Internet TV startup Aereo sues CBS

NEW YORK Internet TV startup Aereo wants a federal court to declare its service legal across the nation. Aereo takes free signals from the airwaves and sends them over the Internet to paying subscribers.

Federal courts in New York have been issuing preliminary rulings declaring that Aereo's service is permitted under copyright law. CBS Corp., however, threatened a lawsuit in Boston after Aereo announced plans to start service there next week. The Boston court would not be bound by New York's rulings (CBSNews.com is owned by CBS.)

Aereo says additional lawsuits would be duplicative and wasteful. To thwart them, Aereo is asking the U.S. District Court in New York to declare outright that its service doesn't infringe on broadcasters' copyrights, consistent with the preliminary rulings so far. The declaration sought would apply to Aereo's expansion markets, including Boston.

Last Wednesday, CBS Corp. chief executive Les Moonves dismissed Aereo as an "insignificant player" that was stealing CBS' signal.

Moonves told investors that Aereo has "gotten way too much attention" from the news media. The New York-based company takes broadcast signals for free from the airwaves and charges customers to watch them over computers and mobile devices. That threatens CBS' ability to collect fees from traditional service providers such as cable TV for rights to redistribute its stations' signals.

"We're not losing sleep over it. It is an insignificant player that has a couple thousand (subscribers)," Moonves said on a conference call. "We think ultimately that it goes away."

Broadcasters such as CBS have sued Aereo for copyright infringement, but so far Aereo has managed to keep operating thanks to a preliminary ruling in its favor last month. The company captures signals using thousands of tiny antennas, which it argues is comparable to individuals buying digital antennas for themselves.

Moonves echoed the comments of News Corp. Chief Operating Officer Chase Carey, who said last month that if Aereo gets a legal OK to keep operating, he would consider changing the Fox network to a channel available only through cable and satellite TV services.

Moonves said that making this switch at CBS would be "fairly easy to do" and not that disruptive because 85 percent of people who watch CBS do so through TV providers such as cable and satellite companies. But he added, "I'm very doubtful that happens."