June 2nd, 2012

Los Angeles Daily Journal

Related Attorneys

Fox sues over ad-skipping service

FOX Broadcasting Co. filed suit Thursday against Dish Network LLC over its new video-on-demand service that allows subscribers to watch shows without commercials, saying the service infringes on Fox’s copyrights and breaches the companies’ distribution contract.

Late Thursday, CBS and NBCUniversal filed their own suits against Dish.

The suit marks the first major legal challenge to ad· skipping technology since three major networks sued digital video recorder maker ReplayTV in 2001. That case was dropped after ReplayTV filed for bankruptcy two years after being sued.

In a complaint filed in Los Angeles federal court, Fox said Dish’s “bootleg” Prime Time Anytime service makes unauthorized copies of the prime-time shows of the four major television networks and violates a licensing agreement between the two companies. In March, Dish introduced a “Hopper” set·top box that makes and stores Prime Time Anytime copies and offers an Auto Hop feature that lets viewers skip commercials.

Fox said in the complaint that the service would cause the free broadcast television business model to collapse because advertisers would no longer help pay for shows.

“We were given no choice but to file suit against one of our largest distributors, Dish Network, because of their surprising move to market a product with the clear goal of violating copyrights and destroying the fundamental underpinnings of the broadcast television ecosystem,” Fox said in an emailed statement.

“Fox’s lawsuit makes sense to me,” said Lindsay Conner, an entertainment. attorney and partner at Manatt, Phelps & Phillips, LLP in Los Angeles. “The underlying economic issue is who pays for the creation of content? Studios and networks spend millions of dollars creating content That’s not a viable business model unless someone pays for it.”

Bryan Sullivan of Early Sullivan Wright Gizer & McRae LLP, said, “One of the biggest problems studios and networks are having is DVRs that cut ad revenues.”

He added that whether Fox will prevail may turn on the exact wording of its distribution agreement with Dish. “If the agreement is vague or permits modifications, then it’s going to be harder to win.”

Source: Jean Yung, Los Angeles Daily Journal