If you take the recording device of a DVR off the customer's premises and place it in an upstream transmitting station, does that constitute an unauthorized duplication? Last year, a US district court said yes. Today, it's a new ballgame.

In a ruling this afternoon that is very, very likely to be appealed itself, a three-judge panel of the US Second Circuit Court of Appeals unanimously reversed a lower court ruling in March 2007 in favor of movie and cable TV studios. That ruling stated that Cablevision Systems' plan to provide cable customers with a DVR-like system using its remote servers, constituted an illegal rebroadcast of their content. This afternoon, the judges strongly disagreed.

At issue is a key element of the language of the law: Everyone knows that electrical processes are required to produce a copy of a digitally recorded work. Plaintiffs, including 20th Century-Fox and various entities of Turner Broadcasting, and backed by the Motion Picture Association of America, had argued that such processes constituted transmission, and that implied in the concept of transmission of a recorded work was the performance of that recorded work. You can't have one without the other, plaintiffs argued; and a US District Court agreed last year.

But the Appeals Court called that permutation of the law an "error" today, ripping apart its technical basis (PDF available here, published by Public Knowledge). Specifically, it focused on Cablevision's proposed Remote Storage-Digital Video Recorder (RS-DVR) schematic, in which copies of a work in whole or in part were recorded on buffers prior to their being transmitted to customers' receiving equipment. The District Court presumed that those copies constituted the "embodiment" of the recorded work.

"The district court mistakenly limited its analysis primarily to the embodiment requirement," wrote Appeals Court Judge John M. Walker earlier today. "As a result of this error, once it determined that the buffer data was 'clearly . . . capable of being reproduced, i.e., that the work was embodied in the buffer, the district court concluded that the work was therefore 'fixed' in the buffer, and that a copy had thus been made."

But buffers are temporary storage media, Judge Walker went on, designed only to harbor portions of files for a "transitory duration" -- in other words, just long enough to get the file transmitted and removed from memory. He cited an earlier court decision in favor of a repair service that had rescued a customer's hard drive, and in so doing had copied that customer's software -- allegedly illegally. Since the rescue copy was only for a "transitory duration," that court ruled, the duplication wasn't really a "copy" for practical purposes.

In the case of RS-DVR, the transitory period was found to be no greater than 1.2 seconds. "While our inquiry is necessarily fact-specific, and other factors not present here may alter the duration analysis significantly," Judge Walker wrote, "these facts strongly suggest that the works in this case are embodied in the buffer for only a 'transitory' period, thus failing the duration requirement."

So if the buffer doesn't truly constitute a copy, then the transmission doesn't constitute a "performance" of that copy.

That's not the only angle from which the panel attacked the District Court's findings, however. The lower court had compared Cablevision's service to the case of a service that made unlicensed packages of course curricula material for college professors. That service had "unfettered access" to a wide range of material from which it selected the choicest portions. The District Court believed Cablevision had a similar selection ability, making virtually any programming provided through its digital service capable of being copied by the customer at will.

Not so, Judge Walker reasoned, for a reason he found to be all too obvious: Cablevision is not the content provider to begin with; the plaintiffs have that role.

As Judge Walker wrote, "Cablevision, we note, also has subscribers who use home VCRs or DVRs (like TiVo), and has significant control over the content recorded by these customers. But this control is limited to the channels of programming available to a customer and not to the programs themselves. Cablevision has no control over what programs are made available on individual channels or when those programs will air, if at all. In this respect, Cablevision possesses far less control over recordable content than it does in the [video on demand] context, where it actively selects and makes available beforehand the individual programs available for viewing. For these reasons, we are not inclined to say that Cablevision, rather than the user, 'does' the copying produced by the RS-DVR system. As a result, we find that the district court erred in concluding that Cablevision, rather than its RS-DVR customers, makes the copies carried out by the RS-DVR system."

Finally, the three-judge panel disassembled plaintiffs' arguments that the retransmission constituted an unauthorized public performance of digital works. Since the customer is in charge of the copying process, and since the dissemination of the work takes place on customer premises, the Appeals Court found that any performance, if it can be called that, is directed by the customer and not Cablevision.

But is that a performance "to the public," isn't that an unauthorized performance, and isn't it Cablevision that makes that performance feasible? Supporting plaintiffs' arguments are statutes dating back literally to 1967, clearly stating that transmissions do constitute public performances.

However, the Appeals Court reasoned, just how much of the public is capable of receiving those performances? As Judge Walker made clear, that subset of the public would consist of people who own Cablevision RS-DVR systems...which isn't exactly "the public."

"Cablevision argues that, because each RS-DVR transmission is made using a single unique copy of a work, made by an individual subscriber, one that can be decoded exclusively by that subscriber's cable box, only one subscriber is capable of receiving any given RS-DVR transmission. This argument accords with the language of the [older] transmit clause, which...directs us to consider the potential audience of a given transmission. We are unpersuaded by the district court's reasoning and the plaintiffs' arguments that we should consider a larger potential audience in determining whether a transmission is 'to the public."'

Cablevision may have been helped by an amicus brief filed by the Electronic Frontier Foundation last May (PDF available here). That brief made multiple references to the US Supreme Court, which is almost certainly where this case will end up next.