''WPIX, Inc. v. ivi, Inc.'', was a

copyright infringement Copyright infringement (at times referred to as piracy) is the use of Copyright#Scope, works protected by copyright without permission for a usage where such permission is required, thereby infringing certain exclusive rights granted to the c ...

case heard before the

United States Court of Appeals for the Second Circuit The United States Court of Appeals for the Second Circuit (in case citations, 2d Cir.) is one of the thirteen United States Courts of Appeals. Its territory covers the states of Connecticut, New York (state), New York, and Vermont, and it has ap ...

. The appeals court affirmed the decision of the

district court District courts are a category of courts which exists in several nations, some call them "small case court" usually as the lowest level of the hierarchy. These courts generally work under a higher court which exercises control over the lower co ...

to grant an

injunction An injunction is an equitable remedy in the form of a special court order compelling a party to do or refrain from doing certain acts. It was developed by the English courts of equity but its origins go back to Roman law and the equitable rem ...

for the

plaintiff A plaintiff ( Π in legal shorthand) is the party who initiates a lawsuit (also known as an ''action'') before a court. By doing so, the plaintiff seeks a legal remedy. If this search is successful, the court will issue judgment in favor of the ...

s, barring ivi, Inc. from broadcasting television programming over the

Internet The Internet (or internet) is the Global network, global system of interconnected computer networks that uses the Internet protocol suite (TCP/IP) to communicate between networks and devices. It is a internetworking, network of networks ...

. This decision set a precedent that broadcast television material can be protected by copyright and cannot be re-transmitted on the Internet without permission.

Background

ivi, Inc. is a

Seattle Seattle ( ) is the most populous city in the U.S. state of Washington and in the Pacific Northwest region of North America. With a population of 780,995 in 2024, it is the 18th-most populous city in the United States. The city is the cou ...

-based company that began retransmitting

broadcast television Broadcast television systems (or terrestrial television systems outside the US and Canada) are the encoding or formatting systems for the transmission and reception of terrestrial television signals. Analog television systems were standardized ...

content via the Internet to paid subscribers on September 13, 2010. Designed to be an improvement over more expensive traditional cable services, viewers could watch local broadcast TV from New York City and Seattle, and later Chicago and Los Angeles, from anywhere in the world for a monthly subscription of $4.99 without any special equipment. A recording service could be added for $0.99 per month. Shortly after beginning operations, ivi and CEO Todd Weaver received cease-and-desist notices from a group of affected copyright holders and

television station A television station is a set of equipment managed by a business, organisation or other entity such as an amateur television (ATV) operator, that transmits video content and audio content via radio waves directly from a transmitter on the earth's s ...

s, who calculated that ivi's services severely decreased the value of their programming and decrease advertisement revenue.

Legal proceedings

On September 20, 2010, ivi filed a

declaratory judgment A declaratory judgment, also called a declaration, is the legal determination of a court that resolves legal uncertainty for the litigants. It is a form of legally binding preventive by which a party involved in an actual or possible legal ma ...

action in the District Court for the Western District of Washington, seeking a declaration of non-infringement on the grounds that §111 of the

Copyright Act of 1976 The Copyright Act of 1976 is a United States copyright law and remains the primary basis of copyright law in the United States, as amended by several later enacted copyright provisions. The Act spells out the basic rights of copyright holders, ...

authorizes retransmission of broadcast television content for cable companies. The same day, ivi issued a press release calling their legal action "a preemptive move to discourage needless litigation from big media," and expressing their desire to "work with content owners o helpthem to realize new revenue streams and reach more viewers from around the globe." On September 28, a group of copyright holders and broadcasters, including

Disney The Walt Disney Company, commonly referred to as simply Disney, is an American multinational mass media and entertainment industry, entertainment conglomerate (company), conglomerate headquartered at the Walt Disney Studios (Burbank), Walt Di ...

NBC The National Broadcasting Company (NBC) is an American commercial broadcast television and radio network serving as the flagship property of the NBC Entertainment division of NBCUniversal, a subsidiary of Comcast. It is one of NBCUniversal's ...

, ABC, CBS, Fox,

The CW The CW Network, LLC (commonly referred to as The CW or simply CW) is an American commercial broadcast television network which is controlled by Nexstar Media Group through a 75% ownership interest. The network's name is derived from the firs ...

Telemundo Telemundo (; formerly NetSpan) is an American Spanish-language terrestrial television network owned by NBCUniversal Telemundo Enterprises, a division of NBCUniversal, which in turn is a wholly owned subsidiary of Comcast. It provides content ...

, and others, filed a copyright infringement action against ivi in the District Court for the Southern District of New York. ivi's earlier declaratory action was subsequently dismissed by the Washington district court on the grounds that it was improperly anticipatory. On January 31, 2011, Public Knowledge, the

Electronic Frontier Foundation The Electronic Frontier Foundation (EFF) is an American international non-profit digital rights group based in San Francisco, California. It was founded in 1990 to promote Internet civil liberties. It provides funds for legal defense in court, ...

, the Media Access Project, and the Open Technology Institute filed an ''amici'' brief with the court in support of ivi. Noting that "''amicus briefs'' are unusual at the district court level," the brief argued that ivi should be considered a cable system under §111, and that granting a preliminary injunction against ivi would not serve the

public interest In social science and economics, public interest is "the welfare or well-being of the general public" and society. While it has earlier philosophical roots and is considered to be at the core of democratic theories of government, often paired ...

. On February 20, 2011, the New York district court granted the plaintiff's motion for a preliminary injunction against ivi, finding that ivi was not a "cable system" and hence not entitled to a compulsory license under §111 of the Copyright Act. ivi appealed the district's court decision.

Opinion of the Appeals Court

ivi admitted that they had broadcast the plaintiff's copyrighted content, but offered an

affirmative defense An affirmative defense to a civil lawsuit or criminal charge is a fact or set of facts other than those alleged by the plaintiff or prosecutor which, if proven by the defendant, defeats or mitigates the legal consequences of the defendant's ...

by arguing that §111 of the Copyright Act grants cable systems a compulsory license to retransmit broadcast television content. Hence, the principal issue to be decided by the court was whether ivi qualified as a "cable system" according to the Copyright Act. In deciding whether ivi qualified as a cable system under the Copyright Act, the court applied the two-step test from '' Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc.''. ''Chevron'' dictates that courts should first consider the text of the relevant legislation and the intent of

Congress A congress is a formal meeting of the representatives of different countries, constituent states, organizations, trade unions, political parties, or other groups. The term originated in Late Middle English to denote an encounter (meeting of ...

. If the relevant legislation does not directly address the issue at hand, ''Chevron'' then instructs that courts should defer to the interpretation of the government agency that administers the statute, provided that the agency's interpretation is deemed to be "reasonable."

Chevron Step One

§111 of the Copyright Act defines a "cable system" as: The court found that "it is simply not clear" whether the text of the Copyright Act would include ivi as a cable system. Next, the court considered whether it was the

legislative intent In law, the legislative intent of the legislature in enacting legislation may sometimes be considered by the judiciary to interpret the law (see judicial interpretation). The judiciary may attempt to assess legislative intent where legislation ...

of Congress to include Internet-based retransmission as a type of cable system. The court observed that Congress' original intent in enacting §111 was to encourage cable systems to provide better

television reception A television antenna, also called a television aerial (in British English), is an antenna specifically designed for use with a television receiver (TV) to receive terrestrial over-the-air (OTA) broadcast television signals from a television st ...

for remote communities that were poorly served by over-the-air broadcast television. Drawing upon '' Turner Broadcasting v. Federal Communications Commission'', the court found that "Congress intended to support localized—rather than nationwide—systems that use cable or optical fibers to transmit signals." Because Internet-based retransmission is not intended to deliver content to remote regions and is not a localized transmission service, the court found that "Congress did not intend for §111's compulsory license to extent to Internet retransmissions." The court noted that it intentionally interpreted §111 of the Copyright Act "as narrowly as possible" according to '' New York Times Co. v. Tasini'', in order to minimize government interference on the market; exceptions to the exclusive

property rights The right to property, or the right to own property (cf. ownership), is often classified as a human right for natural persons regarding their Possession (law), possessions. A general recognition of a right to private property is found more rarely ...

of copyright holders should be granted sparingly.

Chevron Step Two

Although the court found that step one of the Chevron test was sufficient to conclude that ivi is not entitled to a compulsory license, the court also provided a step two analysis to see if the

United States Copyright Office The United States Copyright Office (USCO), a part of the Library of Congress, is a United States government body that registers copyright claims, records information about copyright ownership, provides information to the public, and assists ...

has interpreted the Copyright Act in a way that would treat ivi as a cable system. The court found that this was not the case; the Copyright Office has repeatedly stated their view that Internet-based transmission not eligible for a compulsory license because it is "so vastly different from other retransmission industries now eligible for compulsory licensing." The court found the Copyright Office's position to be a reasonable interpretation of the statute.

Irreparable Injury

The appeals court also ruled that if the injunction against ivi were not upheld, then the plaintiff broadcast companies would lose significant amounts of revenue. For instance, ivi's live broadcasting feature would allow viewers to watch programs earlier than would otherwise be available in their time zone. This is different from other services such as

Hulu Hulu (, ) is an American Subscription business model, subscription streaming media service owned by Disney Streaming, a subsidiary of the Disney Entertainment segment of the Walt Disney Company. It was launched on October 29, 2007, initially as ...

, which delays Internet re-transmission of broadcast television. Additionally, advertisers pay large sums to place commercials for specific demographics for broadcast television; ivi's services make this targeting far less effective.

Public Interest

The appeals court reasoned that protection of copyright of broadcast television is in the public interest, by giving incentive to parties willing to create new works. The court opinion also states that ivi's services provide convenience and do not necessarily improve access to broadcast television. Therefore, on August 27, 2012, the appeals court affirmed the district court's opinion, ruling that ivi's retransmitting of broadcast television without obtaining licenses constituted copyright infringement.

Service termination

ivi was forced to suspend their operations when the district court granted a preliminary injunction, and has not resumed operations since then. After the appeals court decision supporting the injunction, an ivi spokesperson commented that "This is not the final chapter to this story", leading some to speculate that the company continued to work on litigation after the appeals ruling. The decision has been called a "major victory for broadcasters." In light of this ruling, some have become frustrated that courts' and the FCC's interpretation of what constitutes a cable company has not kept up with modern technology, and that a clear Internet TV policy has not been established. However, as shown in the court case '' ABC v. Aereo'', which provides VCR-like services rather than re-transmitting services as ivi attempted, it is possible to legally make TV available on the Internet for a profit.

References

{{Reflist, refs= {{cite news, title=ivi, Inc. Launches Highly Disruptive Software Delivering Live TV to the Internet, url=http://www.prweb.com/releases/2010/09/prweb4487284.htm, archive-url=https://web.archive.org/web/20100918193003/http://www.prweb.com/releases/2010/09/prweb4487284.htm, url-status=dead, archive-date=September 18, 2010, date=September 13, 2010, agency=PR Web {{cite web, title=Complaint for declaratory judgement of copyright noninfringement, url=https://ww1.prweb.com/prfiles/2010/09/22/186492/iviTVComplaintAmended2.pdf, date=September 20, 2010 {{cite news, title=ivi TV Challenges 'Big Media' to Innovate Rather than Litigate, url=http://www.prweb.com/releases/2010/09/prweb4542434.htm, archive-url=https://web.archive.org/web/20100923074552/http://www.prweb.com/releases/2010/09/prweb4542434.htm, url-status=dead, archive-date=September 23, 2010, date=September 20, 2010, agency=PR Web {{cite press release , publisher = ivi, Inc. , date = February 1, 2011 , title = Prominent Public Interest Groups Rally Around ivi TV , url = http://www.prweb.com/releases/2011/02/prweb5024914.htm , archive-url = https://web.archive.org/web/20120217102628/http://www.prweb.com/releases/2011/02/prweb5024914.htm , url-status = dead , archive-date = February 17, 2012 {{cite news , title = Ivi Asks Appeals Court to Reverse Web TV Service Shutdown , author = Don Jeffrey , url = http://www.businessweek.com/news/2012-05-30/ive-asks-appeals-court-to-reverse-web-tv-service-shutdown , archive-url = https://archive.today/20130118203324/http://www.businessweek.com/news/2012-05-30/ive-asks-appeals-court-to-reverse-web-tv-service-shutdown , url-status = dead , archive-date = January 18, 2013 , newspaper = Bloomberg , date = May 30, 2012 {{cite court , litigants=WPIX, Inc. v. ivi, Inc. , vol=11-788-cv , reporter= , opinion= , pinpoint= , court=2nd Cir. , date=August 27, 2012 , url=https://scholar.google.com/scholar_case?case=17655266333044714259&hl=en&as_sdt=2,5 , accessdate= , quote= {{cite court , litigants=WPIX, Inc. v. ivi, Inc. , vol=594 , reporter=F.Supp.2d , opinion= , pinpoint= , court=S.D.N.Y. , date=February 22, 2011 , url=https://scholar.google.com/scholar_case?case=15911634531326965709 , accessdate= , quote= {{cite news , title = Disney, CBS, Fox Sue Ivi for Streaming Shows on Web , author = Don Jeffrey , url = https://www.bloomberg.com/news/2010-09-28/disney-cbs-fox-sue-ivi-for-streaming-tv-shows-on-web-without-permission.html , newspaper = Bloomberg , date = September 28, 2010 {{cite news , title = Ivi TV Loses Bid to Overturn Court-Ordered Shutdown , author = Don Jeffrey , url = http://www.businessweek.com/news/2012-08-27/ivi-tv-loses-bid-to-overturn-court-ordered-shutdown , archive-url = https://web.archive.org/web/20120831082538/http://www.businessweek.com/news/2012-08-27/ivi-tv-loses-bid-to-overturn-court-ordered-shutdown , url-status = dead , archive-date = August 31, 2012 , newspaper = Bloomberg , date = August 27, 2012 {{cite court , litigants=ivi, Inc. v. Fisher Communications, Inc. , vol= , reporter= , opinion=C10-1512JLR , pinpoint= , court=W.D. Wash. , date=January 19, 2011 , url=http://www.loeb.com/news/CaseList.aspx?Type=ip&case=1439 {{cite web , url = http://www.publicknowledge.org/files/docs/PK_Amici_Brief_ivi.pdf , title = Amicus Memorandum Of Law In Opposition To Motion For Temporary Restraining Order And/Or Preliminary Injunction , author = Jennifer A. Klear, Esq. , date = January 31, 2011 {{Cite report , author = U. S. Copyright Office , date = August 1, 1997 , title = A Review of the Copyright Licensing Regimes Covering Retransmission of Broadcast Signals , url = http://www.copyright.gov/reports/study.pdf {{cite web , url = http://www.usip.com/Publications/EyeonIP/120925.html , title = TV Streaming Service Hits Roadblock Under U.S. Copyright Law , date = September 25, 2012 , author = Sheldon Mak & Anderson {{cite web, last=Cole, first=Harry, title=ivi TV Loses Round Two, url=http://www.commlawblog.com/2012/08/articles/broadcast/ivi-tv-loses-round-two/, work=CommLaw Blog, date=28 August 2012 , publisher=Fletcher, Heald & Hildreth, accessdate=November 12, 2012 2012 in United States case law United States copyright case law United States Court of Appeals for the Second Circuit cases United States Internet case law Broadcast case law Streaming television in the United States 2012 in case law Internet case law