FORTNIGHTLY CORP. v. UNITED ARTISTS
Legal provision: 17 U.S.C. 1
Argument of Robert C. Barnard
Chief Justice Earl Warren: Number 618, Fortnightly Corporation, petitioner, versus United Artists Television, Incorporated.
Mr. Robert C. Barnard: Mr. Chief Justice, may it please the Court.
This case is here on certiorari to the Court of Appeals for the Second Circuit.
The respondent, plaintiff below is engaged in the business of licensing films and cartoons to television stations to be broadcasted by those stations.
The petitioner on two community antenna systems is charged with copyright infringement by reason of the reception of the broadcasts of the movies and cartoons by the stations licensed by the respondent.
There are two basic issues on this appeal.
First is the reception of a broadcast signaled by the petitioner, CATV, and the transmission or the conducting of that signal by wire to the homes of the subscribers without sight or sound being involved a performance in public of the copyrighted works within the meaning of Sections 1 (c) and 1 (d) of the copyrighter.
The second and related issue is whether when a broadcast has been licensed by a copyright owner, as it has been here.
A member of the public has a license implied in law under the Copyright Act and the Communications Act to receive off the air and enjoy the authorized broadcast by the use of a receiving antenna of his choice, including subscribing to the service of a community antenna.
Petitioner's two community antenna systems were located in Clarksburg and Fairmont, West Virginia, two towns in --.
Just by West Virginia is hilly, rugged, and mountainous.
In 1952 when the systems began, the only television stations in the area were in Pittsburgh and in Johnstown, Pennsylvania.
In 1953, the stations in Wheeling, West Virginia and Steubenville, Ohio began broadcasting.
They were -- these were the only stations that the people in this area had from which they could get any television service.
These stations were some distance away from Clarksburg and Fairmont.
They're some 50 to 65 miles from Fairmont and a little bit farther from Clarksburg.
As I said, the area here is mountainous and the towns are in hilly areas.
Most of the houses are in valleys but there are also houses and people who live on the hills and in and around the towns.
This is also an area where the winters are harsh.
As a result of the winds and ice, the tall antennas on poles presented problems with the householders.
As a result, many Clarksburg and Fairmont residents found it convenient to subscribe to the petitioner's service rather than put up their own antennas.Others joined in cooperation with their neighbors and put up cooperative antennas.
Coops of this kind still exist in these communities.
Others subscribed to community antennas other than those owning to petitioner and those systems still exist.
We suggest that the petitioner systems are classic examples of CATV put up where the terrain and the distance made reception difficult for the people in the area.
We were performing this service which Mr. Gellar said yesterday the Commission had found to be in the public interest.
And perhaps, West Virginia is a classical area for the community antenna.
Figures that were writ -- issued recently suggest that more than 25% -- more than 20% of the homes in that area depend on community antenna for their television service.
The Court has just heard community antenna discussed in very general terms in the Southwestern case.
The facts in this case are not in dispute but I think it is important that I state not only what community antenna does, but also what it does not do because there is confusion and a number of allegations that do not apply to the facts in this case.
In order to operate, every television set must have an antenna and there must be a connection between the antenna and the receiving set.
In most cases, the antenna is built in to the television set itself and most people in metropolitan areas use the built-in antenna.
Others use rabbit ears, others put antennas on top of their houses or on poles, depending on their interest in television service and how much they wish to spend for an antenna.
But in all instances, they must have an antenna and the connection from the antenna to the set for the set to operate.
Now, the sole activity of the petitioner's antenna system was to put up an antenna and to provide an antenna connection or a wire connection to the set.
We had antennas on telephone poles or on structures, on hills near the towns, and they were connected to the towns by wire coaxial cable and distributed along the cables were amplifiers in order to maintain the strength of the signal because it losses its strength as it passes through the wires.
The respondent's expert testified that the function of our antenna system is the same as that of a home antenna or an apartment house antenna.
Petitioner systems received the entire broadcast of the stations and it was able to receive -- there was no editing or deletion.
The service provided was instantaneous and simultaneous.
There was no recording or transcriptions made of any broadcasts.
The petitioner did not originate any programs and had no equipment to do so.
I wish to characterize the service but there is no doubt as to what we did.
We provided a service for a flat fee.
We charged just a flat fee regardless of whether any programs were watched by the subscribers.
Justice Potter Stewart: I guess there was an installation fee and then a monthly fee?
Mr. Robert C. Barnard: That's correct, sir.
Chief Justice Earl Warren: Would you mind telling me how you do this when you get the antenna on the telephone poles?
How do you get it into the house?
Mr. Robert C. Barnard: There's a connection by coaxial cables strung along telephone poles on the streets, sir.
And from that coaxial cable, there's what is called a drop, a connecting cable that goes into the house itself.
It goes into the house and the subscriber attaches it to his own television set within his house.
Chief Justice Earl Warren: But you do is to make it possible by supplying an antenna of that kind.
Mr. Robert C. Barnard: That's correct.
Chief Justice Earl Warren: For them to receive communications from further away?
Mr. Robert C. Barnard: I would like to come to that point right now, sir.
We of the -- each system received five stations.
There are therefore ten station system situations, all of them were received off the air.
In five of the instances, we are receiving what the Commission calls local stations.
That is the system was within the Grade B contour of the station itself.
And the other five instances, we were virtually on or very near the Grade B contour of the station.
We were within an area where reception is possible off the air.
This is all off the air reception.
Justice Potter Stewart: Where without the services of your antenna, the reception in some cases in the householders in the valley might have been impossible and in all cases, it might have been inferior.
Mr. Robert C. Barnard: I -- it's conceivable it would have been inferior.
They would obviously have made other arrangements for their television reception.
Justice Potter Stewart: And the five stations were what, three Pittsburgh stations and a Wheeling station, and Steubenville --
Mr. Robert C. Barnard: And Steubenville and Wheeling.
Justice Potter Stewart: And then, the five others were what?
Mr. Robert C. Barnard: They're all the same here, sir.
There were two separate systems, one in Clarksburg and one in Fairmont and received the same stations.
Justice Potter Stewart: And one was then the B contour and the other was just on the --
Mr. Robert C. Barnard: In the Fairmont case, in four instances, it was within the B and in one instance, it was just outside, and Clarksburg it is the reverse.
It was one instance within the B and four instances just outside.
Chief Justice Earl Warren: There's a need for it brought about by the hilliness of the country?
Mr. Robert C. Barnard: Partly by the hilliness and it's with -- it's certainly within the area where reception would have been expected if it were not for the ruggedness of the area.
May I say that there is no sight or sound involved in any part of our system.
Chief Justice Earl Warren: There is no what?
Mr. Robert C. Barnard: Sight or sound.
If there is any rendition of the movies involved here, it's in the homes of the subscribers.
They provide their own sets.
We do not sell them, service them, provide them or control them in any way.
We don't display or show a program of any nature in the community antenna system.
Chief Justice Earl Warren: May I ask you, is this widespread throughout the nation now?
Mr. Robert C. Barnard: There is -- there are about 1,800 systems as I understand it, 1,800 community antenna television systems throughout the nation and of course, there are many thousand apartment house antennas which provide service for the people who live in the apartments and use equipment substantially like that which is used by the community antenna systems.
Chief Justice Earl Warren: Either done by small companies or as yours are large?
Mr. Robert C. Barnard: In general, it's done by small companies, sir.
The industry is diffused and it's a small town industry.
The respondent has pointed out that there had been some larger companies that have come into the business, but it is essentially a small town business and is a small town type industry.
Chief Justice Earl Warren: Do you do this business over the country or just in this section?
Mr. Robert C. Barnard: We did business just in these sections here.
Justice William J. Brennan: Was it that the thought that all these systems do is enhance the efficiency of the receiver?
Mr. Robert C. Barnard: I believe that's correct, sir.
We do not do anything at all with the programs.
We have nothing to do with the programs.
We provide a service which connects an antenna well situated to the homes of the subscribers.
Justice Byron R. White: And if every subscriber could have afforded it, they could have put up their own antenna.
Mr. Robert C. Barnard: They could certainly have filed over with the antenna service because it is available in the community by coops or other ways.
Justice William J. Brennan: Did I understand you to say that something -- I live in the section of Washington where I don't get some stations very well.
I'll use an antenna and that gets me the local signals because I could not get them without an antenna.
And is that what you're suggesting as all the CATV service?
Mr. Robert C. Barnard: Yes sir, it provides a more efficient antenna service and the higher the -- the more -- the better the location of the antenna, the better your reception will be.
We provide that service and provide a -- an efficient link between the antenna and the home sets of the subscribers.
Justice Byron R. White: But you do give a -- don't you give the signal a little more power?
Mr. Robert C. Barnard: We amplify the signal as it goes down the line, Mr. Justice White, because it loses strength as it passes through a cable.
We maintain the strength of the signal with the amplifiers, yes.
Chief Justice Earl Warren: We'll recess now.
Mr. Barnard, you may continue your argument.
Mr. Robert C. Barnard: Thank you, Your Honor.
Justice Byron R. White: Mr. Barnard, could you just address yourself one more moment to -- what you actually do?
Don't you, as well as amplify signals, also convert them from one frequency to another or something like that?
Mr. Robert C. Barnard: Yes, Your Honor.
There is equipment within our community antenna system which converts from one frequency to another.
We convert from a what so-called high band, that is the 7 to 12 down to 2 to 6 because it is more efficient to transmit through the cables.
You'll lose less on the --
Justice Byron R. White: You do considerably more with your antenna system than the ordinary set owner does with his.
He takes it off the air -- he either takes it off the air the way it comes or that's the end of it.
Mr. Robert C. Barnard: It depends on what you mean, Mr. Justice White.
Within each set, the signal is converted by the set itself.
It is converted for amplification and for purposes of circuitry within the set itself.
So far as conversion is concerned, it's a standard operation that's done by every radio set and every television set.
Chief Justice Earl Warren: You told us how many thousand of these community antennas are were in the country I think you said something like 3,000, I'm not sure.
Mr. Robert C. Barnard: I believe it's closer to 2,000, Your Honor.
Chief Justice Earl Warren: 2,000.
Now, do they do these things that have just been asked of you?
Mr. Robert C. Barnard: I'm sure that many of them do because the equipment is reasonably standard, Your Honor.
It is not --
Chief Justice Earl Warren: They have a cable -- a cable coming from --
Mr. Robert C. Barnard: Normally, they have a cable which connects from the antenna to the -- into town.
They use lots of names, they call it runs.
The equipment has been described as being sophisticated and complicated.
It involves nothing that's complicated electronically.
I'm sure Mr. Nizer will point out that it cost quite a bit of money but then, it also provides antenna service for quite a few people.
Chief Justice Earl Warren: Do they boost the power as you do?
Mr. Robert C. Barnard: As a signal is received, it is amplified near the antenna site in order to maintain strength down the cable as the cable -- as it moves down into town because it loses strength as it passes through the cable.
So amplifiers are spaced every thousand or 1,500 feet, whatever it is, in order to maintain the strength of the signal.
But I would point out one thing to Your Honor.
There is nothing that the community antenna can do to improve the signal as it's received at the antenna site.
If the signal received at the antenna site is bad, it remains bad.
All it can do is maintain the signal in the form in which it arrives at the antenna site as efficiently as possible.
It endeavors with its equipment to avoid distortion between the antenna site and the homes, but there's nothing you can do to improve the signal if when it arrives at the antenna as bad.
In that respect, it's exactly like a home.
Justice Byron R. White: Including that you can't amp -- you say you can strengthen the signal.
Mr. Robert C. Barnard: That -- but you couldn't improve it if it had snow or distortion that there's nothing you could do about it.
Justice Byron R. White: But you could strengthen it.
Mr. Robert C. Barnard: You could strengthen.
Justice Byron R. White: Which you do.
Mr. Robert C. Barnard: Yes, Your Honor, just as every television set does, too.
There are several additional undisputed facts that I'd like to call to the Court's attention.
I mentioned the fact that every one of these broadcasts that were involved here were licensed.
There's no contention that the broadcasts are infringed.
We received all of the signals off the air and the -- what we conduct or transmit is electromagnetic energy and the respondent claims no copyright in the electromagnetic energy.
The only rendition, if there is any, is in the homes of the subscribers and there is no contention that that viewing is an infringement.
A copyright is a completely statutory right and whatever is claimed by the copyright owner must be found within the four corners of the statute.
Sections 1 (c) and 1 (d) confirm on the copyright owner the exclusive right to perform the copyrighted work.
But in order to be an infringement however, there must be two separate elements shown as required by the statute.
First, there must be a performance of the copyrighted work, and second, the performance must be in public.
In the case of 1 (c), there is a third element for profit.
I emphasize these separate elements because the respondent has endeavored to collapse them into one in public.
There must first be a performance and then in public.
It makes no difference whether it's in public or private if it's not a performance.
The number of the subscribers which we have may be relevant to the issue whether it's in public but that issue is reached only if it's first found that there is a performance.
So I then turn to the question which I regard as the key question, whether we perform the copyrighted work, that is whether receiving the signal off the air, conducting it through a wire with amplifiers and with the equipment that we use to the homes of the subscribers without sight or sound is a performance within the meaning of the act.
The guiding principles for the construction of the Copyright Act were set forth by this Court in the White Smith against the Apollo Company case many years ago.
There, the issue was whether a perforated role, piano player role was a copy within the meaning of the Copyright Act.
It was no doubt that you could use the role to reproduce the music and they were the economic arguments made there which are like those made here.
However, the Court held there that this was not a copy and in reaching that conclusion laid down the construction of the copyright statute.
It said that you should not use strained and artificial meaning in construing the words but the words should be construed as the Court said using its words in terms of the ordinary sense, the common understanding or the generally understood meanings of the terms.
And it's this construction which we think if applicable here indicates that what we do is not to perform the copyrighted work.
The Court of Appeals did not consider what would be the ordinary meaning of the word “perform”.
The District Court did consider it but recognized that the meaning it was adopting was not that which an ordinary layman would use for the word perform.
We believe that if the courts below had followed the standard of the ordinary meaning of the words, they would have recognized that the word “perform” in the copyright statute means providing a visible and audible rendition of the work, a rendition of the work.
We think this is the meaning that Congress had in mind when it passed the statute.
It was concerned primarily with the problem of stage plays and people who came in and took stenographic notes or transcriptions of the play with the intention of giving an authorized performance at a later date.
Congress is also concerned with the Nickelodeon what it called the graphic phone and the phonograph and the player piano.
Indeed in Section 1 (e) which is not involved here, the so-called jukebox provision, in order to provide and exception from the public performance provision for a jukebox, the Congress had to say that a rendition or a reproduction of the music was not a public performance except where admission were charged.
This is in my -- our minds a clear indication of the relationship between rendition sight and sound and performance.
We believe that to hold that by receiving a broadcast signal and conducting those signals with whatever equipment is needed to maintain their strength to the homes of their subscribers.
Without sight or sound is not a performance within the ordinary meaning of the word and does not meet the standards which this Court laid down in the White Smith case.
Justice Byron R. White: I suppose Mr. Barnard, you will deal with the situation where there is a licensed television station in a city, and that licensed television receives a network program and does nothing with the signal it receives by microwave relay or whatever it is.
It receives the signal and retransmits it to the public who take it into their sets and watch it, and the station doesn't do anything to the signal at all except retransmit it, I gather.
And if the program has a copyrighted work in it, does that station have to pay?
Mr. Robert C. Barnard: Yes, Your Honor, it does.
Justice Byron R. White: And what are they doing that you aren't doing?
Mr. Robert C. Barnard: They're doing several things.
A broadcaster is in a very different kind of business than we're in.
A broadcaster's business is to procure programming.
As federal communication has said, his -- the essence of his business is to procure programs.
He can either procure programs by having a program in his own studio or he can procure the program by having it performed in a distant studio.
And his job is to, once he procured the program, is to make the program public by means of a broadcast.
The fact that he gets it from a network simply means that his studio is placed at some distance from where he is.
It's not in the building where he's actually conducting his business.
Justice Byron R. White: That is both the originating station and the, say originates in New York it would be that the station of New York has to pay and the station of Pittsburgh?
Mr. Robert C. Barnard: The network doesn't originate, Your Honor.
The network does not broadcast.
The network provides programs to stations to broadcast.
The network is not engaged in broadcasting.
It is simply engaged in providing programs.
Justice Byron R. White: Who pays?
Mr. Robert C. Barnard: The stations.
Justice Byron R. White: Just the stations?
Mr. Robert C. Barnard: The stations pay or in the instance of the network, the network provides the clearance in advance for the stations, but it is not the network which is the broadcaster.
Justice Byron R. White: Well what if there's -- the programs originate in the station and is carried to another station, and that station in other words -- will both stations pay in other words?
Mr. Robert C. Barnard: Yes, Your Honor because the station which is, as you say, retransmitting is also engaged in broadcasting.
And the fact that he has got his program from a distant studio doesn't make any difference than when he got his program in his own studio.He is procuring a program for the purposes of broadcast.
Justice Byron R. White: Yeah, but then in terms of the physical activities that he goes through, he gives it very difficult use.
Mr. Robert C. Barnard: Yes, there are.
There is a significant difference in the physical activities, Your Honor.
In order to broadcast the station which, as you said, retransmitted, must modulate a carrier wave in order to broadcast because what he receives is a video or sound signal.
Our equipment does not modulate a carrier wave.
Indeed, one of the misconceptions of the District Court was that we are the same as the broadcaster because we modulate a carrier wave.
The truth is that once --
Justice Byron R. White: -- one for sound and the -- doesn't have to be in this -- it would be the licensed station that it's consummate?
Mr. Robert C. Barnard: But he is procuring a performance in another location.
The difference between the location within his building and the location outside his building seems to me to be not very significant, but what he's doing is asking that a performance be made someplace else and doing it under contract, i.e., by a network agreement.
Justice Byron R. White: What I get to say is the same thing about your client.
Mr. Robert C. Barnard: Because we're making no arrangements for our programs.
We have nothing to do with him.
We don't know what they're going to be in advance.
We don't know where they come from, and we don't ex -- we don't endeavor to exploit them as programs.
We sell no advertising.
We do nothing with them, which is what a broadcaster does with them.
This is --
Chief Justice Earl Warren: Which is to have a sponsor isn't it?
Mr. Robert C. Barnard: To sell advertising and association with them.
Chief Justice Earl Warren: Just crossed my mind.
How do you quite this to the football situation where the lead decides that it doesn't want to broadcast within a hundred miles of the place where the game is played in order to get a -- in order to get an audience.
And your antenna could pick something up 250 miles away and send it down into that various -- that same community and deprive them of their right to keep it from there.
It couldn't pick them up 250 miles --
Chief Justice Earl Warren: Well -- well, let's just say 150, like Los Angeles.
Mr. Robert C. Barnard: Your Honor --
Chief Justice Earl Warren: Or San Diego?
Mr. Robert C. Barnard: The critical issue is what is the public entitled to receive off the air.
If the receiver is within the normal service area of a station where the signal can be received off the air, in our view, it is the public's right to receive, which should be given -- paid attention to here, and when we argue the second branch of the case, I will argue that the public has the right to receive within the antenna it chooses, that this is the nature of broadcasting and the right which was conferred.
And indeed, we -- our contention is that the copyright owner had been paid.
He is releasing a particular form of his work to the public in the form of a broadcast.
He is releasing it because he licensed the broadcaster and he's paid for that broadcast, and the people who receive the broadcast off the air are the people for whom the broadcast was intended indeed as a matter of law.
Under the Communications Act, the broadcast must be that which is intended to be received by the public.
And in our view, the public interest is what is paramount here as to the right to receive once you have licensed the broadcast itself.
Chief Justice Earl Warren: Could you use it in any way other than to just do what you do here?
Mr. Robert C. Barnard: We certainly could not transcribe it or record it.
You could not rebroadcast it because Section 325 forbids rebroadcasting and we are not a broadcaster.
We are engaged solely and exclusively in simultaneous and instantaneous reception off the air of a television signal.
Our -- the courts below rely on Buck against Jewell-LaSalle, the hotel case, and we think erroneously because that case confirms our view that the Court has adhered to the ordinary meaning of the word perform.
In that case, the hotels was held to have performed the music but its equipment was significantly different from that which the community antenna has.
The hotel not only had an antenna and a connection between the antenna of a radio set, it had loudspeakers.
And it was the fact that it provided the music in audible form in the loudspeakers which the Court referred to in connection to performance.
Mr. Nizer would interpret it to mean that if the hotel simply had a wire down to a radio set but no loudspeakers so that you heard nothing that the hotel would have held to have performed.
We think that the -- if you see the -- in the opinion, the significance of the hearing of the music is paramount to the decision in that case as to the meaning of the word “perform” because the court said it was the translation in the sound of the musical works on instrumentalities under the hotel's control, which was the reproduction that amounted to a performance.
Here, there was no translation of the sound, no visible nor audible reproduction of the music, and we think therefore that the hotel case actually demonstrates that the word “perform” does not apply to the operations.
Justice Byron R. White: If your client owned all the television sets, it would be like the hotel case.
Mr. Robert C. Barnard: There is only one instance -- well, Your Honor, that case has come up in Canada where they -- the system provided something called radio diffusion.
It provided all of the hotel -- provided all of the equipment in the homes.
The Canadian Court said that the performance in the homes or the rendition in the homes was a private performance and that when the radio diffusion system had sets in a public room, that part of its operations was a public performance.
Our respondent tried its case on the theory that performance could be found in the electronic function of our equipment and the District Court accepted that view.
There were two technological alternates which were urged and which the respondent no longer urges here.
First, it said that because of the way the circuitry has worked inside the television -- inside of the equipment, there was an electronic reproduction made that is the of the signal, that is the signal that came out of the tube, had the same electrical characteristics, and that this was a reproduction within the meaning of the Copyright Act.
No one supports this view here and the almost unbelievable billions of numbers of tubes that would be involved if that weren't correct is an indication of the tremendous sweep of this position.
The second position which they took below was that because our equipment modulated the carrier wave that its electronic function was like a broadcaster.
Hence, we performed.
I have commented on this.
We had equipment at one time which model -- modulated the video carrier but not the sound carrier.
Our older equipment did not.
The more modern equipment modulates nothing, and it seems to us clear that since modulation is neither required nor typical as CATV equipment, this theory of performance must fall.
Justice Abe Fortas: Well, on the other hand, I suppose it's arguable that the substance of the situation is that by your facilities, you to some extent exhibit that you're responsible for making the motion picture available in homes where it would not otherwise be available, take your facilities that are on the outer -- that are outside of the -- the band they expect from here, the service area.
And I suppose that it's arguable that that's what you're doing in essence, that you're making available the motion picture film to which is the property of somebody else to people to whom it would not otherwise be available, and that is -- and you're getting paid for it and that that is a use of somebody else's property which without too much quarreling and hair splitting can be brought within a specific language of the Copyright Act.
I'm not saying that that's my position but I say that that's -- I understand it would be the argument on the other side.
Mr. Robert C. Barnard: May I suggest Your Honor that this mixes up the electromagnetic energy which we receive and the copyrighted work.
There is no contention --
Justice Abe Fortas: Well, they do get kind of mixed up don't they?
Mr. Robert C. Barnard: Well, I suppose they get mixed up in the argument but they don't get mixed up in fact because there's no doubt that the copyright is not on the electromagnetic energy.
If there is a copyright, it is on the movie and on the performance of the movie.
And so far as the electromagnetic energy is concerned --
Justice Abe Fortas: Well, what's that thing I see on the screen when I go to the movies?
Mr. Robert C. Barnard: When you go to the movies?
You see light or a picture.
Justice Abe Fortas: That was my point, yes sir.
Mr. Robert C. Barnard: Well, I suppose Your Honor that everything could be reduced to electromagnetic energy because I guess that's all we are.
But I -- on the other hand, it seems to me that when you --
Justice Abe Fortas: Well, I could say speak for yourself but --
Mr. Robert C. Barnard: Well, I don't feel very electromagnetic but it does seem to me, Your Honor, that it does confuse what the statute is talking about, the copyrighted work and electromagnetic energy because all we deal with or conduct or amplify or convert is electromagnetic energy, and there is no claim that there is a copyright on that.
Indeed, it could not be copyrighted.
If there is something that is a rendition and you must look to the statute as to what it covers.
If there is a performance, in our view, it is in the home where the light and sound appear.
Justice Hugo L. Black: Do you know whether there's any claim that these individual companies that put up aerials for us are liable for infringement of the copyright?
Mr. Robert C. Barnard: Within the theory which was just suggested here, yes, they would be liable and one of the points which we have made is that the various theories of performance urged in this Court sweep within the scope of the copyright statute not only community antennas but the apartment house antenna which is so common in this area.
They sweep within their scope the common carriers.
They sweep within their scope new methods of communication which are just on the horizon because they include within their scope these broad elements of communication or the dealing in electromagnetic energy.
Justice Hugo L. Black: I assume there would be no difference between the apartment house antenna and yours, would they?
Mr. Robert C. Barnard: Your Honor, that case -- that point came up specifically in the record and it is no doubt that the function of the apartment house antenna is exactly the same as ours, respondent's expert so testified, and the equip -- we offered to prove that the equipment was the same.
We were not permitted to make that -- good on that offer, but we offered to prove that the equipment was the same.
Justice Hugo L. Black: Well, did you all approve whether it would help to collect from the apartments?
Mr. Robert C. Barnard: I think that that was conceded but no effort had been made to collect from anyone prior to the time they brought suit against us.
Justice Hugo L. Black: From anyone?
Mr. Robert C. Barnard: I believe that's correct, sir.
I'm talking of community antennas or apartment house antennas.
Justice Hugo L. Black: Talking about what?
Mr. Robert C. Barnard: Community antennas or apartment house antennas.
Justice Hugo L. Black: Yes, that's what I was talking about.
Mr. Robert C. Barnard: Yes.
Justice Abe Fortas: By the way, what are your charges? What are your charges for this service?
Mr. Robert C. Barnard: It's -- well, there are two varying in charges depending on whether they paid a so-called installation fee or a rental fee.
It's $3.75 if they paid an installation fee and $5.00 if they paid a rental fee.
Justice Abe Fortas: A month?
Mr. Robert C. Barnard: A month.
Justice Abe Fortas: Then -- and that's the total charge?
Mr. Robert C. Barnard: That's the total charge, Your Honor.
Justice Byron R. White: Mr. Barnard, I suppose that under those decisions below that if you just -- if your equipment has made a mistake and you then put out a perfectly good signal but it just had to be a signal that your subscribers did receive in their sets, somebody else might have been able to receive it that there would still be infringement.
Mr. Robert C. Barnard: That's correct, Your Honor.
Indeed, under the argument which is here in this Court now, the respondent takes the position that the viewing in the homes is not even relevant to the question whether or not we infringe or whether or not we perform to be more specific.
They say that the viewing is, as they said in the opposition, private performance and in their brief here, they say it's not even within the scope of the copyright monopoly, therefore you must find that performance in the wires and amplifiers and what we do to the electromagnetic energy within the wires and amplifiers --
Justice Byron R. White: What if you -- what if you have to comply with the FCC rules, you taped a program for delayed delivery to your customers in a couple of days.
Mr. Robert C. Barnard: Well, there are no such FCC rules, but I --
Justice Byron R. White: Well, I thought -- I thought they -- I thought that they prevented duplicating local programs?
Mr. Robert C. Barnard: That's correct sir.
What they mean is that you block out, it isn't that you tape.
It means that you block out.
Justice Byron R. White: But do the CATV people ever taped and -- for delayed delivery?
Mr. Robert C. Barnard: If they do, it's not in this case and I know of no one in this practice to do it.
Justice Byron R. White: But if they did, I suppose then you have it over a different question.
Mr. Robert C. Barnard: The statute reads specifically on the making of a transcription or a record of a copyrighted at work.
But that is -- that's illegal because the statute forbids the making.
It isn't because it's a public performance.
Justice Byron R. White: I understand.
Chief Justice Earl Warren: Are there any such community antennas in this metropolitan area?
Mr. Robert C. Barnard: I don't know -- there are great many apartment house antennas in Washington and Baltimore.
There are some that I understand are constructed close here.
Cumberland, Maryland has a CATV.
There are some out by the bay that the communities are setting up CATVs and I think there are some around the metropolitan area.
I don't know of any in the metropolitan area, Your Honor.
Justice William J. Brennan: Do I understand Mr. Barnard that merely pick up local signals if that's the reception of local signals?
Mr. Robert C. Barnard: Yes, Your Honor.
In New York City, this is the way they work.
They -- under the franchise in New York City, they pick up only local cities.
New York from the point of view of electromagnetic wave is a horrid area because it's very mountainous.
And so, reception is difficult in the apartment buildings in New York, so that they do use antenna systems there for reception and to improve the reception.
This is the kind of function which we contend we're doing in the area worthy because of terrain or other reasons the reception is difficult.
We are providing a service that makes the reception better.
The respondent really has three theories of performance which is surging in this Court.
The first is that by amplifying, processing and retransmitting electromagnetic energy we are performing, every television set, every radio set, every communications common carrier does that.
The second is that we are communicating the pictures in whatever form they may be to where they become visible or audible.
This is the separate new position which they took in this -- in their brief in the Court this time.
As I tried to comment earlier, I think this confuses the signal with the copyrighted work.
The rendition of the work which they say is irrelevant to performance occurs in the home and we do not see how there can be a performance without a rendition.
In the Buck case, there surely would not have been a performance found if the hotel did not have loudspeakers on which it made the music audible for the benefit of its guests.
Respondent relies on three broadcaster cases for its argument.
Each of these cases involved the actual performance of the music in the studio of the broadcaster, one was in American case, the Remick case in the Sixth Circuit, one was an Australian case and one was a British case.
In each case, there was -- there's no question that there was an actually rendition of the work in the studio.
The issue which the court addressed itself to is whether that performance had been made public by the broadcaster.
In each instance, they said it was made public.
The broadcaster's function as I have tried to say is significantly different both from a physical and business point of view than the CATV.
The Solicitor General has suggested that this problem has ramifications in copyright law, communications regulations and anti-trust, and we suggest that in an area where there is no evidence as to the congressional intent, here there is no evidence as to congressional intent.
These are considerations which the Court should have in mind in construing or deciding whether to extend or expand the monopoly conferred by the copyright statute.
In earlier testimony and in its memorandum, the Department of Justice points out the anti-competitive consequences that would flow if infringement were imposed on CATV.
As I said earlier, this is a small town industry.
And as the solicitor has said, copyrights are concentrated in the hands of the networks and seven movie companies, either because of back damages, and respondent is claiming $250.00 minimum damage for every cartoon and every movie which we received.
On the basis of that claim, we would be incurring damages at the rate of $1 million a month.
Obviously, this opens the way to take over the community antenna business.
But even apart from the past damages, there's no doubt that if copyright infringement is imposed, they will be able to control the community antennas for the purposes of -- for their own purposes obviously.
There's nothing to prevent them from putting a community antenna on a business by the size of the fee they would charge.
And indeed, they have said that we were carrying programs into areas that they would otherwise like to exploit differently.
So clearly, they want to cut off the reception of the programs in those areas.
So far as the copyright owner is concerned, he has received his reward.
He's been paid for the broadcast as I had said earlier.
The Solicitor General acknowledges this and we offered to prove that the copyright owner had been paid not only for the audience of the station but the audience which included the CATV subscribers.
What the broadcasters and the NA - National Association of Broadcasters' brief and it makes clear the respondent says here they want to control the competition between stations for their own purposes.
They want to cut off by license agreements the reception of the signals of a competing station when it suits their interest.
They want to supplant the regulation of reception by license exclusivity, license agreements to supplant the regulation which the FCC as found to be in the public interest has been explained to you in the case just preceding.
And we suggest that it is the same power in the use of exclusive territories which concerned the court in the Schwene case and the Albreck case.
We suggest that the Court should not strain to expand the statute in order to encourage this kind of exclusivity.
This brings me to the second issue, the issue of the license implied in law.
Justice Hugo L. Black: The what?
Mr. Robert C. Barnard: The license implied in law to receive broadcasts off the air.
If it be assumed that our systems perform the copyrighted works, which we deny, then the question is, does the public have a license implied in law to receive the broadcast off the air with whatever set or equipment it chooses, including a community antenna?
This was a question reserved in the Jewell-LaSalle case and as the court below said, it's presented here as a question of first impression.
In our view, the public has the right to receive broadcasts off the air with antennas of their choice.
And that this policy -- this is based on the policy embodied on the Copyright Act and the Communications Act.
When a copyright owner has licensed a broadcast, he has received his reward for releasing that particular embodiment of his work to the public.
I emphasize this, Your Honor, because there has been confusion.
It's been said that we are -- say the work is dedicated to the public.
That's not correct.
We said that -- it's been said that we are charging that the owner loses his right to license other broadcast stations.
That's not correct.
It said that work falls in the public domain.
That's not correct.
The only point we have made is that when the broadcast -- when the copyright owner decides to license a broadcast, the public has a right to receive that broadcast off the air with its antenna of its choice, including CATV, and that the copyright owner cannot control that reception or put a second charge on it.
Respondent says there is no such license implied in law.
It says it doesn't want to charge the public and wants to charge the community antenna.
This is of course just passing beside the point because clearly, a charge on the community antenna is a charge on the public.
It's a charge in doing business and will be passed along.
And certainly, in the case of apartment house antennas, it would be a charge directly --
Justice Hugo L. Black: I suppose it would be a charge on the people that use the radio or television, wouldn't it?
Mr. Robert C. Barnard: That's correct, sir.
That's our position, that this is genuinely a charge to the public.
Justice Hugo L. Black: Are there any claim made that they have to pay a copyright infringement or else --
Mr. Robert C. Barnard: No.
Justice Hugo L. Black: -- if they put up their own antenna?
Mr. Robert C. Barnard: No.
It's conceded that this non-infringing, Your Honor.
Justice Hugo L. Black: Why?
What basis is that?
Mr. Robert C. Barnard: Well, they claim that the principle is do-it-yourself, that you must put up your own antenna, that you're not entitled to go to others to assist you in reception of your program a reception of the broadcast.
Justice Hugo L. Black: You'd be getting the performance, wouldn't you?
Mr. Robert C. Barnard: It's on the -- you're getting exactly the same performance on a private antenna as you're getting on the community antenna.
Justice Byron R. White: But perhaps the basis for say that the private set owner is not liable for an infringement.Is it on the implied license theory?
Mr. Robert C. Barnard: If I underst -- in my view, yes.
But if I understand respondent's position correctly, no, their view is that the viewing is outside the scope of the copyright monopoly.
They have also stated that the viewing in the homes is a private performance, not a public performance.
Now, which position they're taking right now, I don't know.
The respondent's primary legal argument is that --
Justice William J. Brennan: Did you say that the position was that when I hire someone as I did and paid a lot of money for it to put up one of these fancy antennas that runs by electric clocks, that that was the do-it-yourself kind?
Mr. Robert C. Barnard: Your Honor, I don't think it's do-it-yourself.
I think it's exactly the same kind of thing as a homeowner can do if he chooses to do it.
What they're suggesting is that an --
Justice William J. Brennan: That probably costs me a lot more than if I got one of -- subscribe to one of your community antenna services, wouldn't it?
Mr. Robert C. Barnard: I think it quite possibly may, Your Honor.
I don't know.
Justice Byron R. White: Do you suppose that if the gentleman has sold him and installed the antenna, he's subject to the rule below?
Mr. Robert C. Barnard: Under -- I think that under the construction of the rule below and certainly under the respondent's theories here, the gentleman is maybe within the scope of the copyright monopoly because he was contributing, he was providing -- making it possible for you to view what otherwise you wouldn't view.
As I was saying, the main legal argument that's made here is that a broadcast is different from a sale of a book and because of a license to a broadcaster is personal while a sale of a book is a transfer of title in a channel.
But the form of the release we suggest -- the form of the release to the public selected by the monopolist, the copyright owner we believe is not important in this context.
The normal method for release of a book is sale.
The normal method for release to the public of a film to be broadcast is by broadcast.
The controlling issue is not the form which the copyright owner chooses to release to the public but the pubic policy underlying the Copyright Act and the Communications Act that once the copyright owner has been paid, and he has been paid here, then the public policy of release to the public should be the guiding policy and the public should be entitled to receive that broadcast by any means it finds convenient, including a do-it-yourself or a community antenna if it chooses to.
Justice Abe Fortas: Suppose that were technologically possible and you sold your service to --
Mr. Robert C. Barnard: I'm sorry I didn't hear the first one?
Justice Abe Fortas: Suppose that were technologically possible and you sold your service to a theatre, and the theatre exhibited a motion picture that came in over there and exactly the way you described charged admission for it.
What would be the legal consequences under the Copyright Act?
Mr. Robert C. Barnard: I would have no doubt that the theatre was performing within the meaning Buck case.
This is providing --
Justice Abe Fortas: But you would not be.
Mr. Robert C. Barnard: It's conceivable that we would be liable as a contributory infringement but we would not be liable as a performer because we are not giving a performance.
Justice Abe Fortas: But you would be liable -- you would be infringing the Copyright Act?
Mr. Robert C. Barnard: We might be liable as a contributory infringement and need the respond that has said that it's going to make such a contention but so far as we can see, the performance is done by the theatre in your illustration and not by us.
Justice Abe Fortas: The difference being that then you would be providing this service or facility or whatnot for a public performance as distinguished from a private performance.
Mr. Robert C. Barnard: That's correct Your Honor.
Justice Abe Fortas: For a private viewing or whatever.
Mr. Robert C. Barnard: That's correct Your Honor.
Justice Abe Fortas: As I say, we believe the public has the right to receive.
This is reinforced by the Communications Act which says that a broadcast must be intended for reception by the public.
In the NBC case, the court commented on the fact that the public interest would be served by the Communications Act is the interest of the listening public in the greater and more efficient use of radio.
I assume today, the Court would speak of the viewing public as well as the listening public.
Nothing in the Act restricts the right.
Nothing in the laws restricts the right of a member of the public to use any antenna it chooses for any set he chooses for a reception of a broadcast.
And as I say, we believe this is confirmed by the industry economics which we offered a proof that the broadcaster has contemplates the audience which include the community antenna subscriber.
The license has been paid for broadcast to that public and that therefore the public should have the right to receive.
The Solicitor General acknowledges a license implied in law but he limits the -- limits it to the state -- what he calls the station service area or the B contour.
He proposes this limit not because this marks the end of the limit where you can receive a broadcast off the air but because it is in his words a good rule of thumb and because and we believe this is correct that it is certain, there is a map of FCC for every station marking out the contour, A contour and B contour.
Moreover, the Commissions regulations of CATV are geared to the B contour.
It's the station within which the system is located if it's to B Contour, it's known as the local station.
Now the Commission has made clear that CATV provides an important service in connection with its allocations plan and in the recent decision last February 23rd in a so called Shen Heist case, the Commission made clear what it meant by that because there, it ordered the community antenna to receive a signal and to give the station a non-duplication protection even though the station did not put a viewable signal in the Commissions word over any part of the CATV community.
This means that the Commission is regarding the community antennas as a means of assuring service of the stations and in Mr. Hyde's words under the Commission's regulations, community antennas are providing the antenna service which he regards as being the proper service to be provided.
If a judicial limitation is to be constructed on the right of the people of the people -- public to receive off the air then we agree that the B contour is the only reasonable limit but we point out particularly in this case for the receptions of the air that all the receptions within the B or very near the B involves no significant extension of the area.
The Solicitor General has said that he favors an interpretation which harmonizes the Copyright Act and the Federal Communications Act and the antitrust laws.
We believe that this will lead to the conclusion that CATV reception is not performance.
However, if it worked to be held to be performance then implying a license brings about what the Solicitor General has called the coalescence of these laws but he coalescence is only partial unless the public has the right to receive off the air for surely there are still the same tendency or dangers of monopolistic practices in the event that the B contour marks the limit because they're just across the line of the copyright owners control takes over, he can substitute his systems of exclusivity, can rollback the public's use of CATV for television service and can in short control, competing -- competition between stations for his own benefit in exporting his copyright monopoly.
If there is to be a limit on the public's right to receive and we suggest that it should be by the Congress and should not be constructed by the court by a strained expansion of the words of the Copyright Act.
I would like to reserve the remainder of my time.
Chief Justice Earl Warren: Yes you may.
Argument of Louis Nizer
Mr. Louis Nizer: Mr. Chief Justice and may it please the Court.
The picture of what is involved in this copyright dispute is so contrary to a four weeks trial with experts, thousands of pages of depositions, the finding of the trial court in a profound 74 page printed opinion and the unanimous affirmance by Court of Appeals in the 24 page printed opinion that I think I'd better stop to dissipate the notion that we're dealing with rooftop antennas which are not copyright infringements at all and explained briefly at the out set what this system is.
It has just as Clarksburg and Fairmont system has steel towers, a hundred feet high connected with a cat volt of 25 feet with five antennas arrays.
It has a head-in equipment which is as extensive as a broadcasting stations equipment.
It has 665 miles of cable and strands on 10,000 poles for which a franchise has been obtained from this two cities.
It has ten men to maintain the system, two of them engineers.
It has 2,000 to 3,000 tubes in both systems as compared with the 150 tubes in a transmitter of a small broadcasting station.
It cost the small equipment $750,000.00 to a million dollars without the head-in equipment.
The installation charges were $200.00 a month or a $110.00 and $6.00 monthly charge, meaning a collection of $630,000.00 a year for this small equipment from 15,000 subscribers.
So that when Your Honor, I ask whether you could direct the same kind of antenna, if Your Honor wish to spend $800,000.00 direct to these towers and ten engineers and then to run it, you could.
Justice William J. Brennan: You misunderstood Mr. Nizer.
That wasn't my point at all.
My point was, how would possibly be regarded as a do-it-yourself job what's on the top of my roof, so it was, nothing to do with what his is.
Mr. Louis Nizer: It isn't Your Honor, I'm sure.
But the master antenna or rooftop antenna is not involved in this case.
There was no finding that it was a violation.
No one has ever claimed that it is a violation --
Justice William J. Brennan: But you are going to get around and then telling us why it isn't done.
Mr. Louis Nizer: Yes Your Honor.
Justice William J. Brennan: Yes.
Mr. Louis Nizer: Right now, it's function is not to send out to thousands of subscribers or less a picture through a treatment and change of channel in this complex, sophisticated equipment.
It doesn't advertise for subscribers.
It is as much a facility in the house, let's say a refrigerator or anything else that is supplied in order to facilitate the rental arrangement.
There's actually no profit made in those situations but it's usually a charge to keep a thousand antennas off the roof so that each band doesn't have an antenna and the accidents which result to their problem.
The trial court and the Court of Appeals did not make any finding that there was a master antenna case involved here at all.
No one has ever claimed that it's a violation.
The thoughts here as well as that of damages which I shall address myself too are simply to avoid the simple issue that a CATV system takes copyright material and pays nothing for it while all the stations, local stations it competes with are paying for that property, hundreds of thousand, indeed millions of dollars.
We want the CATV systems.
It provides with the copyright on it.
It provides a new market and we hope they prosper as indeed they are but not without paying a license fee and keeping the unjust enrichment which they receive from these moneys.
Now, there are six points that I've observed that counsel made at the outset of this argument which by choice of sort of anticipated rebuttal, I will address myself to briefly before treating more completely the issues involved.
CATV bespeaks the public interest in receiving free telecast yet it along in the entire broadcast industry imposes a direct charge on the public for television reception and the evidence given before various Senate Committees that it receives a 72% profit on its collections and a 59% profit on its capital investor.
These extraordinary figures of course due to the fact that they don't pay for the merchandise they sell which is the royalties they ought to pay for the copyrighted material.
CATV claims deep concern for anti competitive consequences of the copy -- if the Copyright law is applied to it.
Yet CATV engages in the most deadly unfair competition with the local TV stations since it pays nothing for programs for which the local station pay 63% of its operating cause.
Indeed in this very case Your Honor, the evidence is that the local TV station in Clarksburg, WBOY was bought out by the petitioner CATV since its cost could not compete within any more than a grocery store could compete with any other store when it paid for its merchandise and its competitor did not.
The FCC has reported in its second order that it cannot consider CATV operation “a fair method of competition with local stations”.
CATV protested that it is not dealing with programs but it's only on antenna service.
But when WBOY is a very local TV station before it succumb, subscribed to the petitioner's TV system -- CATV system and then rebroadcast a program that had received on this subscription.
The petitioner laid a trap by cutting off its own broadcast and putting on the air and announcement “trouble on the network” it incidentally shows that they can originate with them and send out their own messages which 159 of them do originate programs.
And when this sign appeared on WBOY's broadcast, a letter followed from the petitioner which is an evidence demanding that WBOY be ceased from “rebroadcasting programs” our programs.
Thus the petitioner who has choose the word program in describing its activities, considered someone else's retransmission of a CATV broadcast an appropriation of its program.
CATV pleads that its activity does not involve a corporeal right which could be the subject of a copyright license that it did only propagates electromagnetic energy.
Yet when a railroad worker in Clarksburg tapped a CATV cable to get the program into his home, the petitioner, CATV induced the District Attorney to have a warrant of arrest issued and the accused was confined in jail for 12 to 18 hours because he couldn't raise the bail and thereafter was convicted and pay the fine.
The petitioner was so intent on protecting its program, its property from being siphoned off that it resorted to the criminal laws but when the creators of literary works seek to protect their rights under the copyright statute, CATV tells them they have none because it is transmitting a femoral electromagnetic energy.
Justice Potter Stewart: What was the criminal offense?
Mr. Louis Nizer: What?
Justice Potter Stewart: What was the charge and what was the conviction in that trial case?
Mr. Louis Nizer: The evidence –-
Justice Potter Stewart: I don't care what he evidence –-
Mr. Louis Nizer: The testimony was they claimed it was a trespass and that they have blown out the service but actually of course it isn't trespass to take a line that was taking their property which was really involved.
This was a matter --
Justice Potter Stewart: I just want to know what the charge was and what the conviction was.
Was it general trespass?
Mr. Louis Nizer: I think the only testimony in the record is by a manager who didn't know the law that he thought it was a trespass charge.
Justice Potter Stewart: How about the judge?
I presume he knew something about the law.
What was the charge and what was the conviction?
Mr. Louis Nizer: Alright, there is nothing in the record to substantiate it Your Honor.
I can only say that I believe it was --
Justice Potter Stewart: I just wanted how much that had to do with the issues in this case and it would depend upon -- if it has any relevance, it would only have it in the event that it was a certain kind of a conviction.
Mr. Louis Nizer: It was a testimony given in a deposition by a manager in Fairmont who characterize that he believe that's a trespass charge.
There is no record of the actual criminal proceeding except for that testimony.
That when a new tenant moves in to an apartment which already has had a CATV installation.
CATV requires him to pay another installation fee although nothing has to be done but it's reduced from $125.00 to $110.00 and if he doesn't, the CATV executive who testified referred to this as “stealing my signal” and this phrase connotes the very property right which CATV pretends does not exist.
CATV asserts a conflict between the Communication Act and the Copyright law.
There is none Your Honor.
The Federal Communication Commission itself has rejected this contention and asserted its communication policy with regards to CATV.
It has said in its second report, I quote “Our decision is not intended to affect in anyway the pending copyright suits referring to this litigation involving as they do matters entirely beyond our jurisdiction.
The fact that we have given the local station the right to have its signal carry over CATV system upholds no defense to that system in the copyright suit.”
Justice Abe Fortas: Mr. Nizer, is there anything in the pending Copyright Bill that deals with this situation?
Mr. Louis Nizer: Yes Your Honor, there has been an attempt made and that is where the attempt should be made to amend the Copyright Act so as to create certain -- either compulsory licenses or involved provision with respect to CATV.
It's quite complicated.
Thus far Your Honor, the House has not accepted that proposal to change the Act, it's still under consideration and it is coming before the Senate.
There is a good deal that has been done by the two industries mainly the copyright owning industry, the office, writers, copyright owners, companies and the CATV industry which is organized into an association of some 500 members to impress upon the legislature, the need for some special kind of amendment to the Copyright Act.
The register of copyright has issued a statement which I hope to quote in which he says that clearly, this is a performance.It is a violation of the Copyright Act and --
Justice William J. Brennan: I don't understand Mr. Nizer.
What's this proposal now to bring CATV explicitly within the Copyright Act?
Mr. Louis Nizer: Yes, to the effort is being --
Justice William J. Brennan: Is it -- I didn't quite get you.
You said something about license and the proposal being considered was made by whom, by the copyright service?
Mr. Louis Nizer: No.
The CATV industry is attempting to get an exemption written into the Act to change the Act as it is now which I think everyone recognizes encompasses them in copyright infringement.
Justice William J. Brennan: Well, that's the issue we have to decide.
Mr. Louis Nizer: That's right.
When I say, everyone recognizes, what I mean Your Honor, I didn't mean to be presumptuous.
I mean that thus far, the only courts which have passed on it and the register of copyright and other statements made by the authorities.
Justice William J. Brennan: Yes but what I'm trying to get to is what is this Bill, it's proposal --
Mr. Louis Nizer: By the CATV to get some kind of --
Justice William J. Brennan: -- explicitly is that it?
Mr. Louis Nizer: Yes.
Explicitly to get some kind of --
Justice William J. Brennan: When someone else is trying to get something explicit to include them, is that it?
Mr. Louis Nizer: No, we don't need any inclusion of CATV.
We believe Your Honor respectfully that it is in --
Justice William J. Brennan: Yeah, that will depend on how we come out here.
Mr. Louis Nizer: Of course Your Honor.
Justice Abe Fortas: Mr. Nizer.
I suppose that presently if it should be held that CATV has to imply copyright laws if that would mean that if your plan for example did not want to permit them to show use to transmit, propagate or whatever it may be any particular film that you own that you could withhold permission.
And then they'd have to blackout that part of the program?
Mr. Louis Nizer: No.
Justice Abe Fortas: No?
Mr. Louis Nizer: No Your Honor because as an individual company, we may refer as we do today with local broadcasting companies to give one rather than another license for commercial reasons.We may think it's a better station and to that extent, each individual company and indeed that's true of every copyright owner or patent owner has some choice.
But the attempted impression which is being given here, if it would be to our interest generally as --
Justice Abe Fortas: I'm not asking you that Mr. Nizer.
I'm asking you whether you could refuse to permit a CATV to utilize a film to which you own a copyright.
Mr. Louis Nizer: Of court Mr. Justice we can --
Justice Abe Fortas: Now how much is any instrument in this record or can you give us any idea about how much of a station's programming, daily programming handled by CATV system would be subject to copyright if it's -- if we decide in your favor?
I assume the principle would apply not only to motion pictures but to any type of original production.
Mr. Louis Nizer: I understand sir.
The best information we have is about 50% of the material on network and local stations is copyrighted and the other 50% are not.
And of this, the client I represent, United Artist and I presume what the motion pictures represent probably about 5% or 6% of all motion pictures on film, on TV about I think maybe 5% to 6%.
Those are the best statistics available.
Justice Abe Fortas: So you have two questions facing CATV if we should agree with you.
One is whether they can get the permission from the copyright owner of this 50% of the material and the other is at what price?
Mr. Louis Nizer: That's right.
Thank you Your Honor.
I have personally, after this decisions came down, sent a letter to all CATV stations inviting them to come in and get licenses at reasonable fees.
They are customers of ours.
There's no reason for us economically to which to buy them.
We welcome a need of this kind of further outlet -- of that growth at crushing UHF possibilities in the area.
Justice Abe Fortas: And just assume not a picture like a history of motion picture distribution with which we're all familiar.
Mr. Louis Nizer: And that is why any anticipation of any repetition of past sins is unlikely a view -- as Mr. Justice Holmes says, “Not as long as we're here.”
And I think that to take away a copyright right, right.
I'm not suggesting again presumptuously that anyone will but the argument that a copyright right, right, which exist now in the statute should be taken away because of anticipation that there maybe abuse of that right which we should have.
We respectfully submit is to do violation to every statute which can be abused or illegally applied and then the court's are there for that remedy.
There is nothing to indicate Your Honor that in view of the many, many copyright companies available that it wouldn't be the severest competition to get into this program.
Indeed, we the copyright owners are for the CATV originating programs because this will encourage them to use some of our properties to do it directly.
We are appealing to whatever authorities they're ought to give them back right.
We are not opposed to CATV on every economic interest and instinct is to encourage them to grow and they don't need our encouragement.
It has been suggested Your Honor, I testified too before a Senate hearing that by 1984, there will be a hundred and ten million cabled homes and that the income to CATV will be three billion, $200 million a year more than all the income from all the TV broadcasting industry.
That's how quickly they are growing and we welcome that if they only pay and they can afford to pay the reasonable share to the artist who had created the material which they are using.
Justice Abe Fortas: Mr. Nizer, I hope you will indulge me of one further thing.
I hope before you finish that you will comment on the Solicitor General's decision.
I tend to in depth.
The Solicitor General incidentally so far as this issue was concern, stated in the Southwest Cable Company brief just argued before Your Honors stating in the Commissions view.
This extension of signal by CATV directly affects its basic plan for allocating free television service throughout United States.
Now CATV presents itself as “predominantly oriented toward smaller systems in smaller size communities” Your Honor for that repeated by Mr. Barnard.
In giving the impression to this in capable of coping with the giant broadcasting industry and therefore the potential victim of anti competitive pressures, the fact is that CATV operators now include the largest industrial complexes in the United States such General Electric, Westinghouse, Time Life, Western Union, APCO, Scripts Howard, General Telephone and Electrics Used Aircraft Company and many others.
And multiple ownership is common 25 owners controls 671 franchises with 394 applications pending in 1966.
CATV National Executives therefore have taken the position now that they are far more responsible executives in the industry representing these large companies that they do not object.
They have made public statements on it which is quoting in one of the amicus curiae briefs by director of Cox Broadcasting one of the large CATV operators and a director of the national association of which he said a recent court ruling implies that the CATV operators maybe required to pay fees for the privilege of transmitting copyrighted material to cable television subscribers.
It has been suggested that this would impose a critical financial burden of the operators in our opinion.
The answer -- the alarm is not warranted.
Copyright fees are a normal cost of doing business in many fields and as in radio and television today, they would constitute a relatively small element in their total cost of providing a service desired.
There is therefore no fear in the industry actually except this counsel attempts to present it that paying a fair minor portion of their unjust enrichment as we view it to the artist who create the material within any way sacrificed their position.
The Solicitor General in his Southwestern Cable brief says, “CATV poses a genuine threat to potential harm to the public interest and possible frustration of Congress' goal.”
It is now Your Honors concentrating in the large settings.
It is not giving the service which originates this practice.
If for example, it has committed itself according to the testimony to $16 million for CATV system in Denver.
$37 million in Philadelphia and it is estimated that there will be a $30 million annual income from one borrows in Manhattan, in New York.
It is against this background Your Honors, so different from the miniature depiction of the petition that we turn to his argument for an applied license in law.
We shall assume for this discussion as the petitioner must arguendo when he argues for an applied license that a CATV transmission is a performance under the Copyright law and I shall as time permits later deal with that question.
But assuming a performance is there an implied license of law in favor of CATV which exempts it from being an infringer under the Copyright law.
The District Court in its scholarly opinion said there was no implied license in law concluding “neither the policy nor language of the Federal Communications Act nor its regulations are intended to or have the effect of repealing or modifying Section 1 of the Copyright law.”
The Court finds no basis for concluding that defendant is the beneficiary of any license implied in law.
The Court of Appeals agreed specifically residing, rejecting the theory of double payment as a justification for an applied license in law.
It concluded “a resolution of such issues of broadcasting economics has not been entrusted to the courts through the Copyright Act.”
The Solicitor General agrees with the courts below that they can be no implied license applicable to all programs “whatever their source and wherever reproduced”.
He stresses that such an implied license in law “would be inconsistent not only with the terms of the statute of the Copyright law but also with existing precedence and with its own policy”.
And one would think that there would be no occasion after this correct statement of the law to have any differences with the learned Solicitor General.
But surprisingly, he abandons his statement -- this statement of the law fully supported by all the authorities onto which there is not a single exception to suggest that there should be an exception that this Court should create a unprecedented implied license in law for a CATV transmission with the broadcasting stations within the broadcasting stations Grade B contour.
Let us examine this suggestion legally and then in terms of alleged economic realities which spawned this hybrid concept.
The Copyright law grants to the copyright owner, exclusive right not merely to one public performance or to any limited number of performances.
But as this Court phrased it expressly to all public performances for profit without limitation, a copyright infringement does not depend on the pleas of the performance.
To grant upon the statute unequivocal, unambiguous and absolute grant of right to the copyright owner, a limitation of such right is the privilege only of the legislature.
It is a strange and dangerous doctrine the preaches that an active Congress maybe improper appealed or modified by the Court as Justice Holmes put that the law is not approving under presence in the sky.
Justice Abe Fortas: Isn't that quite -- that is -- I don't understand his position but as well as I can understand it, the Solicitor General's position is that a television station duly licensed and to -- and duly authorized to broadcast the copyrighted material.
That the substance of that is that it maybe transmitted for a reception in the home etcetera within certain areas as the A contour and the B contour and that the CATV service merely results in providing the material of presumably more satisfactory basis within those same contours but if the CATV service goes outside of the intended license covered by the copyright fee then the CATV does not have an implied license.
Mr. Louis Nizer: That is a correct statement to this proposal.
Justice Abe Fortas: That is his position, isn't it?
Mr. Louis Nizer: That is his position that the --
But you're saying that -- you're saying that everytime in a house as I understand it, there is a CATV -- the use of a CATV service to exhibit a film at that type of public performance.
Justice Abe Fortas: No.
The -- perhaps that's right.
I'm not sure I understand Your Honor.
I say that reception is never an infringement under the Copyright law.
All the spheres that somebody will be held contributing an infringement by receiving or seeing it, never -- the statute forbids performance and when there is a performance, a second or a third by an intervener such as CATV who makes a profit there from unless he too pays a reasonable license fee under the Section of the Act, he is receiving an unjust enrichment and that the uniform law on this subject is that they can be multiple performances, multiple collections as this Court has repeatedly said indeed in this particular industry at a significant Mr. Justice Fortas that the syndicated material which goes out again and again and again, it's called syndicated on local stations, is the only source from which the cost of the program is finally recoup.
But first, the evidence is that the first rate showing does not recoup the cost and that the testimony is clear that if a writer or a director all of whom exhibit amicus curiae briefs with statistics in this matter unless he can receive this repeated revenues from subsequent showings in any area, the B or A area aside from difficulties, I will address myself too as to what is a B area and what the Solicitor General suggest as a case by case determination of this in the courts which would create a flood of litigation was not without guidelines of any kind.
Aside from that, we do take the position that even within any area, a future subsequent choice from which a profit is made entitles the author, the creator the work with the awesome background of Article I of the Constitution of the United States to promote the odds that it entitles him to some share and I call respectfully the --
Justice William J. Brennan: Well Mr. Nizer, I don't follow this if you're talking within the A area.
There's only one showing by the local broadcasting station right?
Motion picture is on and there it is and it's on at nine o'clock at night and all those television receivers in the A area would receive it.
Mr. Louis Nizer: Yes.
Justice William J. Brennan: That's one show -- that's one performance.
Now how is it become two when everybody in that are uses a CATV service to improve their reception of that one showing.
How does it become two performances?
Mr. Louis Nizer: Because whoever else intervenes to perform even within the --
Justice William J. Brennan: He is not performing.
There's only one performance at my home that I can't get it without the help of the CATV service because the reception on my set is not that good or if it is good, it's not good enough for me.
So I take the CATV service to improve my reception of it.
But all I'm watching is the motion picture as it's broadcast by the local TV station.
That's one performance.
Mr. Louis Nizer: Your Honor, if isolated to an individual home, what you say is true.
The A area --
Justice William J. Brennan: What difference does it matter if in New York City there are million homes would perceive the same performance?
Mr. Louis Nizer: I should like to explain.
If isolate to one person what you say maybe true but of the A area and B areas are constantly shifting and there are many people who would not see this program at all except for this new transmission which brings it into their home and since the people who have made that performance and it is accepting performance according to all the authorities, the Buck and LaSalle, the --
Justice William J. Brennan: Well, I guess that's really the knob of this case isn't it?
Is that another performance?
Mr. Louis Nizer: Yes and it has been held repeatedly.
There's no opinion I think that they will indicate Your Honor anything to the contrary.
I'd like to say that in the Buck case for example which I was going to analyze under the later point of performance, the hotel picked up a radio signal but had a very special kind of equipment and also a control room and two engineers, it wasn't just an antenna and sent it down to 1900 rooms and this Court held in that case, Justice Brandeis writing the opinion that that was a performance, a new infringement by the owner even though those people might or might not have received it on their own radio.
Justice Byron R. White: Yes but Mr. Nizer, the hotel also own the equipment at the end of the line that which actually made the sounds or the pictures of what it was.
Mr. Louis Nizer: It did in that case but in this upward case, it was held specifically that once the equipment the radio wouldn't make the slightest difference and it doesn't because that's really the reception.
It is true in all electromagnetic phenomena that unless you turn the buckle on you will get nothing in your home.
But the ownership of a television set which is available as the Court of Appeals said in this case weeping soundly.
Justice Byron R. White: Well could you tell me what your basis is for saying that the home owner that turns on his set and invites the people in to watch some show is that --
Mr. Louis Nizer: That's not infringement.
Justice Byron R. White: Yes, it's not an infringer.
Mr. Louis Nizer: Well, clearly that the statute does not make reception ever in infringement.
It only makes performance.
The language is --
Justice Byron R. White: I know but why isn't that a performance?
Mr. Louis Nizer: Because the --
Justice Byron R. White: You can't just say it's because of the reception.
Mr. Louis Nizer: Yes, that's right.
A performance in the sense Your Honor in terms of semantics perhaps, it is difficult but in terms of legal connotation it has been made fairly clear a turning on of an instrument, radio or television which makes the performance come into your home in that sense performance is not a violation of the Act which does not forbid reception even of an authorized copyrighter -- an authorized copyrighter.
In other words, if I were to set --
Justice Byron R. White: Well, what would you say if I had a television -- a large television screen in my house and I made a regular practice of charging to come over and watch a -- watching programs and people did.
They came in and paid a dollar of every Sunday afternoon.
They paid me a dollar.
Mr. Louis Nizer: The -- it would make it --
Justice Byron R. White: Did that reception come to be a performance?
Mr. Louis Nizer: No Your Honor.
If there is a charge made that has been held that reception for profit is a violation of the Act.
So it has been held.
So if Your Honor charged or of a store, if a tenant charge to see the television program, it has been held by the --
Justice Byron R. White: Even though all you did is turn on and switch.
Mr. Louis Nizer: That's right.
Justice Byron R. White: And receive.
Mr. Louis Nizer: That's right.
That's the statute.
The statute makes only reception for profit.
Public reception for a profit is a violation.
Reception otherwise is never a violation under the Act.
Justice Byron R. White: Well, it doesn't even mention reception, isn't it?
Mr. Louis Nizer: No, the authorities have held that reception for profit is a violation of the Act.
Justice William J. Brennan: Has this Court said that?
Mr. Louis Nizer: Pardon.
Justice William J. Brennan: Has this Court said that?
Mr. Louis Nizer: There was no occasion to it.
It didn't come into play in this case.
Justice -- Mr. Justice Brandeis said it very clearly in the Buck-LaSalle case and if I have the time, I'd like to refer it to this specific analysis of that point which he made.
Now, implied in law Your Honor, it connotes that some condition is imposed at least on one of the parties and therefore is equivalent to a compulsory license but when the Copyright statute intended to provide a compulsory license, it did so high further for example Section 1 (e) Music.
There is a compulsory license for records to a sense of that but this compulsory license was conditioned in the statute upon special registration formalities and periodical accountings under oath.
But when Congress intended also a complete exemption under the Copyright Act and also, you have to provide it explicitly in this Copyright statute when it exempted jukeboxes from any copyright liability whatsoever.
Incidentally Your Honors that is worth noting that at the time that this exemption was urged upon the Congress, it was on the theory that it was a minor advertising device at any powers they have now become a $500 million a year industry without paying a cent of the composers and musicians at least until the new Copyright Act goes into effect.
I think that is going to be changed Your Honors.
This illustrates the danger even for the legislature in granting exemptions when the art may prosper subsequently.
In this case, the CATV we're dealing already with the giant and to imply a license, a concept to which binds lower guardian law in this field at all on the unwanted grounds of judicial flexibility to cover out special privileges as unwarranted.
In Buck against LaSalle too Your Honor, it was urged to make an acception to the Copyright Act to the benefit of hotel keepers who used radio broadcast for its own commercial purpose.
Mr. Justice Brandeis said there, the existing statute makes no such exception and if one is to be made, it must be done by the legislature and not the courts.
Now, the petitioner and the Solicitor General, contend that a license implied in law under the Copyright Act results from what they turn communications policy.
Communications policy can only have two sources Your Honor, the Act itself and the actions of the Commission.
One can search the Communications Act from one end to the other and find nothing directly or implied dealing with copyrights.
There is a communication policy with respect to CATV clearly announced that it is to lessen CATV's unfair competitive advantage over local broadcaster which arise --
Justice Abe Fortas: Where is that clearly declared?
Mr. Louis Nizer: This is a quotation of it Your Honor.
I believe I have --
Justice Abe Fortas: From the Statute?
Mr. Louis Nizer: No, no this is the regulations to repeatedly and rules announced can the first and second order?
No, the communications--
Justice Abe Fortas: That's what we have before us in the proceeding case?
Mr. Louis Nizer: Yes Your Honor, that's the case.
The CATV has taken the position Your Honor that for the Commission has taken the position.
The CATV which leads the phase for its programs Your Honors the exclusive rights of the local TV station to programs for which it pays is unfair competition and wishes to limit that in order to increase the competitive opportunity.
I wish to insert the other fact that the legislative purpose was also to encourage UHF development.
That's ultra high frequency is against very high frequency that has 70 possibilities and this was not making headway Your Honor until the Congress passed a special statute requiring all television sets to have UHF reception and you now see it on every television set.
And for a while Your Honor UHF began to grow but when the CATV group, it was preposterous to expect the UHF station to make its investment and also go into the field in competition with someone who got the product free for which UHF would have had to pay a license.
And the Commission stated clearly that the reason why it was necessary in the public interest to adopt the carriage requirement which I think was explained to you Your Honors this morning, the non-duplication rule and the distant signal rule and the reason for this and here, I have the quotation Mr. Justice Fortas was to ameliorate the risk the bargaining CATV industry would have a future adverse impact on television broadcast service both existing and potential.
That's in the second order in 725.
In short Your Honor, the Commission emphasized not once but many times that the condition it was trying to overcome resulted from the inability of the present copyrighter to enforce their rights with respect to CATV.
For example, the Commission said on another occasion in the light of the unequal footing on which the broadcasters and CATV systems now stand.
We cannot regard any CATV systems duplication of local programming via the signals of distant stations is a fair method of computation.
That's also in that order.
I have one more quotation on the question you're asked Your Honor.
The Commission said that “we cannot close our eyes to the significance which the present inability of program supplies to control the availability of their programs via CATV has from petition between CATV and broadcasting station.”
Now this being the one and only communication policy based on the inability of copyright owners to enforce the existing law against CATV and the consequent burdens placed on the Commission by the intransigence of CATV, how anomalous it is to argue that it is necessary to exempt CATV from copyright liability in order to coalesce the communications policy with the Copyright law.
In the petitioners replied brief, he contends that it is not as reasserted as to policy and he quotes the FCC the second order paragraph 47 to the effect that quote -- that Commission goal was to integrate CATV service into the national television structure in such a way as to promote maximum television service to both those who are cable viewers and those dependent and off their service.
The petitioner has however omitted the very next sentence of the passage which reads “the new rules discussed below, that's the carriage and duplication distant signal rules are the minimum measures we believe to be essential to ensure that CATV continues to perform its valuable supplemental role without unduly damaging or impeding the growth of television broadcasting service.”
So I repeat Your Honor, there is only one CATV communication policy with respect to CATV and it lends no support to any theory for an implied license.
Now who would benefit from the exemption sought and at whose expense.
Justice Hugo L. Black: Why do you refer to this exemption?
I thought that if the issue was not whether we would exempt them, but whether the Act includes it?
Mr. Louis Nizer: Well, the implied in law theory contrary to the precise language giving us exclusive rights for every public performance without limitation is a misnomer and as a semantic, wittingly or unwittingly a semantic device to put a good color on an impossible concept in this case.
So we have translated it to be what it must be even a compulsory license or an exemption.
It can't be anything else because there is no warrant to say under this Act that one can apply on how he make it and with what the guarantees to the owner to the contrary.
Justice William J. Brennan: Of course, this is all on the -- on the premises Mr. Nizer.
You persuaded us that what CATV does is a performance within the meaning of the statute.
Mr. Louis Nizer: Yes and I am able to persuade you but the briefs and the clarities will make it rather clear.
It isn't involved and refined subject matter not and rather sophisticated analysis but having made it leave with this for years.
I may say to you Your Honor, something should be explained.
This case is six years old, the defendants put in every conceivable defense which is now put aside for separate trial.
I think Your Honors ought to understand that legends.
Stop them because we gave a license we must have included this.
Copyrights are not properly noticed.
It's claimed to be eligible.
Antitrust law violation and after six years of delay during which they were making hundreds of thousands of dollars, we think of unjust profits.
The Court finally -- the Chief Justice and the District Court said we will put a note to this delay and we will try this case in separate sections.
We will try first the copyright infringement, is there one?
And then after we will put aside implied license in fact in other words by giving a license to the copyright -- to the station, have we thereby granted a license to CATV.
They have that issue.
It will be tried subsequently Your Honor.
And damages had been put aside and the law is clear that there can be no oppressive damages such as it's been feared here and the stopple and ledges and all the other defenses have been put aside and after six years, we finally got to an issue where we could come to grips with this question while our copyrights were dying due to the statute of limitations.
They were running out and due to the statute of limitations of three years once you know you have a claim and everyday that goes fine.
We lose those rights for these arguments and it was to stop that that the courts split this case into four parts and many of the matters which our adversary refers to, he will have a full day in court after this case is decided by Your Honors.
Now, who would profit from this exemption?
The CATV who never creates anything except those 159 stations that are beginning to originate programs, I think they do.
Sells a product which others have invested millions of dollars which they appropriate without even a thank you, this profit exorbitantly not by virtue of skill but because they're not paying on what the merchandise they sell who frustrate the communication policy of encouraging local stations particularly UHF which serve local expression.
Justice Byron R. White: Mr. Nizer, I think that those stations that you suggest are -- have began to originate programs if they use a copyright at work, they do pay their royalties.
Mr. Louis Nizer: Pay them.
Yes Your Honor.
In all and that is why we hope Your Honor they prosper and even to begin to originate more programs that will give as an outlet of the copyright owners and all the others or the field which we -- which the others particularly desperately need as the briefs here indicate.
Justice Byron R. White: I think that if you do – I gather you don't see any difference though between the station that originates and the station that doesn't?
Mr. Louis Nizer: None at all.
Anymore Your Honor than a local station that receives by microwave a program -- this is the way all network works.
There are very few live programs from the major network.
They put it on tape, they send it to your local station here but it just receives this electromagnetic energy which we talked about and sends it out, rebroadcast the same person.
Justice Byron R. White: But the station it originates is doing a lot of things different in addition to what the non-originated Act.
Mr. Louis Nizer: It is arranging the program and it pays license fees for everything that it engages and then sends it out by this -- the same way and the only difference is they send it over the air and they send it by wire.
Otherwise, it's precisely the same.
There are differences that a broad -- and this was analyzed by the court, a broadcasting station goes to advertise at the present time they don't but there's nothing to stop them from going to advertise and they will as soon as they originate programs.
Justice Byron R. White: Doesn't the CATV system such as the petitioners here -- don't they actually make a selection of the program that they're going to give to their subscribers?
Mr. Louis Nizer: They do only in this sense Your Honor.
They denied that they do attempting to make another distinction but actually, they select from the various different --
Justice Byron R. White: Stations that's within the range of their equipment.
Mr. Louis Nizer: Yes but you go very far.
For example, they picked up Pittsburg and they advertised Mr. Justice Warren asked about football, it was a felicitous question in view of the evidence here.
They advertise -- the only way you can get the football and baseball games is by coming to our cable because no one else will have it due to local conditions and restrictions.
Justice Byron R. White: But they simultaneously on their cable have more than one program, I gather don't they?
Mr. Louis Nizer: Oh yes.
They have -- they now build them.
It started with three, five, they've gone to twelve and now twenty stations and they select which ones they want and if the local TV is not on it, that station is going to die and in addition to that, in addition to that selection Your Honor.
Justice Byron R. White: How many programs if I will subscribe with their service and say in the primetime in the evening, how many different programs could I get off with their cable.
Mr. Louis Nizer: Well, if they have 20 channels.
I suppose you could --
Justice Byron R. White: And if they chose to send you 20 different stations, you have 20.
Mr. Louis Nizer: If they chose to you have, yes, on the UHF band particularly and I suppose on the VHF 13 would be the limit.
You can't get more than 13.
Justice Byron R. White: And so if there were.Let's assume there were 20 stations within the range of this CATV system and they just -- but they just chose to retransmit or whatever they do, three of them.
So they are selecting a program in that sense.
Mr. Louis Nizer: Yes, they quite so.
I think they are and Your Honor, the testimony was that they even had a poll taken of their subscribers.
What do you wish?
But when the subscribers wish something which they found was a little more expensive to bring in, they ignored it just the same but there was this evidence in the record that they --
Justice Abe Fortas: But you're not suggesting -- are you suggesting Mr. Nizer that they can -- CATV can pick an individual program such as an individual football game from a station and not carrying the entire station program?
Mr. Louis Nizer: Oh yes.
They do it all the time and they do not only that Your Honor.
Those -- it is far more serious than that as one of the questions elicited a proper answer from counsel.
They will convert the signal from one to another.
They will change the band.
Channel 9 will be on their station Channel 2 if they wish.
They have the equipment with which to do this so as to be able to get more power and get further stations away for sending so that the identity of the station is lost as well in cost of--
Justice Abe Fortas: What you're saying is that if I understand, it is that -- they can hold of a particular CATV system it does not customarily carry the programs of television station X.
It can and does on occasion carry a particular program that originates with station X.
Mr. Louis Nizer: Yes Your Honor.
They can pick whatever they wish off the air.
Take it and then send it out.
Indeed their advertising was unless you subscribe to the Clarksburg station, you will never get the three big networks.
We're the only one who can give it to you and that was true.
Now what chances a copyright owner to sell his product in Clarksburg to the local TV station when the local TV station says, “I'm hardly listened to, they've got the football and other big programs that I'll see in here and I can't have that?”
They took full advantage of that in their advertising and there were letters of evidence.
One of which was by the manager of a CATV system saying, “We have this baseball we're going to bring you in here.
It was close to World Series time or might have been World Series.”
And our opponent, WBOY, the independent local station is claiming that it's going to get a baseball game in here but I don't see how I've talked to these people, they're not getting that license it's too expensive on whatever the reason was and they advertise the only way you're going to get this is by coming to the CATV system.
I also wish to point out and I omitted to say something which maybe helpful in my effort to persuade that even if a copyright infringer does not cause damage.
He has a cause of action for the profits.
Under the copyright law, it is clear that if you can recover either damager all profits, in other words, the unjust enrichments still belongs to you even if you haven't been heard and therefore even in the local areas or anywhere else where a intervening broadcaster send even to the same people, we, the copyright owners are damaged in two ways.
That is damaged by loss of profits at least in two ways.
One, we have not received part of that royalty that we should have gotten and secondly the local station has been heard and we have far more difficulty selling them and indeed we can't at all.
Justice Abe Fortas: That's really just a letter in it because let's assume that a television station who is your licensee completely saturated an area, you don't get anymore for your copyright, do you?
Mr. Louis Nizer: No, there isn't -- that's quite right.
There isn't the sensitive relationship between audience which our friend here argues and the fee.
Far more significant in the bargaining process as the evidence would show, this is for later damages.
There's nothing in the record I must be fair to say as yet.
But far more important than merely audience at least 15,000 subscribers added to a million viewers, far more important is how many stations are there in the area.
That's what creates the competition and then it gives us a chance to get more money where as one station, we have very much bargaining power and also, how much inventory have they if the station has bought motion pictures from Warner Brothers and United Artist comes.
It is not a very good position.
So that the economic factors here are not -- are completely over simplified where it is said just more audience, more money.
It doesn't reflect itself that way at all but whatever there is to that, you'll have this day in court on that on the question of damages and applied license in fact and double payment, all of these issues that have been raised here, he will have his trial after Your Honors decide this if there is anything to go to trial.
Now, I was saying who is victimized by this implied license of law or exemption or whatever it is called.
In addition to all the copyright companies, owners that have spent millions and millions of dollars for these licenses and find that they're just being taken, there are 16,000 actors in the Screen Actors Guild who is averaging from the year it was testified before the Senate is $3000.00 a year according to Charlton Heston testified.
There are 3000 writers of the Writers Guild who depend upon their livelihood from television.
The testimony is that their largest income comes from this broadcast today, all of these others.
3300 members of the Directors Guild, 16,000 members of actor -- it's the union that takes care of the small mid players and so on.1
50 composers of the screen composes, more than 10,000 members of ASCAP, 14,000 writers and publishers of BMI and tens of thousands of musicians and thousands of other artists.
They are the ones who are being deprived.
Justice Abe Fortas: But on the other end, it maybe that the question is, that didn't quite shape up that way Mr. Nizer because I would assume that it should be established that your product and the product of these artists is being disseminated not only by a television station but also by some other instrumentality that your fees would take that into account just as I should think that maybe the advertisers on the television station are more concerned about the number of people to whom their advertising is exposed and whether it's exposed to the potential consumer and picks it up directly from the station or through the intervention of CATV.
Mr. Louis Nizer: That would go to the implied license in fact that we've been paid.
Justice Abe Fortas: So it goes to a lot more than implied licensing.
Mr. Louis Nizer: Well -- double payment thus it is argued that will be for a trial and since my time is limited, I would like to -- if Your Honor will excuse me, just very briefly reply.
It is a very involved subject.
I think --
Chief Justice Earl Warren: You may have two or three minutes.
Mr. Louis Nizer: Thank you sir.
Chief Justice Earl Warren: And counsel may have the same time.
Mr. Louis Nizer: I appreciate it Your Honor.
I haven't even touch the performance which I did want to address myself so I have to leave it to the briefs.
But on this subject Your Honor, the evidence that is now in the record since depositions were permitted on this subject even though it was kept for a separate trial.
The evidence already in the record in the depositions is that we are injured far more by losing the local TV stations opportunity to purchase and we all by any theoretical notion that because there are more listeners or viewers that we can get a larger fee.
It doesn't work out that way.
It is completely and the evidence also shows that one of our companies that invested money in the -- a full group of pictures, copyrights brought them for this purpose has lost $10 million because it hasn't got the outlet that it expected to have due to CATV.
Thank you Your Honor.
Chief Justice Earl Warren: Mr. Barnard.
Rebuttal of Robert C. Barnard
Mr. Robert C. Barnard: Your Honor.
I find a little hard to recognize the case.
This is a case of statutory construction involving the meaning of the word “perform” as it appears in the Copyright Act.
Mr. Nizer refers to criminal prosecution in 1954 involving a man who cut the cable.
He talks about station WBOY, this is discussed in our reply brief footnote 25 and I commend the Court to that.
The only theory on which he tried to bring this within the statute is that there has been a reception or a transmission as he says for profit.
The statute doesn't read on reception or transmission.
The statute reads on perform and there is no element of profit in Section 1 (d) but there is in 1 (c).
The statutes briefs on perform and in public.
Mr. Nizer says that he does not wish to cover master antennas but there is no way in which you can exclude master antennas if reception and transmission are to test.
That's exactly what they do.
It doesn't make any difference that a man pays for his master antenna service and his rent rather than pays directly for the service.
Mr. Nizer talked about advertising.
Is it -- does it make any difference as to whether a man advertises or not as to whether he performs is -- performing when it says something in its ad about ads for television sets.
You can see the World Series game, is that performing the World Series game?
I don't understand this.
I don't understand the relevance of this at all.
We must somehow rather get back to the statute and look to see what these systems do and how it fits the statutes.
Mr. Nizer talked about the expensive equipment.
We hope our equipments could.We tried to buy good equipment and we hope we provide a decent service to our people and we'll certainly try to do better for our subscribers if we can.
He talks about broadcasting.
It's perfectly clear that there is no evidence of the congressional intent as to the community antenna but the evidence of congressional intent as to broadcasting is clear.
In 1952, the Congress amended Section 1 (c) specifically with reference to broadcasting thus making a claim that the Congress thought that broadcasting was covered within the scope of the statute.
He speaks about unfair competition.
There's no doubt that the Commission addresses itself to what it regards as a competitive problem and its rules and regulations deal with that.
He talks about the local station.
Well, there is no doubt that reception of the local station on the community antenna would in Mr. Nizer's views being infringement.
He is not trying to provide an audience for the local station.
He wants to prohibit reception in order that he can practice exclusivity in his marketing.
He talks about the Federal Communications Commission being concerned with this matter because copyright infringement has not been imposed on a community antenna.
This is just plain not correct as Mr. Gellar said today, the Commission has found the community antenna provides a valuable service in connection with the reception in the service areas of the stations.
This is precisely what it does and this is precisely what we do.
He suggests that we are proposing that the Copyright Act has been repealed by the Communications Act.
It's not correct at all.
Our position is that the public policy underlying the Copyright Act and the Communications Act should be considered by the Court when it is deciding whether or not to extend the meaning of a word performs in a noble area, an area not contemplated by the Congress.
He said we select the programs.
It's completely agreed that there has been no selection of programs here in the sense that we did not receive everything that is on the air.
There is no deletion, no picking and choosing.
We select the programs in the sense that our systems were capable of receiving five stations and we receive five, we didn't receive six.
In that sense, we select it but only in that sense.
There was no picking and choosing of programs.
Justice Abe Fortas: Well, let's see.
What is the specific answer to this specific question?
Mr. Robert C. Barnard: Have we ever picked in a specific program and receive for our subscribers, the answer is no.
Justice Abe Fortas: Is your system capable of doing that?
Mr. Robert C. Barnard: Well, I suppose you could take a switch and turn it off and on, yes.
Justice Abe Fortas: No, I mean suppose that you irregularly providing your subscribers with the service of -- from three stations, could you pick a program from the fourth?
Mr. Robert C. Barnard: Only by cutting off the reception of one of the three.
Justice Abe Fortas: So that would be possible?
Mr. Robert C. Barnard: Technically, you could switch from one station to another.
Justice Abe Fortas: But you say you've never done it?
Mr. Robert C. Barnard: No.
The record is perfectly clear that there's been no deletion of broadcast.
We have received the entire broadcast.We received it simultaneously with --
Justice Abe Fortas: By the entire broadcast, you mean the entire programming of a station for the entire day?
Mr. Robert C. Barnard: Yes sir
Justice Abe Fortas: And for seven days in a week?
Mr. Robert C. Barnard: Yes sir, subject going to shutdown for failure of equipment.
Justice Potter Stewart: But in fact to five different stations.
Mr. Robert C. Barnard: Five different stations, yes sir.
Justice Potter Stewart: And nearly the homeowner has his choice among the five?
Mr. Robert C. Barnard: That's correct sir.
And he turns it off or on as he sees fit.
Justice Potter Stewart: Yes or not to listen any of it.
Mr. Robert C. Barnard: At or were not to listen to any which I'm sure many of them elect.
We suggest also Your Honor that the issue.
There's no question about the rightness of the issue here.
The question is under the statute, there is no doubt that the issue is here.
The issue implied in law is that which was reserved in the Buck case.
In the Buck case, the broadcast was unauthorized
Justice William J. Brennan: -- to that if we agree with you.
Mr. Robert C. Barnard: I beg your pardon?
Justice William J. Brennan: We don't ever get to that if I agree with you --
Mr. Robert C. Barnard: I agree sir.
I agree sir.
In our view, the construction of the statute should take into account as the Solicitor suggests the harmonizing of the copyright laws, communications laws and the antitrust laws.
And that if one looks at the consequences in this situation, the obvious conclusion is that the statute should not be extended into a new area, a noble area and not contemplated by the Congress that this is a subject which ought to be considered by the Congress and should not be handled by judicial construction where the consequences are those which the Solicitor General has foreseen and it is our view therefore that we are not proposing a violation that a repeal where proposing is a construction of the statute in the light of the opinion of the Court and right begins to power which we think is the guiding rule here.
The ordinary common sense meaning of the word “perform” and under that standard, we do not perform we're providing a reception service.
If there are no questions Your Honor, I've concluded.
Chief Justice Earl Warren: Thank you Mr. Barnard.
We will adjourn now.