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FilmOn X is Cable Service Provider, Court Says

Billionaire Alkiviades “Alki” David has won a significant battle against the largest U.S. television networks – at least for now.

A federal judge in Los Angeles ruled that David’s Beverly Hills online TV-steaming service FilmOn X was eligible for a special license to legally retransmit live TV on any computer or mobile device in the United States.

“It’s a vote in favor of technology and a vote in favor of the public,” said Ryan Baker, FilmOn’s attorney. “It’s an important day for FilmOn’s progress and the development of its model, which aims to deliver content in a more user-friendly fashion.”

The judge, George H. Wu, ruled that FilmOn is “entitled to a compulsory license” as long as the company meets the requirements of the U.S. Copyright Office. The decision is in response to a request Baker filed last month that sought the court’s blessing.

A compulsory license, issued by the Copyright Office, allows cable service providers to retransmit live TV to consumers. But such licenses have never been approved for streaming companies such as FilmOn. And each of the legacy broadcast networks – Fox Television Stations Inc., NBCUniversal Inc., CBS Broadcasting Inc., and Disney Enterprises Inc. (parent of ABC) – have teamed up to ensure that does not change.

The networks have argued that if FilmOn and its competitors become eligible to stream their content online it would threaten their core business model as it could harm their leverage in distribution negotiations and could make it tougher for them to expand into new markets.

“This advisory opinion contravenes all legal precedent,” Fox said in a statement. “The court only found that FilmOn could potentially qualify for a compulsory license, and we do not believe that is a possibility. The injunction barring FilmOn from retransmitting broadcast programming over the Internet still remains in place and the full burden of proof still lies with FilmOn. We will of course appeal and fully expect to prevail.”

Still, FilmOn has already filed its application with the Copyright Office. The process stalled due to ongoing litigation, which is why FilmOn asked the court last month to allow its application to move forward.

Even if the networks appeal Judge Wu’s ruling to the Ninth Circuit, Baker said the Copyright Office could still decide to process FilmOn’s application.

For more on FilmOn and David’s years-long battle against the legacy broadcasters, check out the Business Journal’s recent coverage..

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