright payments.