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Gibson Dunn - The Fashion Law and Business Report > Posts > New Supreme Court Copyright Decision Has Lessons for Fashion / Retail Companies
New Supreme Court Copyright Decision Has Lessons for Fashion / Retail Companies

On June 25, 2014, the Supreme Court of the United States ruled in American Broadcasting Cos. v. Aereo, Inc., 13-461 (U.S. June 25, 2014), that the video streaming service offered by Aereo, Inc. infringed the exclusive right of copyright owners to publicly perform television broadcasts.  Although the decision revolves around public performance rights and Congress’s intent with respect to the re-transmission of television programming over cable television and modern communications devices, it also has lessons for disruptive businesses in other industries, such as fashion in retail. 

In particular, the Court addressed the concern that its holding “will impose copyright liability on other technologies, including new technologies, that Congress could not possibly have wanted to reach.”  The Court examined technologies like cloud computing and remote DVR’s which were addressed in briefs filed by various amici and concluded that “[w]e cannot now answer more precisely how . . . the Copyright Act will apply to technologies not before us” and “agree[d] . . . that ‘[q]uestions involving cloud computing, [remote storage] DVRs, and other novel issues not before the Court, as to which Congress has not plainly marked [the] course, should await a case in which they are squarely presented.’”  In his dissent, moreover, Justice Scalia noted that courts may be particularly poor arbiters of the effect their decisions will have on technology, noting that “[w]e came within one vote of declaring the VCR contraband 30 years ago in” Sony Corp. of America v. Universal City Studios, Inc., 464 U. S. 417 (1984).

New technologies are similarly transforming the retail and fashion industries.  As 3D printing and smart products revolutionize the ways that consumers purchase and interact with fashion products, it is likely that fashion and retail companies will be confronting issues as fundamental as Aereo’s formula is to the broadcast networks.  The Court’s Aereo decision, however, makes clear that, in evaluating the legality of business models developed to take advantage of these new technologies, attorneys and courts will need to carefully consider not just the mere written language of the Copyright Act, but also “the activities that Congress intended this language to cover.”

A summary of the decision can be found here.

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