Here we go… Major broadcast networks are taking the Aereo fight right to the top. Reuters reports that the four US networks filed a request to have the Supreme Court hear the case of whether or not Aereo’s novel scheme for bypassing broadcast law is actually legal.
Now, it’s not even clear if the Supreme Court will take up the case; they have until the end of the year to decide. However, this seems tailor-made for a SCOTUS decision because appeals courts in two different parts of the country have said two opposing things. The eastern courts say Aereo is legal, while in the west, the court says they can’t operate.
There’s a lot to this, and it really depends on how far the court wants to take it. The real question is, if you do something that you know is only designed to bypass the current law, even though you know that it’s only legal on a technicality… is that legal or illegal? That question could apply to a lot of things, not just broadcasting. While the broadcasters contend that what Aereo is doing is actually broadcasting, the fact is that it isn’t. Aereo uses a single antenna per user and that makes it placeshifting, which is legal. But really, it’s just like broadcasting, except that Aereo did an end run around the language of the law.
When you talk about exploiting loopholes of any kind, the relevant statement comes from Judge Learned Hand who said in 1935,
Anyone may arrange his affairs so that his taxes shall be as low as possible; he is not bound to choose that pattern which best pays the treasury. There is not even a patriotic duty to increase one’s taxes. Over and over again the Courts have said that there is nothing sinister in so arranging affairs as to keep taxes as low as possible. Everyone does it, rich and poor alike and all do right, for nobody owes any public duty to pay more than the law demands.
This is often taken to mean that it is not illegal to use the way a law is written to your own benefit. While it specifically applies to tax law, there’s no reason it can’t apply to broadcast law. It’s our belief that the court will see it this way and kick it back down to the FCC to redraft broadcast law so that what Aereo does is illegal, but in a way that keeps things like Slingboxes legal. Perhaps it will hinge on the idea that Aereo requires a service fee.
The other major bit of law here is Fox Vs. Cablevision, where Fox tried to proved that Cablevision’s on-demand service was illegal since programs were being broadcast from a remote server. Fox lost that battle, and though Cablevision originally opposed Aereo’s attempt to do essentially the same thing with live TV, the company has recently changed its mind and now claims to support Aereo in its fight against broadcasters.
Again, here, we think the Supreme Court will use the Cablevision decision in determining that Aereo is not illegally broadcasting.
We’ll know by the end of the year if the court will even take this up, and if they’ll choose to do it in the current term. If they do, there may be an answer as soon as June. If not, this could drag on for decades.