The Streams Run Downhill: Part 1

Today’s blog post will focus on yet another online television streaming case. In a recent decision by the Federal District Court in Massachusetts, a company owning a local broadcast network found itself unable to get a preliminary injunction to stop a new start-up from converting its signals into a digital, streaming format.

The set-up of the case is interesting, in that it shows how changing technology can, in some cases, create new conflicts. Aereo, the defendant in this case, had recently begun a new service that allowed users, for a fee, to receive digital versions of broadcast television signals that they could either watch live or save on a DVR system for later viewing. To accomplish this goal, Aereo had set up a number of antennae around Boston in order to receive the broadcast signals for digital conversion. The Hearst Group, a media conglomerate that counts WCVB-TV in Boston as one its holdings, brought suit in the District Court of Massachusetts, alleging copyright infringement by Aereo, and further filed for a preliminary injunction to stop Aereo’s service while the litigation was ongoing. Aereo responded by asking the court to transfer the case to the Southern District of New York, where the company was incorporated.

As a preliminary matter, the court first rejected the motion for transfer. It explained that even though Aereo was incorporated in New York, and the Hearst Group had its place of principal business there as well, the Hearst Group’s choice of venue would have to be given deference unless Aereo could show some reason why the action should be transferred. In this case, since the Hearst Group’s claim was restricted to Aereo’s conversion of signals only from WCVB, based in Boston, and since Aereo did a great deal of business in the city, there was no sufficient reason to transfer the case. Further, as the court pointed out, the litigation was in an advanced enough stage that the transfer would have the pernicious effect of delaying the litigation, which the court also deemed to be a factor in denying Aereo’s request. Looking at the rest of the decision, it is clear that at least one reason for Aereo’s attempt to move venue is that the 2nd circuit, which encompasses New York, had a more substantial body of favorable precedent than the 1st Circuit, and, in addition, Aereo had already prevailed in a similar suit in the 2nd Circuit just months prior.

Next week we will begin to review the court's process in reaching its decision.


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