`FILED
`
`MOV 12 2013
`
`9 FF!CE OpTj-jf" Ci CE*1/
`
`No. 13-461
`
`In The
`Supreme Court of tfre WLnitzb States
`American Broadcasting Companies, Inc., et al,
`Petitioners,
`
`Aereo, Inc., f/k/a Bamboom Labs, Inc.,
`Respondent.
`
`On Petition for Writ of Certiorari to the
`United States Court of Appeals for the Second Circuit
`
`Brief of Amici Curiae The American Society of
`Composers, Authors and Publishers (ASCAP),
`Broadcast Music, Inc. (BMI), The National Music
`Publishers' Association (NMPA), The recording
`Industry Association of America (RIAA), SESAC,
`Inc., The Songwriters Guild of America, Inc.
`(SGA), The Church Music Publishers Association
`(CMPA), The Nashville Songwriters Association,
`International (NSAI),and SoundExchange, Inc.
`in Support of petitioners
`
`Russell J. Frackman
`Counsel of Record
`Mitchell Silberberg &
`Knupp LLP
`11377 W. Olympic Blvd.
`Los Angeles, CA 90064
`Tel:
`(310)312-2000
`Email: rjf@msk.com
`
`Counsel for
`
`Eric J. Schwartz
`J. Matthew Williams
`Mitchell Silberberg &
`Knupp LLP
`1818 N St., NW, 8th Fir.
`Washington, DC 20036
`Tel:
`(202)355-7900
`Email: ejs@msk.com
`Email: mxw@msk.com
`Amici Curiae
`
`
`
`TABLE OF CONTENTS
`
`Page
`
`INTERESTS OF AMICI CURIAE
`
`SUMMARY OF ARGUMENT
`
`ARGUMENT
`
`1
`
`6
`
`8
`
`8
`
`I.
`
`II.
`
`III.
`
`The Second Circuit's Interpretation Is
`Inconsistent With The Statute's Purpose To
`Provide A Fair Return To Copyright Owners
`As An Incentive To Create And Disseminate
`Works
`
`The Second Circuit Misread The Language
`And Intent Of The Transmit Clause
`
`12
`
`The Second Circuit's Opinion Cannot Be
`Reconciled With The Structure Or Legislative
`History Of The Copyright
`Act
`
`19
`
`IV.
`
`The Second Circuit's Opinion Is Inconsistent
`With Treaty Obligations
`24
`
`CONCLUSION
`
`28
`
`
`
`TART/E OF AUTHORITIES
`
`Page(s)
`
`Cases
`Beethoven.com LLC v. Librarian ofCong.,
`394 F.3d 939 (D.C. Cir. 2005)
`
`Bowen v. Gilliard,
`483 U.S. 587 (1987)
`
`Broad. Music, Inc. v. Columbia Broad. Sys.,
`Inc.,
`441 U.S. 1 (1979)
`Cartoon Network LP, LLLP v. CSC Holdings,
`Inc.,
`.
`536 F.3d 121 (2d Cir. 2008), cert, denied,
`129 S. Ct. 2890 (2009)
`Columbia Pictures Indus., Inc. v. Prof'l Real
`Estate Investors,
`866 F.2d 278 (9th Cir. 1989)
`
`Columbia Pictures Indus, v. Redd Home,
`749 F.2d 154 (3d Cir. 1984)
`
`Eldred v. Ashcroft
`537 U.S. 186 (2003)
`537 U.S. 186 (S
`FDA v. Brown &Williamson Tobacco Corp
`529 U.S. 120 (2000)
`
`22
`
`lb
`
`z
`
`!» 5> 8
`
`15
`
`19
`
`25
`
`23
`
`u
`
`
`
`TABLE OF AUTHORITIES
`(continued)
`
`Page(s)
`
`Fox Television Stations, Inc. v. BarryDriller
`Content Sys., PLC,
`915 F. Supp. 2d 1138 (CD. Cal. 2012)
`
`Fox TV Stations, Inc. v. FilmOn XLLC,
`No. 13-758 (RMC), 2013 U.S. Dist. LEXIS
`126543 (D.D.C. Sept. 5, 2013)
`
`Golan v. Holder,
`132 S. Ct. 873 (2012)
`
`Hearst Stations Inc. v. Aereo, Inc.,
`No. 13-11649-NMG, 2013 U.S. Dist. LEXIS
`146825 (D. Mass. Oct. 8, 2013)
`
`ITVBroad. Ltd v. TV Catchup, Ltd.,
`Case No. C-607/1 (E.C.J. Mar. 7, 2013)
`
`Mazer v. Stein,
`347 U.S. 201 (1954)
`
`Metro-Goldwyn-Mayer Studios Inc. v.
`Grokster, Ltd.,
`545 U.S. 913 (2005)
`
`4, 14
`
`4, 13
`
`7, 25
`
`5
`
`27
`
`6
`
`5
`
`Natl Cable Television Ass'n, Inc. v. Broad.
`Music, Inc.,
`772 F. Supp. 614 (D.D.C. 1991)
`
`7, 15
`
`i n
`
`
`
`TABLE OF AUTHORITIES
`(continued)
`
`Page(s)
`
`Nexstar Broad., Inc. v. Aereo, Inc.,
`No. 2:13-cv-975 (D. Utah Oct. 24, 2013)
`
`On Command Video Corp. v. Columbia
`Pictures Indus.,
`Ill F. Supp. 787 (N.D. Cal. 1991)
`
`PGA Tour, Inc. v. Martin,
`532 U.S. 661 (2001)
`
`Sebelius v. Auburn Reg'l Med. Ctr.,
`133 S. Ct. 817 (2013)
`
`SoundExchange, Inc. v. Librarian of Cong.,
`571 F.3d 1220 (D.C. Cir. 2009)
`
`United States v. Gonzales,
`520 U.S. 1 (1997)
`
`5
`
`16
`
`20
`
`13
`
`21
`
`18
`
`WNET Thirteen v. Aereo, Inc.,
`712 F.3d 676, reh'g denied, 722 F.3d 500
`(2d Cir. 2013)
`
`Passim
`
`WPLX,Inc.v.ivi,Inc,
`691 F.3d 275 (2d Cir. 2012)
`
`Statutes
`U.S. Constitution, Art. 1, §8, cl. 8
`
`IV
`
`15
`
`6
`
`
`
`TABLE OF AUTHORITIES
`(continued)
`
`17U.S.C,
`§101
`§106
`§§106(6), 112(e), 114
`§114(d)(3)(C)
`§114(d)(4)(B)
`
`47 U.S.C. §325(b)
`
`Berne Convention Implementation Act of
`1988, Pub. L. No. 100-568, 102 Stat. 2853
`(1988)
`
`Digital Millennium Copyright Act, Pub. L. No.
`105-304, 112 Stat. 2860 (1998)
`
`Uruguay Round Agreements Act, Pub. L. No.
`103-465, 108 Stat. 4809 (1994)
`
`Page(s)
`
`passim
`6, 14, 19
`22
`22
`22
`
`10
`
`26
`
`26
`
`26
`
`Legislative Materials
`
`H. Rep. on Copyright Law Revisions, H.R.
`Rep. No. 94-1476, 94th Cong., 2d Sess.
`(1976)
`
`6,18,21
`
`H. Rep. on Copyright Law Revision, H.R. Rep.
`No. 90-83, 90th Cong., 1st Sess. (1967)
`
`21
`
`
`
`TABLE OF AUTHORITIES
`(continued)
`
`Page(s)
`
`H. Rep. on the Digital Performance Right in
`Sound Recordings Act of 1995, H.R. Rep.
`No. 104-274, 104th Cong., 1st Sess. (1995)
`
`Music Licensing in Restaurants and Retail
`and Other Establishments: Hearing Before
`the Subcomm. on Courts and Intellectual
`Property of the H. Comm. on the Judiciary,
`105th Cong. (1997)
`
`Rep. of the Comm. on the Judiciary of the H.
`of Rep. on the WIPO Copyright Treaties
`Implementation and On-Line Copyright
`Infringement Liability Limitation Act,
`H.R. REP. No. 105-551, pt. 1 (105th Cong.,
`2d Sess. 1998)
`
`Supplementary Register's Rep. on the General
`Revision of the U.S. Copyright Law, 89th
`Cong., 1st Sess., Copyright Law Revision Part
`6 (H. Comm. Print 1965)
`
`Other Authorities
`Agreement on Trade-Related Aspects of
`Intellectual Property Rights, April 15,
`1994, 1867 U.S.T. 154, 33 I.L.M. 81
`
`23
`
`20
`
`26
`
`19
`
`24
`
`VI
`
`
`
`TABLE OF AUTHORITIES
`(continued)
`
`Page(s)
`
`Ben Sisario, As Downloads Dip, Music
`Executives Cast a Wary Eye on Streaming
`Services, N.Y. TIMES, Oct. 21, 2013
`
`Berne Convention for the Protection of
`Literary and Artistic Works, Sept. 9, 1886,
`(Paris Text 1971, as amended Sept. 28,
`1979), 25 U.S.T. 1341, 828 U.N.T.S. 221
`
`Brian Stelter, Netflix Hits Milestone and
`Raises Its Sights, N.Y. TIMES, Oct. 22, 2013
`
`Cecelia Kang, Time Warner May Weigh Aereo
`Model, WASH. POST, May 3, 2013
`
`Graeme McMillan, Viewers Are Flocking to
`Streaming Video Content - And So Are
`Advertisers, WIRED, Mar. 1, 2013
`
`Jane C. Ginsburg, Copyright 1992-2012: The
`Most Significant Development, 23
`Fordham Intell. Prop. Media & Ent. L.J.
`465(2012)
`
`2 M.B. Nimmer & D. Nimmer, Nimmer On
`Copyright §8.ll[D] [4] [c] (2013)
`
`2 Paul Goldstein, Goldstein On Copyright
`§7.7.2(2013)
`
`vii
`
`2
`
`24
`
`3
`
`10
`
`11
`
`10
`
`20
`
`13
`
`
`
`TABLE OF AUTHORITIES
`(pnntinued)
`
`Page(s)
`
`Press Release, Int'l Fed'n of the Phonographic
`Indus., Record Labels Invest US. $4.5
`Billion In New Music, Nov. 12, 2012
`Richard A. Posner, Reasoning by Analogy, 91
`Cornell L. Rev. 761 (2006)
`l SamRicketson &Jane C. Ginsburg, Int'l
`Copyright And Neighbouring Rights:
`The Berne Convention and Beyond (2d
`ed. 2006)
`Shalini Ramachandran &Amet Sharma
`Electricity Use Impedes Aereo sMarch,
`Wall St. J. Oct, 28, 2009
`Shalini Ramachandran, Evidence Grows on
`TV Cord-Cutting, WALL St. J., Aug. 7, 2012
`Top EU Court Rules Against "Live Stream"
`Web Broadcaster, REUTERS, Mar. 7, 2013
`4William F. Patry, PATRY On COPYRIGHT
`§14:16(2013)
`
`^
`
`^
`
`vin
`
`
`
`INTERESTS OF AMICI CURIAE1
`
`This case is about a misinterpretation and
`curtailment
`of
`the
`Copyright Act's
`public
`performance
`right at precisely the time when
`compensation from public performances, specifically
`via digital transmissions, is of critical importance to
`Amici and their members. At stake is more than the
`economic
`survival
`of
`over-the-air
`television
`broadcasters. The decisions in WNET Thirteen v.
`Aereo, Inc., 712 F.3d 676 ("Aereo"), reh'g denied, 722
`F.3d 500 (2d Cir. 2013) and in Cartoon Network LP,
`LLLP v. CSC Holdings, Inc., 536 F.3d 121 (2d Cir.
`2008) ("Cablevision"), cert, denied, 129 S. Ct. 2890
`on which Aereo is based,
`(2009),
`imperil
`the
`livelihoods of millions of artists and creators in
`multiple industries,
`including the music business.
`The
`decisions
`also
`conflict with
`clear U.S.
`international treaty obligations.
`
`Curiae
`Amici
`and
`associations
`are
`and
`members
`create
`whose
`organizations
`disseminate a wide variety of musical compositions
`and sound recordings. Amici and their members
`depend
`heavily
`on
`royalties
`from the
`public
`performance of
`their copyrighted music through
`audio services, such as broadcast radio and Internet
`webcasting,
`and audiovisual
`services,
`such as
`
`No party or counsel for any party authored any part of this
`brief or made a monetary contribution intended to fund the
`preparation and submission of this brief.
`Counsel
`for all
`parties received at least ten days notice of Amici's intent to file
`this brief. All parties consent to Amici filing this brief.
`
`
`
`video.
`streaming
`and
`television
`broadcast
`Collectively, Amici represent hundreds of thousands
`of
`songwriters,
`composers, music
`publishers,
`recording artists, record labels, and others who will
`2
`be harmed if the Aereo opinion stands.
`
`are
`transmissions
`from digital
`Royalties
`becoming the most important source of revenue for
`Amici and their members, with the number of digital
`streams growing at an increasingly rapid pace as
`more consumers turn to online streaming services as
`their primary source of music and audiovisual
`content. See Ben Sisario, As Downloads Dip, Music
`Executives Cast a Wary Eye on Streaming Services,
`N.Y. TIMES, Oct. 21, 2013, at B3 ("Last year,
`streaming and subscription services generated $1.03
`
`2
`
`Through their robust enforcement and licensing activities,
`ASCAP, BMI, and SESAC play a crucial role in giving practical
`effect to the public performance right granted to songwriters,
`composers, and music publishers. They offer "blanket" licenses
`that allow broadcasters, cable and satellite operators, and
`audio and audiovisual streaming services to perform publicly
`their repertoires of compositions. See generally Broad. Music,
`Inc. v. Columbia Broad. Sys., Inc., 441 U.S. 1 (1979). NMPA
`and RIAA work on behalf of music publishers and record labels,
`respectively, to protect, promote, and advance their interests on
`legislative,
`litigation, and regulatory matters. CMPA is an
`organization of
`religious music publishers
`that works
`to
`support and promote worldwide copyright protection and
`education.
`SoundExchange, on behalf of record labels and
`recording artists,
`collects performance
`royalties under a
`statutory license for certain non-interactive, online streams of
`sound recordings and other eligible services. SGA and NSAI
`are not-for-profit trade associations for songwriters.
`
`
`
`billion in revenue, up 59 percent from the year
`before ... .").
`In the future, nearly everyone may
`watch
`"television"
`through
`on-demand
`and
`individualized programming services that enable
`consumers to enjoy tailored and targeted viewing
`See Brian Stelter, Netflix Hits
`experiences.
`Milestone and Raises Its Sights, N.Y. TIMES, Oct. 22,
`2013, at Bl; Shalini Ramachandran, Evidence Grows
`on TV Cord-Cutting, WALL St. J., Aug. 7, 2012, at
`B3.
`In the digitally networked environment,
`the
`exclusive right to license the public performance by
`streaming of music and audiovisual works that
`contain music is even more critical to the vitality —
`and the economic survival - of Amici, their members,
`and others involved in creating and distributing
`music.
`
`community
`copyright
`the
`in
`As many
`predicted, Cablevision's erroneous interpretation of
`the public performance right created a problematic
`and unintended loophole.
`As a result,
`service
`providers can avoid obtaining licenses and paying for
`the right to publicly perform copyrighted works by
`structuring their businesses so that individual copies
`are used to transmit the performances of audiovisual
`programs or songs to their viewers or listeners. The
`in Aereo,
`following Cablevision's erroneous
`Court
`See Aereo,
`interpretation, widened that loophole.
`712 F.3d at 689 ("Cablevision's interpretation of the
`Transmit Clause ... establishes guideposts
`that
`determine this appeal.").
`The result
`is Aereo's
`parasitic business model, a model which has been
`and will be adopted by other services.
`
`3
`
`
`
`Aereo's technology is neither new nor efficient
`- it merely uses traditional antennae (thousands of
`miniature ones) to capture and copy over-the-air
`broadcasts and retransmits those broadcasts over
`the Internet to paying subscribers. Regardless of
`how many antennae and how many digital copies
`Aereo uses to stream copyrighted programming, it
`performs exactly the same function and provides
`exactly the same consumer experience as services
`with which it competes and that Amici and its
`members license.
`The difference is
`that by a
`technological sleight of hand Aereo transforms for-
`profit, commercial broadcasts,
`the paradigm of
`public performances under the Copyright Act, into
`putative private performances. See Aereo, 722 F.3d
`at 513 (denying rehearing; Chin, J., dissenting)
`(calling Aereo's technological set-up "a sham").
`
`businesses
`copycat
`its
`and
`As Aereo
`proliferate the number of lawsuits involving the
`precise issues presented by the petition will continue
`to grow and to reach inconsistent outcomes. See,
`e.g., Shalini Ramachandran & Amet Sharma,
`Electricity Use Impedes Aereo's March, WALL St. J.
`Oct, 28, 2009, at Bl ("Aereo intends to expand to 22
`markets by year end."). As a result, courts are
`carving up the country into a patchwork ofpermitted
`or enjoined Aereo-type services. See Fox Television
`Stations, Inc. v. BarryDriller Content Sys., PLC, 915
`F. Supp. 2d 1138, 1148 (CD. Cal. 2012) (injunction
`limited to Ninth Circuit); Fox TV Stations, Inc. v.
`FilmOn X LLC, No. 13-758 (RMC), 2013 U.S. Dist.
`LEXIS 126543, at *58-9 (D.D.C. Sept. 5, 2013)
`
`
`
`Second Circuit);
`except
`injunction
`(nationwide
`Hearst Stations Inc. v. Aereo, Inc., No. 13-11649-
`NMG, 2013 U.S. Dist. LEXIS 146825, at *22 (D.
`(denying injunction); Nexstar
`Mass. Oct. 8, 2013)
`Broad., Inc. v. Aereo, Inc., No. 2:13-cv-975 (D. Utah
`Oct.
`24,
`2013).
`The
`uncertainty
`extends
`internationally, with the same types of services held
`unlawful in some countries with which the United
`States has copyright treaty obligations. See Top EU
`Court Rules Against "Live Stream" Web Broadcaster,
`REUTERS, Mar. 7, 2013 (The ECJ held:
`"Television
`broadcasters may prohibit
`the retransmission of
`their programmes by another company via the
`Internet.").
`
`Artists, developers, businesses, and investors
`in the entertainment and technology industries are
`in dire need now of the type of clarity that only this
`Court can provide.
`This Court previously has
`intervened to strike down business models premised
`infringement. E.g., Metro-Goldwyn-
`on copyright
`Mayer Studios Inc. v. Grokster, Ltd., 545 U.S. 913
`(2005). The petition provides the timely opportunity
`to correct the erroneous interpretation of the public
`performance clause by Cablevision and Aereo,
`to
`prevent the harm caused by digital profiteers like
`Aereo, and to uphold the protections intended by the
`Copyright Act.
`The issue presents an important
`federal question and the petition should be granted.
`
`3 Available at: http://www.reuters.com/article/2013/03/07/eu-
`court-internet-tv-idUSL6N0BZ5IH20130307.
`
`
`
`SUMMARY OF ARGUMENT
`
`The Copyright Act must be interpreted to
`achieve its purpose of promoting "the Progress of
`Science and useful Arts." U.S. Constitution, Art. 1,
`§8, cl. 8. As this Court has observed:
`
`The economic philosophy behind the
`clause empowering Congress to grant
`patents and copyrights is the conviction
`that encouragement of individual effort
`by personal gain is the best way to
`advance public welfare through the
`talents of authors and inventors
`in
`"Science and useful Arts."
`Sacrificial
`days devoted to such creative activities
`deserve rewards commensurate with
`the services rendered.
`
`Mazer v. Stein, 347 U.S. 201, 219 (1954).
`To
`implement that philosophy, Congress crafted the
`Copyright Act to provide broad protections in the
`form of exclusive rights in original "works" subject to
`narrowly defined statutory exceptions. See H. Rep.
`on Copyright Law Revisions, H.R. Rep. No. 94-1476,
`94th Cong., 2d Sess., at 61 (1976) ("The approach of
`the bill is to set forth the copyright owner's exclusive
`rights in broad terms in section 106, and then to
`provide
`various
`limitations,
`qualifications
`or
`exemptions in the ... sections that follow.").
`
`Consistent with this approach, the provision
`that defines the contours of the public performance
`
`
`
`all
`encompasses
`"Transmit Clause")
`(the
`right
`technological methods of delivering performances of
`works to members of the public. 17 U.S.C. §101 ("To
`perform ... a work 'publicly' means ... to transmit or
`otherwise communicate a performance ... of the work
`to the public, by means of any device or
`...
`process ...") (emphasis added). Read broadly, as
`Congress
`intended,
`the Transmit Clause
`is
`See Golan v.
`consistent with the Act's purpose.
`Holder, 132 S. Ct. 873, 889 (2012) ("Our decisions ...
`recognize
`that
`copyright
`supplies
`the economic
`incentive to create and disseminate ideas.") (original
`emphasis) (quotation marks omitted).
`In contrast,
`the Second Circuit's Aereo opinion is inconsistent
`with the purpose of the Copyright Act,
`the plain
`language of the specific statutory provisions,
`the
`structure and legislative history of the Act as a
`whole, and international agreements to which the
`United States is a party.
`See Jane C. Ginsburg,
`WNET v. Aereo: The Second Circuit Persists in Poor
`(Cable)Vision, Media
`Inst., April
`23,
`2013
`"Ginsburg, WNET v. Aereo") (calling
`(hereinafter
`Aereo "a decision so inconsistent with statutory text
`and policy as to inspire surmise that the ruling was
`an April Fool's prank").
`
`4
`
`Available at:
`http://www.mediainstitute.org/IPI/2013/042313.php.
`
`7
`
`
`
`I
`
`ARGUMENT
`The Second Circuit's Interpretation Is
`Inconsistent With The Statute's Purpose
`To Provide A Fair Return To Copyright
`Owners As An Incentive To Create And
`Disseminate Works.
`In Aereo,
`the Court held that Cablevision
`required reading the Copyright Act to provide avery
`limited public performance right, the parameters of
`which are defined by arbitrary and illogical technical
`distinctions between how delivery methods function.
`In the Second Circuit, courts now must consider the
`[each] ^ff
`potential
`audience
`of
`transmission." Aereo, 712 F.3d at 689.
`If an
`individual transmission can be received by only one
`household, it is private. Id.
`If multiple households
`can receive the individual
`transmission,
`it very
`Id. Courts may not aggregate
`likely is public.
`multiple individual transmissions of performances ot
`the same work delivered by the same service
`them as public, unless the
`provider and treat
`"private transmissions are generated from the same
`copy of the work.
`In such cases
`these private
`transmissions should be aggregated and if these
`aggregated transmissions from a single copy enable
`the public to view that copy, the transmissions are
`public performances." Id.
`
`
`
`the
`of
`interpretation
`convoluted
`This
`Transmit Clause is directly contrary to Congress'
`intent
`to
`provide
`a broad and flexible
`public
`performance right.
`It
`is a road map for media
`companies to design services providing thousands or
`evens millions of transmissions of performances of a
`work to paying subscribers and by that device avoid
`compensating
`copyright
`owners
`because
`the
`performances are deemed "private" when separate
`copies are used to generate the transmissions.
`Artful Dodgers like Aereo are now using this map to
`deprive not only television broadcasters, but also
`artists,
`copyright
`owners,
`and
`authorized
`distributors
`of
`entertainment
`content
`of
`fair
`compensation for their works. Aereo's practice has a
`domino effect on Amici, their members, and millions
`of others who earn their livings through the creation
`and distribution of copyrighted content. See ROBERT
`Levine, Free Ride: How Digital Parasites Are
`Destroying The Culture Business, And How The
`Culture Business Can Fight Back 3 (2011) ("[T]he
`easy, illegal availability of all kinds of content has
`undermined the legal market for it, in a way that
`affects
`the entire media business.
`...
`This
`devaluation could also hurt
`the Internet,
`since
`professional media provides much of the value in a
`broadband subscription.").
`
`The Aereo decision threatens rapidly evolving
`Internet
`and on-demand markets
`for
`licensed
`For example, Amici will
`content.
`receive lower
`payments from broadcasters because their revenues
`will decrease as fewer and fewer companies that
`
`9
`
`
`
`perform television programming pay retransmission
`consent fees. See 47 U.S.C. §325(b) (requiring multi
`channel video programming distributors ("MVPDs")
`to license retransmissions of broadcast signals).
`In
`addition, Amici will receive lower payments from
`cable and satellite television providers because
`unfair competition from Aereo and others will
`decrease
`revenues
`earned
`by
`licensed
`retransmitters, who may themselves ultimately
`forego licenses and adopt Aereo's "unique copy"
`scheme. See Cecelia Kang, Time Warner May Weigh
`Aereo Model, WASH. POST, May 3, 2013, at A13.
`Moreover, Amici likely will receive lower payments
`from audio and audiovisual streaming services
`arguing that the Second Circuit's holdings apply to
`their business models because they use (or will use)
`easily made unique but exact copies to deliver
`See Jane C. Ginsburg,
`content
`to customers.
`Copyright
`1992-2012:
`The Most
`Significant
`Development, 23 FORDHAM INTELL. PROP. MEDIA &
`ENT. L.J. 465, 476-77 (2012) ("As the cost of digital
`storage
`drops,
`the prospects
`for
`redundant
`individually-dedicated copies increase, potentially
`spawning a host of new copyright-avoiding business
`models, particularly as that storage moves to the
`'cloud.'").
`
`Amici and those they represent invest money,
`talent,
`labor, and time to create, market, and
`See, e.g., Press
`distribute works to the public.
`Release, Int'l Fed'n of the Phonographic Indus.,
`Record Labels Invest U.S. $4.5 Billion In New Music,
`Nov. 12, 2012 ("Music companies invest a greater
`10
`
`
`
`proportion of their global revenues in A&R [artists
`and repertoire]
`than most other
`sectors do in
`research
`and
`development
`(R&D),"
`including
`software and computing and the pharmaceutical and
`biotech sectors).
`Copyright exploitation of those
`works that ultimately are proven to be commercially
`successful
`is
`the
`only way
`to
`recoup
`these
`investments. See Richard A. Posner, Reasoning by
`Analogy, 91 CORNELL L. REV. 761, 771 (2006) ("The
`purpose [of copyright] is to prevent the form of free
`riding that consists of waiting for someone to spend
`money creating a valuable work and then preventing
`him from recouping his investment by ... selling
`copies at a price below the price the creator of the
`work would have to charge to break even."). When
`investment
`is not
`recouped, projects
`(such as a
`band's next record or a label's new artist) disappear
`and the Copyright Act is not serving its purpose.
`
`This case does not present a Hobson's choice
`between
`allowing Aereo
`to
`function
`as
`an
`unauthorized
`television
`retransmitter
`or
`else
`eliminating access
`to all
`such content on the
`Internet. Licensed services already provide online
`access to broadcast television content. See Graeme
`McMillan, Viewers Are Flocking to Streaming Video
`Content - And So Are Advertisers, WIRED, Mar. 1,
`2013 ("Now, there are very few shows that you can't
`actually find online, whether downloading them
`
`5
`
`Available at:
`http://www.ifpi.org/content/section_news/investing_in_music.ht
`ml.
`
`11
`
`
`
`from iTunes, streaming them directly from Amazon
`or elsewhere, or even finding older movies and shows
`on Netflix.").6 The choice is whether to allow Aereo
`and others to unfairly compete with licensed services
`or to uphold the purpose of the Copyright Act by
`requiring fair compensation to copyright owners and
`their business partners in return for their creative
`efforts.
`
`II.
`
`The
`Circuit Misread
`Second
`The
`Language And Intent Of The Transmit
`Clause.
`
`The decision below is based on the fallacy that
`the Transmit Clause must be read as follows:
`
`To perform or display a work 'publicly'
`means - ... to transmit or otherwise
`communicate a performance or display
`of the work ... to the public, by means
`of any device or process, whether the
`members of
`the public
`capable of
`receiving the performance or display
`transmission
`[the
`receive
`**
`transmission] in the same place or in
`separate places and at the same time or
`at different times.
`
`17 U.S.C. §101 (emphasis and edits added).
`
`6
`
`Available at:
`http://www.wired.com/underwire/2013/03/streaming-video-
`advertising/.
`
`12
`
`
`
`The Second Circuit misinterpreted the statute
`when it
`read the pronoun "it"
`to refer
`to "the
`transmission," and required that each individual
`transmission of a single, identical work be capable of
`reaching multiple households in order to be a public
`See Aereo, 112 F.3d at 789. Read
`performance.
`correctly,
`"[t]here can be
`little doubt
`that
`the
`italicized word it in the [Transmit Clause] refers to
`'performance or display,' not transmission, which in
`fact appears only as a verb, and not as a noun, in the
`definition."
`2 PAUL GOLDSTEIN, GOLDSTEIN ON
`COPYRIGHT §7.7.2 (2013) (original emphasis).
`
`Underlying the Second Circuit's error is the
`conclusion that the "transmission of a performance is
`itself a performance." Aereo, 712 F.3d at 687,
`quoting Cablevision, 536 F.3d at 134.
`That
`is,
`according to the Second Circuit, Congress used the
`words
`"performance"
`and
`"transmission"
`as
`synonymous. See FilmOn X, 2013 U.S. Dist. LEXIS
`126543 at *49, n.12 ("Aereo mistakenly substituted
`'transmission'
`for
`'performance'
`in its analysis");
`Ginsburg, WNET v. Aereo,
`supra ("The Second
`Circuit conflated 'performance' with 'transmission'...
`This reading does not work in terms of the
`statute."). To the contrary, Congress defined those
`terms separately and distinctly.
`17 U.S.C. §101.
`And "unless a contrary result is readily apparent,
`[courts]
`generally
`presume Congress
`intends
`different terms in the same statute to have different
`Aereo, 722 F.3d at 507 (rehearing
`meanings."
`denied; Chin, J., dissenting). See Sebelius v. Auburn
`Reg'l Med. Ctr., 133 S. Ct. 817, 825 (2013) ("[A]s a
`
`13
`
`
`
`general rule, ... Congress's use of certain language in
`one part of the statute and different language in
`another can indicate that different meanings were
`intended.") (quotation marks omitted).
`
`The definitions of "perform" and "transmit"
`make plain the crucial distinction between them:
`"To 'perform' a work means to recite, render, play,
`dance, or act it, either directly or by means of any
`device or process or, in the case of a motion picture
`or other audiovisual work, to show its images in any
`sequence or to make the sounds accompanying it
`audible."
`17 U.S.C. §101.
`"To 'transmit' a
`performance or display is to communicate it by any
`device or process whereby images or sounds are
`received beyond the place from which they are sent."
`Id. Thus, "transmission" is a term of art
`for a
`vehicle that delivers a "performance." By focusing
`myopically on who is capable of receiving each
`individual
`transmission,
`the Second Circuit
`lost
`sight of the fact that the Copyright Act concerns
`exclusive rights to exploit performances of "works."
`See 17 U.S.C. §106 ("[T]he owner of copyright under
`this title has the exclusive rightD to ... perform the
`copyrighted work publicly ... ") (emphasis added);
`17 U.S.C. §101 ("To perform ... a work publicly
`means ...") (emphasis added). The dispositive issue
`under
`the Transmit Clause then is whether a
`performance ofa "work" is transmitted to the public,
`not how it is transmitted. See BarryDriller, 915 F.
`Supp. 2d at 1144-45 ("Very few people gather around
`their oscilloscopes to admire the sinusoidal waves of
`transmission.
`a television broadcast
`People are
`
`14
`
`
`
`interested in watching the performance of
`the
`work.")
`(original emphasis).
`The Second Circuit
`confused the means with the end.
`
`Copyright protection is not contingent on
`technical differences between delivery methods that
`have no impact on the use or the user experience,
`such as Aereo's thousands of tiny antennae and
`See
`multiple digital copies of
`the same works.
`Columbia Pictures Indus., Inc. v. Prof'l Real Estate
`Investors, 866 F.2d 278, 282 (9th Cir. 1989) ("A plain
`reading of the transmit clause indicates that
`its
`purpose is to prohibit transmissions and other forms
`of broadcasting from one place to another without
`the copyright owner's permission.").
`"[I]t would
`strain logic to conclude that Congress would have
`intended the degree of copyright protection to turn
`on the mere method by which television signals are
`transmitted to the public." Natl Cable Television
`Ass'n, Inc. v. Broad. Music, Inc., 772 F. Supp. 614,
`651 (D.D.C. 1991), quoting David v. Showtime/The
`Movie Channel, Inc., 697 F. Supp. 752, 759 (S.D.N.Y.
`1988).
`
`that courts determine
`requirement
`Aereo's
`whether a unique copy of a particular work was used
`to deliver a transmission of a performance of that
`work to a member of the public elevates form over
`substance. From the consumer's perspective, Aereo's
`service is no different from the streaming television
`retransmission services
`that
`courts have held
`infringe the public performance right. E.g., WPLX,
`Inc. v. ivi, Inc., 691 F.3d 275 (2d Cir. 2012). See also
`
`15
`
`
`
`Bowen v. Gilliard, 483 U.S. 587, 606 (1987) (courts
`should not place "form over substance, and labels
`over
`reality" where the difference between two
`concepts
`is
`"more
`theoretical
`than practical").
`Common sense and the Transmit Clause dictate that
`a public performance occurs when members of the
`public are capable of receiving transmissions of
`performances of the same work. See Aereo, 712
`F.3d at 698 (Chin,
`J., dissenting)
`("Giving the
`undefined term 'the public' its ordinary meaning ... a
`transmission to anyone other than oneself or an
`intimate relation is a communication to a member _
`of
`the public, because it
`is not
`in any sense
`'private.'") (citations omitted); On Command Video
`Corp. v. Columbia Pictures Indus., Ill F. Supp. 787,
`790 (N.D. Cal. 1991)
`(where "the relationship
`between the transmitter of the performance ... and
`the audience ...
`is a commercial,
`'public' one" the
`public performance right is implicated).
`
`the
`The Second Circuit's misreading of
`Transmit Clause
`inevitably
`leads
`to
`internal
`inconsistencies. The judicially created exception for
`individual
`transmissions of performances that by
`design originate from unique copies is directly at
`odds with the statute's instruction that a public
`performance of a work occurs when members of the
`public receive the performance of that work "at
`different times." 17 U.S.C. §101. Forced to reconcile
`these
`antithetical
`concepts,
`the Second Circuit
`fashioned
`an
`illogical
`and
`unsupported
`new
`exception to its entirely new rule, i.e., that separate,
`"private" transmissions from the same copy of a
`
`16
`
`
`
`work are "aggregated" even when the transmissions
`occur at different times, whereas separate, "private"
`transmissions of the same work from different
`identical copies are not. Aereo, 712 F.3d at 789.
`Simultaneously,
`the
`court had to
`admit
`that
`"[aggregating private transmissions generated from
`the same copy is in some tension with the ...
`conclusion that
`the relevant
`inquiry under
`the
`Transmit Clause is the potential audience of the
`particular transmission." Id. atn.ll.
`
`The Aereo Court's novel reading is not just in
`"some tension" with the statute; it severely limits the
`provision in the Transmit Clause stating that a
`public
`performance
`takes
`place
`"whether
`the
`members of the public capable of
`receiving the
`performance receive it
`... at the same time or at
`different
`times."
`17 U.S.C. §101.
`See Ginsburg,
`WNET v. Aereo,
`supra (contending that:
`"[T]he
`Second Circuit's reading effectively deletes 'different
`times' from the statute, thus defeating Congress's
`clear
`intent
`to
`bring pay-per-view and other
`individualized forms of
`transmission within the
`scope of the Copyright Act.").
`
`tortured rationale was never
`The court's
`mentioned in the 20-year process leading to the
`Copyright Act of 1976. It ignores that nothing in the
`language of
`the Transmit Clause refers
`to the
`number of copies used to deliver transmissions of
`performances of works to members of the public.
`If
`the number of copies used by a device or process to
`transmit a performance of a work were critical,
`
`17
`
`
`
`that
`expressed
`have
`surely would
`Congress
`It did not. See Aereo, 722 F.3d at 509
`condition.
`rehearing; Chin,
`J.,
`dissenting)
`("If
`(denying
`Congress had intended the definition to turn on
`whether a unique copy was used, it knew how to say
`See also,
`e.g., 17 U.S.C. §§101 (defining
`so.").
`"copies"); 108 ("no more than one copy"); 109 ("owner
`of a particular copy"); 112 ("no more than one copy of
`a particular transmission"); 107 ("making of another
`copy ).
`
`statutory
`relevant
`the
`of
`none
`In fact,
`"copies."
`Instead,
`the
`definitions
`reference
`technologically neutral and broad language of the
`Transmit Clause is reiterated in the definitions of
`"perform" ("either directly or by means of any device
`or process"), "transmit" ("to communicate ... by any
`device or process whereby images or sounds are
`received beyond the place from which they are
`sent"), "device" ("one now known or later developed"),
`and "proce