The district court found it unnecessary to resolve the disputed question of whether the
primetime programming was identified through the operation of software or through human
review of program schedules because under the Second Circuit’s Cartoon Network (Cablevision)
case, the pivotal factor for direct liability is initiation of the act of copying rather than the
selection of offerings for possible copying or the creation of the technological structure. The
possible involvement of Dish’s agents in determining the time parameters of programming
available for PTAT/Hopper recording was therefore insufficient to render Dish a direct infringer.
The court noted that Dish had no control over which programs would be shown on the plaintiffs’
networks or in what order, just as it had no control over which of its subscribers would choose to
copy those programs. It was the Dish subscriber who decided if he or she wanted to use the
PTAT feature and the subscriber was required to enable PTAT before the Hopper would record
any programs. The subscriber also selected which of the networks’ primetime offerings to
record and which nights to record and, once the subscriber enabled the PTAT, the recordings
were saved on the subscriber’s personal hard drive on the Hopper, rather than at Dish
headquarters. The subscriber also decided the length of time the recordings should be kept.
Accordingly, the court ruled that the subscribers made the copies, and the plaintiffs had therefore
failed to demonstrate a likelihood of success on a claim for direct infringement liability.^269
The court also ruled that Dish had no secondary liability for its subscribers’ copying
under either vicarious or contributory theories. With respect to vicarious liability, the court
found that Dish had no control over whether its subscribers enabled the PTAT technology or
what they chose to copy. The court also concluded that Dish was likely to establish that it could
have no secondary liability under the Sony case because the copying by Dish’s subscribers for
private, non-commercial time shifting use in the home was a fair use. Accordingly, the court
denied the plaintiffs’ request for a preliminary injunction.^270
In Mar. 2014 Dish reached a settlement with the plaintiff Walt Disney Co. under which it
agreed to disable the AutoHop function for ABC programming during the first three days after
shows aired. In return Dish received the rights to stream content from ABC, ESPN and other
Disney properties through a new, Internet-based TV service.^271
(^269) Id. at 19-21.
(^270) Id. at 22-26, 48. The court also found that the plaintiffs had failed to establish irreparable harm. The plaintiffs
argued they would suffer irreparable harm because AutoHop’s efficient commercial skipping feature would
deprive them of advertising revenues premised on PTAT/AutoHop commercial viewing patterns, such as live
TV-watching, commercial-inclusive VOD without fast-forwarding ability, and Hulu, which all exposed viewers
to opportunities to watch commercials during primetime programming, thus harming the plaintiffs’
relationships and negotiations with authorized licensees. The court found, however, that the plaintiffs had not
proffered any evidence of actual and imminent injury. The court noted that Nielsen’s C3 rating system did not
distinguish between commercial-skipping using AutoHop and commercial skipping using other, preexisting
technologies, instead measuring only whether the commercial had been skipped or not. The record therefore
did not support the conclusion that there would likely be an incremental increase in commercial skipping from
AutoHop. In fact, the plaintiffs’ corporate designee and expert on consumer behavior had testified that DVRs
in general had actually boosted the C3 ratings of its programming. Id. at *30-31.
(^271) Bill Donahue, “Dish, ABC Settle Ad-Skipping Fight with Broad TV Deal,” Law360 (Mar. 7, 2014), available as
of Mar. 7, 2014 at http://www.law360.com/articles/515052/print?section=IP.