A Supremely broken Aereo  

Even though it reaches the correct outcome (0), the Supreme Court’s Aereo opinion is staggeringly, and confusingly, bad. The court’s “looks like cable” analysis fails to address the difficult questions about the meaning of the Copyright Act; rather, it has added to existing confusion. This outcome was entirely predictable. As I have explained before (1), by framing the questions presented in traditional copyright terms – the meaning of the Transmit Clause – the court painted itself into a corner where any decision would either get the policy right and the law wrong, or get the law right and the policy wrong.

I would like to use this post to rewrite the Supreme Court’s opinion, anchoring it in the statutory language and analysis relevant to the underlying policy concerns that guided the opinion. This is, without question, a true act of hubris on my part. I don’t just mean to explain what the court could or even should have said: I would suggest that the analysis I present here is what the court actually meant to say. I offer this analysis because I believe that those who try to use the court’s opinion in any context other than the (near-)simultaneous retransmission of a broadcast television signal are engaged in a fool’s errand – and because we are already seeing firms try to do just that.

The most perplexing and problematic aspect of the Supreme Court’s opinion is that it never uses the term “primary transmission.” A primary transmission is a signal broadcast to the public that is later retransmitted by another service (a secondary transmission). Section 111(f) of the Copyright Act defines this term, and notes expressly that any streams broadcast by a broadcast television station are primary transmissions. The Act then defines “secondary transmission” as the “further transmitting of a primary transmission simultaneously with the primary transmission.” This is precisely what Aereo was doing: it made a secondary transmission of a primary transmission.1

In other words, the Copyright Act has special provisions dealing with the retransmission of signals from broadcast television stations. Indeed, the first sentence of Section 111 tells us that “the secondary transmission of a performance or display of a work embodied in a primary transmission is not an infringement of copyright if … ,” and goes on to offer various circumstances in which secondary transmissions of a primary transmission do not violate copyright. The implication – supported by one of the most basic principles of statutory construction2 – is that any secondary transmission is in fact a copyright violation unless it falls into one of the listed exceptions.

Approaching the case this way avoids the difficulties that the Supreme Court faced in interpreting the Transmit Clause. We need not consider whether the secondary transmission is a “performance” or if it is made to “the public.” This is demonstrated by an example of what constitutes a secondary transmission in the Act’s definition of a cable system: a cable system makes a secondary transmission when it transmits “signals or programs [broadcast by one or more FCC-licensed broadcasters] by wires, cables, microwave, or other communications channels to subscribing members of the public who pay for such service.”

Addressing the question in this way also avoids the question of cloud services – the question that dogged both the Supreme Court and petitioners. Section 111(a)(3) exempts carriers that do not have direct or indirect control over which primary transmissions are retransmitted, or to whom they are transmitted. This provision can easily be read to limit the impact of a holding based on Section 111 to only capture those firms that (like Aereo) capture broadcast television signals and retransmit them to subscribers.

It is entirely possible that the court would ultimately reject this argument. Nonetheless, given the precision of the statutory language, one would expect the court to at least consider it – even if only to reject it as the basis for their opinion. Indeed, one would expect it to be the starting point in the court’s analysis.

If the approach that I suggest here is as good as it sounds, the real question is why the Supreme Court didn’t use it. There are many possible reasons – and we will likely never know the real answer. The most likely is that the case was framed, briefed, and argued in terms of the Transmit Clause, focusing on the meaning of “publicly performs.” In other words, the court asked the wrong question. If this is the case, the court should perhaps have dismissed the petition as improvidently granted, perhaps soliciting additional cert petitions on the correct question.

It is curious to consider why the parties framed the issues as they did. The obvious explanation is that Aereo’s business model was from the start premised on threading its copyright-infringing freight train through the eye of the Second Circuit’s Cablevision RS-DVR decision. This framed the issue in the Transmit Clause from the start. But there is an equally likely and more problematic explanation: the parties didn’t want the Supreme Court to focus on the relevant statutory language. Aereo has consistently attempted to avoid being classified as a cable system, which could result in extensive FCC regulation that would undermine its business model. Broadcasters, on the other hand, don’t want Aereo classified as a cable system because that could allow Aereo to avail itself of the Copyright Act’s compulsory license – effectively giving Aereo free access to their content. In either of these cases, treating Aereo as a secondary transmitter would have been a step down the path towards treating Aereo as a cable system. The consequence is that both parties had the incentive to present the case to the court in a way that avoided the proper framing of the question.

Of course, having asked for briefs and arguments on the wrong question doesn’t foreclose the Supreme Court from answering the correct question of its own accord. While the court is sometimes reluctant to veer from the questions presented or to consider arguments other than those briefed, it certainly can do so – particularly in cases such as this, where the parties may have faced incentives to avoid the best framing of the question.

And, indeed, the Supreme Court should have had some awareness of the Section 111 arguments. In their briefs, the parties argue, obliquely, over whether Aereo is making a secondary transmission. Aereo attempts to use a distinction in the statute’s discussion of secondary transmission to argue that there is a distinction between retransmitting the primary transmission itself and transmitting a copy of the contents of that transmission – if right, this distinction could have an impact on the argument that Aereo was “publicly performing” copyrighted content. The broadcasters responded that Aereo was drawing a distinction without meaning, that Aereo, in fact, was making a secondary transmission.

Importantly, neither party argued – or wanted to argue – that Aereo was making a secondary transmission for purposes of establishing a copyright violation. Rather, they were arguing the point for its salience to the public performance question. Regardless of their purpose, the parties’ briefs would have made the Justices sufficiently aware of Section 111’s framework to find answers to their questions there.

This is why the court’s opinion is truly perplexing. The majority focuses extensively on Aereo’s system as “cable-like,” and on the history of retransmission of broadcast television content by “cable-like” systems. And it acknowledges Section 111 – which it also has the benefit of the parties’ briefs in understanding – describing it as “a complex, highly detailed compulsory licensing scheme that sets out the conditions, including the payment of compulsory fees, under which cable systems may retransmit broadcasts.” Yet despite the court’s awareness of this “highly detailed” statutory provision written specifically to address the retransmission of broadcast television content by “cable-like” systems, its opinion does nothing more than note Section 111 in passing. Rather, the Supreme Court reaches the same end with a forced reading of the Transmit clause, further unsettling an already uncertain area of law in the process.

Regardless of why the Supreme Court took this approach, the reality is that its decision has made an unfortunate mess of already complicated questions in copyright law. The dissenting opinion’s concerns about the majority’s abuses of statutory construction are well placed. The positive outcome of the opinion is that, at a policy level, the court clearly got things right, vis-a-vis the relationship between broadcasting and copyright. But in so doing, it has damaged the Copyright Act’s already delicate statutory framework.

(1) Importantly, the Act does not require that secondary transmissions be made by a cable system. For instance, the term secondary transmission is also used in Section 119 to refer to retransmission by satellite carriers, and Section 111 makes distinctions between, e.g., “secondary transmissions” and “secondary transmissions by a cable system.”

(2) This canon of construction is expressio unius est exclusio alterius, or “expression of the one excludes the others.” This means that a statute that indicates several states of the world subject to the statute should be read to exclude other states of the world from the statute, unless the statute contains language suggesting that the listed states of the world are only examples.

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