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Aereo Tells Judge It Can Beat Lawsuit Despite Supreme Court Ruling

The digital company also renews a challenge to the irreparable harm faced by TV broadcasters

 Aereo CEO Chet Kanojia - P 2013

On Friday, Aereo filed its opposition to an injunction demanded by television broadcasters. As expected, the digital TV company is asserting that it is a "cable system" and is therefore entitled to a statutory license under Section 111 of the Copyright Act.

Two weeks ago, after U.S. District Judge Alison Nathan said that broadcasters should get the opportunity to first make an injunction motion before Aereo opposed, the plaintiffs did just that with one that was aimed at stopping Aereo from "streaming, transmitting, retransmitting, or otherwise publicly performing any Copyrighted Programming over the Internet... or by means of any device or process throughout the United States of America."

The broadcasters said that it was in keeping with the U.S. Supreme Court's ruling on June 25 to interpret Aereo's system of capturing over-the-air television signals and relaying them to subscribers' digital devices as a violation of broadcasters' public performance rights.

Justice Stephen Breyer likened Aereo to a cable system -- an unlicensed one -- which has led the company to fully embrace the designation in the interest of saving its company.

According to Aereo's memo opposing an injunction, "At oral argument, the [Supreme] Court made clear its understanding that its ruling would entitle Aereo to a Section 111 license when Justice [Sonia] Sotomayor specifically stated, 'We say they’re a c[]able company, they get the compulsory license.'”

"Indeed, the Court specifically found that with respect to its 'Watch Now' functionality, Aereo is a facility that receives television broadcast signals and makes secondary transmissions to its subscribers," continues the brief.

The broadcasters have pointed to arguments why Aereo won't prevail in the copyright case and can't attain a statutory license including WPIX, Inc. v. ivi, Inc., a 2nd Circuit opinion from 2012 that knocked down a statutory license attempt from a Aereo predecessor.

"But ivi concerned nationwide, out-of-market retransmissions that are fundamentally different from Aereo’s in-market-only technology and thus it does not apply here," responds Aereo. "Aereo has paid the statutory license fees required under Section 111, and thus Plaintiffs can no longer complain that they are not being compensated as copyright owners."

Aereo raises another argument about why it is likely to succeed in the case. It points to the safe harbor provisions of the Digital Millennium Copyright Act. Those govern takedown procedures when infringing works are hosted by digital service providers. Aereo says it is entitled to such safe harbor.

The defendant also asserts that the TV broadcasters have failed to show any "irreparable imminent harm" -- one of the two main factors in the issuance of a preliminary injunction -- even though Judge Nathan ruled in favor of the broadcasters on this point when she first denied a preliminary injunction.

"That preliminary finding, however, was based on Plaintiffs’ testimony that Plaintiffs contradicted almost immediately in public statements to investors and that has been further debunked in discovery," says Aereo. "Plaintiffs have admitted that, notwithstanding the fact that Aereo continued to operate and expand in the two years after the denial of the preliminary injunction, they suffered no harm to their retransmission negotiations. For example, the CEO of CBS has said that Aereo has not 'affected us in terms of one sub, one deal, one anything.'”

If those arguments don't work, Aereo is at least seeking to narrow the injunction to cover the live aspect of its service and not the time-shifted DVR functions. In truth, it's that aspect of Judge Nathan's forthcoming decision that warrants closest attention. Other services such as Tivo have recently come out with digital services or products that attempt to exploit antennas and remote-DVR functionality.  Aereo tells the judge, "Cablevision  [a 2008 case] remains the law in this Circuit and Aereo’s time-shifted DVR is functionally identical to the Cablevision system."

Email: Eriq.Gardner@THR.com
Twitter: @eriqgardner