“If Aereo is preliminarily enjoined, thousands of its customers will see their accounts closed, Aereo's reputation for reliability will be irretrievably tarnished, and Aereo will forever lose the benefit of the goodwill associated with its market launch,” the company says in papers filed this week with the 10th Circuit Court of Appeals.
Aereo is seeking to reverse an injunction issued last week by U.S. District Court Judge Dale Kimball in Utah, who prohibited the company from operating in six states -- including Utah and Colorado, where the service already is live. Kimball later gave the Barry Diller-backed Aereo a two-week reprieve, allowing the company to operate while it files an emergency appeal with the 10th Circuit.
Aereo streams over-the-air television programs to consumers iPads, iPhones and other devices. The company also enables people to “record” programs and watch them later.
Broadcasters say Aereo is infringing copyright by transmitting programs without a license. But Aereo says it's legal due to its technological architecture, which relies on antennas to capture programs and then stream them to users.
Broadcasters have sued Aereo in New York, Boston and Utah; they also have sued Aereo rival FilmOn X -- which says it uses similar technology -- in Washington, D.C. and Los Angeles. Aereo prevailed at preliminary stages in New York and Boston, but broadcasters convinced judges in Los Angeles and Washington, D.C. to prohibit FilmOn X from operating.
Last month, the Supreme Court agreed to settle questions about Aereo's legality. That court will hear arguments in April, and is expected to issue a ruling by June.
Aereo argues that all proceedings in Utah should be stayed until the Supreme Court decides the case. “The Supreme Court is considering the central legal issue that underlies the propriety of an injunction in this case, and will rule within four months. Even if this Court were to view any of plaintiffs' theories as viable ... a stay pending appeal is nonetheless warranted because Aereo will suffer devastating harm if enjoined during those four months,” the company argues.
Aereo adds that its technology merely enables people to watch and record over-the-air TV, which they are legally entitled to do.
“If the preliminary injunction goes into effect, Aereo users in Utah will be cut off using their antenna and DVR to access local programming and, if Aereo is their only source of access, they will be cut off entirely from important local news as well as entertainment,” Aereo writes. “The effect would be akin to entering a person's home and removing their antenna and DVR and deleting the shows recorded on their DVR.”
That argument, while interesting, plays fast and loose with one of the most important aspects of this case: Aereo's system is remote; it streams programs to consumers via antennas and servers that are located in warehouses.
The broadcasters are obviously hoping that courts will draw a distinction between consumers' use of recording technology in their own homes -- like VCRs and DVRs -- and an offsite system that transmits programs to consumers. Whether that distinction will be important to the Supreme Court will remain unknown until later this year.
Meanwhile, the 10th Circuit has directed the broadcasters to respond to Aereo's arguments by Monday morning.