“I Scream, You Scream, We All Scream for…iStream!” Aereo Online Video Streaming Case Heads to Supreme Court

Agreeing to decide a case involving one of the most contentious and unresolved issues in copyright law, the Supreme Court recently announced that it would hear a lawsuit brought by major television broadcasters against a service that streams the broadcasters’ video content over the internet without permission.

The case, ABC, Inc. v. Aereo, Inc., stems from claims by the broadcasters that Aereo violates their copyrights by streaming free-to-air television content to the computers and mobile devices of paying Aereo subscribers. Although the subscribers could watch the content for free over the public airwaves, the broadcasters argue that Aereo is essentially “retransmitting” their protected content for the company’s own financial gain, while avoiding paying any licensing fees to the broadcasters. The broadcasters argue that Aereo and other video streaming services should be required to pay the same licensing and retransmission fees that cable and satellite companies pay to rebroadcast content. They also argue that a Supreme Court ruling for Aereo could jeopardize the future of free-to-air TV and lead broadcasters to move to cable.

Streaming video services have generated a significant amount of copyright litigation in recent years. Section 106 of the federal Copyright Act grants copyright holders six exclusive rights, including the right to perform a work publicly. Courts have sharply disagreed over whether online video streaming meets the definition of a “public performance.” The Second Circuit, which decided the Aereo case, has repeatedly held that whether a performance is “public” depends on “the persons capable of receiving it.” Essentially, so long as Aereo is streaming video directly to individual subscribers and not to a mass audience, the Second Circuit has reasoned that the performance is not public and is therefore permissible. The Second Circuit’s position generated a strong dissent from Judge Denny Chin, who argued that Aereo is “over-engineered” to take advantage of a loophole in the Copyright Act. Other courts, including federal district courts in DC and California, have also disagreed with the Second Circuit, finding that a performance that is made generally available to members of the public, even if each member of the public views their own unique copy in the privacy of their home, constitutes a public performance.

Recently, broadcasters accelerated their legal fight against streaming video services like Aereo and rival FilmOn, filing lawsuits in courts around the country in an effort to force the online services to stop streaming their content, as well as to increase the likelihood that the Supreme Court would be forced to address the issue and resolve a growing split among the federal circuits. Now it appears the broadcasters have gotten their wish.

The Supreme Court’s decision in the case could significantly impact the ability of copyright holders to control how their works are distributed over the internet. Arguments in the case have not yet been scheduled. Arent Fox will continue to monitor Aereo and related cases. In the meantime, please contact Anthony V. Lupo, Matthew R. Mills, Amy E. Salomon, or Daniel B. Jasnow with questions.