By Andrew Noyes
(Monday, July 16) A new round of friend-of-the-court briefs were filed last week in Cablevision's appeal of a March decision against its proposed digital video-recording service.
Twentieth Century Fox sued the cable provider, claiming that the contraption would violate copyright by letting customers store television programming remotely -- a function not covered by existing licensing agreements with content providers. A federal judge in New York agreed.
Cablevision's supporters include the Center for Democracy and Technology, Consumer Electronics Association, and Electronic Frontier Foundation. They told the 2nd U.S. Circuit Court of Appeals last month that a district judge imposed liability without considering potential non-infringing uses of the device or how the ruling would impact copyright law.
But in new filings, the company's opponents warned the appeals court that reading exemptions from liability broadly, even in the name of advancing technologies, eliminates incentive by new distributors to license content.
The Progress and Freedom Foundation's Solveig Singleton said in her think tank's filing that the lower court properly applied case law concerning direct liability for infringement. Singleton added that the ruling does not suppress technological innovation.
Cablevision's network-based service would harm consumers, "whose interest is in ensuring that creators are paid so they continue to produce," she said. Distributors also have "a long-run interest" in licensing "because their networks gain in value when more quality content is available," she added.
A joint filing from the Directors Guild of America, National Music Publishers Association, Recording Industry Association of America, Screen Actors Guild and others also argued in favor of the ruling.
The cable company cannot skirt liability as a direct infringer, nor can it rely on the "fair use" rights of its subscribers, they wrote. "When a defendant engages in commercial exploitation of consumer demand for copyrighted content, it invades the exclusive rights of the copyright owners, regardless of the end uses to which the content is put."
A pair of performance rights organizations -- the American Society of Composers, Authors and Publishers and BMI -- filed a separate brief complaining that Cablevision's service could deprive those in the music industry of royalties.
Certain on-demand transmissions by Internet music services are considered public performances, and fees are paid to ASCAP and BMI. But if Cablevision wins, those services could adopt a similar distribution model and claim that they no longer have to pay royalties, the groups said.
Webcasters could create a service that lets users specify songs, artists or music genres just as Cablevision customers could select particular TV shows and movies, they said. "As a result, music creators might lose this source or royalty income entirely."
Cable analyst Craig Moffett said the case has "sweeping ramifications for companies across the media-tech-telecom landscape" and could be "even more seminal" than the Supreme Court's MGM v. Grokster ruling against illegitimate file-sharing services.
A win for Cablevision would be "transformational to the economics of the cable business," but the prospect of widespread ad-skipping would be "devastating" to content creators. "The media value chain, broadly read, just isn't ready for this," he said.
600 New Hampshire Ave., NW