WASHINGTON D.C. - Solveig Singleton, Senior Adjunct Fellow of The Progress & Freedom Foundation (PFF) filed comments today with the Second Circuit Court of Appeals in the case of Cartoon Network v. CSC Holdings, asking the court to affirm the ruling of the lower court to block the cable operator's plans to roll out a network-based digital video recorder (DVR) service. In the filing, Singleton argues that the District Court properly applies the case law concerning direct liability for infringement on Cablevision.

The case arose when Cablevision proposed a new video distribution service that would allow customers to record and store Cablevision programming remotely, as if Cablevision had given each subscriber a Digital Video Recorder (DVR). But Cablevision’s existing license agreements with content providers did not contemplate this service and content providers sued, and won.

Those filing on behalf of Cablevision argue that parity requires that Cablevision enjoy the same protection as ISPs or consumer products like the VCR. PFF's concern is that reading exemptions from liability broadly, even in the name of sheltering new technologies, eliminates the incentive of new distributors to license programming from the copyright owners who work so hard to produce it.

"This ultimately harms consumers, whose interest is in ensuring that creators are paid so they continue to produce," said Singleton. “Distributors, too, have a long run interest in the function of licensing markets, because their networks gain in value when more quality content is available."

Unlike an ISP or the seller of consumer recording equipment, Cablevision licenses and selects the content at issue as well as maintains physical control of the programming and the copies throughout. Singleton notes that Cablevision's level of volition, control, understanding of the programming and its legal status mean that this service is not really "like" the early ISP or a VCR. PFF concludes the decision of the lower court does not suppress technology; rather, it affirms the need for distributors and creators alike to come to the bargaining table in support of markets.

"Finding exactly the right mix of rules is difficult, but one thing is clear: always drawing a bright line so that innovative distributors escape liability is a gross oversimplification of the supposed conflict between distributive technologies and content creators," Singleton added. "Taking a broad perspective, there is generally no conflict between these interests; rather, they complement one another and add value to one another's ventures."

The filing is available online.

The Progress & Freedom Foundation is a market-oriented think tank that studies the digital revolution and its implications for public policy. It is a 501(c)(3) research & educational organization.