Scarinci Hollenbeck, LLC, LLCScarinci Hollenbeck, LLC, LLC

Firm Insights

Networks Defeat Aereo 6-3 In The Supreme Court

Author: Scarinci Hollenbeck, LLC

Date: July 2, 2014

Key Contacts

Back

The Supreme Court recently made a powerful ruling that has implications for the way that we watch TV, and more importantly, the development of disruptive technologies.

On June 25th, the Court ruled 6-3 in favor of the networks against a TV startup called Aereo, saying that the company will need to pay the networks for the re-broadcasting of their content.

Aereo’s business model worked on the same principle that governs an antenna in your own home. Once you buy the antenna, the signals that it picks up from networks like ABC, CBS, Fox, NBC and PBS are free. Networks don’t charge for over-the-air broadcasts because most of their money comes from advertising anyway – the more people that watch their channels, the more money they make.

However, many people don’t like installing antennae in their homes because the signal is unreliable and most premium channels don’t broadcast for free. Aereo solved the first problem by lining a warehouse with tens of thousands of tiny antennae next to a machine that amps up the signal’s power. Users were allowed to rent one of these antennae for $8 per month, the signals from which were pumped back to them over the Internet, making Aereo one of the cheapest options in television.

Court Ruling

This is all set to change now that the Supreme Court has ruled against Aereo. To their credit, the justices were careful to tread lightly in the face of the potentially massive and unpredictable ramifications such a ruling might have. Liberal justice Stephen Breyer, who led the majority that voted against Aereo, told the startup’s lawyer that he did not understand what a decision either for or against the company would do to other kinds of technologies.

In the end, the majority opined that Aereo was overwhelmingly similar to the cable companies that were specifically targeted by amendments that Congress made to the Copyright Act in 1976. Breyer acknowledged that Aereo has a key difference in that its system remains inert until a subscriber indicates that he or she wants to watch a program, but found that the difference was ultimately not critical.

“This difference means nothing to the subscriber,” he wrote. “It means nothing to the broad­caster. We do not see how this single difference, invisible to subscriber and broadcaster alike, could transform a system that is for all practical purposes – a traditional cable system into a copy shop that provides its patrons with a library card.'”

While Aereo was never a massive company – at least in part due to its limited range of content – the finding would have carried important ramifications either way. Finding for Aereo would have meant that the piece of copyright law that ensured that cable companies had to keep subsidizing networks would have been weakened, or potentially caused them to stop transmitting for free over the air. Find for the broadcasters, however, and there is the potential for damage to citizens’ rights to obtain free content.

In the end, the Supreme Court took an extremely narrow opinion and ruled that Aereo’s business model was illegal only in that it is extremely similar to old CATV systems. While the startup’s users are likely to be disappointed, this is probably the safest ruling the Court could have made for the long-term development of new technologies.

If you are interested to learn how this entire case began, check out Is Aereo Fight Headed to the U.S. Supreme Court?  at www.businesslawnews.com.

If you have any questions about this post or would like to discuss your sports and entertainment matters , please contact one of your Sports and Entertainment attorneys.

No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.

Scarinci Hollenbeck, LLC, LLC

Related Posts

See all
Guardianships in New Jersey: When a Loved One Can No Longer Manage Personal or Financial Affairs post image

Guardianships in New Jersey: When a Loved One Can No Longer Manage Personal or Financial Affairs

When a family member can no longer make important decisions for themself, the question is often not whether the family will step in, but whether they have the legal authority to do so. A spouse may manage household finances, or an adult child may arrange medical care and pay bills. Still, informal assistance does not […]

Author: Marc J. Comer

Link to post with title - "Guardianships in New Jersey: When a Loved One Can No Longer Manage Personal or Financial Affairs"
New Jersey’s Revised UHAC Regulations: What Residential Developers Need to Know About Affordable Housing Commitments post image

New Jersey’s Revised UHAC Regulations: What Residential Developers Need to Know About Affordable Housing Commitments

New Jersey residential developers with affordable housing obligations should carefully review their existing approvals, development agreements, and proposed deed restrictions in light of the State’s revised UHAC regulations (Uniform Housing Affordability Controls). The regulations, which took effect on November 6, 2025, significantly change the administration and physical requirements for affordable housing units. For developers with […]

Author: Wendy Rubinstein Quiroga

Link to post with title - "New Jersey’s Revised UHAC Regulations: What Residential Developers Need to Know About Affordable Housing Commitments"
“No Comment” Culture: Why Silence Is Often the Riskiest Legal Strategy post image

“No Comment” Culture: Why Silence Is Often the Riskiest Legal Strategy

A “no comment” response is sometimes the right call when a legal problem arises. As a blanket policy, however, it lets allegations go unanswered, deadlines pass, evidence disappear, and manageable disputes grow into expensive litigation. The businesses that fare best are usually the ones that say little publicly while acting decisively behind the scenes. When […]

Author: Sean M. Pena

Link to post with title - "“No Comment” Culture: Why Silence Is Often the Riskiest Legal Strategy"
Utility-Scale Battery Storage Projects: A Legal Roadmap for Developers, Property Owners and Other Stakeholders post image

Utility-Scale Battery Storage Projects: A Legal Roadmap for Developers, Property Owners and Other Stakeholders

Utility-scale battery energy storage systems (BESS) are becoming an increasingly important component of the electric grid throughout New Jersey, New York, and Pennsylvania. As renewable generation expands, electricity demand increases and grid operators seek greater flexibility, battery storage can help balance supply and demand while providing additional capacity and reliability. For developers, battery storage presents […]

Author: Nicholas Wall

Link to post with title - "Utility-Scale Battery Storage Projects: A Legal Roadmap for Developers, Property Owners and Other Stakeholders"
Navigating Disputes: Hire a Partnership Dispute Lawyer post image

Navigating Disputes: Hire a Partnership Dispute Lawyer

A falling out between partners can be disastrous for any business. In many cases, the partnership will not survive. If you are in an unworkable situation with your partners, it may be time to consult a partnership dispute lawyer experienced in handling partnership breakups and dissolutions before the situation deteriorates any further. It is easy […]

Author: Jay McDaniel

Link to post with title - "Navigating Disputes: Hire a Partnership Dispute Lawyer"
Section 363 Sales in Bankruptcy: What Businesses, Lenders, and Buyers Need to Know post image

Section 363 Sales in Bankruptcy: What Businesses, Lenders, and Buyers Need to Know

When a company enters Chapter 11 bankruptcy, many assume the process will culminate in a lengthy reorganization plan. However, distressed businesses are increasingly being sold through a different mechanism — a sale under Section 363 of the United States Bankruptcy Code. A Section 363 sale allows a company, as a debtor-in-possession in bankruptcy, to sell […]

Author: John D. Giampolo

Link to post with title - "Section 363 Sales in Bankruptcy: What Businesses, Lenders, and Buyers Need to Know"

No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.

Sign up to get the latest from our attorneys!

Explore What Matters Most to You.

Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.

Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.

Let`s get in touch!

* The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form. By providing a telephone number and submitting this form you are consenting to be contacted by SMS text message. Message & data rates may apply. Message frequency may vary. You can reply STOP to opt-out of further messaging.
“If you would like to submit a file, please email it directly to info@sh-law.com.

Sign up to get the latest from the Scarinci Hollenbeck, LLC attorneys!