Nets seek to protect revs from retransmission fees

A Los Angeles federal court is ordering a halt to a start up company’s service that offers streaming of broadcast signals to the Internet and mobile devices, delivering a victory to the networks as they seek to protect their revenue stream from retransmission fees.

Alki David, the colorful entrepreneur who already has faced broadcasters when he offered digital streaming of broadcast signals via his company FilmOn, had launched a new service last summer, dubbed Aereokiller, that provided local stations via remote digital antennas. His company defended the service as legal given a decision by a New York federal court in July to allow startup Aereo to continue to offer digital broadcast signals in the New York market, based on technology in which subscribers are also assigned individual, remote antennas.

Fox Television Stations and NBC Universal, the named plaintiffs in the case, argued that Aereokiller violated public performance provisions of the Copyright Act.

In granting a preliminary injuction, U.S. District Judge George Wu’s decision in favor of the networks was a contrast to the Aereo decision. His ruling on Aereokiller raises the prospect that Aereo will face a less hospitable legal environment if it tries to expand in the western states. Wu made clear that he diverged from the reasoning of U.S. District Judge Alison Nathan, who relied on a 2008 2nd Circuit decision upholding Cablevision’s offering of a remote DVR.

Wu noted that in the 2nd Circuit, “cases there have held that where a transmission of a work over the internet is made from a copy of a work made at the direction of and solely for use by [a] single user, there is no public transmission.”

But he wrote that “Second Circuit law has not been adopted in the Ninth Circuit, and this Court would find that the Ninth Circuit’s precedents do not support adopting the Second Circuit’s position on this issue. Instead, the Court would find that Defendant’s transmissions are public performances, and therefore infringe Plaintiff’s exclusive right of public performance.”

Meanwhile, the networks have appealed the Aereo decision, and are awaiting an opinion from the Second Circuit.

Aereokiller had contended that its system was “better and more legally defensible than Aereo’s.”

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