Fox Broadcasting won a court order halting Barry Diller-backed Aereo's online-TV service in Utah while the U.S. Supreme Court weighs whether it infringes broadcasters' copyrights.
U.S. District Judge Dale A. Kimball in Salt Lake City yesterday granted the request by Fox to block the service while the Supreme Court case is pending, saying Fox and the local TV stations that brought the lawsuit were likely to succeed on the merits of their infringement claims and would suffer irreparable harm without an injunction.
That's an unusual result for Aereo, which has typically been allowed to continue operating while the broader legal challenges continue.
Aereo uses thousands of dime-sized antennas to obtain broadcast signals without paying fees to networks. The company last month had to temporarily close its service to new subscribers in New York because it ran out of capacity. Aereo operates in nine other U.S. cities, with plans to expand after it completed a $34 million round of funding last month.
Chet Kanojia, chief executive officer of New York-based Aereo, said he was disappointed by the decision.
"Consumers have a fundamental right to watch over-the-air broadcast television via an antenna and to record copies for their personal use," he said in an e-mailed statement. "The Copyright Act provides no justification to curtail that right simply because the consumer is using modern, remotely located equipment."
The Supreme Court agreed last month to hear a copyright case by media companies including Twenty-First Century's Fox, CBS Corp., Walt Disney Co.'s ABC and Comcast's NBCUniversal. Unlike Aereo, cable and satellite carriers pay the broadcasters for the right to distribute their programming, even though it's available for free over the air through an antenna.
Broadcasters say a federal appeals court ruling favoring Aereo created a blueprint that might let cable and satellite providers avoid paying those "retransmission" fees. With those fees estimated to exceed $4 billion this year, some broadcast companies say they may convert to cable channels if Aereo isn't shut down.
~ Bloomberg News ~