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Networks Get a Victory in Court Over Streaming Service

September 5, 2013 by

For the first time in nearly a year, the nation’s major television broadcasters have won a round in their legal battle against start-up firms that stream programs from local stations over the Internet without their consent.

The Federal District Court for the District of Columbia issued a preliminary injunction on Thursday against one such start-up, FilmOn X. The broadcasters that sued FilmOn, claiming copyright infringement, cheered the news. It was not immediately clear how the ruling might affect Aereo, a better-known streaming service backed by the head of IAC/InterActiveCorp, Barry Diller.

“We are pleased, but not surprised, that the court recognized that the commercial retransmission of our broadcast signal without permission or compensation is a clear violation of the law,” the Fox network said in a statement. The network said the preliminary injunction would apply across the country, with the exception of New York, Connecticut and Vermont, where the United States Court of Appeals for the Second Circuit has upheld Aereo’s business model in the face of lawsuits from the broadcasters.

Fox, which was joined in the suit by CBS, NBC and ABC, added, “This decision should finally put the matter to rest, and will hopefully discourage other illegal services from attempting to steal our content.”

FilmOn said the ruling was “just a temporary setback.” The service, previously named Aereokiller in a jab of sorts at Mr. Diller’s start-up, is the brainchild of the billionaire Alkiviades David. One of its features lets users live-stream programs from the local TV stations that are beamed over public airwaves in New York and elsewhere.

Both FilmOn and Aereo operate antennas that pick up the signals of local stations and send them over the Internet to viewers. This tactic has frustrated station owners because it bypasses the system of retransmission fees — paid by cable and satellite companies for the privilege of carrying those signals — which broadcasters have become increasingly dependent upon. Analysts have predicted that services like Aereo could seriously compromise retransmission fees.

Aereo has consistently said that it is operating within the law, and the Court of Appeals for the Second Circuit in New York has agreed. In July, Aereo won its third consecutive victory there when the court declined to hear the broadcasters’ appeal. Aereo, heartened by the court’s support, has expanded to markets like Boston and Atlanta, and the company says other market will follow.

The broadcasters have sought to stop companies like Aereo by seeking more favorable settings for lawsuits. In December, a federal court in California concluded that FilmOn had violated the copyrights of the broadcasters; the broadcasters pointed to that ruling when they filed suit in Washington.

In the ruling on Thursday, Judge Rosemary M. Collyer said she had considered the court decisions in both New York and California and had found the latter “to be more persuasive.”

“Because there is no dispute of fact between the parties — indeed, each has won and each has lost in a different forum on these same facts — the court will grant plaintiffs’ motion for a preliminary injunction,” she wrote.

The injunction bars FilmOn from streaming the stations’ programs until a trial concludes.

In an e-mail, Mr. David iobjected to the ruling.

“We will win on appeal,” he said.

He said he would keep the service partly functioning in the meantime by streaming from independent stations that were not parties to the suit. Aereo was not part of the lawsuit, either, so the ruling does not automatically affect it. Other courts could cite Thursday’s ruling in the future, however — and the Supreme Court may eventually be asked to hear the case.

Article source: http://www.nytimes.com/2013/09/06/business/media/networks-get-a-victory-in-court-over-streaming-service.html?partner=rss&emc=rss

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Ticketmaster Accuses 21 of Fraudulent Ticket Buying

May 2, 2013 by Leave a Comment

In the lawsuit, filed on Tuesday at United States District Court in Los Angeles, Ticketmaster accused Joseph Shalom, a producer of live entertainment events in New York, of being the central figure in a coordinated series of attempts over the last two years to obtain large numbers of tickets and resell them at a profit.

According to the suit, Mr. Shalom and his associates used “bots,” or specialized computer programs, to bypass online features like Captchas — series of distorted letters or numbers — that test whether a potential ticket buyer is a person.

Ticketmaster, a division of Live Nation Entertainment, says Mr. Shalom and others linked to him used these systems to gain access to as many as 200,000 tickets a day ahead of the public, aiming for the most desirable tickets.The suit claimed Mr. Shalom and the others violated Ticketmaster’s terms of use, which prohibit bots and limit the number of tickets a customer may request in a single day. It also accuses them of committing several offenses as part of the ticket-buying process, including copyright infringement and the assumption of false identities.

Ticketmaster seeks unspecified damages in the suit and does not say how many tickets were bought by the 21 people. It also says the use of bots damages Ticketmaster’s reputation and harms the public.

As a result of the behavior outlined in the lawsuit, the company says, “the inventory of tickets available to consumers who do not use such devices is substantially diminished, which has led some consumers to question Ticketmaster’s ability to ensure a level playing field for the purchase of tickets.”

Bots have become a major source of consumer and industry complaints about the ticketing market. Consumers grow frustrated when concerts often sell out moments after tickets go on sale, and listings then appear for those tickets at inflated prices through online secondary markets like StubHub, owned by eBay, or TicketsNow, part of Live Nation.

The concert industry has also been frustrated at the difficulty of cracking down on the use of bots. Three years ago, federal authorities charged a group of men with using similar tactics to make $25 million in profit. But the men were sentenced to probation, which music executives say has not served as a deterrent. Concert promoters and others have said that the use of bots has become increasingly common, particularly for the most popular shows.

In a statement, Ticketmaster said: “We care about protecting fans and the integrity of our business. We are doing exactly what we have repeatedly said we do: stand up for the fans who use our site in the proper manner.”

Mr. Shalom did not respond to an e-mail requesting comment.

Article source: http://www.nytimes.com/2013/05/02/business/media/ticketmaster-targets-scalpers-in-federal-lawsuit.html?partner=rss&emc=rss

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ReDigi Loses Suit Over Reselling of Digital Music

April 1, 2013 by Leave a Comment

A federal judge in New York has dealt a blow to the nascent business of reselling digital goods like music and e-books, ruling that a small company’s secondary market for digital music infringes on the copyrights controlled by record companies.

The company, ReDigi, opened an online platform in late 2011 that allowed people to upload and resell songs they had bought from online retailers like Apple’s iTunes. ReDigi said its technology deleted the original file once a copy was put up for sale, but the major record labels were skeptical, and Capitol Records sued in early 2012.

The case has been closely watched as a test of whether the first sale doctrine — the legal principle that someone who owns a copy of a copyrighted work, like a book or album, is free to resell it — can be applied to digital goods.

In an order dated Saturday, Judge Richard J. Sullivan of United States District Court in Manhattan ruled that ReDigi was liable for copyright infringement, and seemed entirely unmoved by ReDigi’s arguments.

“The first sale defense does not cover this any more than it covered the sale of cassette recordings of vinyl records in a bygone era,” he wrote.

In sometimes wry language — one footnote mentions that ReDigi compared its system to the “Star Trek” transporter and “Willy Wonka’s teleportation device, Wonkavision” — Judge Sullivan ruled that ReDigi’s system infringed on Capitol’s reproduction rights because it transmitted an unauthorized copy of the file over the Internet.

In a statement, ReDigi said it was “disappointed” by the ruling and would appeal it, but noted that the decision applied to its original technology, not its updated version, ReDigi 2.0.

“While ReDigi 2.0, 3.0, or 4.0 may ultimately be deemed to comply with copyright law,” the judge wrote, “it is clear that ReDigi 1.0 does not.”

Damages for the infringement will be considered at a later date.

Capitol Records did not respond to a request for comment.

Although ReDigi is a small player in the world of digital media, the case has been watched for the effect it may have on two giants, Apple and Amazon, which have applied for patents for secondary digital markets but have not put them in place.

In addition to record companies, book authors have spoken out against the idea of a digital secondary market, saying that the presence of a “used” but perfect digital copy of a book would cause prices to crash.

Among those supporting reselling digital goods are libraries, because it could make more material publicly available.

The decision came less than two weeks after the Supreme Court upheld the first sale doctrine in the case of Kirtsaeng v. John Wiley Sons, about a student who was importing and selling textbooks that he had bought at a lower price overseas.

That case concerned different aspects of the rule, and legal experts said it did not apply strictly in the ReDigi case. But digital rights advocates worried the decision effectively banned an online secondary market.

“The decision was very one-sided,” said Jason M. Schultz, an assistant clinical professor of law at the University of California, Berkeley. “There needs to be some way to resell if we believe the Supreme Court that first sale is important.”

Article source: http://www.nytimes.com/2013/04/02/business/media/redigi-loses-suit-over-reselling-of-digital-music.html?partner=rss&emc=rss

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7 Charged as F.B.I. Closes a Top File-Sharing Site

January 20, 2012 by Leave a Comment

The federal authorities on Thursday announced that they had charged seven people connected to the Web site Megaupload, including its founder, with running an international criminal enterprise centered on copyright infringement on the Internet.

According to a grand jury indictment, Megaupload — one of the most popular “locker” services on the Internet, which lets users anonymously transfer large files — generated $175 million in income for its operators through subscription fees and advertising, while causing $500 million in damages to copyright holders.

Four of the seven people, including the site’s founder Kim Dotcom, born Kim Schmitz, have been arrested in New Zealand, the Justice Department and Federal Bureau of Investigation said on Thursday; the three others remain at large. The seven — who a grand jury indictment calls part of a “Mega Conspiracy” — have been charged with five counts of copyright infringement and conspiracy, the authorities said.

The charges, which the government agencies said represented “among the largest criminal copyright cases ever brought by the United States,” come at a charged time, a day after online protests against a pair of antipiracy bills being considered by Congress — the Stop Online Piracy Act, or SOPA, in the House, and the Protect I.P. Act, or PIPA, in the Senate.

In response to the arrests, the hacker collective known as Anonymous said it had taken down the Web sites of the Justice Department, the Motion Picture Association of America, and the Recording Industry Association of America. All three sites were inaccessible late Thursday afternoon.

The indictment in the Megaupload case was handed down by a grand jury in Virginia two weeks ago, but was unsealed on Thursday, and stems from a federal investigation that began two years ago.

The Megaupload case touches on many of the most controversial aspects of the antipiracy debate.

Megaupload and similar locker sites, like Rapidshare and Mediafire, are often promoted as being convenient ways to legitimately transfer large files — a recent promotional video had major stars like Will.i.am of the Black Eyed Peas singing Megaupload’s praises. But they have become notorious among media companies, who see them as abetting copyright infringement on a large scale by giving people easy, but unauthorized, access to movies, music and other content.

Megaupload is currently engaged in a lawsuit with Universal over the promotional video and Universal’s efforts to have it removed from YouTube.

As part of the crackdown on Megaupload, 20 search warrants were executed in nine countries, including the United States. About $50 million in assets were also seized, as well as a number of servers and 18 domain names, the authorities said.

Ira P. Rothken, a lawyer for Megaupload, said in a phone interview on Thursday afternoon that he had not yet seen the indictment, but he added: “Clearly we have due process concerns. This was done without a hearing.”

Article source: http://feeds.nytimes.com/click.phdo?i=6ed5fbe843e26108fcd648d841daf833

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Daniel Ortega Extends Control to Nicaragua’s Airwaves

November 29, 2011 by Leave a Comment

Video of flag-waving Ortega supporters flooding the streets and shooting off homemade explosives filled screens. One television anchor called the election a “resounding victory” as festivities were underscored by the governing party’s rewrite of the song “Stand by Me,” despite Sony’s demand that it be pulled for copyright infringement. “Nicaragua is free and just wants jobs and peace,” so the chorus goes.

The jubilant imagery reflected one of Mr. Ortega’s biggest accomplishments in the five years since he returned to power: his tightened grip on the news media.

He has bolstered investment in traditional Sandinista Party outlets like the television station Multinoticias and Radio Ya, while cutting government advertising in non-Sandinista outlets. The former revolutionary now controls nearly half of Nicaraguan TV news stations; his children run Multinoticias and Channels 8 and 13, and Channel 6 is state-run. He has also started two news Web sites.

Political analysts say that the media power has given Mr. Ortega a tool to discredit critics, and that the positive exposure helped him finish with 63 percent of the vote, according to official returns, up from his plurality of 38 percent in 2006.

“There was a fundamental shift in Ortega’s image over five years, and one could argue that among contributing factors is his greater presence in the media,” said Arturo Cruz, a political analyst at Managua’s Incae Business School who served as Nicaragua’s ambassador to Washington in Mr. Ortega’s second term.

Mr. Ortega’s allies already run the electoral council (which oversees elections) and dominate the courts, and this month’s vote nearly doubled his party’s seats in Congress to 62, a majority big enough to rewrite the Constitution and change the limits on re-election he has challenged through the judiciary. With the media now one of the last bastions of opposition, said Robert J. Callahan, who left his post as the American ambassador to Nicaragua in July, the Ortega family’s growing influence recalls the way Anastasio Somoza used nepotism to control the economy before Mr. Ortega’s Sandinistas overthrew his dictatorship in 1979.

“Nicaraguans call this Somocismo without Somoza,” Mr. Callahan said, using a term that refers to Somoza’s style of ruling through favoritism.

Mr. Ortega’s chief spokeswoman, who is his wife, Rosario Murillo, did not respond to a request for comment.

Mr. Ortega has said right-wing “oligarchs” still have a stronghold in the media despite his advances. “The forces of savage capitalism have TV stations and a monopoly on newspapers,” he said in a speech in March.

He has had less success gaining control of newspapers, which have a smaller audience than TV and radio, especially among the half of Nicaragua’s population that lives in poverty and those who struggle with illiteracy.

That is not for a lack of trying. Mr. Ortega’s wife tried buying shares in El Nuevo Diario, one of the biggest newspapers in the country, after the government cut publicity that accounted for a quarter of the paper’s advertising revenue. Negotiations fell through when another buyer entered the fray.

Many suspect that Venezuelan aid is behind the Sandinista media conquest. The manager of Albanisa, a joint energy venture between the Nicaraguan and Venezuelan state oil companies, was sent back to Venezuela after he told reporters that the company had bought Channel 8 last year for $10 million. The company denied the comments.

Tracing the Venezuelan money is difficult because Mr. Ortega has refused to include a five-year, $1.6 billion Venezuelan aid package in the budget, where it would face congressional oversight.

The Ortega outlets cast him in a light that is benign, or at least innocuous.

When Mr. Ortega cast his vote, non-Sandinista reporters were cordoned off, while those for Multinoticias on the scene asked him about the weather.

On Sandinista-favored outlets, the first lady releases poetic communiqués and exclusive reports record debaucheries of Ortega critics. One report showed feminist opponents of an abortion ban sponsored by Mr. Ortega caught driving drunk after a “girls only” beach bash. Headlines describe Mr. Ortega’s political rivals as “parasites” and “promoters of death.”

Non-Sandinista reporters can face threats for their coverage of the government. One journalist, Silvia González, fled the country in September, saying she had received death threats after reporting for El Nuevo Diario that soldiers may have killed a rebel in northern Nicaragua who opposed Mr. Ortega’s re-election.

The Chamorro family, longtime foes of Mr. Ortega, come in for heavy scrutiny in his media.

The Chamorros run El Nuevo Diario and La Prensa, and La Prensa’s former publisher Violeta Chamorro defeated Mr. Ortega in the 1990 presidential race. Mr. Ortega’s government has investigated Ms. Chamorro’s younger son, Carlos Fernando, over money laundering accusations and last year bought the television station that had been broadcasting his newsmagazine, “Esta Semana,” which often investigated accusations of Sandinista corruption.

In seeking another channel to broadcast his show, Mr. Chamorro found that other outlets — including those owned by Ángel González, a Mexican media mogul whose stations are known for gentle treatment of the governing party — would not have him. Eventually, Channel 12 picked up the show. “There are outlets that aren’t controlled by the Ortega family but are co-opted nonetheless,” said Mr. Chamorro, a former Sandinista who became a journalist after Somoza gunmen assassinated his father, the editor of La Prensa, in 1978. “All spaces for critical journalism are shrinking dramatically in Nicaragua.”

Article source: http://www.nytimes.com/2011/11/29/world/americas/daniel-ortega-extends-control-to-nicaraguas-airwaves.html?partner=rss&emc=rss

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To Slow Piracy, Internet Providers Ready Penalties

July 8, 2011 by Leave a Comment

After years of negotiations with Hollywood and the music industry, the nation’s top Internet providers have agreed to a systematic approach to identifying customers suspected of digital copyright infringement and then alerting them via e-mail or other means.

Under the new process, which was announced Thursday, several warnings would be issued, with progressively harsher consequences if the initial cautions were ignored.

The companies took pains to say that the agreement did not oblige Internet providers to shut down a repeat offender’s account, and that the system of alerts was meant to be “educational.” But they noted that carriers would retain their right to cut off any user who violated their terms of service.

In bringing together the media companies and Internet carriers, the deal demonstrates how the once-clear line separating those two businesses has been blurred. Eight years ago, the Recording Industry Association of America had to sue Verizon to try to uncover the identity of a customer who was sharing music online. This year, Comcast completed its merger with NBC, bringing an owner of digital content and a conduit for it under the same roof.

Now the Internet providers are hoping to profit as they pipe music and video of the nonpirated variety to their customers.

“The I.S.P.’s want to cooperate with Hollywood because the carriers recognize that their own growth depends in part on bundled content strategies,” said Eric Garland of BigChampagne, which tracks online media traffic. “They don’t want to be just utilities providing Internet access, but premium content distributors as well.”

The system announced on Thursday involves a series of six warnings that an Internet provider can send to a customer whom the media companies have identified as a possible copyright infringer.

The warnings escalate from simple e-mail notifications to, at levels 5 and 6, a set of “mitigation measures,” like reduced connection speeds or a block on Web browsing. As the alerts progress, a customer must acknowledge that he understands the notice. Customers will also have the opportunity to contest the complaint.

The effect on consumers, the companies hope, will be more of a deterrent-by-annoyance — rather than the random lightning bolt of litigation that was once the preferred method of enforcement by the recording industry association, one of the parties to the agreement.

The media companies were also represented by the Motion Picture Association of America and groups acting on behalf of independent record companies and filmmakers. The Internet carriers involved in the deal include ATT, Cablevision, Comcast, Verizon and Time Warner Cable.

The music and movie companies, which estimate that digital piracy costs the United States economy $16 billion in lost revenue each year, have been eager for an efficient way to deal with the problem.

As illegal downloading has become ingrained as a cultural habit, especially among young people, expensive litigation has become less effective, and the lawsuits against individuals were something of a public relations disaster for the music companies. The new deal, the companies say, offers plenty of chances for even the most recalcitrant pirates to reform.

“This is a sensible approach to the problem of online content theft and, importantly, one that respects the privacy and rights of our subscribers,” Randal S. Milch, executive vice president and general counsel for Verizon, said in a statement.

The agreement has an unlikely origin: it came about as a result of an effort to crack down on child pornography that was led by Andrew M. Cuomo while he was the New York attorney general.

Steve Lohr contributed reporting.

Article source: http://feeds.nytimes.com/click.phdo?i=539416452492a643a89771d7dc88377d

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YouTube Is Said to Be Near a Major Film Rental Deal

April 27, 2011 by Leave a Comment

Sony Pictures Entertainment, Universal Pictures and Warner Brothers have agreed to rent movies via YouTube, according to two studio executives who spoke on condition of anonymity because they said YouTube wanted to make the announcement. Rental fees are expected to be comparable to those charged by rivals like iTunes.

YouTube, however, has only half of the industry’s top players on board. Still on the sidelines are Walt Disney Studios, which is closely aligned with Apple, and 20th Century Fox and Paramount Pictures. Paramount’s corporate owner, Viacom, is still battling YouTube in court over copyright infringement. These three studios together control about 60 percent of the North American movie market.

YouTube declined to comment on reports of new rental deals. “We’ve steadily been adding more and more titles since launching movies for rent on YouTube over a year ago and now have thousands of titles available,” said YouTube in a statement.

Lionsgate Entertainment, the Weinstein Company and independent filmmakers already make films available for rent on the site for $2 to $4, including “Scary Movie 4,” “3:10 to Yuma” and “Saw.”

But the arrival of bigger Sony, Universal and Warner movies would give the streaming service a shot in the arm as it tries to compete with Apple’s iTunes, Amazon.com and Netflix. YouTube has been trying several strategies to keep people on the site for longer periods as it tries to poach viewers from TV and attract ad dollars.

Despite YouTube’s popularity — people view videos on the site two billion times a day — its film rentals do not appear to have gained much traction.

Still, YouTube offers movie studios more than just viewers, said James L. McQuivey, a digital media analyst at Forrester Research. Google can provide valuable data on how many people have searched for movies and which terms they used to search.

“That’s just a marketing chain of cause and effect that nobody else asking movie studios for rights to rentals can show,” Mr. McQuivey said. “You don’t necessarily need to show that a rental has been blockbuster successful to show a movie studio that it’s an avenue worth pursuing.”

Studios have repeatedly said that their digital strategies involve making on-demand deals with as many legitimate Web sites as they can — reflecting lessons learned from the music industry’s attempt to shut down digital consumption. They are also eager to replace dwindling DVD revenue. The latest rental plans were first reported by TheWrap.com, a movie industry blog.

But the chill between YouTube and Hollywood has taken time to ease. During its first few years, YouTube stood behind the Digital Millennium Copyright Act and told media companies it was not legally required to remove unauthorized material from its site unless specifically asked to do so by the owner. The stance provoked a $1 billion lawsuit from Viacom and broad animosity from media executives.

The willingness of mainstream studios like Sony, Universal and Warner to finally play ball reflects the work YouTube has done to make its portal look less like an online video garage sale. The site has also made it easier for media companies to take down pirated video content. It does not hurt that a New York federal judge last year sided with YouTube in the Viacom lawsuit; Viacom has since appealed.

“The fact that there’s still a few studios holding out on Google just goes to show you that even though this is an obvious no-brainer decision, the fear of Google still rests heavily on people’s minds,” Mr. McQuivey said. “But eventually they’ll all be there because why on earth would you refuse to put your content in the path of millions of users?”

Article source: http://feeds.nytimes.com/click.phdo?i=dd5fdb6136d1ec9f9de306662cb5c798

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