New lawsuit by would-be rival threatens Aereo’s entry into Chicago market

A new lawsuit could keep Aereo out of the third biggest media market, and also complicates a confusing situation that makes it legal for Americans in some part of the country — but not others — to watch over-the-air TV via third party streaming services.

The lawsuit was filed on Friday by FilmOn, an Aereo-like service owned by eccentric billionaire Alki David. FilmOn’s complaint (embedded below) claims that a PBS station sent a letter accusing it of stealing its signal; FilmOn claims its service is a form of legal private copying, and asks the Chicago court to declare that it’s not violating the Copyright Act.

The Chicago complaint amounts to a fresh courtroom stunt by David, a notorious provocateur who has repeatedly thumbed his nose at the court system. On Monday, according to reports, a judge in Washington held FilmOn in contempt of court and called David a “man who is missing couth.” David, who was not in court, told the Wrap that his lawyers informed him that the judge was “p***ed.”

The contempt finding and the Chicago filing are just the latest twists in a larger nationwide legal fight over services that take over-the-air TV signals and stream them to internet devices. For Aereo, which charges $8/month to watch and store TV, the Alki David developments could further threaten its expansion ambitions.

On to Chicago (or not)

David likes to play the role of joker (he has taunted the courts and Aereo investor Barry Diller), but his antics are no laughing matter for Aereo, which has used a buttoned-down strategy to establish a legal foothold for its service. David’s biggest impact so far came via FilmOn’s rush to go live in California — which led a judge to quickly issue an order banning it in nine western states. That ruling also served to make the West an effective no-go zone for Aereo.

FilmOn’s move is highly unusual as a legal tactic — it carries little chance of success and could expose David to further fury from the Washington judge. But it does throw up a major roadblock to Aereo’s plan to launch in Chicago; if Aereo goes ahead with the launch, the broadcasters would likely sue to add Aereo to the FilmOn case, forcing Aereo to work with David and his loosey-goosey legal team. As a result, Aereo may avoid the Windy City altogether.

The new FilmOn case in Chicago could also provide more grist for the broadcasters which, along with the NFL and Major League Baseball, are beating on the door of the Supreme Court to get a ruling on the copyright question. The Court has yet to decide if it will take the case.

Meanwhile, Aereo is broadening its reach across the country, recently going live in Detroit. As for Chicago, Aereo suspended its launch plans in late September, citing technical reasons; a person familiar with the company could not comment on the legal issues, but said Aereo will release an updated rollout plan for Chicago in December.

FilmOn in Chicago (Aereo Related)

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