TV broadcasters are urging a federal appellate panel to uphold a contempt finding against online video provider FilmOn, which allegedly violated a court by streaming TV programs to consumers.
“This is a simple case of civil contempt,” the broadcasters argue in papers filed on Friday with the 2nd Circuit Court of Appeals. “FilmOn does not dispute that it engaged in precisely the infringing activity that the 2012 injunction prohibits: streaming plaintiffs’ programming over the Internet without authorization.”
The broadcasters' papers come in response to FilmOn's appeal of U.S. District Court Judge Naomi Reice Buchwald's July order holding the company and its founder, Alki David, in contempt, and ordering them to pay around $150,000.
Buchwald found FilmOn in contempt for continuing to operate its streaming service after the U.S. Supreme Court ruled that a similar product by the now-defunct Aereo infringed copyright. Buchwald said that FilmOn's streams violated a 2012 injunction that she entered against an earlier incarnation of the company.
The prior matter also stemmed from allegations that FilmOn infringed copyright by streaming programs online. But when that case went through the courts, FilmOn hadn't yet started using the multiple-antenna technology at the center of the lawsuits involving Aereo.
That more recent technology drew on individual mini-antennas to capture programs and stream them to users on an antenna-to-user basis. Unlike FilmOn's original system, the multiple-antenna technology was considered legal in New York, Vermont and Connecticut until last June, on the theory that each stream was a “private” performance.
But that theory was rejected last summer by the Supreme Court, which ruled that Aereo's transmissions were public performances regardless of the company's back-end technology. The Supreme Court said in its ruling that Aereo resembled a cable system, and therefore couldn't transmit programs without a license.
Aereo suspended operations three days after that decision, but FilmOn didn't stop using its multiple-antenna system to stream television programs until around July 8 -- nine days after Aereo did so. In the interim, FilmOn issued a press release touting a new streaming technology that it called the “teleporter.”
Several weeks later, Buchwald found FilmOn and David in contempt for violating the 2012 injunction, which prohibits FilmOn from infringing broadcasters' copyrights “by any means.”
She imposed sanctions of $90,000 to $100,000 for every day that FilmOn streamed programs after Aereo ceased doing so, and also ordered the company to pay attorneys for the TV networks around $56,000.
FilmOn is appealing that ruling on the grounds that it believed in “good faith” that the 2012 injunction didn't clearly prohibit it from using either the multiple-antenna technology, or the even newer “teleporter” technology.
The company also argues that it honestly thought it was entitled to a cable license as a result of the Supreme Court ruling. FilmOn applied for a cable license last summer, and says in appellate papers that it wasn't in contempt because it was entitled to a compulsory license.
The broadcasters are asking the 2nd Circuit to reject those arguments. “Acting in 'good faith' ...is no excuse for contemptuous conduct,” they argue in an appellate brief. “If FilmOn truly had doubt about what the 2012 Injunction prohibits, it should have promptly sought clarification or modification of the injunction, rather than gamble that plaintiffs would not discover or object to FilmOn’s continuation and expansion of its infringing service.”
Broadcasters also argue that FilmOn was never entitled to a cable license, noting that the U.S. Copyright Office refused to process FilmOn's application for a license.