Televised European Sports – Bar Owners v. Broadcasters

The right combination of beer, wings and sports has proved successful for hundreds of thousands of pub and bar owners in the United States.  Whether it is football, baseball, or European soccer, owners work to provide the sports their patrons want to watch.

Owners typically pay high prices to receive broadcasts of overseas sporting events.  However, Eugene Rooney, part owner of Old Castle Restaurant and Pub in Manhattan was able to the lower the cost for his bar and ultimately his patrons by using online technology and old fashion ingenuity.  Unfortunately, Premium Sports Inc., a San Francisco-based company offering broadcast packages which include overseas matches in sports like soccer, rugby and Gaelic football did not like Mr. Rooney’s method and filed suit.  A recent decision of the Southern District of New York in the case could be the start of an ongoing battle between broadcast providers and restaurant/bar owners.  Premium Sports Inc. v. Connell, et. al., No. 10 Civ. 3753 (KBF) (S.D.N.Y. March 1, 2012).

Facts

On February 13, 2010, Old Castle showed the Scotland/Wales soccer game in the pub.  While Premium Sports was the exclusive licensee for that programming in the United States, Old Castle did not pay for and obtain it from Premium Sports.  Instead, Old Castle obtained the programming via a friend of Mr. Rooney, Michael Caulfield, who was living in Ireland.

A company called “RTE” broadcast the match free in Dublin, where Caulfield received it on his television.  Caulfield then, in turn, sent it on to Rooney, who showed the match at his pub, Old Castle.  According to The New York Times, Rooney setup Caulfield in Dublin and his bars in New York with $3,000 in equipment to stream television signals online.[1]

Since Old Castle played the match without paying Premium Sports for it, Premium Sport claimed Old Castle violated section 605(a) of the Federal Communication Act (FCA).  In terms of programming, the statute is intended to prevent the interception – i.e., piracy – of satellite transmissions.  See J&J Sports Prods., Inc. v. Pimentel, Sabor del Caribe, Inc., No. 09 Civ. 1501, 2009 U.S. Dist. LEXIS 119085, at *11 (M.D.Fla. Dec. 4, 2009).  Section 553 of the FCA provides similar protections with regard to cable transmissions.

To establish liability under this section of the FCA, there must be an “interception” of a signal or transmission and case law states “intercept” or “interception” means to stop, seize or interrupt prior to arrival; or taking or seizing before arrival at the destined place.  See, e.g., Katz v. United States, 389 U.S. 347, 88 S.Ct. 507, 19 L.Ed.2d 576 (1967); Cablevision of Michigan, Inc. v. Sports Palace, No. 93-1737, 1994 U.S.App. LEXIS 13914, at *13, 1994 WL 245584 (6^th Cir. June 6, 1994).  However, in this case, the Southern District of New York found Premium Sports did not propound any evidence that Mr. Rooney’s friend in Ireland “intercepted” a satellite communication.  By the time the game appeared on the televisions at Old Castle, which was at least two to three minutes behind the live broadcast, there is no indication the transmission was via the original satellite signal.

Therefore, the Federal Court, found in favor of Old Castle and its owners because the version of the match playing at Old Castle was technically a rebroadcast and not an illegally intercepted signal.

While the owners at Old Castle won their case regarding Premium Sports’ alleged violation of the FCA, they could potentially face other claims for allegedly unauthorized use of an exclusively licensed game.  For example, if Premium Sports had made the requisite filings at the copyright office, Premium Sports might have had an infringement claim.

As the interest for international sports grows larger and technology gets better, bars and pubs like Old Castle will continue to display this type of ingenuity.  License holders should remain vigilant to protect their rights, and presenters of copyrighted materials — such as bars, clubs, and restaurants — should familiarize themselves with the laws governing broadcast of such productions and observe them in order to keep from running afoul of the law and potentially exposing themselves to the time and money of costly litigation.  While Rooney and Old Castle were victorious, he never imagined it would cost them $25,000 in legal fees.[2]

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