The Dish Network satellite service is refusing to back down to network pressure over its new ad-skipping DVR system. The Hopper, which records prime-time television shows and automatically removes all of the commercials, has led to a flurry of network lawsuits in recent months.

For instance, a lawsuit filed by FOX Broadcasting maintains that the Dish Network is liable for copyright infringement and breach of contract. It is also seeking a preliminary injunction to stop Dish from offering its "AutoHop" and "PrimeTime Anytime" services, both of which provide commercial free content.

FOX expressly points to its retransmission agreement with Dish, namely a clause governing Video-On-Demand services. While the agreement authorizes Dish to offer VOD to subscribers, it is "expressly conditioned on Dish disabling any fast-forwarding of commercials during VOD playback," according to court documents.

As FOX’s motion further argues in support of the injunction, “PrimeTime Anytime and AutoHop cut the legs out from under the advertiser-supported broadcast television business model, devalue Fox’s commercial air time in the eyes of advertisers, usurp Fox’s control over the timing and manner in which Fox has chosen to exploit its copyrighted works, and threaten to disrupt Fox’s ability to license its programs and recoup its massive investment.”

Dish is fiercely defending its service, citing Sony Pictures, Inc. v. Universal Studios, Inc., 464 U.S. 417 (1984), in which the Supreme Court held that “time-shifting” is a fair use recording of copyrighted broadcast content. Its opposition to the preliminary injunction also highlights that Dish pays the networks “hundreds of millions of dollars per year in retransmission fees, collected from its subscriber base, for the right to rebroadcast these signals.”

Contrary to the broadcast company’s arguments, Dish also maintains that “Fox expressly acknowledged and agreed that DISH would authorize consumers to connect video replay equipment and make recordings for private home use—precisely what is at issue here.” Dish further argues that under FOX’s proffered interpretation of the retransmission agreement, all of DISH’s existing DVRs would suddenly be prohibited.

This case highlights the growing tensions between the broadcast networks and cable/satellite providers. While Dish and other providers maintain that they are simply tailoring their services to meet consumer demand, the networks argue that the new technology threatens to undermine their entire business model.

For more information about this case, please contact Anthony Caruso, Chair of Scarinci Hollenbeck’s Sports and Entertainment Law Group.