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9th Circuit Rejects FilmOn Streaming of Broadcast Channels

The 9th Circuit Court of Appeals on Tuesday rejected a bid by FilmOn to stream broadcast channels over the Internet under a provision of the Copyright Act of 1976.

FilmOn argues that it should be allowed to stream broadcast TV online under an exception to the Copyright Act intended for cable operators. The act granted cable companies the right to a “compulsory license” to distribute broadcast channels for a nominal fee.

But in its ruling, a three-judge panel of the 9th Circuit found that Congress did not envision that the exception would apply to internet-based distribution. Overturning a district court ruling, the panel reinstated a copyright claim against FilmOn filed by the major broadcasters, including Fox, NBC, CBS, and Disney.

The panel did acknowledge that the statute is ambiguous, and could be read to support either party, but deferred to the Copyright Office, which has consistently found that internet-based services do not qualify as “cable systems” under the law.

“The Copyright Office says they are not eligible. Because the Office’s views are persuasive, and because they are reasonable, we defer to them,” the court ruled.

FilmOn currently streams licensed content, and has repeatedly applied for a compulsory license to stream broadcast TV under the name FilmOn X. In a statement, attorney Ryan Baker said the company is “disappointed” in the ruling.

“FilmOn X continues to believe Congress intended that cable companies could utilize modern communications channels to deliver broadcast television to the American public,” he said.

FilmOn is arguing two similar cases at the D.C. Court of Appeals and the 7th Circuit Court of Appeals.

“FilmOn X remains hopeful that those appellate courts will apply the statute as written and shun any attempt to impose extratextual limitations on the compulsory license,” Baker said.

The company has also sought to legitimize the service through the FCC, and will continue to pursue that avenue, he said.

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