Jeff Roberts

Streaming video service Hulu’s decision to use Facebook’s “Like” button on its webpages may have violated a federal law that forbids companies from sharing customers’ video histories, according to a San Francisco court decision that could spell trouble for other companies.

In a 27-page ruling full of technological details, US Magistrate Judge Laurel Beeler refused to dismiss a class action complaint that accuses Hulu of violating a 1982 law known as the Video Privacy Protection Act, or VPPA.

While the original purpose of the law was to prevent video stores from sharing their customers’ rental histories, it continues to trip up online media companies like Netflix, which paid $9 million in 2012 to settle a VPPA-related lawsuit.

Even though a recent update to the VPPA permits video companies to tell Facebook and other third parties what their customers are watching, Judge Beeler concluded that Hulu did not obtain the required consent. Hulu did not send lists of its subscribers’ viewing habits to Facebook. Instead, the company is in legal trouble because it shared customers’ movie choices indirectly as a result of the “Like” button.

[Commentary] To avoid being shut down, Aereo must persuade the Supreme Court that it has a legal home within these technologies and the elaborate regulatory rules that have sprung up around them.

One way Aereo will try to do that is by likening its legal position to cases involving the Sony Betamax, which let consumers record analog TV signals onto magnetic tape, and to Cablevision’s remote DVR service. Taken together, those cases, handed down 25 years apart, established that consumers have a “fair use” right to record shows, and that no “public performance” takes place when the consumer plays them back later on. Aereo says its tech does the same thing. As the company will tell the Court, it is Aereo’s subscribers -- not Aereo -- who determine when the recording starts and stops, and when the show will start playing back.

History may help Aereo too in rebutting the argument that Aereo, if it were operating legally, it would be paying signal retransmission fees like cable and satellite companies do. As Aereo points out in its brief, the retransmission fees (which now account for about 10 percent of broadcasters’ revenue) don’t flow from the Copyright Act, but from a separate law that Congress passed to promote competition in different sectors of the TV industry. The implication is that, if these fees should be extended further, it’s a job for Congress and not the Supreme Court.

Finally, Aereo will try to tell the court that the local over-the-air TV signals that its antennas detect are free, and always have been. In the history of TV, Aereo says, these local signals stand apart and are part of an historical bargain in the TV industry under which the big broadcasters get access to public spectrum in return for beaming information to the public.

Europe’s highest court declared that a directive requiring phone and Internet companies to retain data for up to two years violated citizens’ fundamental rights to privacy and to control personal data.

The ruling by the European Court of Justice means national governments will have to rewrite data collection laws that the EU requested after terrorist bombings in London and Madrid in 2006. While noting that authorities had a genuine national interest in collecting the data, the court said the current rules exceed what is needed to fight crime, and leave citizens “feeling that their private lives are the subject of constant surveillance.” The decision also complains that the law does not require data collected from phone and Internet companies to remain in the EU -- an apparent acknowledgment about ongoing concern over European countries sharing data with US intelligence services.

A federal judge sided with Internet radio service Pandora over the music industry in a bitter fight over songwriting royalties, after concluding that Pandora is more akin to regular radio than other music services like iTunes Radio and Spotify.

In a decision published in New York, US District Judge Denise Cote concluded that Pandora should continue paying a royalty rate of 1.85 percent of its annual revenues, and that the 3 percent music publishers had sought was not “reasonable.” According to the court, the fair rate for Pandora should not be determined by referring to what interactive music service, Spotify, pays to license songs from ASCAP. The reason is that: “on-demand streaming services like Spotify are widely considered cannibalistic and are licensed at a higher rate accordingly.”

The court also rejected the music companies attempt to use Apple, which launched a radio service of its own, as a royalty model. While Apple is rumored to be paying ASCAP a 10 percent royalty rate, Judge Cote ruled that this amounts to an apples-to-oranges comparison, in part because the service is new and because Apple is using it promote its hardware products. The ruling in favor of Pandora may further embitter certain songwriters who blame digital musical services for undercutting artists’ ability to make a living.

The bottom line is that the ruling puts Pandora on about equal footing with other radio stations when it comes to paying ASCAP, but the music royalty system still appears deeply distressed and uneven.