Did Aereo Kill The Cablevision Ruling That Enabled So Much Innovation? Who The Hell Knows?

from the and-that's-why-it's-a-problem... dept

We've already discussed how the Aereo ruling is a disaster because of its lack of guidance, and a perfect example of that is that reading the decision you would have no idea whether or not it outlaws Cablevision's remote DVR service. None. It all depends on who you talk to. During the oral arguments, it appeared that the Justices recognized that they wanted to keep the important 2nd Circuit ruling that found Cablevision's remote DVR legal, with Justices even asking lawyers to take that ruling as precedent (even though it's not, since the Supreme Court refused to review that ruling). That's why it's been somewhat shocking to many that the final ruling from the Supreme Court doesn't even address Cablevision, other than an aside in a footnote.

And that means it's basically an open question as to whether or not Cablevision's remote DVR is still legal or not.

Cablevision, not surprisingly, insists that the ruling vindicates its position. You may recall that even though Aereo was relying on the Cablevision precedent, Cablevision sided with the broadcasters, stupidly believing that the Supreme Court would reject Aereo while preserving the Cablevision ruling. So, when the ruling came out, the company announced victory:
"We are gratified that the Court's decision adopted a sensible middle ground, holding that unlicensed retransmission services like Aereo violate the copyright law, while protecting consumer-friendly, cloud-based technologies, such as RS-DVR. The real winner today is the consumer who will continue to benefit from future innovation."
The problem is that's not true. The Court doesn't really say a damn thing about Cablevision, and leaves it out to hang based on the amorphous "looks like a" test. Law professor James Grimmelman is pretty sure that the Cablevision ruling is now dead, because the Aereo ruling totally overshadows it and creates this new standard that would clearly wipe out the Cablevision standard. Similarly, law professor Eric Goldman wonders what's left of that ruling:
... because the court said Aereo took the legally significant actions, it's possible this ruling overturned the 2008 Second Circuit ruling, exposing DVR service operators to new liability. The opinion further reinforces the riskiness of DVR-as-a-service when it says the simultaneous delivery of content to multiple viewers is an infringement, even if the system stores and delivers a personal copy for each viewer (the court later implies that even simultaneous delivery isn't required to violate the law).
Another commentator, Deborah Goldman, notes that the SCOTUS ruling "eviscerates" that ruling.

However, not everyone is convinced. Matt Schruers suggests that the Supreme Court effectively side-stepped the question by avoiding even looking at the DVR features of Aereo's system:
Importantly, yesterday's decision doesn't reach the question of Aereo's DVR-like features, and it seems clear that the Court's opinion does not aim to upset Cablevision.
But, of course, there's a difference between aiming to upset Cablevision and actually upsetting Cablevision, and there's nothing in the ruling that suggests a second shot at a remote DVR system won't turn out quite differently, given that plaintiffs can now use the "looks like a duck" test, rather than ever looking into the black box to see if the company hosting the DVR is really doing any infringement. And it gets especially worrisome with non-tech-savvy judges. While Schruers isn't sure if this ruling upsets the Cablevision standard, he is worried about the resulting uncertainty:
On the other hand, the Court's approach offers technology lawyers counseling clients little guidance. Who can predict whether a non-tech savvy federal judge will think that the next innovative service "looks like cable"? Yesterday's decision creates considerable uncertainty, suggesting that lawyers should counsel their clients based on what analogy will most appeal to a federal judge in the distant future. The Court — like others in the lead-up to the decision — promises its opinion won't threaten new technology, but as the dissent points out, it cannot deliver on that promise.
And this is not a small issue. As we've noted, a study by Harvard professor Josh Lerner found that the certainty created by the Cablevision ruling, resulted in somewhere around a billion dollars in new investment. Take that certainty away... and a lot of investment is about to go elsewhere.
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Filed Under: copyright, innovation, looks like a duck, remote dvr, supreme court, uncertainty
Companies: aereo, cablevision

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  1. identicon
    Anonymous Coward, 30 Jun 2014 @ 9:28pm

    It seems to me that SCOTUS operates under the "ends justify the means" philosophy. That is, the Justices assume their conclusions (based on political skew) and contort the law to output the desired conclusion when applied to the facts.

    In essence, this means that the Justices act as persuasive litigators rather than as objective judges. This is very unsettling to me.

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