FOX TELEVISION STATIONS, INC., et al v. AEREOKILLER LLC, et al

Filing 55

Emergency MOTION for Reconsideration re 54 Order on Motion to Modify DEFENDANTS EMERGENCY MOTION FOR RECONSIDERATION OF THE MOTION TO MODIFY THE PRELIMINARY INJUNCTION IN LIGHT OF THE HEARST DECISION by FILMON X, LLC, FILMON.COM, INC,, FILMON.TV NETWORKS, INC.,, FILMON.TV, INC. (Attachments: # 1 Declaration of Ryan G. Baker, # 2 Declaration of Alkiviades David, # 3 Proposed Order, # 4 Certificate of Service)(Baker, Ryan)

UNITED STATES DISTRICT COURT FOR THE
DISTRICT OF COLUMBIA
_______________________________________
Civil No. 1:13-cv-00758 (RMC)

FOX TELEVISION STATIONS, INC., et al.

Hon. Rosemary M. Collyer

Plaintiffs/Counter-Defendants,
v.

Civil No. 1:13-cv-00758 (RMC)

FILMON X LLC, et al.
Defendants/Counter-Plaintiffs.
_______________________________________
DEFENDANTS’ EMERGENCY NOTICE OF MOTION AND MOTION FOR
RECONSIDERATION OF THE MOTION TO MODIFY THE PRELIMINARY
INJUNCTION IN LIGHT OF THE HEARST DECISION
FilmOn X LLC, FilmOn.TV Networks, Inc., FilmOn.TV, Inc. and FilmOn.com, Inc.
(collectively, “defendants” or “FilmOn X”) respectfully seek reconsideration of this Court’s
October 15, 2013 Order (Dkt. 54) denying their motion to modify the Preliminary Injunction
issued on September 5, 2013. Specifically, defendants request, on reconsideration, that this
Court modify the scope of the Preliminary Injunction to exclude the geographic boundaries of
the United States Court of Appeals for the First Circuit.
The basis for defendants’ motion is set forth in the attached Memorandum, the
accompanying declarations of Alkiviades David and Ryan Baker, and the court records filed by
the parties in connection with plaintiffs’ motion for a preliminary injunction. A proposed order
is also included.
Pursuant to Local Rule 7(m), defendants provided notice of their intent to seek the relief
requested in this motion to plaintiffs’ counsel on October 16, 2013. (Declaration of Ryan Baker
(“Baker Decl.”), ¶ 4.) Plaintiffs’ counsel indicated that plaintiffs would oppose this motion. (Id.,
i

¶ 5 & Ex. 2.) This motion has been brought by defendants at the first available opportunity. (Id.,
¶ 6.)

Dated: October 17, 2013

BAKER MARQUART LLP

By:________________________
Ryan G. Baker
BAKER MARQUART LLP
10990 Wilshire Blvd., Fourth Floor
Los Angeles, California 90024
[phone] (telephone)
[phone] (facsimile)
Bar No.: 200344
Attorneys for Defendants and Counterclaim Plaintiffs FilmOn X, LLC,
FilmOn.TV, Inc., FilmOn.TV Networks, Inc., and FilmOn.com, Inc.

ii

TABLE OF CONTENTS
INTRODUCTION .......................................................................................................................... 1
ARGUMENT .................................................................................................................................. 3
A.

Hearst Does Not Require That The Court Reverse Its Ruling, But The Court Should
Permit A Sister Court To Apply The Law Of The Circuit In Which It Resides................. 4
1.

Hearst Is Factually Indistinguishable from this Case .................................................. 4

2.

Hearst Is the only Court to Consider and Apply the Law of the First Circuit ............. 5

3.

This Court Should Permit the Hearst Court to Interpret the law of the First Circuit
and Defer to Its Interpretation within the First Circuit ................................................ 5

B. 

FilmOn X Has Acted In Good Faith And This Court Did Not Have All The Facts When It
Denied The Motion To Modify........................................................................................... 7

C.

This Court’s Denial Of The Motion To Modify Is Clearly Erroneous And Would Result In
A Manifest Injustice ............................................................................................................ 9
1.

The Massachusetts District Court’s Decision in Hearst, at a Minimum, Constitutes a
Significant Change in the Law of the First Circuit ..................................................... 10

2.

This Court Should Modify the Injunction to Allow FilmOn X to Compete with Aereo
in the First Circuit in Compliance with Hearst........................................................... 12

CONCLUSION ............................................................................................................................. 13 

i

TABLE OF AUTHORITIES
Page(s)
FEDERAL CASES
Bates v. Donley,
CIV. 11-1589 RCL, 2013 WL 1224482 (D.D.C. Mar. 27, 2013)........................................6, 10
Bryant v. Smith,
165 B.R. 176 (W.D. Va. 1994) ............................................................................................6, 10
Campbell v. U.S. Dep't of Justice,
231 F. Supp. 2d 1 (D.D.C. 2002) ...............................................................................................3
Cartoon Network LP v. CSC Holdings, Inc. (“Cablevision”),
536 F.3d 121 (2nd Cir. 2008)...................................................................................................10
Christianson v. Colt Indus. Operating Corp.,,
486 U.S. 800, 108 S.Ct. 2166, 100 L.Ed.2d 811 (1988) ............................................................3
Fair Assessment in Real Estate Ass’n, Inc. v. McNary,
454 U.S. 100 (1981) ...................................................................................................................6
Fox Television Stations, Inc. v. BarryDriller Content Sys., Plc
(“BarryDriller”), 915 F. Supp. 2d 1138 (C.D. Cal. 2012) .................................................4, 5, 6
Holland v. National Mining Association,
309 F.3d 808 (D.C. Cir. 2002) ...................................................................................................7
Lederman v. United States,
539 F. Supp. 2d 1 (D.D.C.2008) ............................................................................................3, 4
Los Angeles Haven Hospice, Inc. v. Sebelius,
638 F.3d 644 (9th Cir. 2011) .....................................................................................................9
N.L.R.B. v. P*I*E Nationwide, Inc.,
894 F.2d 887 (7th Cir. 1990) .....................................................................................................6
NAACP, Jefferson Cnty. Branch v. Brock,
619 F. Supp. 846 (D.D.C. 1985) ................................................................................................6
Newell v. Harold Shaffer Leasing Co.,
489 F.2d 103 (5th Cir.1974) ....................................................................................................10
R.C. by Alabama Disabilities Advocacy Program v. Nachman,
969 F. Supp. 682 (M.D. Ala. 1997) ...........................................................................................8

ii

Schauss v. Metals Depository Corp.,
757 F.2d 649 (5th Cir.1985) ......................................................................................................6
Securities and Exchange Commission v. Lauer,
445 F. Supp. 2d 1363 (S.D. Fla. 2006) ......................................................................................8
Singh v. George Wash. Univ.,
383 F. Supp. 2d 99 (D.D.C. 2005) ................................................................................... passim
Virginia Soc. for Human Life, Inc. v. Federal Election Comm’n,
263 F.3d 379 (4th Cir. 2001) .........................................................................................9, 11, 13
WCVB-TV v. Aereo, Inc.,
Civ. No. 13-11659-NMG (D. Mass.) (“Hearst”) ............................................................. passim
Weinberger v. Romero-Barcelo,
456 U.S. 305 (1982) ...................................................................................................................5
FEDERAL STATUTES
17 U.S.C. § 502 ................................................................................................................................6
17 U.S.C. § 502(b) ...........................................................................................................................5
RULES
Federal Rule 54(b) ...........................................................................................................................3

iii

MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEFENDANTS’
EMERGENCY MOTION FOR RECONSIDERATION OF THE MOTION TO MODIFY
THE PRELIMINARY INJUNCTION IN LIGHT OF THE HEARST DECISION
INTRODUCTION
This Court should reconsider its October 15, 2013 denial of FilmOn X’s motion to
modify the September 5, 2013 injunction. Reconsideration is permissible if a court has, inter
alia, misunderstood a party, or where a significant change in law or facts have occurred since the
submission of the issue. Singh v. George Wash. Univ., 383 F. Supp. 2d 99, 101 (D.D.C. 2005).
Here, those factors, as well as manifest justice, require reconsideration of the October 15 order
(and modification of the underlying September 5, 2013 preliminary injunction).
First, FilmOn X did not request that the Court reverse its injunction order based on
Hearst Stations, Inc., d/b/a/ WCVB-TV v. Aereo, Inc., Civ. No. 13-11659-NMG (D. Mass.)
(“Hearst”). Rather, FilmOn X requested only that the Court clarify that FilmOn X users may
access plaintiffs’ programming in the First Circuit based on the Hearst court’s conclusion that
any such access within the First Circuit would constitute a private performance according to First
Circuit law. In its October 15 order, the Court states that “a contrary decision by a co-equal
court in another district involving different parties does not represent a change in controlling
law.” But FilmOn X did not argue that Hearst was “controlling law;” rather, Hearst reflects the
law of the First Circuit, as it is the decision of the only court within the First Circuit to
specifically consider and apply First Circuit law to facts that are indisputably similar in all
relevant ways to the facts before this Court.1 While FilmOn X contends that Hearst’s reading of
the Transmit Clause is correct, this Court has reached the opposite conclusion. Hearst does not

1

This Court previously ruled that the technological systems used by FilmOn X and Aereo “are
essentially the same, and the parties agree that there are no legally meaningful differences.”
[Dkt. 33 at 4.]
1

invalidate the conclusion of this Court, but Hearst is the only court to specifically analyze and
apply First Circuit law to facts similar to the facts before this Court. Accordingly, FilmOn X
requests that this Court, in light of comity concerns, modify the injunction so that FilmOn X may
operate its service in the First Circuit, just as Aereo currently does.
Pursuant to Hearst, the services of FilmOn X and Aereo do not enable public
performance under First Circuit law. The authority offered to this Court by plaintiffs on this
point (e.g., Singh,2 383 F. Supp. 2d 99) is inapposite, as that authority contemplates the reversal
of a court order, not a modification based on comity. FilmOn X respectfully requests that this
Court reconsider its decision to prevent FilmOn X from operating in a circuit where the only
court to specifically consider and apply the law of that circuit concluded the service offered by
FilmOn X does not warrant injunctive relief.
Further, additional facts, not before the Court prior to its October 15 decision, warrant
reconsideration. The Court’s October 5 order states that “FilmOn X may be acting in defiance of
this Court’s Preliminary Injunction.” But plaintiffs’ scandalous accusations that FilmOn X has
“unclean hands” and has “deliberate[ly] defi[ed]” this Court’s orders are completely unfounded.
[See Dkt. 53 at 1.] Following the ruling of the First Circuit, FilmOn tested its service in the First
Circuit. That service was temporarily active. It was deactivated well before this Court’s October
15 ruling. FilmOn X has consistently acted in good faith and has taken prompt steps to ensure
ongoing compliance with this Court’s preliminary injunction.
Manifest justice also requires reconsideration of the Court’s October 15 order. The
practical effect of this Court’s nationwide injunction is to prohibit FilmOn X from operating in
the First Circuit where a sister court has issued a ruling that allows FilmOn X’s competitor,
2

Aside from Hearst and a case on judicial notice, Singh is the only decision that this Court cited
in its October 15, 2013 order. [Dkt. 54 at 2.]
2

Aereo, to engage in the exact same conduct based on the conclusion that under First Circuit law,
the users of services such as those offered by FilmOn X and Aereo privately perform plaintiffs’
works. The Court should respect the Hearst ruling and permit FilmOn X to offer a service the
Hearst court has determined is permissible under First Circuit law.
This Court erred in refusing to modify the scope of the injunction to exclude the First
Circuit in light of Hearst. Furthermore, additional facts and manifest justice require that the
Court reconsider its refusal to modify the injunction. The Court should reconsider its October 15
ruling and modify the injunction in this case to permit FilmOn X to operate in the First Circuit.
ARGUMENT
Under Federal Rule 54(b), a trial court may grant reconsideration “as justice requires.”
Campbell v. U.S. Dep't of Justice, 231 F. Supp. 2d 1, 7 (D.D.C. 2002). Reconsideration may be
warranted where there was a patent misunderstanding of the parties, where a decision was made
that exceeded the issues presented, where a court failed to consider controlling law, or where a
significant change in the law occurred after the decision was rendered. Singh, 383 F. Supp. 2d at
101. Additionally, a prior decision should be reconsidered where it was “clearly erroneous and
would work a manifest injustice.” Lederman v. United States, 539 F. Supp. 2d 1, 2
(D.D.C.2008) (quoting Christianson v. Colt Indus. Operating Corp., 486 U.S. 800, 817, 108
S.Ct. 2166, 100 L.Ed.2d 811 (1988)).
This Court’s ruling that “FilmOn X has provided no basis for the Court to modify the
Preliminary Injunction” is clearly erroneous. [Dkt. 54 at 2.] FilmOn X has shown that the
District Court of Massachusetts found that a substantially identical service operated by FilmOn
X’s competitor, Aereo, does not violate the Transmit Clause under the law of the First Circuit.
Specifically, Hearst found that any performance of plaintiffs’ copyrighted programming enabled

3

by technology such as that of FilmOn X or Aereo is a private, not public, performance. Plaintiffs
do not dispute that. This Court acknowledged that “[t]he district court in Hearst dealt with
copyright infringement issues similar to those already addressed here and came to the opposite
conclusion.” [Dkt. 54 at 2.] Under settled principles of comity, this Court should modify its
injunction to prevent manifest injustice arising from this admitted conflict between two district
court decisions. This Court also should reconsider its denial of the motion to modify in light of
new facts showing FilmOn X’s good faith compliance with this Court’s injunction.
A.

Hearst Does Not Require That The Court Reverse Its Ruling, But The Court Should
Permit A Sister Court To Apply The Law Of The Circuit In Which It Resides
In Hearst, the court considered facts analogous to the facts before this Court in every

relevant way. As this Court has recognized, Hearst reached the opposite conclusion. That
conclusion does not control in this case, but as the ruling of the only court to consider and apply
the law of the First Circuit, FilmOn X urges this Court to recognize that ruling and permit the
courts of another circuit to analyze and apply the law of the circuit within which they reside.
1.

Hearst Is Factually Indistinguishable from this Case

In all relevant respects, the facts and law at issue in this case and Hearst are identical.
This Court previously ruled that the technological systems used by FilmOn X and Aereo “are
essentially the same, and the parties agree that there are no legally meaningful differences.”
[Dkt. 33 at 4.] It also previously found that the parties in this case between FilmOn X and
plaintiffs3 “agree that the Aereo courts and BarryDriller court described the technology and
services accurately.” [Dkt. 33 at 4.] Likewise, it has found that “[t]he district court in Hearst
3

As they must, plaintiffs consistently admit that the material facts in the Aereo, BarryDriller and
Hearst line of cases (like this lawsuit) are the same. [See, e.g., Dkt. 39 at 8 (accepting that
“FilmOn X’s technology is identical to Aereo’s”); Id. at 10 (referring to Aereo’s technology as
“identical to FilmOn X”); Dkt. 27-1 at 30-31 (discussing Aereo’s technology and stating that
“[t]he same is true for FilmOnX (sic)); Dkt. 5 at 7 (stating that Aereo’s “Internet-based television
retransmission service [is] allegedly similar to Defendants’ service.”).]
4

dealt with copyright infringement issues similar to those already addressed here and came to the
opposite conclusion.” [Dkt. 54 at 2.] Accordingly, the mere fact that this case involves
“different parties” is not a sufficient basis to distinguish Hearst.
2.

Hearst Is the only Court to Consider and Apply the Law of the First Circuit

At least four district courts have considered facts such as those before this court and have
ruled on motions similar to plaintiffs’ motion for a preliminary injunction in this case. Two of
those courts (this Court and the Central District of California) have found in favor of plaintiffs’
position and two (the District of Massachusetts and the Southern District of New York) have
found in favor of the arguments advanced by defendants. All of those rulings were appealed and
the only appellate court to rule on these issues has found that Aereo and FilmOn X do not enable
any public performance. In the first court to find in plaintiffs’ favor, Fox Television Stations,
Inc. v. BarryDriller Content Sys., Plc (“BarryDriller”), 915 F. Supp. 2d 1138 (C.D. Cal. 2012),
plaintiffs sought a nationwide injunction, except for the Second Circuit. At that time, the Second
Circuit had not yet affirmed the ruling of the Southern District of New York, yet not only did the
court in BarryDriller refuse to apply the injunction in the Second Circuit, that injunction was
limited to the Ninth Circuit based on comity concerns. BarryDriller, 915 F. Supp. 2d at 1148.
Hearst is the latest district court to rule on issues similar to those before this Court. And
Hearst is the only Court to consider and apply the law of the First Circuit. Unlike the district
court in Hearst, this Court did not purport to determine or apply the law of the First Circuit.
3.

This Court Should Permit the Hearst Court to Interpret the law of the First
Circuit and Defer to Its Interpretation within the First Circuit

This Court committed legal error when it assumed that 17 U.S.C. section 502(b)
“requires” the Court to issue an injunction that covers every jurisdiction where a circuit court has
not yet ruled. [See Dkt. 41 at 8.] “An injunction is an equitable remedy,” Weinberger v.

5

Romero-Barcelo, 456 U.S. 305, 311 (1982), and “is subject to the equitable constraints that have
evolved over centuries.” N.L.R.B. v. P*I*E Nationwide, Inc., 894 F.2d 887, 893 (7th Cir. 1990).
Under principles of comity, this Court must exercise restraint when issuing nationwide
injunctions to avoid undue interference with the authority of courts in other jurisdictions to
determine and apply their own law within their territory. “Comity interests are advanced when
‘courts of coordinate ranks are respectful of each other’s orders,4 as well as careful to avoid
hindering each other’s proceedings.’” NAACP, Jefferson Cnty. Branch v. Brock, 619 F. Supp.
846, 853 (D.D.C. 1985) (quoting Schauss v. Metals Depository Corp., 757 F.2d 649, 654 (5th
Cir.1985).) Indeed, “[c]omity has an established and substantial role in informing the exercise of
the court’s discretion” when a “federal court is asked to employ its historic powers as a court of
equity, and is called upon to decide whether to exercise the broadest and potentially most
intrusive form of judicial authority.” Fair Assessment in Real Estate Ass’n, Inc. v. McNary, 454
U.S. 100, 119-20 (1981).
As BarryDriller recognized, principles of comity impose important equitable limits on a
court’s power to issue a nationwide injunction under 17 U.S.C. section 502. Especially when
confronted with conflicting decisions on a legal issue from another jurisdiction, a district court
should be cautious in “assum[ing]” that other circuits that have not yet ruled would adopt its
interpretation of the law. BarryDriller, 915 F. Supp. 2d at 1148. See id. (reasoning that “[i]f
other circuits do not have law that conflicts with this decision, they might adopt such law when
presented with the choice. The Court would therefore issue an injunction covering only the Ninth
Circuit.”). The D.C. Circuit has similarly cautioned against “[a]llowing one circuit’s statutory
interpretation to foreclose . . . review of the question in another circuit,” which would “squelch
4

The mere fact that the Massachusetts District Court is not an appellate court does not mean that
this Court may simply ignore its decision. “The opinions of district court judges have persuasive
authority” and are “entitled to substantial deference.” Bryant v. Smith, 165 B.R. 176, 180-81
(W.D. Va. 1994) (internal quotations omitted); see also Bates v. Donley, CIV. 11-1589 RCL,
2013 WL 1224482 (D.D.C. Mar. 27, 2013) (“[Plaintiff] is right to suggest that the well-reasoned
holdings of a colleague have a strong persuasive effect.”).
6

the circuit disagreements that can lead to Supreme Court review.” Holland v. National Mining
Association, 309 F.3d 808, 815 (D.C. Cir. 2002). That is exactly what plaintiffs seek to do here.
By obtaining a nationwide injunction from this Court, plaintiffs seek to convert a “win” before
this Court into an order that effectively prevents district courts in other jurisdictions from
considering and applying their own law within their territory.
B.

FilmOn X Has Acted In Good Faith And This Court Did Not Have All The Facts
When It Denied The Motion To Modify
This Court should reconsider its denial of the motion to modify on the ground that it did

not consider new facts relating to FilmOn X’s good faith compliance with this Court’s orders.
Relying entirely on the first argument presented in plaintiffs’ opposition papers, this Court
expressed concern that “FilmOn X may be acting in defiance of this Court’s Preliminary
Injunction, possibly by retransmitting Plaintiffs’ copyrighted broadcast programming in the
Boston area.” [Dkt. 54 at 2.] Unfortunately, because this Court ruled only a couple of hours
after plaintiffs’ filed their opposition brief, the Court was not presented with and did not have an
opportunity to consider the actual facts showing FilmOn X’s good faith.5 Indeed, on October 15,
2013 – before plaintiffs’ filing of their opposition brief (at approximately 10:03 a.m. eastern
daylight time) – FilmOn X’s counsel expressly advised plaintiffs’ counsel that he had
“confirmed that no FilmOn X user in the First Circuit may view [plaintiffs’] programming using
FilmOn X at this time.” (Baker Decl., ¶ 3 & Ex. 1.)
Accordingly, FilmOn X’s alleged “unclean hands” is not a proper basis for this Court’s
denial of the motion to modify. As one of plaintiffs’ cases explains, a party who comes to a
court of equity seeking relief “must have acted in good faith” and the doors to equity will not

5

Counsel for defendants attempted to contact the court after receiving plaintiffs’ opposition to
the motion to modify the scope of the injunction to request leave to submit evidence of
defendants’ compliance in response to the opposition, but the Court was closed at that time.
7

open “if defendant’s wrongdoing has helped create the situation from which defendant seeks
relief . . . .” R.C. by Alabama Disabilities Advocacy Program v. Nachman, 969 F. Supp. 682,
688 (M.D. Ala. 1997). In each of the cases cited by plaintiffs, courts refused to modify consent
decrees or denied other equitable relief because the defendants had engaged in bad faith conduct
that contributed to the situation from which they sought relief.6 That is not the case here.
FilmOn X is acting and always has acted in good faith. Shortly after this Court originally
issued the preliminary injunction on September 5, 2013, FilmOn X timely complied with the
injunction by shutting down FilmOn X users’ access to plaintiffs’ programming in all the
jurisdictions covered by the injunction (including the First Circuit). [See Dkt. 43 at p. 2
(explaining that defendants “removed all access to the unlicensed Copyrighted Programming to
users logging on to any of the websites or mobile applications operated by defendants from
within any designated market areas outside the Second Circuit.”).] Subsequently, for a very brief
period of time after the Massachusetts District Court issued its ruling in Hearst, FilmOn X tested
its “technology in anticipation of the possibility that the [Preliminary Injunction] Order would be
lifted as applied to the First Circuit.” (Declaration of Alkiviades David (“David Decl.”), ¶¶ 6-7.)
“The testing was only done within the geographic limits of the First Circuit periodically over a
span of 2 to 3 days, and only so that Defendants could begin offering their services immediately
6

None of the “unclean hands” cases cited by Plaintiffs are remotely analogous to the facts at
issue in this case. For example, in Securities and Exchange Commission v. Lauer, 445 F. Supp.
2d 1363, 1366 (S.D. Fla. 2006), the District Court of Florida denied a request to modify a
preliminary injunction to permit a criminal defendant to access frozen assets to fund his legal
defense. The court reasoned that the criminal defendant, while represented by counsel, twice
consented to the asset freeze order. Id. at 1364-65. It also found that the defendant had
repeatedly failed to disclose assets and had intentionally diverted other assets from the freeze in
violation of the court’s prior orders. Id. at 1366. Because the defendant had “not shown an
intervening change in controlling law, newly discovered evidence, or a need to correct a clear
error or manifest injustice[,]” the court denied the motion to modify the asset freeze order. Id. at
1371. That is not the case here.
8

if the Order was modified so as not to include the First Circuit.” (Id., ¶ 7.) Unfortunately,
“[d]uring the brief window when the testing occurred, a limited number of users in the First
Circuit may have been able to access some of the Copyrighted Programming subject to the
Order. As soon as Defendants learned of this, they discontinued testing in the First Circuit.
Prior to the Court’s issuance of its October 16 order denying Defendants’ motion to modify the
scope of the injunction in this case, no user of Defendants’ services could access plaintiffs’
programming through the FilmOn X service. No testing has occurred since.” (Id., ¶ 8.)
“Currently, users who attempt to access Defendants’ programming covered by the Order outside
of the geographic limits of the Second Circuit are denied access. Defendants continue to take
steps to ensure that this remains the case going forward.” (Id., ¶ 9.)
In light of these new facts showing FilmOn X’s good faith efforts to comply with this
Court’s injunction, this Court should modify the injunction.
C.

This Court’s Denial Of The Motion To Modify Is Clearly Erroneous And Would
Result In A Manifest Injustice
Hearst is the latest in a string of related cases about the same technology at issue in this

case that have been reached in different jurisdictions across the country. In some cases, the
courts have adopted Aereo and FilmOn X’s interpretation of the Transmit Clause; in other cases,
courts have adopted a contrary reading. In light of these judicial disagreements, it would be a
manifest injustice for this Court to enforce its view of the law on other jurisdictions where courts
have reached different conclusions. See Virginia Soc. for Human Life, Inc. v. Federal Election
Comm’n, 263 F.3d 379, 393 (4th Cir. 2001) (holding that nationwide injunctions should not be
used by a court to “impos[e] [its] view of the law on all the other circuits” and should not “thwart
the development of important questions of law by freezing the first final decision rendered on a
particular legal issue”); see also Los Angeles Haven Hospice, Inc. v. Sebelius, 638 F.3d 644, 6649

65 (9th Cir. 2011) (vacating nationwide injunction where a lawsuit involved important or
difficult questions of law).
1.

The Massachusetts District Court’s Decision in Hearst, at a Minimum,
Constitutes a Significant Change in the Law of the First Circuit

Reconsideration is appropriate where a significant change in the law occurred after the
decision was rendered. Singh, 383 F. Supp. 2d at 101. Hearst is a significant change in the law,
particularly in the law of the First Circuit. This Court’s refusal to recognize the Hearst court’s
interpretation of First Circuit law is clearly erroneous. It is the duty of the District Court of
Massachusetts to consider, determine and apply the law of that circuit. Newell v. Harold Shaffer
Leasing Co., 489 F.2d 103, 107 (5th Cir.1974). That is exactly what the district court did in
Hearst. It applied its reasoned judgment as to First Circuit law and agreed with the analysis
contained in the Second Circuit’s decision in Cartoon Network LP v. CSC Holdings, Inc.
(“Cablevision”), 536 F.3d 121 (2nd Cir. 2008). [Dkt. 52-1, Ex. A at 10-13.] It thus refused to
issue a preliminary injunction on the ground that Aereo was “transmitting private rather than
public performances per Cablevision.” [Id. at 12, 20.] Thus, even though Hearst is not binding
on this Court, it is still a valid reflection of the law of the First Circuit.
Unlike the district court in Hearst, this Court did not purport to determine or apply the
law of the First Circuit. This Court should defer to the Hearst decision within the territory of the
First Circuit. See, e.g., Bryant, 165 B.R. at 180-81 (“The opinions of district court judges have
persuasive authority entitled to substantial deference.”); Bates v. Donley, CIV. 11-1589 RCL,
2013 WL 1224482 (D.D.C. Mar. 27, 2013) (“well-reasoned holdings of a colleague have a
strong persuasive effect.”).

10

Moreover, the decision in Singh,7 383 F. Supp. 2d at 101, does not provide any support
for this Court’s October 15, 2013 order. That case did not involve an injunction that applied
across multiple jurisdictions; instead, it involved reconsideration of a summary judgment ruling.
The court wisely declined to reconsider its summary judgment ruling where a party had
submitted non-binding supplemental authority from another court on a legal issue that the court
found to be “poorly reasoned.” Id. at 103. That is not at all the situation here.
Unlike Singh, this Court has issued an extremely broad injunction that applies across
multiple jurisdictions and has the effect of precluding FilmOn X from operating in another
judicial circuit where the exact same operations have been found to be legal by a district court.
Singh’s reasoning highlights why this Court should give deference to the decision of a sister
court in Massachusetts:
District courts, and circuit courts, are free to disagree as they seek to apply to the
law and to reach just results in their cases. Our lower federal courts, as the
various states are laboratories for new policies, are the laboratories for the law as
it develops in response to particular controversies. A disagreement between
coequal courts in separate districts is no grounds for reconsideration.
Id. at 103. It is precisely because district courts should be “free to disagree” that it is manifestly
unjust for this Court to enforce its view of the law in another jurisdiction where a district court
has reached a different result. See also Virginia Soc. for Human Life, 263 F.3d at 393 (holding
that a court should not “impos[e]” its view of the law “on all the other circuits” and a party
should be permitted “to press its position in those circuits” if it so chooses). Indeed, this Court
has previously rejected FilmOn X’s argument that the injunction causes irreparable harm because
it prevents FilmOn X from competing with Aereo in jurisdictions outside the Second Circuit. At
the time, this Court reasoned that FilmOn X “should not be permitted to infringe simply
7

Aside from Hearst and a case on judicial notice, Singh is the only decision that this Court cited
in its September 15, 2013 order. [Dkt. 54 at 2.]
11

because” “there is another infringing service in operation (Aereo) with which FilmOn X
competes.” [Dkt. 41 at 4-5.] But now that the Massachusetts District Court has ruled that Aereo
does not infringe, this Court should modify the injunction to permit FilmOn X to operate
alongside its competitor Aereo, in the First Circuit.
2.

This Court Should Modify the Injunction to Allow FilmOn X to Compete
with Aereo in the First Circuit in Compliance with Hearst

FilmOn X does not ask this Court to vacate the Preliminary Injunction in its entirety
based on the Hearst decision. While FilmOn X believes that this Court misinterpreted the
Transmit Clause and should have adopted the contrary reasoning of the Second Circuit and the
District of Massachusetts, FilmOn X merely asks this Court to modify the injunction so that
FilmOn X may continue to operate its service just as Aereo currently does in the First Circuit.8
This Court earlier rejected the argument that FilmOn X should be permitted to engage in
the same conduct as Aereo on the ground that Aereo is also “infring[ing]” plaintiffs’ copyrighted
programming. [Dkt. 41 at 5.] That is clearly no longer the case in the First Circuit. In light of
Hearst, there is now a judicial decision finding that Aereo’s technology does not infringe
copyrights. Thus, it would be manifestly unjust and would cause irreparable harm to prohibit
FilmOn X from competing in this same market against Aereo.
If the injunction is not modified, FilmOn X will lose market share to Aereo, which will
continue to provide consumers with remote data storage services for copyrighted programming
in the First Circuit even though FilmOn X is no longer allowed to do so. [Dkt. 37-2 at ¶¶ 6-8,

8

Lest there be any confusion, FilmOn X does not contend—as this Court suggested in its
October 15, 2013 order—that “this Court must follow a new ruling from the District of
Massachusetts . . . .” [Dkt. 54 at 1.] This Court, of course, may make its own decisions and
interpret the law differently from the District of Massachusetts. However, it should not issue an
injunction outside its territorial boundaries in a manner that clearly conflicts with the law of
another jurisdiction.
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10.] In light of the fact that FilmOn X is a relatively new technology company, formed in 2008
in a rapidly evolving industry, it is no stretch of the imagination to conclude that FilmOn X will
permanently lose a substantial portion of its market share to Aereo or other competitors who
spring up to fill the void left by FilmOn X’s forced exit from the marketplace.9 [See id. at ¶¶ 5-8,
10.] Even if FilmOn X wins its appeal to the D.C. Circuit and the preliminary injunction is
vacated, it is extremely unlikely that FilmOn X will ever be able to recover its market share and
customer loyalty in this rapidly evolving industry. [Id. at ¶ 8.] All of those factors weigh in
favor of reconsideration and, ultimately, modification of the Court’s September 5 injunction.
CONCLUSION
For the foregoing reasons, FilmOn X respectfully requests the Court reconsider its ruling
denying defendant motion to modify the scope of its preliminary injunction and modify that
injunction to exclude the First Circuit.

9

At present, Aereo provides the same DVR-like services as FilmOn X in Atlanta, Boston,
Miami, Salt Lake City, as well as within the Second Circuit. [See Dkt. 38, Exs. 1-5; Dkt 37-2 at
¶ 4.] Even more importantly, Aereo has publicly announced plans to expand to Washington
D.C., as well as Austin, Baltimore, Birmingham, Alabama, Chicago, Cleveland, Dallas, Denver,
Detroit, Houston, Kansas City, Madison, Wisconsin, Minneapolis, Philadelphia, Pittsburg,
Providence, Rhode Island, Raleigh-Durham, North Carolina, and Tampa, Florida. [See Dkt. 38,
Exs. 6-9.] Thus, Aereo—an extremely well-funded operation—certainly is in a position to
expand into other geographic markets where it can be expected to steal FilmOn X consumers
who are disappointed that they can no longer use FilmOn X’s services to record copyrighted
programming for their own private performances. [Dkt. 37-2 at ¶¶ 7-9.]
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October 17, 2013

Respectfully submitted,

By: /s/ Ryan G. Baker
Ryan G. Baker
BAKER MARQUART LLP
10990 Wilshire Blvd., Fourth Floor
Los Angeles, California 90024
[phone] (telephone)
[phone] (facsimile)
Bar No.: 200344
/s/ Kerry J. Davidson
LAW OFFICE OF KERRY J. DAVIDSON
1738 Elton Road, Suite 113
Silver Spring, Maryland 20903
[phone] (telephone)
[phone](facsimile)
Bar No.: 456431
Attorneys for Defendants and Counterclaim
Plaintiffs FilmOn X, LLC, FilmOn.TV, Inc.,
FilmOn.TV Networks, Inc., and FilmOn.com, Inc.

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