The oral arguments in the Aereo case happened this morning before the Supreme Court and you can read the transcript here
(it's still a travesty that there is no live broadcasting (or any video recording at all) of the proceedings, but that's a different argument for a different day). As with any such case, this discussion needs to be prefaced with the fact that reading the tea leaves from what Justices say during oral arguments is a unlikely to yield much that is useful. You'll often see large segments of the arguments discuss issues that later don't appear at all in the final ruling. In some cases, Justices are just testing out certain theories or pushing the lawyers to see how they respond. Oral arguments do matter, but not nearly as much as the underlying briefs. We still have a few months (probably) to find out how the Court will rule, but we can at least comment on some of today's discussion.
The important thing to get from the discussion was that the Justices, for the most part, seem to actually recognize that with copyright law the way it is today, finding -- as the broadcasters would like -- that Aereo is engaged in a public performance -- may have long term consequences for all sorts of other industries. It starts off early on, with Justice Sotomayor jumping in with a very different question, concerning whether or not Aereo is a cable company, which would include a different set of issues (in fact, this was exactly the strategy that Aereo competitor/predecessor ivi sought to take -- and ran into trouble
). She points out that there may be value in avoiding the whole public performance question all together, since it could get messy:
If we take public performance, maybe we run
into what Professor Nimmer saw as a problem. Why isn't
what used to be called a phonograph record store that
sells phonograph records to 10,000 customers a public
performance? It seems to fall within that definition.
But if it is, there's no -- no first sale doctrine and
it's a big problem. So we could avoid that problem.
Meanwhile, Justice Breyer is clearly concerned about the possible impact on the cloud, again in discussing the possibility that the Court could avoid the issue by calling Aereo a cable company:
And what you've read in their briefs is
they, in their supporting amici, have thrown up a series
of serious problems not involving them, like the cloud,
which the government tells us to ignore, and many
others, which make me nervous about taking your
Which bounces back to Sotomayor, who notes that the public performance definition the broadcasters want "sweeps up" an awful lot of other businesses where it doesn't make sense:
I mean, Justice Breyer has already asked you -- said he's
troubled about the phonograph store, and -- and the
Dropbox and the iCloud. I'm also worried about how to
define or -- public performance or the performance of a
work publicly, which I guess is the better way to do it,
according to you. How do I define that so that someone
who sells coaxial cable to a resident of a building is
not swept up as a participant in this? Or someone
who -- the sort of passive storage advisors that -- this
is really hard for me.
Justice Kagan, also, quickly gets to the heart of the matter -- the point that we've been raising since the beginning with Aereo -- that this is all about the length of the cable. If someone were to do this at home -- with the same exact electronic setup, it's clearly legal. But the broadcasters want to make Aereo illegal, because the length of the cable between the "DVR" component and the "TV" component is much longer.
Suppose a company just gave the
antenna and a hard drive, that's what they sold to the
user, and the user was able to use the antenna and the
hard drive in her own house or apartment in order to get
all these broadcast programs. What would the -- would
that be a performance?
When the broadcaster's lawyer pushes back, Kagan points out that it does seem odd that where the hardware sits determines if there's a public performance or not.
But then it really does
depend on, like, where the -- where the hardware is. In
other words, if -- if Aereo has the hardware in its
warehouse as opposed to Aereo selling the hardware to
the particular end user, that is going to make all the
difference in the world as to whether we have a public
performance or not a public performance.
Chief Justice Roberts highlighted the same issue:
Why isn't -- and I don't want to stretch it too -- but why isn't it like a
public garage in your own garage? I mean, you know, if
you -- you can park your car in your own garage or you
can park it in a public garage. You can go to Radio
Shack and buy an antenna and a DVR or you can rent those
facilities somewhere else from Aereo. They've --
they've got an antenna. They'll let you use it when you
need it and they can, you know, record the stuff as well
and let you pick it up when you need it
There's then a discussion trying to see if there's a way to distinguish Aereo from the Cablevision decision (in the 2nd Circuit appeals court) saying that Cablevision's remote DVR was legal. The lawyer for the broadcaster says that he thinks the Cablevision decision was decided incorrectly, but the difference is that Cablevision already has a license. This is misleading, because the license in Cablevision was unrelated to the issue of the DVR feature. Furthermore, over-the-air broadcasts (which is what Aereo offers) have an implied license already associated with them (you don't have to pay to watch over-the-air TV for that very reason). So the distinction here is meaningless. Justice Breyer says that, even if that's true, there's still a real risk to cloud computing.
But then the problem is in the words that do
that, because we have to write words, are we somehow
catching other things that really will change life and
shouldn't, such as the cloud? And you said, well, as
the government says, don't worry, because that isn't a
public performance. And then I read the definition and
I don't see how to get out of it.
When asked similar questions, the Deputy Solicitor General, Malcolm Stewart, (again, bizarrely, the US is intervening
on behalf of Hollywood for no clear reason), appears to admit that there's no clear line, and that things should be decided on something of a case by case basis:
I think you would have to --
you would have to know both the details of the service
and you would have to be making a harder call there
about how to draw the line, because I don't pretend that
there is a bright line between providing a service and
providing access to equipment. If you look, for
instance, at the extremes of a person putting a rooftop
antenna at his own home, everybody agrees that the
rooftop antenna manufacturer is not performing at all
and the individual is engaged in a solely private
The other extreme is the cable company, one
big antenna, makes transmissions to a lot of people;
Congress clearly intended to define that as a private
performance. Somewhere in the -- you could come up with
lots of hypotheticals that look more or less like one of
the other extremes, they are somewhere in the middle.
It's an authentically hard call as to where to draw the
line. So I don't have a good answer for you.
But that seems rather important, given that this case is asking for that line to be drawn. And the Justices were clearly struggling with that point. Justice Breyer responded:
How do we get out of
the example? I mean, how do we get out -- what words do
I write to get out of this, throwing into this clause a
music store that distributes via Federal Express, a
device, or the U.S. Postal Service or even someone over
the counter, distributes to 10,000 people a copy of a
record which they then will take and play it? They
have, to the same degree, transmitted something that
will electronically make a performance of the music. So
are they when they sell the record violating the display
This isn't to say that the Justices are in agreement with Aereo. They expressed plenty of skepticism about the whole setup, arguing repeatedly that the whole thing seems to have been set up solely to fit within the law, using a technological setup that makes no sense. Aereo, in response, sought to argue that there were technical reasons for its setup, but frankly, that's bogus. The technological setup is insane
, but the insanity is not because Aereo is trying to "get around" the law, but the exact opposite. Because it's trying to stay within the law
. If the setup of copyright law itself wasn't so insane, there would be much better ways to do what Aereo is doing. But thanks to a bunch of interlocking "rights" buried within copyright law, and caselaw that is basically duct-taped onto the statute every time a new technology comes around, actually innovative requires
the Rube Goldbergian-approach that Aereo took just to stay within
the law. It's ridiculous that that
is seen as a suggestion of illegality...
When the broadcasters lawyer comes back to rebut Aereo's lawyer, he argues that if Aereo loses, it can just get a license or go out of business. But Justice Breyer notes that it's really not that simple:
Once you take them out of
the compulsory licensing system, they're going to have
to find copyright owners, who owns James Agee's
pictures? Who owns something that was written by --
like a French silent film in 1915? I mean, the problem
is that they might want to have perfectly good things
that people want to watch and they can't find out how to
get permission. That is a problem that worries me and
it worries me again once you kick them out of the other
In the end, I think the Justices were rightly worried about how any ruling might impact the cloud. While there was some skepticism about Aereo's setup, Aereo's lawyer did a good job highlighting why those were wrong. Still -- and again, reading Supreme Court tea leaves is nearly impossible -- if I were going to guess, I'd guess that the Supreme Court will seek some sort of "narrow" ruling that tries to say that Aereo should get a license (possibly just throwing the issue back to the lower courts on the details), while doing everything it can to avoid a ruling that throws the entirety of cloud computing under the bus.