• by Wendy Davis  @wendyndavis, December 10, 2013

Online video company Aereo poses a threat to over-the-air broadcast services, the TV company Hearst says in new court papers.

Hearst, which owns the ABC affiliate WCVB in Boston, makes the argument as part of its attempt to convince the First Circuit Court of Appeals to ban Aereo from operating. “Aereo’s use of contrived technology to free-ride on WCVB’s substantial investment in its copyrighted programming ... clashes with a finely-balanced regulatory scheme that promotes investment in critical local news and entertainment programming,” Hearst says in its court papers, filed on Monday.

The broadcaster adds that U.S. District Court Judge Nathaniel Gorton's earlier decision allowing Aereo to continue to stream programs online “threatens the entire over-the-air broadcast industry.”

Aereo offers paying subscribers the ability to stream over-the-air TV programs to iPads, iPhones and other devices. The Barry Diller-backed company also offers DVR functionality, allowing subscribers to record shows and stream them later.

Hearst, like other TV broadcasters across the country, says Aereo infringes copyright by publicly performing television shows without a license. But Aereo maintains that its service is legal, due to its architecture. The company installs thousands of tiny antennas in local warehouses, then uses those antennas to capture over-the-air broadcasts and stream them to users.

Aereo argues its streams are not “public” performances -- which would violate the copyright law -- but private ones, because they are made on an antenna-to-user basis.

Gorton agreed with Aereo, ruling in October that the company's interpretation of the law “is a better reading” of the copyright statute than the broadcasters' interpretation. He refused to grant Hearst's request to ban Aereo from operating while the case proceeds.

Hearst is now appealing that ruling. “Regardless of the technology it uses, Aereo transmits performances of copyrighted programs to members of the public,” Hearst argues in its court papers.

The broadcaster also says it will suffer “irreparable harm” if Aereo is allowed to continue operating. “Aereo’s entry into the internet space before WCVB irreparably harms WCVB in the form of lost 'first mover' status,” the broadcaster argues.

Hearst adds that the “most dangerous” harm it will face is the potential loss of retransmission revenue. “If Aereo is not enjoined, licensed distributors of WCVB’s broadcasts likely will opt to utilize their own Aereo-like systems, eliminating all payments to WCVB for the right to retransmit and resell WCVB’s signal.”

TV broadcasters have also sued Aereo in federal court in New York and Utah. The broadcasters have so far lost in New York, where the 2nd Circuit Court of Appeals upheld a trial judge's decision to allow the service to continue operating. The broadcasters are seeking to appeal that ruling to the Supreme Court. The Utah case hasn't yet resulted in any rulings.

But judges in both Los Angeles and Washington, D.C. have sided against an Aereo rival, FilmOn X, which reportedly uses the same technology as Aereo. U.S. District Court Judge George Wu in California issued an order banning FilmOn X from operating in nine Western states, while U.S. District Court Judge Rosemary Collyer banned the company from operating anywhere in the country except for New York, Connecticut and Vermont. FilmOn X is appealing both rulings.