Aereo in a Nutshell

Cross-posted on the Copyhype blog.

Now that the Supreme Court has agreed to hear the Aereo appeal, I want to offer a simple explanation of the central legal issue before the Court. Much has been written about Aereo, but surprisingly little of it discusses the actual question the Court will decide. There is no doubt that Aereo is performing works as it retransmits them to its customers—that’s the very service that Aereo provides. The fundamental legal point the Court will determine is whether those performances are public or private. If public, they’re infringing, and if private, they’re not. Don’t let the argle-bargle being tossed out by bloggers and commentators distract you from this simple point.

Lots of arguments being offered by copyright critics are simply wrong. This case isn’t about the future of cloud computing companies—those services are protected by the DMCA. It isn’t about the length of any cord—no matter how long the cord is, the legal question is the same. Nor is it about Aereo simply doing something that a customer could do himself—the fact is that the customer isn’t doing it himself since Aereo is helping him do it. And it certainly isn’t about thwarting the progress of innovation—Aereo’s design is rather ridiculous, and it’s only “innovative” in that it retransmits broadcasts without paying any fees.

The Copyright Act gives copyright owners the exclusive right “to perform the copyrighted work publicly.”1 A work can be performed publicly in one of three ways. The first is by performing the work at a place open to the public or at a place where people outside of one’s family and friends congregate.2 An example of this would be putting on a play at a theater where tickets are available to the general public. The second is by transmitting a performance of the work to a place open to the public or to a place where people outside of one’s family and friends congregate.3 An example of this would be an opera house that transmits a performance to a movie theater where tickets are available to the general public.

The final way a work can be performed publicly is by transmitting a performance of the work to the public, by whatever means, whether the transmission of the performance can be received in one place or in many places and at one time or at many times. An example of this would be a broadcaster that transmits a television show to the general public over the airwaves. This last way of performing a work publicly is the one that’s at issue here with Aereo, and the operable statutory text comes from the last section of what is called the “Transmit Clause” in Section 101 of the Copyright Act. The outcome of the Aereo appeal will turn on how the Supreme Court parses this section of the Transmit Clause, which provides:

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, whether the members of the public capable of receiving the performance . . . receive it in the same place or in separate places and at the same time or at different times.4

Note how this opens up four possibilities, all of which are public performances of a work. The transmission of a performance of a work to the public is a public performance if it is capable of being received: (1) in the same place and at the same time, (2) in separate places and at the same time, (3) in the same place and at different times, and (4) in separate places and at different times. These various possibilities are very important here with Aereo because they show that the same public performance of a work can occur via multiple asynchronous transmissions to the public. An example of this would be a work streamed from YouTube—a distinct transmission occurs whenever a member of the general public initiates playback, and despite the asynchronous transmissions, YouTube is publicly performing the work.

The Transmit Clause tells us that several distinct transmissions of a performance to the public, capable of being received in separate places and at different times, can be aggregated together as constituting one single public performance. The tricky part is figuring out when to aggregate multiple transmissions of a performance. And this gets us to the crux of the arguments in the Aereo appeal. The petitioners argue that Aereo’s distinct transmissions to its customers should be aggregated together as constituting part of the same performance, and this would mean the performance is public. Aereo, on the other hand, argues that its distinct transmissions to its customers should not be aggregated, and this would mean that there are several performances which are all private.

The reason Aereo argues that its distinct transmissions of a performance to its customers should not be aggregated is because they are made from unique copies of the underlying work. If YouTube uses only one source copy of a work to make multiple transmissions of a performance to the public, the case law tells us that those distinct transmissions should be aggregated together as constituting part of the same public performance. But Aereo argues that when each distinct transmission of a performance arises from a unique copy, this one-to-one relationship between the source copy and the customer means that multiple transmissions should not be aggregated. Whether there is any legal difference between using one source copy or multiple source copies for these transmissions of a performance forms the key question to be decided by the Supreme Court.

The notion that the private-public performance divide turns on whether the source of the transmissions comes from one copy or from multiple copies can be traced back to the influential Nimmer on Copyright treatise. In the famous Cablevision case,5 the Second Circuit adopted Nimmer’s view that a one-to-one relationship between the source copy and the customer means that multiple transmissions of a performance to the public should not be aggregated, thus making them separate private performances. According to the Cablevision court, when a unique copy is used to transmit a performance of a work to a customer, the only transmission that counts is that particular transmission—other transmissions made to other customers from other copies of the work are irrelevant.

But, as the petitioners in the Aereo appeal point out, this one source copy theory has no textual basis in the Transmit Clause. The Transmit Clause defines what it means to perform a work publicly, and the fact that the same public performance of a work can be received by the public in separate places and at different times tells us that multiple transmissions of a performance can constitute the same public performance. The Transmit Clause says nothing about the number of source copies used to make these multiple transmissions—the words “copy” or “copies” do not appear in the Transmit Clause. What matters is whether the public is capable of receiving the same performance of a work; the number of source copies used to transmit this performance is irrelevant.

The fault with the Second Circuit’s reasoning in Cablevision, and its subsequent application in Aereo,6 is in how it misinterprets the word “performance” in the following section of the Transmit Clause: “whether the members of the public capable of receiving the performance . . . receive it in the same place or in separate places and at the same time or at different times.” The Second Circuit replaced the word “performance” with the word “transmission,” and under this construction, the focus is on the audience of a particular transmission. But while a transmission of a performance is itself a performance, the words “transmission” and “performance” are not synonymous and interchangeable.

Thus, under the Second Circuit’s reading of the Transmit Clause, what matters is the potential audience of each distinct transmission. But the Transmit Clause tells us that the proper focus is on the audience of a performance, not the audience of any particular transmission of a performance. The problem with focusing on who is capable of receiving a particular transmission of a performance is that it reads the “different times” language out of the Transmit Clause. The Second Circuit realized as much, and that’s why it read into the Transmit Clause a distinction between one source copy and multiple source copies.7

Given the fact that the Transmit Clause makes no reference to the number of source copies used to generate multiple transmissions of a performance, and given the fact that the Transmit Clause by its very terms says to focus on who is capable of receiving a performance of a work—and not any particular transmission of a performance of a work—I think the Supreme Court should reverse the Second Circuit’s misapplication of the Transmit Clause in Aereo—and, by extension, in Cablevision. What matters is the fact that Aereo’s customers are capable of receiving the same performance of a work, despite the fact that this performance is comprised of distinct transmissions made from distinct copies.

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© 2014 Devlin Hartline. Licensed under the Law Theories Public License 1.0.

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  1. 17 U.S.C.A. § 106(4) (West 2014). 
  2. See 17 U.S.C.A. § 101 (West 2014) (“To perform . . . a work ‘publicly’ means . . . to perform . . . it at a place open to the public or at any place where a substantial number of persons outside of a normal circle of a family and its social acquaintances is gathered.”). 
  3. See 17 U.S.C.A. § 101 (West 2014) (“To perform . . . a work ‘publicly’ means . . . to transmit or otherwise communicate a performance . . . of the work to a place specified by clause (1),” i.e. “a place open to the public or . . . any place where a substantial number of persons outside of a normal circle of a family and its social acquaintances is gathered.”). 
  4. 17 U.S.C.A. § 101 (West 2014). 
  5. See Cartoon Network LP, LLLP v. CSC Holdings, Inc., 536 F.3d 121 (2d Cir. 2008). 
  6. See WNET, Thirteen v. Aereo, Inc., 712 F.3d 676 (2d Cir. 2013), petition for rehearing en banc denied, WNET, Thirteen v. Aereo, Inc., 722 F.3d 500 (2d Cir. 2013). 
  7. See Aereo, 712 F.3d at 688 n.11 (“The Cablevision court’s focus on the potential audience of each particular transmission would essentially read out the ‘different times’ language, since individuals will not typically receive the same transmission at different times. But Nimmer’s solution—aggregating private transmissions when those transmissions are generated from the same copy—provides a way to reconcile the ‘different times’ language of the Clause.”). 

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