It was a good day in the Supreme Court for FilmOn, Aereo and the rest of the cloud computing industry. Analysis of who “won” the Aereo Supreme Court argument seems to be split, depending on whether the author focuses on the justices’ questions regarding the purpose of Aereo’s technological architecture or on the cloud computing industry. However, only one of these considerations should have any bearing on the Court’s decision, and it is not the argument that Aereo’s technology is specifically designed to pass through a legal loophole.
The technological gimmick question has been a central criticism in every oral argument and opinion in the FilmOn and Aereo cases. But that criticism is totally irrelevant. Whether a performance is public or private under the Copyright Act does not depend on the efficiency of a given technological system. Nevertheless, Aereo’s counsel provided numerous valid justifications for Aereo’s technological setup. In addition to those arguments, FilmOn’s architecture enables more efficient digital tuning by providing each user his or her own dedicated mini-antenna. In any event, even if one assumes the technology employed by FilmOn and Aereo is a “gimmick.” That gimmick is more accurately described as innovation specifically designed to comply with the law, as articulated in the Transmit Clause and the Cablevision case.
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More significant were the questions posed by the Court related to cloud computing and the impact of a decision in favor of the networks on the cloud computing industry. When asked how a decision in favor of the networks would impact cloud computing, the Networks punted. Indeed, neither the networks nor the government had any coherent proposal to protect the cloud computing industry from the adverse consequences that would flow from a ruling against Aereo. In fact, when the networks’ counsel attempted to compare Aereo and other cloud storage companies, on the one hand, to an automobile dealer and a valet parking service, on the other hand, Justice Roberts disagreed. Instead, he asked, why would Aereo not be more accurately compared to a public parking garage? Of course, many cloud computing companies offer more than just storage, a point raised several times by Justice Kagan. It is even less clear how a decision against Aereo would avoid an unintended adverse impact on those companies.
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The Court’s concern with the cloud computing industry was evident in questions by several other members of the Court, including Justices O’Connor, Breyer and Alito. Based on yesterday’s argument, it is clear the Court will take steps to protect the individual’s right to use technology offered by companies in the cloud computing industry to privately perform copyrighted work. FilmOn and Aereo have urged the Court to include them in that group. After the argument, Aereo’s counsel said he was “cautiously optimistic.” I think he should be.
Ryan Baker is a partner in Los Angeles based firm Baker Marquart. The Harvard Law School grad’s practice areas include intellectual property, entertainment, antitrust, securities and white collar crime. Ryan has appeared on CNN’s Burden of Proof and on NBC Channel 4 News in Los Angeles and he been named a rising star by Los Angeles magazine several times and a super lawyer in 2014 .
(TV Mix is owned by FilmOn Networks).
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