ICLE files an Amicus Brief In Fox v. Aereo Killer

Kristian Stout —  4 February 2016

On Wednesday, the International Center for Law & Economics, along with the Competitive Enterprise Institute, filed an amicus brief in the Ninth Circuit Court of Appeals supporting the appellants in Fox Television Stations, Inc. v. Aereo Killer LLC. The case arose out of Aereo Killer’s Internet video platform, from which it would retransmit content without either the consent of the broadcast stations or permission from the holders of copyrights in the content it distributed.

Aero Killer essentially seeks to engage in regulatory arbitrage by, on the one hand, claiming that it qualifies for compulsory licenses as a “cable system” under Section 111 of the Copyright Act, while on the other hand seeking to avoid applying for “retransmission consent” under the Cable Act.

In our brief we explore the issue of the interplay between “retransmission consent” and “compulsory licenses,” and on Aereo Killer’s unjust and illegal attempt to create a carve out for itself in violation of Congressional intent:

Defendants seek a compulsory license under Section 111 of the Copyright Act, which would allow them to sell a service that retransmits copyrighted television shows without permission from the program owners—while paying only statutorily determined royalties that do not come close to market rate for Plaintiffs’ programming. At the same time, however, Defendants have configured their service so that they do not need to obtain consent from the broadcasters whose signals they wish to retransmit, because Internet-based retransmission services do not meet the Communications Act’s definition of an MVPD. On the latter point Defendants are correct: Internet-based retransmission services are not MVPDs. However, treating their service as a “cable system” under the Copyright Act, but not under the Communications Act, is contrary to the statutory framework Congress created.

In practice, and by design, therefore, a service that retransmits television programming is subject to both provisions, or neither of them, depending on the technical details of the service. Congress affirmed its intent that these provisions go hand-in-hand in 1994

Congress crafted the statutory regime as it did precisely to prevent the unjust enrichment of television resellers at the expense of broadcasters and copyright owners. Defendants do not operate a cable system and are thus ineligible for the compulsory copyright license. If they wish to retransmit plaintiffs’ television programming, they are free to bargain for a copyright license, as so many other Internet-based video distributors have done.

Kristian Stout


Kristian Stout is the Associate Director for Innovation Policy at the International Center for Law and Economics (ICLE). As a technology professional and entrepreneur for over ten years, Kristian’s scholarship is influenced by a practical understanding of the challenges facing innovators in the modern economy. Kristian has previously been a lecturer in the computer science department of Rutgers University, is frequently invited to speak on law and technology topics, and has been published in law journals and legal treatises. Kristian is an attorney licensed to practice law in New Jersey and Pennsylvania, is a partner at A&S Technologies, a software services firm, and sits on the board of CodedByKids, a nonprofit organization that provides STEM education to underprivileged children.

One response to ICLE files an Amicus Brief In Fox v. Aereo Killer


    Nonsense. 47 USC 522 (7)(A), for example, specifically exempts cable systems that retransmit only broadcast stations from retransmission consent. Accordingly, the claim that Congress intended compulsory license eligibility and retransmission consent to always go hand-in-hand is obviously false.

    The two don’t always go together because, in fact, retransmission consent was never intended by Congress to provide compensation to broadcasters for the market value of their programming (and explicitly not for the market value of national programming from networks), but rather, to provide broadcasters a means to compete effectively with potential competition from cable operators. The legislative record is very clear on this. (Though history has proven that this concern over competition was entirely misguided.)

    The claim that Congress intended otherwise is manufactured of whole cloth, to bolster an argument for the particular end you hope to see.

    If Congress had intended the two to go hand in hand, they could very easily have adopted the Copyright Act definition of “cable system” for the purposes of retransmission consent, rather than carefully crafting a different definition.

    At the same time, the language of the Copyright Act defining “cable system” very clearly reads on an operator such as FilmOn/AereoKiller (and the former Aereo). Furthermore, like many other provisions of the Copyright Act, that definition was very clearly worded to extend beyond then-current technologies, using technology neutral language.

    If new circumstances and/or a new view as to the proper role of retransmission consent cause Congress to believe that now the compulsory license and retransmission consent should always go hand-in-hand (or even just that this particular instance represents an unjust situation) then that is for them to say, and to implement in law. It is not for the courts to substitute their own judgment regarding such for that of the Congresses that adopted the relevant provisions of the Copyright Act and the Communications Act.