WNET v. Aereo, Inc. Am. Broad. Cos. v. Aereo, Inc.

12-2786-cv; 12-2807-cv
WNET v. Aereo, Inc.; Am. Broad. Cos. v. Aereo, Inc.
1 UNITED STATES COURT OF APPEALS
2
3 FOR THE SECOND CIRCUIT
4
5
6 At a stated term of the United States Court of Appeals
7 for the Second Circuit, held at the Thurgood Marshall United
8 States Courthouse, 40 Foley Square, in the City of New York,
9 on the 16th day of July, two thousand thirteen.
10
11 PRESENT: DENNIS JACOBS,
12 Chief Judge,
13 ROSEMARY S. POOLER,
14 ROBERT A. KATZMANN,
15 REENA RAGGI,
16 RICHARD C. WESLEY,
17 PETER W. HALL,
18 DEBRA ANN LIVINGSTON,
19 GERARD E. LYNCH,
20 DENNY CHIN,
21 RAYMOND J. LOHIER, JR.,
22 SUSAN L. CARNEY,
23 CHRISTOPHER F. DRONEY,
24 Circuit Judges.
25
26 - - - - - - - - - - - - - - - - - - - - - -x
27
28 WNET, Thirteen, Fox Television Stations,
29 Inc., Twentieth Century Fox Film
30 Corporation, WPIX, Inc., Univision
31 Television Group, Inc., The Univision
32 Network Limited Partnership, and Public
33 Broadcasting Service,
34
35 Plaintiffs-Counter-Defendants-Appellants,
36
37 v. 12-2786
38
39
1 AEREO, Incorporated, FKA Bamboom Labs,
2 Inc.,
3
4 Defendants-Counter-Claimants-Appellees.
5
6 - - - - - - - - - - - - - - - - - - - - - -x
7
8 American Broadcasting Companies Inc.,
9 Disney Enterprises, Inc., CBS Broadcasting
10 Inc., CBS Studios Inc., NBCUniversal Media,
11 LLC, NBC Studios, LLC, Universal Network
12 Television, LLC, Telemundo Network Group
13 LLC, WNJU-TV Broadcasting LLC,
14
15 Plaintiffs-Counter-Defendants-Appellants,
16
17 v. 12-2807
18
19 AEREO, Inc.,
20
21 Defendant-Counter-Claimant-Appellee.
22
23 - - - - - - - - - - - - - - - - - - - - - -x
24
25 FOR PLAINTIFFS-APPELLANTS
26 WNET, THIRTEEN, ET AL.: Paul M. Smith, Steven B.
27 Fabrizio, Scott B. Wilkens,
28 Matthew E. Price, Jenner & Block
29 LLP, Washington, DC; Richard L.
30 Stone, Amy M. Gallegos, Jenner &
31 Block LLP, Los Angeles, CA.
32
33 FOR PLAINTIFFS-APPELLANTS
34 AM. BROAD. COS., INC., ET
35 AL.: Bruce P. Keller, Jeffrey P.
36 Cunard, Michael R. Potenza,
37 Debevoise & Plimpton LLP, New
38 York, NY.
39
40 FOR DEFENDANT-APPELLEE: R. David Hosp, John C.
41 Englander, Mark S. Puzella,
42 Yvonne W. Chan, Erin M. Michael,
43 Goodwin Procter LLP, Boston, MA;
2
1 Michael S. Elkin, Thomas P.
2 Lane, Winston & Strawn LLP, New
3 York, NY; Seth D. Greenstein,
4 Constantine Cannon LLP,
5 Washington, DC; Jennifer A.
6 Golinveaux, Winston & Strawn
7 LLP, San Francisco, CA.
8
9
10 ORDER
11 Following disposition of this appeal on April 1, 2013,
12 Plaintiffs-Appellants filed petitions for rehearing in banc.
13 An active judge of the Court requested a poll on whether to
14 rehear the cases in banc. A poll having been conducted and
15 there being no majority favoring in banc review, rehearing
16 in banc is hereby DENIED.1
17
18 Denny Chin, Circuit Judge, joined by Richard C. Wesley,
19 Circuit Judge, dissents by opinion from the denial of
20 rehearing in banc.
21
22 FOR THE COURT:
23 CATHERINE O’HAGAN WOLFE, CLERK
24
25
26
1
José A. Cabranes, Circuit Judge, was recused from
consideration of the matter.
3
DENNY CHIN, Circuit Judge, joined by RICHARD C. WESLEY, Circuit
Judge, dissenting from the denial of rehearing en banc.
Aereo, Inc. ("Aereo") captures over-the-air
broadcasts of copyrighted television programs and
retransmits them to subscribers by streaming them over the
Internet. For a monthly fee, Aereo's customers -- members
of the public -- may watch the programs live or record them
for later viewing. Aereo retransmits the programming
without authorization of the copyright holders and without
paying a fee. The question is whether, by doing so, Aereo
is infringing on the exclusive right of the copyright owners
"to perform the copyrighted work publicly." 17 U.S.C.
§ 106(4).
Aereo argues that its transmissions are not
"public" performances. Rather, Aereo contends, its
transmissions are "private" performances because its system
uses thousands of individual, dime-sized antennas that
enable subscribers to make their own purportedly "unique"
copies of the programming for retransmission back to
themselves. Under this theory, Aereo maintains that it may,
for example, stream the Super Bowl "live" to 50,000
subscribers and yet, because each subscriber has an
individual antenna and a "unique" copy of the broadcast,
these are not "public" but "private" performances.
Based on this Court's decision in Cartoon Network
LP, LLLP v. CSC Holdings, Inc., 536 F.3d 121 (2d Cir. 2008),
cert. denied, 557 U.S. 946 (2009) (mem.) ("Cablevision"),
the panel majority in these tandem cases accepted this
argument and held that Aereo is not engaging in copyright
infringement. See WNET, Thirteen v. Aereo, Inc., 712 F.3d
676 (2d Cir. 2013). Now this Court has denied the petitions
for rehearing en banc. I dissented from the majority's
panel decision, 712 F.3d at 696, and I now dissent from the
Court's denial of rehearing en banc.
First, we should consider the two cases en banc
because they raise "a question of exceptional importance,"
Fed. R. App. P. 35(a)(2), and because "en banc consideration
is necessary to secure or maintain uniformity of the court's
decisions," id. R. 35(a)(1). Second, the text of the
Copyright Act and its legislative history make clear that
Aereo's retransmissions are public performances. Third,
Aereo's reliance on Cablevision is misplaced because, in my
view, Cablevision was wrongly decided. Finally, even
assuming Cablevision was correctly decided, Cablevision has
been misapplied by the majority and should not be extended
to the circumstances of this case. I discuss each of these
issues in turn.
-2-
I. En Banc Review
The petitions for rehearing should be granted
because these cases merit en banc review.
A. Question of Exceptional Importance
Federal Rule of Appellate Procedure 35 provides
that an en banc rehearing is appropriate if "the proceeding
involves a question of exceptional importance." Fed. R.
App. P. 35(a)(2). These cases present such a question.
Indeed, the panel majority's decision has already had a
significant impact on the entertainment industry.
Industry observers predict that the decision will
encourage other companies that retransmit public television
broadcasts to seek elimination of, or a significant
reduction in, their retransmission fees. 1 Time Warner Cable
has already announced its intention to look into adopting an
Aereo-like system to avoid these fees entirely, 2 and Dish
1
See John M. Gatti & Crystal Y. Jonelis, Second Circuit
Deals Blow to Rights of Broadcasters Under the Copyright Act,
Intell. Prop. & Tech. L.J., July 2013, at 16, 18 ("This decision
is a significant setback for broadcasters, who maintain that
their works are being stolen by Aereo, and may very well embolden
Aereo and other similar start-up ventures."); Tristan Louis,
Aereo: The Future of TV Is Here Today, Forbes, Apr. 13, 2013,
available at http://www.forbes.com/sites/tristanlouis/2013/04/13/
aereo-the-future-of-tv-is-here-today/.
2
See Steve Donohue, Britt: Aereo Could Help Time Warner
Cable Stop Paying Retransmission-Consent Fees, FierceCable, Apr.
26, 2012, http://www.fiercecable.com/story/britt-aereo-could-
help-time-warner-cable-stop-paying-retransmission-consent/2012-
04-26.
-3-
Network is in talks to acquire Aereo itself. 3 To protect
their copyrighted material, FOX, Univision, and CBS have
reportedly threatened to move their free public broadcasts
to paid cable if Aereo is permitted to continue with its
service.4 CBS has already had discussions with cable
companies about taking its local signals off the air in the
New York metropolitan area to prevent Aereo from
retransmitting its broadcasts for free. 5
Meanwhile, Aereo has announced plans to expand to
twenty-two cities in 2013, including Boston, Atlanta,
Chicago, Washington, D.C., and Philadelphia. 6 In February
2013, while still awaiting the panel's decision, Aereo
3
Christopher S. Stewart & William Launder, Diller Wins
a Broadcast-TV Clash, Wall St. J., July 12, 2012, at B1,
available at http://online.wsj.com/article/SB10001424052702303
644004577521362073162108.html; Janko Roettgers, Does Dish Want To
Buy Aereo? Broadcasters Would Love To Know, paidContent (April
4, 2013), http://paidcontent.org/2013/04/04/does-dish-want-to-
buy-aereo-broadcasters-would-love-to-know.
4
See Louis, supra note 1; Aimee Ortiz, Fox Threatens to
Leave Network TV in Protest Over Aereo Lawsuit, Christian Sci.
Monitor, Apr. 11, 2013, available at http://www.csmonitor.com/
Innovation/Pioneers/2013/0411/Fox-threatens-to-leave-network-TV-
in-protest-over-Aereo-lawsuit; Brian Stelter, Broadcasters Circle
Wagons Against a TV Streaming Upstart, N.Y. Times, Apr. 9, 2013,
available at http://www.nytimes.com/2013/04/10/business/media/
aereo-has-tv-networks-circling-the-wagons.html.
5
See Stetler, supra note 4.
6
See Press Release, Aereo, Inc., Aereo Announces
Expansion Plans for 22 New U.S. Cities (Jan. 8, 2013), available
at https://aereo.com/assets/marketing/mediakit/press_release_
20130108.pdf.
-4-
cautiously expanded from New York City to the entire New
York metropolitan area, which includes some parts of New
Jersey, Connecticut, and Pennsylvania. 7 Since the panel's
decision was filed in April, Aereo has already expanded to
the Boston and Atlanta markets and will expand to Chicago in
September, making its services available to residents of
Massachusetts, New Hampshire, Vermont, Georgia, Alabama,
North Carolina, Illinois, and Indiana. 8
In recent years, with greater competition from
cable and the Internet, television broadcasters have come to
rely more heavily on retransmission fees, rather than
advertising revenue, to make their free public broadcasts
profitable.9 In fact, as with newspaper companies,
broadcasters are relying increasingly on subscriber fees to
fund the creation of content. The majority's decision,
7
See Press Release, Aereo, Inc., Aereo Announces
Expansion of Consumer Access to Its Groundbreaking Technology
Across the New York City Greater Metropolitan Area (Feb. 25,
2013), available at https://aereo.com/assets/marketing/mediakit/
press_release_20130225.pdf.
8
See Press Release, Aereo, Inc., Aereo Announces Launch
Date for Chicago (June 27, 2013), available at https://aereo.com/
assets/marketing/mediakit/press_release_20130627.pdf; Press
Release, Aereo, Inc., Aereo Sets Launch Date for Atlanta (May 14,
2013), available at https://aereo.com/assets/marketing/mediakit/
press_release_20130514.pdf; Press Release, Aereo, Inc., Aereo
Sets Launch Date for Boston (Apr. 23, 2013), available at
https://aereo.com/assets/marketing/mediakit/press_release_
20130423.pdf.
9
See Stelter, supra note 4.
-5-
which permits Aereo to retransmit television broadcasts
without paying a fee, undermines this model. Indeed, the
filing of this Court's decision on April 1, 2013 caused the
share price for major media firms to drop because of the
threat it posed to a vital source of their revenue. 10
In a decision we issued last year, WPIX, Inc. v.
ivi, Inc., 691 F.3d 275 (2d Cir. 2012), cert. denied, 133 S.
Ct. 1585 (2013), we addressed the harm that would result
from permitting a company (in that case, ivi) to stream
copyrighted television programming over the Internet without
licenses:
Indeed, ivi's actions -- streaming
copyrighted works without permission --
would drastically change the industry, to
plaintiffs' detriment. The absence of a
preliminary injunction would encourage
current and prospective retransmission
rights holders, as well as other Internet
services, to follow ivi's lead in
retransmitting plaintiffs' copyrighted
programming without their consent. The
strength of plaintiffs' negotiating
platform and business model would
decline. The quantity and quality of
efforts put into creating television
programming, retransmission and
advertising revenues, distribution models
and schedules -- all would be adversely
affected. These harms would extend to
other copyright holders of television
programming. Continued live
10
See Signalled Out, Economist, Apr. 13, 2013, available
at http://www.economist.com/news/business/21576161-aereo-small-
start-up-has-infuriated-television-executives-signalled-out.
-6-
retransmissions of copyrighted television
programming over the Internet without
consent would thus threaten to
destabilize the entire industry.
691 F.3d at 286 (citations omitted). These concerns apply
with equal force here.
B. Uniformity of the Court's Decisions
En banc rehearing is also appropriate when
"necessary to secure or maintain uniformity of the court's
decisions." Fed. R. App. P. 35(a)(1). Here, the majority's
decision conflicts with our precedent, as this Court has
repeatedly acknowledged that activity similar to Aereo's
constitutes copyright infringement.
In ivi, for example, although the issue was not
even contested, we recognized that retransmitting
copyrighted television programming by streaming it live over
the Internet constituted a public performance in violation
of the Copyright Act. See 691 F.3d at 278, 286-87.
Similarly, in United States v. American Society of
Composers, Authors & Publishers, 627 F.3d 64 (2d Cir. 2010)
("ASCAP"), cert. denied, 132 S. Ct. 366 (2011), where,
again, the issue was not even contested, we observed that
the streaming of a song, like the streaming of a "television
or radio broadcast," is a public performance. Id. at 74(but holding that downloads of music do not constitute
public performances). Finally, in Infinity Broadcast Corp.
-7-
v. Kirkwood, 150 F.3d 104 (2d Cir. 1998), it was undisputed
that providing users with access to receivers connected to
private phone lines -- arguably the equivalent of the
individual antennas here -- so they could listen to public
radio broadcasts in remote locations was a public
performance. Id. at 106-07, 111-12. 11
There is no substantive difference between what
the retransmitters in ivi, ASCAP, and Kirkwood did and what
Aereo does here. While Aereo argues that its purportedly
individual antennas and unique copies render its
performances private, the tiny antennas and copies are
technologically superfluous. The majority's decision, if
permitted to stand, casts doubt on all these cases.
II. Aereo's Service Violates the Copyright Act
In my dissent from the panel majority's decision,
I explained why Aereo's unlicensed retransmissions are
illegal public performances under the Copyright Act. 712
F.3d at 697-701. I summarize those reasons here.
11
See also Fox Television Stations, Inc. v. BarryDriller
Content Sys., PLC, No. CV 12-6921, 2012 WL 6784498, at *1, *3-6
(C.D. Cal. Dec. 27, 2012) (holding that a service
"technologically analogous" to Aereo was publically performing
television broadcasts by streaming them over the Internet);
Warner Bros. Entm't, Inc. v. WTV Sys., Inc., 824 F. Supp. 2d
1003, 1007-12 (C.D. Cal. 2011) (holding that allowing customers
to "rent" a remote DVD player and stream movies over the Internet
was a public performance); Video Pipeline, Inc. v. Buena Vista
Home Entm't, Inc., 192 F. Supp. 2d 321, 332 (D.N.J. 2002)
(holding that streaming movie clips over the Internet was a
public performance), aff'd, 342 F.3d 191 (3d Cir. 2003).
-8-
A. The Language of the Statute
The text of the Copyright Act makes clear that
Aereo is infringing upon the broadcasters' exclusive right
"to perform the copyrighted work[s] publicly." 17 U.S.C.
§ 106(4). The Copyright Act defines "[t]o perform or
display a work 'publicly'" as:
(1) to perform or display it at
a place open to the public or at any
place where a substantial number of
persons outside of a normal circle
of a family and its social
acquaintances is gathered [the
"performance clause"]; or
(2) to transmit or otherwise
communicate a performance or display
of the work to a place specified by
clause (1) or to the public, by
means of any device or process,
whether the members of the public
capable of receiving the performance
or display receive it in the same
place or in separate places and at
the same time or at different times
[the "transmit clause"].
Id. § 101. To "transmit" a performance means "to
communicate it by any device or process whereby images or
sounds are received beyond the place from which they are
sent." Id.
Aereo's system fits squarely within the plain
meaning of the transmit clause. The system is a "device or
process," which Aereo uses first to receive copyrighted
images and sounds and then to transmit them to its
-9-
subscribers "beyond the place from which they are sent,"
that is, beyond the point of origination. Its subscribers
are strangers -- paying "members of the public" 12 -- and
under the statute, it matters not whether they are receiving
the images "in the same place or in separate places, [or] at
the same time or at different times." Under any reasonable
construction of the statute, Aereo is performing the
broadcasts publicly as it is transmitting copyrighted works
"to the public." Therefore, Aereo is committing copyright
infringement within the plain meaning of the statute.
B. The Legislative History
To the extent the statute is ambiguous, its
legislative history supports the conclusion that Aereo is
engaging in public performances. In Fortnightly Corp. v.
United Artists Television, Inc., 392 U.S. 390 (1968), and
Teleprompter Corp. v. Columbia Broadcasting System, Inc.,
415 U.S. 394 (1974), the Supreme Court held that community
antenna television ("CATV") systems -- which captured public
television broadcasts with antennas set on hills and
12
While "the public" and "members of the public" are
undefined, some guidance is provided by the performance clause,
which defines "[t]o perform or display a work 'publicly'" as "to
perform or display it at a place open to the public or at any
place where a substantial number of persons outside of a normal
circle of a family and its social acquaintances is gathered." 17
U.S.C. § 101 (emphasis added).
-10-
retransmitted them to their subscribers without a license --
were not "performing" the works and thus were not committing
copyright infringement. Congress, however, expressly
rejected this outcome when it passed the 1976 Copyright Act.
See Capital Cities Cable, Inc. v. Crisp, 467 U.S. 691, 709
(1984). It revised the definitions of "perform" and
"publicly" in the 1976 Act specifically to render the CATV
systems' unlicensed retransmissions illegal. See Sony Corp.
of Am. v. Universal City Studios, Inc., 464 U.S. 417, 469
n.17 (1984); H.R. Rep. No. 94-1476, at 63, reprinted in 1976
U.S.C.C.A.N. 5659, 5677 ("[A] cable television system is
performing when it retransmits the broadcast to its
subscribers . . . .").
Congress was not just concerned about the then-
newly-emerging CATV systems. Rather, it broadly defined the
term "transmit" to ensure that all future technological
advances would be covered. It explained that:
The definition of "transmit" . . .
is broad enough to include all
conceivable forms and combinations
of wires and wireless communications
media, including but by no means
limited to radio and television
broadcasting as we know them. Each
and every method by which the images
or sounds comprising a performance
or display are picked up and
-11-
conveyed is a "transmission," and if
the transmission reaches the public
in [any] form, the case comes within
the scope of clauses (4) or (5) of
section 106.
H.R. Rep. No. 94-1476, at 64, reprinted in 1976 U.S.C.C.A.N.
at 5678 (emphasis added). Congress also specified that a
public performance could be received in different places and
at different times. Id. at 64-65, reprinted in 1976
U.S.C.C.A.N. at 5678. Congress thus made clear its intent
to require a license for "[e]ach and every method by which
the images or sounds comprising a performance or display are
picked up and conveyed" -- "if the transmission reaches the
public." Id. Hence, no matter how Aereo's system functions
as a technical matter, because its unlicensed
retransmissions reach the public, it is surely engaging in
copyright infringement as Congress intended the statute to
be interpreted.
III. Cablevision Was Wrongly Decided
The panel majority's decision is based entirely on
Cablevision. In my view, however, as some of the
broadcasters argue, Cablevision was wrongly decided. Of
course, I was the district judge in Cablevision, and I
recognize that the panel was bound by the Court's decision
in Cablevision, to the extent the decision is controlling.
-12-
But rehearing these cases en banc would also give the Court
the opportunity to reconsider Cablevision.
Cablevision involved a cable operator
(Cablevision) with licenses to retransmit broadcast and
cable programming to its paying subscribers. Twentieth
Century Fox Film Corp. v. Cablevision Sys. Corp., 478 F.
Supp. 2d 607, 610 (S.D.N.Y. 2007), rev'd sub nom. Cartoon
Network LP, LLLP v. CSC Holdings, Inc., 536 F.3d 121 (2d
Cir. 2008). Television content providers sought to enjoin
Cablevision's Remote Storage Digital Video Recorder system
(the "RS-DVR"), which allowed customers to record
Cablevision's licensed live retransmissions with equipment
located at Cablevision's facilities and then to play back
those programs on their home television sets. Cablevision,
536 F.3d at 124-25. In essence, the RS-DVR functioned just
like a set-top digital video recorder ("DVR"), except that
Cablevision had to transmit the copies from its remote
facility to the user's household. See id. The content
providers argued that Cablevision needed additional licenses
to do so because it was transmitting their copyrighted
content to the public. Twentieth Century Fox Film Corp.,
478 F. Supp. 2d at 609. This Court rejected that argument
"[b]ecause each RS-DVR playback transmission is made to a
single subscriber using a single unique copy produced by
-13-
that subscriber . . . [and thus] such transmissions are not
performances 'to the public.'" Cablevision, 536 F.3d at
139.
Since that decision was filed in 2008,
Cablevision's interpretation of the transmit clause has been
the subject of much academic criticism. 13 Even the United
13
See, e.g., 2 Paul Goldstein, Goldstein on Copyright
§ 7.7.2, at 7:168 (3d ed. Supp. 2012) ("The error in the Second
Circuit's construction of the transmit clause was to treat
'transmissions' and 'performance' as synonymous, where the Act
clearly treats them as distinct -- and different -- operative
terms."); Daniel L. Brenner & Stephen H. Kay, ABC v. Aereo, Inc.:
When Is Internet Distribution a "Public Performance" Under
Copyright Law, Intell. Prop. & Tech. L.J., Nov. 2012, at 12, 15
("In a world of digital server technology, why should
infringement turn on whether the defendant uses a less efficient,
separate copy system than using a common master copy for each
customer requesting one?"); Jane C. Ginsburg, Recent Developments
in US Copyright Law -- Part II, Caselaw: Exclusive Rights on the
Ebb? 26 (Columbia Pub. Law & Legal Theory Working Papers 2008),
available at http://lsr.nellco.org/cgi/viewcontent.cgi?article
=1050&context=columbia_pllt [hereinafter Ginsburg, Recent
Developments] ("The phrase 'members of the public capable of
receiving the performance' is not intended to narrow the universe
of 'the public.' On the contrary, its role is to clarify that a
transmission is still 'to the public' even if its receipt is
individualized."); Jane C. Ginsburg, WNET v. Aereo: The Second
Circuit Persists in Poor (Cable)Vision, Media Inst., Apr. 23,
2013, www.mediainstitute.org/IPI/2013/042313.php [hereinafter
Ginsburg, Poor (Cable)Vision] ("[T]he decision offered a roadmap
that would considerably undermine the public performance right,
possibly evading its application to new business models for
digital content delivery."); Jeffrey Malkan, The Public
Performance Problem in Cartoon Network LP v. CSC Holdings, Inc.,
89 Or. L. Rev. 505, 532 (2010) ("The statute does not say
'capable of receiving the transmission.' Switching the words
'performance' and 'transmission' changed the outcome of the
case . . . ."); Mary Rasenberger & Christine Pepe, Copyright
Enforcement and Online File Hosting Services: Have Courts Stuck
the Proper Balance?, 59 J. Copyright Soc'y U.S.A. 627, 693 (2012)
("The ability to hold a service directly liable for publicly
performing copyrighted works online has also been severely
curtailed by the potential loophole created by the Cablevision
decision and its recent progeny, Aer[e]o.").
-14-
States, in its amicus brief opposing the grant of certiorari
in Cablevision, argued that this portion of the decision
"could be read to endorse overly broad, and incorrect,
propositions about the Copyright Act." 14 Specifically, the
government acknowledged the argument that Cablevision could
be construed to authorize a legally "suspect" service "in
which the subscriber 'will simply send an electronic request
first to 'copy' and then to 'play' the desired work.'" 15
More recently, the Central District of California has
declined to follow Cablevision, in a case involving a system
"technologically analogous" to Aereo's system, after
concluding that Cablevision's "focus on the uniqueness of
the individual copy from which a transmission is made is not
commanded by the statute." Fox Television Stations, Inc. v.
BarryDriller Content Sys., PLC, No. CV 12-6921, 2012 WL
6784498, at *1, *3-5 (C.D. Cal. Dec. 27, 2012), appeal
docketed sub nom., Fox Television Stations, Inc. v.
Aereokiller, LLC, No. 13-55156 (9th Cir. filed Jan. 25,
2013).
14
See Brief for the United States as Amicus Curiae at 6,
Cable News Network, Inc. v. CSC Holdings, Inc., 129 S. Ct. 2890(2009) (No. 08-448), 2009 WL 1511740 [hereinafter "U.S.
Cablevision Amicus Br."].
15
Id. at 21. The government nonetheless opposed the
granting of certiorari because it believed the procedural posture
of the case made it "an unsuitable vehicle for clarifying the
proper application of copyright principles to technologies like
the one at issue." Id. at 6.
-15-
These criticisms are well-founded. In my opinion,
the Court should take this opportunity to reconsider
Cablevision's interpretation of the transmit clause because
the decision conflicts with the text of the statute in the
following ways.
1. "Transmission" Instead of "Performance"
First, Cablevision held that "the transmit clause
directs us to identify the potential audience of a given
transmission" and if the "transmission is made to a single
subscriber using a single unique copy produced by that
subscriber," then the transmission is a private performance
because no one else can receive it. Cablevision, 536 F.3d
at 139. In reaching this conclusion, this Court erroneously
conflated the phrase "performance or display" with the term
"transmission," shifting the focus of the inquiry from
whether the transmitter's audience receives the same content
to whether it receives the same transmission. 16
16
See Malkan, supra note 13, at 536 ("[E]ven though the
transmit clause refers, as [Cablevision] put it, to 'the
performance created by the act of transmission,' a transmission
and a performance remain, technically and legally, two distinct
things. The difference between them is that a transmission is
the medium through which a performance is delivered 'to the
public.' This is why there may be more than one transmission of
the same performance, that is, why members of the public may
receive a public performance at 'different times.'" (citations
omitted)).
-16-
This Court in Cablevision reasoned that "[t]he
fact that the statute says 'capable of receiving the
performance,' instead of 'capable of receiving the
transmission,' underscores the fact that a transmission of a
performance is itself a performance." Cablevision, 536 F.3d
at 134 (emphasis added). But unless a contrary result is
readily apparent, we generally presume Congress intends
different terms in the same statute to have different
meanings. Sebelius v. Auburn Reg'l Med. Ctr., 133 S. Ct.
817, 825 (2013). Here, there is no reason to assume
Congress intended "performance" and "transmission" to have
the same meaning. Although Congress defined "[t]o
perform . . . a work 'publicly'" as "to transmit . . . to
the public," this is the definition of "publicly," not
"perform." See 17 U.S.C. § 101. Neither "to perform" 17 nor
"to display"18 is defined as "to transmit." See id. In
fact, like "publicly," the definition of "to transmit" 19
17
"To 'perform' a work means to recite render, play,
dance, or act it, either directly or by means of any device or
process or, in the case of a motion picture or other audiovisual
work, to show its images in any sequence or to make the sounds
accompanying it audible." 17 U.S.C. § 101.
18
"To 'display' a work means to show a copy of it, either
directly or by means of a film, slide, television image, or any
other device or process or, in the case of a motion picture of
other audiovisual work, to show individual images
nonsequentially." 17 U.S.C. § 101.
19
"To 'transmit' a performance or display is to
communicate it by any device or process whereby images or sounds
-17-
also distinguishes the "performance or display" from the
process by which they are transmitted. See id. Even within
the transmit clause itself, it would be counterintuitive to
conclude that "transmission" is synonymous with
"performance" because "the members of the public capable of
receiving the performance or display . . . [can receive it]
in the same place or in separate places and at the same time
or at different times." Id. (emphasis added). It is
difficult to imagine a single transmission capable of
reaching people "in separate places" and "at different
times."20
are received beyond the place from which they are sent." 17
U.S.C. § 101.
20
As Professor Jane C. Ginsburg has noted:
Reading the statute to equate
"transmission" with "performance" reads
"different times" out of the statute.
Once one recognizes that it is not
possible for the two people to receive
the same transmission "at different
times," then it becomes clear that the
"public" character of the transmission
cannot turn on capacity to receive a
transmission. Rather, what makes a
transmission, whether simultaneous or
individualized on-demand, and whatever
the number of source copies, "public" is
its communication to "members of the
public."
Ginsburg, Poor (Cable)Vision, supra note 13.
-18-
Thus, there is no indication Congress meant
anything other than what it said: the public must be
capable of receiving the performance or display, not the
transmission. All that matters is whether the transmitter
is enabling members of the public to receive the copyrighted
work embodied in the performance or display, not whether
they can receive the same legally insignificant
transmission. See Fox Television Stations, Inc., 2012 WL
6784498, at *4 ("Very few people gather around their
oscilloscopes to admire the sinusoidal waves of a television
broadcast transmission."). It makes no difference whether
each member of the public receives the work by means of
several individualized, asynchronous transmissions or a
single, shared transmission.
2. Aggregation and "Copies"
Second, having conflated the terms "performance"
and "transmission," the Court tried to accommodate the
problematic "in separate places" and "at different times"
language. By focusing on the unique transmission,
Cablevision first discerned a rule that individualized
transmissions should not be aggregated when determining
whether a transmission is a public performance. See
Cablevision, 536 F.3d at 138. The Court then recognized an
-19-
exception to that rule, however, when multiple private
transmissions are made from the same copy of the work. See
id. According to this exception, "if the same copy of a
given work is repeatedly played (i.e., 'performed') by
different members of the public, albeit at different times,
this constitutes a 'public' performance." Id. (alteration
and internal quotation marks omitted) (quoting 2 Melville B.
Nimmer & David Nimmer, Nimmer on Copyright § 8.14[C][3], at
8-142 (2007)); see also WNET, Thirteen, 712 F.3d at 688-89 &
n.11 (explaining that Cablevision's "exception to this no-
aggregation rule," although "in some tension" with the
Court's focus on the particular transmission, is "a way to
reconcile the 'different times' language" that Cablevision
otherwise "would essentially read out" of the statute).
The Court derived these principles from a Third
Circuit case and a treatise, even though -- as the Court
acknowledged -- neither source "explicitly explain[ed] why
the use of a distinct copy affects the transmit clause
inquiry." Cablevision, 536 F.3d at 138 (citing Columbia
Pictures Indus., Inc. v. Redd Horne, Inc., 749 F.2d 154, 159
(3d Cir. 1984); 2 Nimmer on Copyright § 8.14[C][3]).
Nevertheless, the Court agreed with "their intuition"
-20-
because "the use of a unique copy may limit the potential
audience of a transmission." Id. Perhaps when it was more
costly to make copies, the use of a unique copy could limit
a transmitter's potential audience, but advancements in
technology have rendered such reasoning obsolete.18
But even assuming this logic were still to hold
true today, it ignores the fact that the definition of "to
perform . . . a work 'publicly'" does not use the terms
"copy" or "copies." Nor does the legislative history. See
Fox Television Stations, 2012 WL 6784498, at *3-4. If
Congress had intended the definition to turn on whether a
unique copy was used, it knew how to say so. Indeed,
Congress defined "copies" in the same section of the
Copyright Act. See 17 U.S.C. § 101. Moreover, it defined
that term as "material objects . . . in which a work is
fixed," and it included the following sentence in the
definition of "fixed": "A work consisting of sounds,
images, or both, that are being transmitted, is 'fixed' for
purposes of this title if a fixation of the work is being
18
See Dennis S. Karjala, "Copying" and "Piracy" in the
Digital Age, 52 Washburn L.J. 245, 263 (2013) ("In the early days
of digital technology, when memory was costly, such designs may
have been prohibitively expensive, but now that memory is cheap,
they simply become technologically inefficient or inelegant.").
-21-
made simultaneously with its transmission." Id. (emphases
added). In other words, Congress plainly envisioned
transmissions that did not involve any copies.19 Thus, it
is unlikely that Congress intended the transmit clause
inquiry to turn on the existence of "copies." See Fox
Television Stations, 2012 WL 6784498, at *4 ("Cablevision's
focus on the uniqueness of the individual copy from which a
transmission is made is not commanded by the statute.").
3. "Transmission" Instead of "Transmitting"
Third, the problem of determining which individual
transmissions to aggregate only arises because the Court
disaggregated the act of transmitting into isolated
transmissions. The Copyright Act does not use the noun
"transmission," nor the nouns "public performance" nor
"private performance," but instead uses the verbs "to
perform . . . a work 'publicly'" and "to transmit . . . to
the public." 17 U.S.C. § 101. It is the transmitter's
actions that render him liable, not his individual
19
Compare H.R. Rep. No. 94-1476 at 63, reprinted in 1976
U.S.C.C.A.N. at 5676-77 ("[A] sing[er] is performing when he or
she sings a song; a broadcasting network is performing when it
transmits his or her performance (whether simultaneously or from
records) . . . ." (emphasis added)), with Cablevision, 536 F.3d
at 137 ("[N]o transmission of an audiovisual work can be made, we
assume, without using a copy of that work . . . ." (emphasis
added)).
-22-
transmissions,20 and he can "transmit" by sending one
transmission or multiple transmissions. Thus, there is no
textual reason why each individual transmission must be able
to reach the public. Based on the plain language, it is
sufficient if the actor is "transmit[ting]" the same
performance or display and his recipients are members of the
public.21
4. Transmit Clause, but not Performance Clause
Fourth, the Court erred by looking at the transmit
clause in isolation, rather than in context with the
performance clause. See Cablevision, 536 F.3d at 134.
Congress clearly meant for the two clauses to work in
conjunction. The performance clause covers the act of
performing or displaying a work at a single place open to
the public, while the transmit clause covers the act of
transmitting the work either to such a public place or to
any other place (or places) where the public can receive it.
See 17 U.S.C. § 101. Thus, only the performance clause
requires that the public be able to view the performance or
20
See H.R. Rep. No. 94-1476 at 63, reprinted in 1976
U.S.C.C.A.N. at 5676-77 ("[T]he concepts of public performance or
public display cover not only the initial rendition or showing,
but also any further act by which that rendition or showing is
transmitted or communicated to the public." (emphasis added)).
21
See Ginsburg, Recent Developments, supra note 13, at
26.
-23-
display at the same time and place; the transmit clause
expressly removes that limitation. 22 Moreover, the
performance clause identifies at least one group included
within the meaning of "the public": "a substantial number
of persons outside of a normal circle of a family and its
social acquaintances." Id. This explanatory phrase,
turning on the relationship between the transmitter and the
recipients, accords with the plain meaning of "the public,"
see WNET, Thirteen, 712 F.3d at 698-99 (Chin, J.,
dissenting), and provides a textual basis for distinguishing
between public and private performances. 23
5. "Copies" Instead of "Any Device or Process"
Finally, the Court's reliance on "copies" ignores
Congress's specification that transmitting "to the public,
by means of any device or process," constitutes performing
22
See H.R. Rep. No. 94-1476 at 64, reprinted in 1976
U.S.C.C.A.N. at 5678 ("Clause (2) of the definition of 'publicly'
in section 101 makes clear that the concepts of public
performance and public display include not only performances and
displays that occur initially in a public place, but also acts
that transmit or otherwise communicate a performance or display
of the work to the public by means of any device or process.").
23
See H.R. Rep. No. 94-1476 at 64, reprinted in 1976
U.S.C.C.A.N. at 5678 ("One of the principal purposes of the
[performance clause] definition was to make clear that . . .
performances in 'semipublic' places such as clubs, lodges,
factories, summer camps, and schools are 'public performances'
subject to copyright control. The term 'a family' in this
context would include an individual living alone, so that a
gathering confined to the individual's social acquaintances would
normally be regarded as private.").
-24-
the work publicly. 17 U.S.C. § 101 (emphasis added). Not
only is the word "any" naturally expansive, see United
States v. Gonzales, 520 U.S. 1, 5 (1997), but Congress also
defined both "device" and "process" broadly as "one[s] now
known or later developed," 17 U.S.C. § 101. It is obvious
from the text that Congress intended "any device or process"
to have the broadest possible construction so that it could
capture technologies that were unimaginable in 1976. 24 Even
if the statute were ambiguous in this regard, the
legislative history removes all doubt about Congress's
intentions.25
Furthermore, Congress used this same expansive
language to protect against unforeseen methods of copying
copyrighted works. See 17 U.S.C. § 101 (defining "[c]opies"
as "material objects . . . in which a work is fixed by any
method now known or later developed" (emphasis added)). It
is inconceivable that Congress would use these broad terms
24
See David v. Showtime/The Movie Channel, Inc., 697 F.
Supp. 752, 759 (S.D.N.Y. 1988) ("[I]t would strain logic to
conclude that Congress would have intended the degree of
copyright protection to turn on the mere method by which
television signals are transmitted to the public."); see also
Nat'l Football League v. PrimeTime 24 Joint Venture, 211 F.3d 10,
12-13 (2d Cir. 2000) (adopting David's reasoning).
25
See H.R. Rep. No. 94-1476 at 64, reprinted in 1976
U.S.C.C.A.N. at 5678 (explaining that "transmit" was defined
broadly to "include all conceivable forms and combinations of
wires and wireless communications media, including but by no
means limited to radio and television broadcasting as we know
them").
-25-
to protect against future methods of both copying and
transmitting, but also intend to create a loophole by which
transmitters can avoid liability by first copying works and
then transmitting the copies (rather than originals) to
individual members of the public. 26 Such a system is still
just a "device or process" by which the transmission is made
to the public.
Cablevision's focus on whether the public is
capable of receiving each individual transmission and the
technicalities of how that transmission process works is
incompatible with the statute. By declining to rehear these
cases en banc, the Court misses an opportunity to reconsider
Cablevision and correct its misinterpretation of the
Copyright Act.
IV. Cablevision Should Not Be Extended
Even assuming that Cablevision was correctly
decided, its holding should be limited to its facts.
Cablevision primarily reasoned that the RS-DVR was no
different than a set-top DVR, and that Cablevision should
not have additional liability for transmitting the RS-DVR
26
See U.S. Cablevision Amicus Br., supra note 14, at 21
(considering the argument that Cablevision permitted companies to
"provide [video on-demand] services without a license by
establishing a system in which the subscriber 'will simply send
an electronic request first to 'copy' and then to 'play' the
desired work'" and concluding that the "legality of [this]
conduct would be suspect at best").
-26-
copies to its subscribers when it already paid licensing
fees to retransmit the material live. The Cablevision panel
never considered how its rationale might apply to a device
like Aereo's, which uses individual antennas and unique
copies as a means to avoid paying licensing fees altogether.
The Court did, however, "emphasize" that its holding "does
not generally permit content delivery networks to avoid all
copyright liability by making copies of each item of content
and associating one unique copy with each subscriber to the
network, or by giving their subscribers the capacity to make
their own individual copies." Cablevision, 536 F.3d at 139.
Likewise, when the United States opposed the grant of
certiorari in Cablevision, it argued that "the court of
appeals' analysis of the public-performance issue should not
be understood to reach . . . other circumstances beyond
those presented." 27 Accordingly, Cablevision should never
have been extended to Aereo's unlicensed service. Even
Cablevision itself has submitted an amicus brief in these
cases arguing that Cablevision should not be extended to the
facts here.
Admittedly, there are some technological
similarities between the RS-DVR and Aereo's system, but
there are also important differences. Most significantly,
27
U.S. Cablevision Amicus Br., supra note 14, at 6, 21.
-27-
Cablevision paid statutory licensing and retransmission
consent fees for the content it retransmitted, while Aereo
pays no such fees. Cablevision subscribers already had the
ability to view television programs in real-time through
their authorized cable subscriptions, and the RS-DVR was
merely a supplemental service that allowed subscribers to
store that authorized content for later viewing. The RS-DVR
system made copies only as part of its storage and time-
shifting functions, and the copies were made only of
material that Cablevision already had a license to
retransmit to its subscribers. In contrast, no part of
Aereo's system is authorized. Instead, its storage and
time-shifting functions are an integral part of an
unlicensed retransmission service that captures broadcast
television programs and streams them live over the Internet.
It produces copies not to supplement its authorized
retransmission service, but to enable it to retransmit
programming to its subscribers without a license. Hence,
Aereo's system of antennas and copies are the means by which
Aereo transmits copyrighted broadcasts to the public. See
17 U.S.C. § 101.
By extending Cablevision, the panel decision
eviscerates the Copyright Act: although it is generally
unlawful to capture and retransmit public television over
-28-
the Internet without a license, see ivi, 691 F.3d at 278,
entities may now do so as long as they utilize individual
antennas and unique copies, even though the antennas and
copies functionally are unnecessary, and even though the
programs are retransmitted to members of the public, see
WNET, Thirteen, 712 F.3d at 689-94. These sorts of legal
pronouncements, based solely on the technology of the day,
are sure to be short-lived. "Instead of the law adapting
itself to meet the needs of society under conditions of new
technology, these judicial interpretations [merely] push
technology in odd directions as systems engineers seek to
avoid falling on the wrong side of what is essentially an
arbitrary line." Dennis S. Karjala, "Copying" and "Piracy"
in the Digital Age, 52 Washburn L.J. 245, 263 (2013). This
is precisely what has happened here. Cablevision's reliance
on unique copies in 2008 has opened the door in 2013 for
Aereo to design a Rube Goldberg-like contraption using
miniature antennas and unique copies to flout Congress's
licensing regime.
Congress purposely declined to identify specific
technologies or processes in the Copyright Act because it
realized that such definitions would be destined for
obsolescence. Indeed, the hardware and technology in
Cablevision and the antennas and wiring at issue here are
-29-
fast becoming obsolete in this era of the "Cloud" and
wireless technology. Courts should follow Congress's lead
and resist the urge to look "under the hood" at how these
processes technically work. Instead, our inquiry should be
a functional one, as set forth in the statute: does the
device or process transmit a copyrighted performance or
display to the public? In Aereo's case, the answer is
clearly yes.28
CONCLUSION
As I wrote in my panel dissent, the majority's
decision elevates form over substance. It holds that a
commercial enterprise that sells subscriptions to paying
strangers for a broadcast television retransmission service
is not performing those works publicly. It reaches that
conclusion by accepting Aereo's argument that its system of
thousands of tiny antennas and unique copies somehow renders
these transmissions "private." In my view, however, the
system is a sham, as it was designed solely to avoid the
28
See 17 U.S.C. § 101; H.R. Rep. No. 94-1476 at 64,
reprinted in 1976 U.S.C.C.A.N. at 5678 ("Each and every method by
which the images or sounds comprising a performance or display
are picked up and conveyed is a 'transmission,' and if the
transmission reaches the public in [any] form, the case comes
within the scope of clauses (4) or (5) of section 106."); see
also Nat'l Football League, 211 F.3d at 13 ("[T]he most logical
interpretation of the Copyright Act is to hold that a public
performance or display includes 'each step in the process by
which a protected work wends its way to its audience.'" (citation
omitted)).
-30-
reach of the Copyright Act and to take advantage of a
perceived loophole in the law purportedly created by
Cablevision. Both the majority's decision and Cablevision's
interpretation of the transmit clause are inconsistent with
the language of the statute and congressional intent. This
decision upends settled industry expectations and
established law. It should not be permitted to stand, and
the Court should have taken this opportunity to clarify that
Cablevision does not provide "guideposts" on how to avoid
compliance with our copyright laws. Because it declines to
do so, I respectfully dissent.
-31-