copy for which it had not paid and using it for AutoHop, Dish harmed Fox’s opportunity to
negotiate a value for those copies and also inhibited Fox’s ability to enter into similar licensing
agreements with others in the future by making the copies less valuable. Therefore, the fourth
factor also cut against Dish, and the court ruled that the QA copies did not constitute a fair use.
The fact that consumers ultimately used AutoHop in conjunction with PTAT for private home
use, a fair use under Sony, did not render the intermediate copies themselves a fair use as well.^202
The court then considered whether Dish was liable for violation of Fox’s distribution
right and found that it was not. Citing the Perfect 10 v. Amazon case,^203 the court noted that
infringement of the distribution right requires actual dissemination of a copy by sale or other
transfer of ownership, or by rental, lease, or lending. Here, a PTAT-enabled Hopper recorded
primetime programming locally and, at most that local copy was disseminated within a single
household. PTAT and AutoHop therefore did not involve any actual distribution of unauthorized
copies, so the court concluded that Fox had not established a likelihood of success on the merits
of its distribution claim.^204
Lastly, the court turned to a consideration of whether a preliminary injunction should
issue based on the court’s finding that the QA copies were infringing.^205 The court concluded
that no preliminary injunction should issue because Fox had not established a likelihood of
irreparable harm if Dish were not enjoined from making and using the QA copies. The record
suggested that the extent of harm caused by the QA copies was calculable in money damages.
The fact that Fox had licensing agreements with other companies showed that copies of the Fox
programs had a market value that other companies already paid in exchange for the right to use
the copies. Although Fox had submitted evidence that some irreparable harms, such as loss of
control over its copyrighted works and loss of advertising revenue, might stem from the ad-
skipping use to which the QA copies were put, the record did not show that those harms flowed
from the QA copies themselves. Rather, if those harms were to materialize, they would be a
result of the ad-skipping itself, which did not constitute copyright infringement. The court
therefore concluded that any injury was compensable with money damages and did not support a
finding of irreparable harm.^206
On appeal, the Ninth Circuit affirmed.^207 The Ninth Circuit expressly noted that direct
infringement requires volitional conduct, by reciting that there are three elements to a prima facie
case of direct infringement: (1) ownership of the allegedly infringed material, (2) violation of at
least one exclusive right granted to copyright holders, and (3) volitional conduct by the
(^202) Id. at 1105-06.
(^203) Perfect 10 v. Amazon.com, Inc., 508 F.3d 1146, 1162 (9th Cir. 2007).
(^204) Fox Broadcasting, 905 F. Supp. 2d at 1106.
(^205) The court observed that “neither the marking announcements nor the ad-skipping effect of AutoHop implicates
any copyright interest ....” Id. at 1110.
(^206) Id. at 1109-11.
(^207) Fox Broadcasting Co., Inc. v. Dish Network L.L.C., 747 F.3d 1060 (9th Cir. 2014).