Aereo: Okay, Fine, If You Say We Look Like A Duck, We'll Quack Like A Duck
from the let's-pay-up dept
In the wake of the Aereo ruling, I’d been meaning to do a post questioning whether or not the ruling had effectively overturned the ruling in the ivi case from a few years earlier. We had seen some people in our comments point out that, following the Aereo ruling, Aereo had an easy solution: just start paying retransmission fees. Except… that’s exactly what ivi had tried to do, and the court had shut them down, using almost the opposite reasoning as the Supreme Court. Specifically, the Second Circuit appeals court (the same that had decided in Aereo’s favor) ruled that internet services were not cable companies under the law, and couldn’t just pay retrans fees:
Congress did not, however, intend for Section 111’s compulsory license to extend to Internet transmissions. Indeed, the legislative history indicates that if Congress had intended to extend Section 111’s compulsory license to Internet retransmissions, it would have done so expressly — either through the language of Section 111 as it did for microwave retransmissions or by codifying a separate statutory provision as it did for satellite carriers. See 17 U.S.C. §§ 111, 119.
Extending Section 111’s compulsory license to Internet retransmissions, moreover, would not fulfill or further Congress’s statutory purpose. Internet retransmission services are not seeking to address issues of reception and remote access to over-the-air television signals. They provide not a local but a nationwide (arguably international) service.
Accordingly, we conclude that Congress did not intend for Section 111’s compulsory license to extend to Internet retransmissions.
So, uh, which is it? Aereo has now decided that if the Supreme Court is going to call it a duck for looking like a duck, it’s damn well going to quack like a duck too. It has told the lower court that it intends to pay retransmission fees under Section 111, more or less claiming directly that the Supreme Court overruled the ivi ruling. For what it’s worth, Aereo’s “wacky” (but seriously questionable) “competitor” FilmOn, already made a similar declaration of being a cable company, though as we’ve learned with FilmOn, you should take almost every claim it makes with a huge grain of salt.
Of course, this is a big problem with the Supreme Court’s ruling. By coming up with this wacky “looks like a duck” test, it’s encouraging companies like Aereo to use that test in a variety of ways, even though copyright law has never worked that way. Lots of things that “look like” each other face different rules: think of terrestrial radio and internet radio stations. Under the “looks like a duck” test, internet radio stations should be able to declare themselves the same as terrestrial radio stations and stop having to pay performance fees to musicians.
And, of course, the networks themselves don’t like Aereo embracing the duck, even though the company is only doing so because of the network’s own lawsuit.
On July 1, however, its counsel suggested that Aereo has rethought its entire legal strategy and will raise before this Court a brand new defense based on Section 111 of the Copyright Act. Aereo never before pled (much less litigated) Section 111 as an affirmative defense. Whatever Aereo may say about its rationale for raising it now, it is astonishing for Aereo to contend the Supreme Court?s decision automatically transformed Aereo into a ?cable system? under Section 111 given its prior statements to this Court and the Supreme Court.
But it’s not Aereo that made that decision. It’s pretty clearly the Supreme Court and its stupid “looks like a duck” test. The entertainment industry might want to be careful what it wishes for. It applauded the dreadful looks like a duck test, and now it’s freaking out when Aereo actually tries to apply it.