he drama continues to unfold in the world of Internet retransmission of broadcast TV. As we reported here, the Second Circuit on July 16 denied en banc rehearing of its holding that internet re-broadcaster Aereo did not violate TV networks’ public performance rights, despite vigorous dissents from Judges Chin and Wesley. On September 5, the U.S. district court for the District of D.C. stepped in the ring – but into the corner of the Central District of California and its BarryDriller decision – holding that the Copyright Act forbids Aereo copycat FilmOn X from re-transmitting the plaintiffs’ copyrighted programs over the internet, and that the plaintiffs were likely to succeed on the merits of their claim for violation of the public performance right. On September 12, the court reaffirmed its decision, denying the defendant’s request to stay or limit the injunction.
In Fox Television Stations, Inc. v. FilmOn X LLC, many of the same plaintiffs from the Aereo and BarryDriller cases sued FilmOn X (previously known as Aereokiller and BarryDriller.com) for copyright infringement. FilmOn X offers a familiar service, and which the defendant admitted was similar in every respect to the technology in Aereo and BarryDriller: it retransmits broadcast television signals to subscribers for viewing on mobile devices and personal computers (and allows for DVR capabilities) by allocating a tiny antenna (one of thousands) to each individual user at a given time. Plaintiffs sought a preliminary injunction, and FilmOn X counterclaimed for declaratory relief.
Plaintiffs, predictably, relied upon the Central District of California’s BarryDriller decision, arguing that the Transmit Clause was broad enough to encompass FilmOn X’s re-transmission of TV signals. Defendant — with an equal measure of predictability — argued that the Second Circuit, in Cablevision and subsequently Aereo, had found that identical services enabled only private performances due to their technical architecture.
The court made it a point to note that, while it would analyze the predecessor decisions, it would conduct its own, independent analysis. The court reviewed the operative language in the Copyright Act and its legislative history, and concluded that the public performance right was violated. FilmOn X “performed” the works “publicly” by transmitting (through an antenna) the performance (an over-the-air broadcast) to members of the public (those with access to the service) who receive the performance in separate places at different times. The Copyright Act and legislative history indicate that the definitions of “perform,” “publicly,” and “transmit” encompass not only an initial rendition or showing but also any other transmission to the public, and that FilmOn X’s system constituted the necessary “device or process” of transmission.
The court next took on the critical “one-to-one transmission” issue that served as the lynchpin of the Second Circuit’s jurisprudence. Notably, the court found FilmOn X’s characterization of its own one-to-one system was “charitable” and that the one-antenna-to-one-user ratio was a temporary one. Indeed, the antennas were ultimately networked together such that FilmOn X’s architecture could communicate with them all at once and pass a captured signal through a single transmission process any user can access. The court held that this system was “hardly akin to an individual user stringing up a television antenna on the roof” and that “every broadcast of a television program . . . could be described as ‘generated from the same copy’ – the original source.” (Opinion at 27.) Accordingly, the court held that FilmOn X was not likely to succeed on the merits of its case.
The court went on to hold — as every court that has considered the issue has held — that the plaintiffs were at risk of suffering various forms of irreparable harm (including depreciation of the value of network and local advertising and damage to plaintiffs’ ability to negotiate legal retransmission and internet distribution licenses). Finally, the balance of harms tipped in favor of plaintiffs because the networks would face severe harms, while FilmOn X could survive, given that it admittedly was entering into legal retransmission agreements.
Arguably the most interesting aspect of the court’s decision was the scope of the injunction it issued – one that was broader than the Ninth-Circuit-specific injunction issued in BarryDriller, but not quite the all-encompassing injunction plaintiffs requested. Rather, the court issued a nationwide injunction with the exception of the Second Circuit, where Cablevision and Aereo are binding, and conflicting, law.
With a clear and growing circuit split, the FilmOn X decision could possibly push this controversial issue one step closer to Supreme Court consideration.