This just in: The Tenth Circuit Court of Appeals just whacked the grin off Aereo’s face. Aereo is a technology company that provides live and time-shifted (think DVR) streams of TV shows to devices that connect to the Internet. Basically you get to watch True Detective or The X Factor on your iPad for a fee to Aereo that is a fraction of the cost of cable.

The reason Aereo has been causing TV executives to sweat is the tech company doesn’t pay the executives a dime. ABC, CBS, HBO, FOX—none of them get a cent—and (this might get your hackles up, too) neither do the directors, the actors, or the writers.

Aereo doesn’t have to pay anyone because its service, under the law as it is currently interpreted, is not a public performance. Just as you don’t have to pay CBS to have your friends over to watch the Superbowl (because it’s not a public performance), Aereo doesn’t have to pay CBS to broadcast an episode of Two and a Half Men to hundreds of thousands of people. If that doesn’t make sense, you’re starting to get why this case is going to the Supreme Court.

In 2008, the Cablevision case opened a gaping hole in copyright law. The Second Circuit Court of Appeals ruled that Cablevision could legally deliver remote DVR services to its customers because (1) the buffer copies were fleeting, not fixed, and thus not “copies” under the Copyright Act; (2) the consumers made the recordings, not Cablevision; (3) the playbacks of the recordings were not public performances because each copy could be played by only the consumer who recorded it. This service was not a public performance, and it was not copyright infringement.

Aereo moseyed through this open hole. Its service assigns an individual antenna to an individual subscriber. This antenna broadcasts a subscriber-requested performance to only the individual subscriber. This is not a public performance because it abides by Cablevision‘s precedent. Thus, it is not copyright infringement.

Before Friday, March 7th, Aereo’s service had been upheld in court time and time again. What could the lower courts do? Explicit case precedent forbid them from proscribing the novel technology. Aereo believed it couldn’t be beaten. Broadcasters switched up the five stages of grief and just got angrier. That is, before Friday.

The Tenth Circuit was hearing an appeal of a District Judge’s granting of a preliminary injunction against Aereo’s service based on the judge’s reasoning that broadcasters were likely to win on the merits of their copyright claim because Aereo irreparably harms them. The 10th Circuit upheld the lower court’s injunction, which will deny Aereo from providing its service in states touched by the Tenth Circuit’s jurisdiction (Utah, New Mexico, Colorado, Oklahoma, Wyoming, and Montana).

To be sure, however, this is all chump change and opening round jabs before April 22, when the Supreme Court gets its chance to hear the case and make a ruling that will ultimately determine the direction in which television broadcasting will go. Until then, we can all hold our collective breaths.

Doruk Onvural

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