Cablevision remote DVR stays legal: Supremes won't hear case

Galen

http://arstechnica.com/tech-policy/news/2009/06/cablevision-remote-dvr-stays-legal-supremes-wont-hear-case.ars

Cablevision's "remote storage DVR" moved a DVR's hardware out of the living room and back into the cloud, but TV studios claimed copyright infringement. The Supreme Court's refusal to hear the case means the RS-DVR remains legal, for now.
By Nate Anderson | Last updated June 29, 2009 10:45 AM CT

The US Supreme Court this morning refused to hear a final appeal in the Cablevision remote DVR case, thereby bringing the years-long litigation to a close. Despite the continued objections of broadcasters, video providers like Cablevision will be allowed to offer "box less" DVR service to customers.
The central question in the case might seem an arcane one: does it matter where a hard drive lives? Cablevision said no, and prepared to launch a service in which all of the digital video recorder's hardware lived in the cable company's central office. Subscribers would still have to choose which shows to record, how long to keep them for, and when to view them, using their television sets and cable boxes as a front-end to the system. Cable companies would no longer need to service and distribute hundreds of thousands of DVRs to customer homes.
To broadcasters, though, this was an unacceptable blurring of the line between a cable company and a rights holder. In their view, Cablevision had no right to archive and retransmit Their programming at its discretion. They sued.
Cablevision's position was that the system was identical to those that had legally been deployed for years by consumers; it just shifted the location of the hardware into the cloud. Yes, it would certainly have been a problem if the company was archiving all TV shows and making them available on demand (essentially creating the world's best video on demand library), but that wasn't happening. The consumer remained in control and had to initiate every action taken by the hardware. In effect, the miles of cable between one house and the central office became the world's longest remote control.
The studios also alleged that Cablevision's 1.2-second storage buffer, which kept a copy of all material, infringed their copyrights.
Initially these arguments won sympathy from a federal judge, but they were all overturned on appeal in August 2008. A three-judge panel from the Second Circuit's Court of Appeals ruled that the 1.2 seconds of buffer material was in fact an "embodiment" of the copyrighted work but that it was only of "transitory duration" and therefore not copyright infringement.
The judges also ruled that Cablevision did not "own" the copies on its servers. The copies were made and controlled by the users and therefore fell under traditional fair use guidelines for home recording area
The case was appealed to the Supreme Court, but the Obama administration made clear to the court in early June 2009 that it did not believe the appeal should be granted. The Court apparently agreed, this morning refusing to hear the case (PDF; see p. 9, CNN v CSC Holdings). Justices Roberts and Alito recused themselves from the decision-making process.
Cablevision has promised an aggressive rollout of the technology once the legal issues are settled, and other cable operators have shown interest in deploying similar technology.
But is Cablevision in the clear? The company was only sued for direct copyright infringement, but the possibility of a new lawsuit charging contributory copyright infringement (the same charge that brought down The Pirate Bay administrators) remains.