On 10th January 2014, the U.S. Supreme Court decided that it will take on and eventually resolve the ongoing dispute between Aereo and a group of broadcasters.

Aereo provides the users of its service with an individual antenna which is capable of receiving broadcast signals and which is located at a remote location. The signals received by the remote individual antenna are then delivered over the internet to the subscriber in the form of an individual webpage. On that webpage, the user can choose which broadcast channel he or she wants to watch live and/or which of the programmes broadcast by the channels he or she wants to record for later viewing.

The broadcasters argue that Aereos thus engages in an act of retransmission for which it should seek the consent of the broadcasters as, under copyright law, it is a new act of communication to the public (a new public performance). In exchange for their consent, Aereo would then have to pay a licence fee to the broadcasters. Aereo takes the position that it rents to its users remote equipment comparable to what these users could install at home: each user is receiving a distinct transmission generated by their own individually rented antenna.

The court of first instance, the U.S, District Court for the Southern District Court of New York, ruled in favour of Aereo; the appeal court (the U.S. Court of Appeals for the Second Circuit) denied a rehearing of the case. Consequently, the broadcasters and Aereo petitioned the U.S. Supreme Court, which now accepted to decide the case. It may, however, take until next year before a decision is taken.

The case has many interesting elements which are also under discussion in Europe, albeit in different settings:

– the relevance of the distinction between proxy caching and mirror caching;

– the definition of retransmission;

– the relevance of storing and providing a unique playback copy per user rather than a master copy to which multiple users can be granted access;

– interpretation of the notion of ‘public’ in the copyright relevant act of ‘communication to the public’;

– interpretation of the notion of ‘potential audience’;

– the relevance of time-shifting capabilities.

All these questions can only be ultimately resolved in legal procedures in which only the highest courts can give a final decision (which can go either way and therefore the outcome is highly uncertain). It would be better to follow the example of the Netherlands, where the parties in the value chain of production and distribution of audiovisual media services decided that a legal approach hampers or delays innovation. Therefore, they started commercial negotiations on an economic model which benefits all parties and provides fair compensation for the original creators. X-Media Strategies facilitated this process. For detailed information, please feel free to contact us.

Amounts paid to rightholders from home copying levies should not be considered as a form of remuneration in exchange for their permission to allow reproductions of their works and/or other protected materials for non-commercial purposes by individuals for their personal use; payment of those amounts should rather be regarded as an indemnification for exploitation losses presumed to occur as a result of such a permission, in cases where the legislator created a legal fiction which presumes that the rightsholders have granted this permission.

Home copying levies are not intended to compensate rightholders for the copying of their works and other protected materials from illegal sources (i.e. from sources which have not obtained the rightsholders permission to make protected materials available). EU Member States cannot permit the collecting of home copying levies to compensate for the reproduction of protected materials which are dowloaded from illegal sources.

Home copying levies can only be collected from individuals who reproduce protected works and other protected materials and can therefore only be levied on devices and information carriers which are made available to users for private use purposes only; i.e., not on computers, smartphones and other devices for professional use!

The above are the opinions expressed by the Advocate-General in his Conclusion in a case referred to the European Court of Justice by the High Court of The Netherlands for a preliminary ruling on 9 January 2014. It remains to be seen whether the European Court will follow the Advocate-General.

An English version of the Conclusion is not yet available. Here you can find the French and Dutch versions.