Fox Denied Injunction Against Dish Network’s “Hopper” Ad-Skipping Feature

Most television viewers consider commercials a necessary evil when it comes to watching their favorite programs, one that cannot be avoided during normal viewing. Dish Network provides its customers with the “Hopper” a digital video recorder (DVR) with video on demand capabilities. The Hopper includes a feature called “PrimeTime Anytime” which allows a subscriber to set a single timer to record primetime programming on the four major broadcast networks any night of the week. Beginning in mid 2012, Hopper added a new feature, “AutoHop” that allows users to automatically skip commercials when using the PrimeTime Anytime feature. Fox Broadcasting sued Dish for copyright infringement and breach of contract and sought a preliminary injunction. The District Court denied the injunction finding that Fox did not demonstrate a likelihood of success on most of its claims and Fox appealed to the Ninth Circuit.

The Ninth Circuit affirmed. As to the copyright infringement claims, the Court first found that infringement of the reproduction rights requires copying by the defendant, and here the user/consumer, not Dish, makes the copy. As to secondary liability for copyright infringement, while Fox did establish a prima facie case of direct infringement by Dish’s customers, Dish was able to that is was likely to succeed on its affirmative defense that its customers’ copying was fair use. The Court found that consumers use the feature for “time shifting” - which had been found to be a fair use in the Supreme Court’s 1984 decision of Sony v. Universal Studios - and the commercial-skipping feature does not implicate Fox’s copyrights since it doesn’t even hold the copyrights in the ads being aired. Since the use by consumers was non-commercial, they copy the entire copyrighted work of Fox and Fox had not shown that the consumers use caused market harm to Fox, the court affirmed the lower court’s ruling that Fox was unlikely to succeed on its secondary infringement claims.

FOX Broadcasting Company, et al v. Dish Network LLC, et al.
U.S. Court of Appeals, Ninth Circuit
July 2013