Online video service FilmOn X has told a federal court that a California district court got it right when it concluded last year that FilmOn X was entitled to a statutory license under the Copyright Act.
That license would allow it to pay a flat license fee for content rather than having to negotiate for it individually with programmers.
FilmOn was filing its brief in the U.S. Court of Appeals for the Ninth Circuit in response to the challenge of that California court ruling by Fox Television Stations and other broadcasters.
California district judge George Wu ruled last year that FilmOn X (formerly Aereokiller) was entitled to the license. Fox and company have challenged that ruling in the Ninth Circuit Court of Appeals.
"Appellants' Luddite argument should be relegated to the history books," said FilmOn in its brief. FilmOn also requested oral argument, which has not yet been scheduled.
"The networks have urged the courts to interpret the license provision narrowly, and some courts have erroneously done that," said FilmOn of its filing Wednesday.
Courts signaling no license for online streamers include the Second Circuit federal appeals court in the 2012 ivi decision, though FilmOn X says that case was different, and a D.C. U.S. district court last November.
"The Central District of California, however, which was the first court to rule on the license issue in the active cases between FilmOn and the networks, applied the plain language of the statute to find FilmOn is eligible for the copyright license," the company said. "In their appeal of that decision, the networks urged the Ninth Circuit to disregard the district court's application of plain statutory language in favor of factually distinguishable Second Circuit precedent (ivi) and the biased and inconsistent opinions of the Copyright Office, both of which shun the inclusion of new technology in the statutory license regime."
The issue is whether online video distributors are effectively MVPDs eligible for the statutory license that allows them to avoid negotiating for individual network broadcast content. That issue is unsettled, with the Copyright Office saying they aren’t eligible, but also saying that could change depending on what the courts and the FCC decide.
A compulsory license would allow FilmOn X to deliver TV station programming from the major networks at a below-market rate and without having to negotiate for it individually through retrans deals. That's because it is not defined as a cable operator by the FCC, and so is not subject to retransmission consent requirements.
The FCC is mulling defining some over-the-top distributors as MVPDs, and FCC chairman Tom Wheeler has pointed to the need to prevent “old rules” from hampering online video competitors, but the FCC has yet to vote on a proposal to classify some online video providers as MVPDs and the chairman has signaled no action is forthcoming.
The National Association of Broadcasters took aim at FilmOn X and Wu's decision in a filing with the court last month. "Granting an entity like FilmOn a compulsory license to broadcast content could have a devastating impact on local broadcasting," it said, asking for it to reverse Wu's decision.
