Litigators of the Week: Paul Smith of Jenner & Block and Robert Alan Garrett of Arnold & Porter
FilmOn TV Networks Inc. has pulled some odd publicity stunts, so it can be hard to take the company seriously. But make no mistake: FilmOn's business model of offering network television to subscribers over the Internet — a model it shares with its polished, well-funded rival Aereo Inc. — poses a serious threat to the major networks. That threat got even more serious in April, when the U.S. Court of Appeals for the Second Circuit ruled that Aereo isn't infringing the networks' copyrights.
Fortunately for the networks, two of their lead lawyers — Paul Smith of Jenner & Block and Robert Alan Garrett of Arnold & Porter— are using litigation against FilmOn to even the score. U.S. District Judge Rosemary Collyer in Washington, D.C., ruled on Sept. 5 that FilmOn is likely infringing copyrights owned by Jenner client Fox Broadcasting Company and A&P clients American Broadcasting Companies Inc., CBS Corporation, and NBC Universal Inc. Siding with arguments raised by Smith and Garrett, Collyer issued a preliminary injunction blocking FilmOn from operating in every U.S. state outside the Second Circuit.
FilmOn streams broadcast television to subscribers' mobile devices and computers without paying retransmission fees to the networks. The service is now simply called FilmOn X, but it's also operated as AereoKiller and been available at the domain name BarryDriller.com. Those names were obviously intended to get a rise out of Aereo, which offers more polished service than FilmOn. Aereo is funded partly by media mogul Barry Diller, the original founder of Fox. FilmOn's founder, billionaire heir Alki David, has been known to pick odd court fights with Diller, as we've reported.
Despite some major differences in corporate style, Aereo and FilmOn are stand-ins for one another when it comes to copyright litigation. Both argue that they offer "private performances" of broadcast television, and therefore don't violate the Copyright Act, which only enables copyright-holders to prohibit public performances of their works. Aereo and FilmOn are able to credibly make that argument because of the unusual way they're set up. Both have filled warehouses with thousands of tiny dime-sized antennas that retransmit TV to individually-assigned subscribers. Aereo and FilmOn say that their antennas make unique copies of copyrighted works at the behest of users, just like DVR players, which the Second Circuit called perfectly legal in a seminal 2008 decision known in copyright circles as Cablevision.
As you'd expect, broadcasters have sued Aereo and FilmOn in multiple jurisdictions. Smith and Garrett have been key members of the broadcasters' deep legal bench, which also includes Jenner's Richard Stone and Julie Ann Shepard and John Ulin and James Blackburn of A&P.
The first ruling on the merits came in a New York federal case involving Aereo. As we reported here, U.S. District Judge Alison Nathan ruled against the networks last July, accepting Aereo's DVR comparison. The Second Circuit affirmed Nathan by a 2-1 vote in April. Smith argued for the networks at the Second Circuit along with Bruce Keller of Debevoise & Plimpton.
Thanks to Smith and Garrett, the networks have bounced back quickly from their loss in New York. While they haven't prevailed against Aereo, they're 2-0 against FilmOn. In December, a team of lawyers from Jenner and A&P convinced a federal judge in Los Angeles that FilmOn (then called AereoKiller) likely engages in copyright infringement. The judge, George Wu, issued an injunction shuttering the service, though he deliberately limited the scope of his injunction to a few states. Smith and Garrett jointly argued that case at the U.S. Court of Appeals for the Ninth Circuit in August. We're awaiting a decision.
Meanwhile, the Jenner and A&P lawyers have been doing battle with FilmOn and its lawyers at Baker Marquart in Washington. Judge Collyer had originally scheduled a Sept. 20 oral argument. But after reflecting on the text and legislative history of the Copyright Act, Collyer was so convinced of FilmOn's illegality — not to mention the Second circuit's error — that she opted to decide the case based on the papers. The winning brief was put together by Smith, Garrett, Stone, Shepard, Ulin, and Blackburn, among others.
David, FilmOn's founder, cried foul following the networks' Sept. 5 victory. "The judge is clearly in (the broadcasters') pockets," he wrote in an e-mail to Variety. "Anyway. . . I'm on my yacht in (the) Mediterranean at the moment so they can kiss my hairy Greek ass. This is just a temporary setback."
Smith, for his part, suggested that Collyer's ruling is just the latest sign that FilmOn and Aereo are dead in the water. "Our argument is that these Aereo-like services are doing the same thing as cable companies," Smith told us. "We've won in every jurisdiction that doesn't have to follow the Second Circuit's decision in Cablevision. We think our position is very strong and also very simple, and we're hopeful that our position will prevail."