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Can Cable Companies Store Shows For Us?
NewYorkCountryLawyer writes "Last August I reported that the US Court of Appeals for the 2nd Circuit had defeated the MPAA's attempt to label as copyright infringement a cable operator's storing video for later reuse at the request of its subscribers, in Cartoon Networks v. CSC Holdings. The MPAA has petitioned the US Supreme Court to review that holding. According to a recent interview with Gigi Sohn of Public Knowledge, the High Court has not yet decided whether to grant the MPAA's petition seeking review. What I found odd about the 2nd Circuit decision (PDF) is that (a) although 'fair use' was the most logical defense to be employed in view of the Supreme Court's holding in SONY Betamax, upholding a VCR's 'time shifting' of a broadcast television show as a 'fair use,' the defendant in Cartoon Networks has stipulated to waive 'fair use,' and (b) although the easier legal theory for plaintiff to prove would have been secondary, rather than primary, copyright infringement (i.e. Cablevision's encouraging and inducing its customers to make unauthorized copies), the MPAA has stipulated to waive that line of attack. I.e. neither plaintiffs nor defendants seized the 'low hanging fruit.' In her interview, Ms. Sohn discusses the fair use defense, but I'm not sure why she does, since as I recall the defendant has waived it."
We had a symposium on this issue, and a lawyer talked from the plaintiff's side. Much of their theory dealt with the length of the cable, based purely on a statutory reading. While I understand he has a duty to attempt to apply the statute in his client's best interests, his construction made little sense. Still, he had to rely on that construction to get around Sony. Essentially, it is legal for me to time shift in my house. So why can't I put my time shift device outside of my house, say in a warehouse with a lot of other time shift devices? And what if I make those time shift devices virtual devices on a single server? His point was that moving the device outside of my house was the difference-it became a transmission. He could not provide a length of cable that would trigger that definition, though. And, of course, he was speaking for his client at the time. I will be curious to see how this case works out if SCOTUS does take it. The statutes need some re-writing, honestly.
http://bgcommonsense.blogspot.com
If I'm either party, and I want the Supreme Court to decide an issue for me that I think I'll win, I'm going to work with the other side to waive the legal doctrines which best protect me. I don't want them to say "fair use" or "secondary infringement." Perhaps Cablevision wants to set up a decision granting more protection to content providers, just as the MPAA wants to set up a decision expanding the definition of primary infringement to include what Cablevision did. With the Supremes taking so few cases, it makes sense to give them an extremely narrow legal issue, on a platter, freed, as much as possible, of its factual trappings.
1. I'm not sure I understand your theory as to why both sides waived their best arguments. But I sure would love to have been a fly on the wall when those decisions were made.
2. The issues were narrowed by stipulation earlier in the case, before it got to the Second Circuit. The Second Circuit had to take the case; it was an appeal as of right. So this narrowing had nothing to do with getting Supreme Court review.
Ray Beckerman +5 Insightful
Everybody agrees that I can have a DVR in my house. Is it okay if I move it to my garage?
Is it okay if I buy a plot of land and get satellite and put my DVR there, and relay to my house over the Internet?
Is it okay if I let a friend put his dish and his DVR on my plot of land?
What if I charge some strangers to put their dishes and DVR on my land?
What if I have 200 people, but I rent DVRs to them?
What if I replace the hard drives in individual DVRs with a huge RAID array?
What if I virtualize the DVRs?
What if I sell the satellite connection to begin with?
At what point is it no longer legal?
Go green: turn off your refrigerator.
I think there was at least one case on this involving hotels. Back in the early VHS era, many hotels provided VHS players for guests, and lent out tapes at the front desk. No problem there, at least in the US; that's just the "first sale" doctrine.
Better hotels would deliver tapes via room service. This was labor-intensive. Some hotel then realized that it would easier to centralize all the VCRs, and just have someone in an office put the requested tape in the VCR when requested. This was the beginning of "video on demand".
That was held not to be a copyright infringement, even though the hotel was in a sense "distributing" the content.
Now, of course, there are "video on demand" systems for hotels. But they usually have contractual relationships with all their sources; they're not just buying VHS tapes at retail.
NYCL, as I understand it, the case in question doesn't even involve damages yet; it's basically a declaratory judgment action. So there's no money on the line. It's a pure question of law.
Here's what I'm thinking: Cablevision knows that users can time-shift, under SONY Betamax. So they know that if they sell users a TiVo, it's not secondary infringement.
If Cablevision is looking to provide this on-demand player as a value-added service without paying for it, being able to charge for that feature without having to lease out a bunch of TiVos saves them money; users will presumably pay the same amount regardless of whether there's another box in their entertainment center. So consolidating the service into a central repository is just free money for Cablevision.
The only question left is whether the consolidation itself is infringement. Maybe not, but why take the chance, given how litigious MPAA is?
As for the MPAA, they know they can get secondary infringement in certain situations, but probably not this one, given the end users' right to timeshift. But the MPAA may see this as an opportunity to expand "primary infringement" and secure their position, as digital timeshifting becomes more common, in future negotiations with the midstream providers.