Litigation magnet Aereo Inc. reached a settlement on Monday with billionaire Alki David, the founder of rival TV streaming company FilmOn. The deal brings an end to David’s quixotic fight with Aereo and its top financial backer, Barry Diller, leaving the companies to face their real adversary: network television.
David has repeatedly irked Aereo by adopting names like Aereokiller.com and BarryDriller.com for his streaming TV service. As part of a deal to settle three separate lawsuits pending before U.S. District Judge Audrey Collins in Los Angeles, David agreed this week to permanent injunctions barring him from using the Aereokiller or Barry Driller monikers in connection with any business activity.
David’s lawyer, Ryan Baker of Baker Marquart, passed along a joint statement from the parties saying that Diller, Aereo, David, and Filmon.com settled on "mutually acceptable terms."
"The parties are pleased to have resolved these matters and can now focus on their respective business operations," the statement said. Baker declined to comment further. Diller’s lawyer, Robert Platt at Manatt, Phelps & Phillips, did not immediately respond to our call.
The détente between Diller and David will allow them to focus on the existential threat to their respective companies posed by the networks and their broadcast affiliates, which are pursuing copyright litigation on both coasts. As we’ve reported, in April a divided three-judge panel of the U.S. Court of Appeals for the Second Circuit ruled that the Aereo’s ingenious-if-convoluted system to stream broadcast TV signals over the Internet probably doesn’t violate network copyrights. In California, meanwhile, David’s lawyers at Baker Marquart are hoping to persuade the U.S. Court of Appeals for the Ninth Circuit to reverse a lower court ruling that sided with the networks.
Instead of capturing network programming with one big, powerful antenna, Aereo has filled a warehouse in Brooklyn with unique miniature antennas assigned to each subscriber. Pointing to a prior Second Circuit ruling involving Cablevision, Aereo’s lawyers contend that the company’s service doesn’t amount to a "public performance" under the copyright laws, and therefore doesn’t constitute an infringement of the networks’ rights.
Although that argument won over the Second Circuit majority last month, Circuit Judge Denny Chin wrote a sternly worded dissent calling Aereo’s method "a Rube Goldberg-like contrivance, over-engineered in an attempt to avoid the reach of the Copyright Act and to take advantage of a perceived loophole in the law." The networks have asked the Second Circuit for en banc review.
David and FilmOn, which also relies on individually-assigned antennas to stream broadcast TV, so far haven’t fared as well against the networks. In December U.S. District Judge George Wu in Los Angeles issued a preliminary injunction after finding that David’s companies were infringing the networks’ copyrights under Ninth Circuit precedent. FilmOn’s Ninth Circuit appeal is pending. Interestingly enough, Aereo filed an amicus brief supporting FilmOn in March–nearly two months before the companies announced the settlement of their own dispute.
The networks are represented at the Ninth Circuit by Jenner & Block (for Fox) and Arnold & Porter (for ABC, CBS, NBC, and Telemundo).
