Lawsuit: The Future of #FoxNews

Newsflash from your Hollywood Attorney:

The lawsuit alleges that TVEyes is running a service making "verbatim reproduction" of Fox News' programming and participating in a "massive ongoing pattern and practice of infringement."

Now, the defendant is seeking to have a New York judge throw out several of Fox News' claims. The company has hired Andrew Schapiro at Quinn Emanuel who was also Google's attorney in the billion dollar fight with Viacom. Earlier this month, he filed a motion to dismiss that describes TVEyes as recording and indexing over 1,600 television and radio stations around the world, and whose customers include the United States Department of Defense, the United Nations, several members of Congress, The New York Times, Time Warner Cable, professional sports teams and leagues and other political organizations.

Some of its customers presumably use the service as a form of egosurfing. Others for PR and marketing purposes. And perhaps some news organizations are using it to quickly check out how some of Fox News' conservative commentators are treating the day's most topical news. Whatever those motivations, Fox News sees TVEyes as a form of unfair competition: It's alleged that users of the service would otherwise be watching Fox News telecasts, going to Fox News websites, or bolstering ITN Source, Fox News' licensed clip service.

Fox News' lawsuit against TVEyes is primed to address an area of tort law -- "hot news misappropriation" -- that has been around for nearly a century, but largely fell out of favor until very recently when some publishers wondered whether the threat of online content aggregation required some legal response. Now, a new ruling on the topic could be imminent.

Some background...
The hot news doctrine dates back to a 1918 ruling from the U.S. Supreme Court involving The Associated Press going up against a competitor wire service. Justice Mahlon Pitney wrote that news was "quasi property," and that there should be some consideration of a news organization's expenditure of labor, skill, and money in gathering tips and producing content.

Throughout the years, the "hot news" doctrine has suffered some legal blows, most recently in a 2011 decision by the 2nd Circuit Court of Appeals. In that case, a website called Theflyonthewall.com successfully fought an injunction that was issued after it kept posting leaked stock market buy and sell recommendations from Barclays Capital. A 2nd Circuit judge wrote, "We conclude that in this case, a Firm's ability to make news -- by issuing a Recommendation that is likely to affect the market price of a security -- does not give rise to a right for it to control who breaks that news and how."

Some in the tech community were relieved at the ruling, but the case left possible openings for future courts to draw the line on "scoop" free-riding. Notably, this past March, the Associated Press with support from some news organizations (including TVEyes customer New York Times) prevailed in a ruling against Norway-based news monitoring service Meltwater, whose software enables users to track in real-time when their company is mentioned in breaking news, scraping headlines and article snippets in its reports. The judge in the Meltwater case rejected the defendant's fair use defense, writing, "the public interest in the existence of such commercial enterprise does not... justify allowing Meltwater to free ride on the costly news gathering and coverage work performed by organizations."

That's where Fox News steps in.
In its lawsuit alleging copyright and hot news misappropriation claims (read here) against TVEyes, the cable network points to the expense of producing its news programming and its time sensitive nature, and says, "If TVEyes is allowed to continue its willful free-riding on Fox News's programming, it will substantially reduce Fox News's incentive and ability to produce new content, jeopardizing both the quality and the quantity of premium news reporting available to consumers."

Now comes the motion to dismiss ( http://www.scribd.com/doc/171542472/tveyes ), which says the cable network's "skeletal allegations" don't sufficiently support its claims because among other things, the plaintiff doesn't identify "which particular time-sensitive facts purportedly were... taken."

More interestingly, TVEyes addresses a news future where digital technologies and bots play a role in the delivery of factual information.

"TVEyes captures the content of thousands of television and radio broadcasts and, using its own proprietary technology, indexes the content and delivers small, relevant excerpts to its customers in response to user-selected keywords," it says. "All of this indexing, organizing, and delivering occurs at solely at TVEyes’ expense, and Fox does not allege otherwise."

The company attempts to draw a distinction between what it does and what Fox News does.

"More importantly, in delivering its keyword results to customers, TVEyes merely reports the fact that a particular keyword was mentioned in a particular Fox broadcast," it says. "This, by definition, is not the same underlying news reported by Fox; it is a new fact, and therefore cannot constitute free-riding."

Source.... http://www.hollywoodreporter.com/thr-esq/how-a-fox-news-lawsuit-638315

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Man's Suicide Aired Live, Family Sues Fox

The suit seeks unspecified damages for the sons of JoDon Romero, saying they have suffered signs of post-traumatic stress disorder since watching footage of their father shooting himself.

The family of an Arizona man whose suicide was carried live on the air by Fox News Channel last September is suing the cable network.

Read Full Complaint.... http://www.hollywoodreporter.com/sites/default/files/custom/Documents/ESQ/Angela_Rodriguez.pdf

According to the complaint filed by Angela Rodriguez, the mother of JoDon Romero's three sons, aged 9, 13 and 15, the boys have suffered extreme emotional distress after seeing online video of their father pressing a handgun to his head and pulling the trigger. News Corp., Fox Entertainment Group and Fox News Network are named as plaintiffs in the complaint.

The footage had aired live on Fox News and was seen by millions of horrified viewers. Fox News covered the dramatic events across multiple programs on Sept. 28, 2012, as Romero led police on an 80-mile chase, during which he fired at squad cars and news helicopters. It was during Studio B With Shepard Smith that Romero, 32, exited his vehicle in the desert near Salome, Ariz., ran down a dirt road, tumbled, then stood up and shot himself in the head, to an audible gasp in the newsroom.

Host Shepard Smith, who had been narrating the coverage, shouted at the control room, "Get off, get off, get off, get off, get off, get off, get off — get off it, get off it, get off it!" A flustered Smith returned after a commercial break to explain that the network had "really messed up and we're all very sorry." Fox senior vice president Michael Clemente later released a statement explaining that "severe human error" has failed to censor the footage.

The suit states that the local Fox News affiliate successfully ran the delay, preventing Phoenix viewers from watching the suicide live. But it ran live in most other markets, and was on YouTube within minutes. According to the lawsuit, Romero's three sons were at school during the pursuit.

"Rumor of a suicide broadcast on live television generated considerable buzz among the students at the school, particularly with respect to the two older boys," the suit reads.

"After school, the older boys went home and began looking for the suicide on the Internet," the suit continues. The two boys then searched out the footage on YouTube and "as they watched, they realized in horror that they were watching their father."

Neither of the older two children has returned to school since viewing their father's death on YouTube, the complaint says. It then quotes an examining psychologist who found them to demonstrate "symptoms of post-traumatic stress disorder that included flashbacks, repeated thoughts and feelings associated with viewing the video of their father shooting himself in the head, re-experiencing trauma, sleep disturbance, and intrusive thoughts."

"This psychological trauma is substantial and long-term. It will, upon information and belief, require long-term psychiatric and/or psychological treatment," writes Joel Robbins and Anne Findling, attorneys for the Romero family.

Read More.... http://www.hollywoodreporter.com/thr-esq/fox-news-sued-live-airing-570026

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Victory in Labor Lawsuit Against Fox - Interns Win

In a ruling that is likely to be well read throughout Hollywood and maybe corporate America at large, a federal judge on Tuesday has handed a couple of the interns suing Fox Searchlight a victory on summary judgment and also certified a class action over the internship programs of Fox Entertainment Group.

The lawsuit was first brought in late 2011 by two interns -- Alex Footman and Eric Glatt -- who both worked on Fox Searchlight's Black Swan and claimed that the company's unpaid internship program violated minimum wage and overtime laws.

Read Full Ruling here... http://www.hollywoodreporter.com/sites/default/files/custom/Documents/fox_interns.pdf

The lawsuit then got bigger with amended claims brought by added named plainitffs such as Kanene Gratts, who worked on Searchlight's 500 Days of Summer as well as Eden Antalik, who participated in the FEG internship program. To prevail, they would need to jump several hurdles, including showing that the training programs set up weren't for the advantage of the trainees.

On Tuesday, federal judge William Pauley issued a ruling that is very favorable to the suing interns.
Regarding Footman and Glatt, the judge grants summary judgment to them that Searchlight was their "employer," as that term is defined in the Fair Standards Labor Act and New York Labor Laws.

Fox attempted to convince Judge Pauley that the production companies -- like Lake of Tiers Inc. instead of Searchlight -- were responsible for hiring and controlling the interns, but the judge didn't buy it. Judge Pauley writes that "Searchlight's power to fire Black Swan production staff was unbridled," that "Searchlight closely supervised work on Black Swan," that "the crew of Black Swan was tied to Searchlight, not Lake of Tears," and so forth.

The judge also looked at whether the internship program qualified as a bona fide training program under the Labor Department's six criteria for determining whether an internship might be unpaid. These factors include whether the internship is similar to training that would be given in an educational environment, whether it is for the benefit of the intern, whether the intern displaces regular employees, whether the employer derives immediate advantage, whether the intern isn't necessarily entitled to a job after the conclusion of the internship and the understanding about no entitlement to wages.

After going through the experiences of Footman and Glatt on Black Swan, here's what Judge Pauley concludes:
                         "Considering the totality of the circumstances, Glatt and Footman were classified improperly as unpaid interns and are 'employees' covered by the FLSA and NYLL. They worked as paid employees work, providing an immediate advantage to their employer and perfomed low-level tasks not requiring specialized training. The benefits they may have received -- such as the knowledge of how a production or accounting office functions or references for future jobs -- are the results of simply having worked as any other employee works, not of internships designed to be uniquely educational to the interns and of little utility to the employer. They received nothing approximating the education they would receive in an academic setting or vocational school. This is a far cry from [the Supreme Court's decision in] Walling, where trainees impeded the regular business of the employer, worked only in their own interest and provided no advantage to the employer. Glatt and Footman do not fall within the narrow 'trainee' exception to the FLSA's broad coverage."

Gratts, who completed a similar internship on 500 Days of Summer, was not as lucky. The judge grants the defendant's motion that her claims are time-barred.

But Judge Pauley's decision doesn't end there.

The federal judge in New York has certified a class action that will explore internships throughout the corporate departments at Fox Entertainment Group. Unlike a fellow judge who recently refused to certify a class action for some 3,000 fashion magazine interns working at Hearst, this judge sees commonality and the other factors that are required to move forward such a class action.

Specifically, the judge rules "Antalik has identified several common questions relevant to determining NYLL violations, including: (1) whether Defendants derived an immediate advantage from interns' work, (2) whether interns displaced regular employees, and (3) whether FEG's internship program was for the benefit of interns."

The judge adds, "Here, the relatively small recoveries available to individual plaintiffs make a class action a more efficient mechanism."

UPDATED: Fox says it is "very disappointed" after two interns who worked on "Black Swan" are granted a summary judgment win, while another intern who worked in Fox's corporate department will now be leading a class action suit.

Read More... http://www.hollywoodreporter.com/thr-esq/interns-win-huge-victory-labor-566360

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A Group of Broadcasters (Fox, ABC, CBS, NBC) filed a copyright infringement lawsuit in Washington DC against a similar outfit to Aereo that is also offering re-transmission services to consumers.

Fox Television is going to war with Barry Diller, the man who helped found the network. On Thursday, Fox, ABC, CBS, NBC, and several other television broadcasters filed two major copyright infringement lawsuits against Aereo, a service that's planning to launch in the New York area on March 14th to allow consumers the ability to watch broadcast television online through digital streaming.

Aereo announced it had raised $20.5 million in venture funding at a news conference last month.

In making the announcement of the forthcoming launch, Diller, who joined Aereo's board after his company IAC/InterActiveCorp provided major financial backing, told reporters that Aereo "pries over-the-air broadcast television out of [a] closed system.”

The broadcasters allege that the Aereo service infringes upon the copyright protection afforded to the content of broadcasters’ television programming.  In one lawsuit filed in New York federal court last week, the broadcasters say that the $12-a-month service will “provide unlimited streams of Plaintiffs’ television broadcasts over the Internet in direct competition with Plaintiffs.”  The broadcasters’ complaint also alleges “[c]opyright law does not permit Aereo to appropriate to itself the value of Plaintiffs’ television programming by retransmitting over the Internet without proper licenses” and “simply put, Aereo is an unauthorized Internet delivery service that is receiving, converting and retransmitting broadcast signals to its subscribers for a fee.” The broadcasters claim that statutory definitions and interpretations of a “public performance” render Aereo’s service impermissible as copyright infringement.  Currently, one group of broadcasters including Fox, Telemundo, and PBS, represented by Steven Fabrizio at Jenner & Block, is seeking a permanent injunction and statutory damages against Aereo. Another set of broadcasters including CBS, NBC, and ABC, represented by Bruce Keller at Debevoise & Plimpton, is after pretty much the same thing, though the cases are likely to be consolidated.

Broadcasters are not unfamiliar with battling companies that offer digital streaming services. In 2010, the same major broadcasters sued streaming television companies FilmOn and ivi, and were granted injunctions against both services.  Ivi’s strategy utilized Section 111 of the Copyright Act, which authorizes cable TV companies to make secondary transmissions of copyrighted works embodied in primary transmissions so long as a nominal statutory licensing fee is paid.  The Judge rejected this argument, holding “[n]o technology . . . has been allowed to take advantage of Section 111 to retransmit copyrighted programming to a national audience while not complying with the rules and regulations of the FCC and without consent of the copyright holder.”  Ivi has appealed this judgment, arguing that it only needed to pay a compulsory license fee.  The appeal will be heard at the 2nd Circuit later in March.  Broadcasters have well-founded reasons to fear the threat posed by startups like Aereo – Deloitte’s 6th edition of its report The State of the Media Democracy and other sources report a long term trend of increased “cord-cutting,” a term that refers to the choice by consumers to unsubscribe from cable services in favor of accessing programming content online.  Although current statistics are not dispositive, the proliferation of websites like Hulu has increased the usage of digital streaming services, especially for video content.

Aereo defends its service stating, “[c]onsumers are legally entitled to access broadcast television via an antenna and they are entitled to record television content for their personal use. Innovations in technology over time, from digital signals to Digital Video Recorders (“DVRs”), have made access to television easier and better for consumers. Aereo provides technology that enables consumers to use their cloud DVR and their remote antenna to record and watch the broadcast television signal to which they are entitled anywhere they are, whether on a phone, a tablet, a television or a laptop.”  The district court judge in the ivi case noted that when Congress enacted Section 111, it was doing so with an “understanding of the cable industry as a highly localized medium” and ivi’s service, in contrast, ”retransmits broadcast signals nationwide, rather than [to] specific local areas.” Alternatively, because Aereo is offering its initial service next month in New York, before expanding “a step at a time, a market at a time,” the company may avoid the pitfalls ivi encountered.  The Aereo lawsuit has the potential to provide substantive implications for the future of the Internet TV business and cord-cutting trend in the broadcast television industry.

Read More... http://www.ipbrief.net/2012/03/09/cord-cutting-culprit-fox-television-and-major-broadcasters-claim-aereo-broadcast-streaming-service-infringes-programming-copyrights/ 
and
http://www.hollywoodreporter.com/thr-esq/aereo-barry-diller-stream-tv-online-296426

Interns Owned by Hearst Failed in a Bid Certification in a Lawsuit over Exploitation of Cheap Labor

After determining that not enough commonality existed among some 3,000 fashion magazine interns, U.S. District Judge Harold Baer adjourned a trial "sine die," which translates from Latin to Cosmopolitan as "99 Ways the Judge Won't Give Me the Day."

Wasting no time, Fox raced to the federal judge in its own case to tell him to read up. As U.S. District Judge William Pauley is prepared within a matter of weeks to bless or deny class certification in the most significant challenge to Hollywood internships ever, Fox believes that individuals who once interned on such films as Black Swan and (500) Days of Summer as well as those who interned in its corporate department will soon experience the fate suffered by Hearst's interns.

Fox has reason to be confident.

In the Wang v. Hearst case, it was revealed that since 2008, the publisher worked to reduce costs by decreasing its headcount and expenses by increasingly using interns. Discovery showcased the fact that 229 full-time employees were eliminated as individuals like Xueden Wang, Erin Spencer and Elizabeth Mancini worked nearly full-day shifts for academic credit.

In 2010, the Labor Department published a fact sheet:  http://www.dol.gov/whd/regs/compliance/whdfs71.htm    in the wake of a Supreme Court ruling (Walling v. Portland Terminal Co.) that discussed how training programs should be for the advantage of the trainees. The memo spelled out six factors on how internships could overcome the employment label. One example? "The intern does not displace regular employees, but works under close supervision of existing staff."

The Labor Department memo "puts some meat on the Walling bones," said Judge Baer.

The judge continued by saying that a genuine issue of fact existed as to whether or not Hearst lived up to the standards articulated by the Labor Department -- denying the plaintiffs' motion for partial summary judgment on the possibility that a jury could find in favor of the defendant.

But more importantly, Judge Baer shrugs off the plaintiffs allegation that Hearst had a “centralized policy” of classifying all interns as unpaid, non-employees and determining that "the commonality requirement is not satisfied because Plaintiffs cannot show anything more than a uniform policy of unpaid internship." Further, the judge finds that the plaintiffs failed to meet certification tests of predominance (whether proposed classes are sufficiently cohesive) and superiority (whether a class action is superior to other available adjudication methods).

In his ruling, Judge Baer writes, "While there is undeniable efficiency that stems from consolidating and concentrating the litigation of similar claims, the individualized nature of proofs in this case signals that case management would be difficult, if not near-impossible, and separate actions may be more appropriate."

That's just what Fox wanted to hear. The company is facing a similar lawsuit over its internship program with damages estimated to be $5 million. Here are the arguments made by plaintiffs and Fox over class certification before the Wang ruling came out.

Now that a judge has delivered a big blow to one internship class action, Fox demands the same on another.

Read More... http://www.hollywoodreporter.com/thr-esq/hollywood-interns-class-action-lawsuit-520693