NEW YORK—Aereo has filed for Chapter 11 bankruptcy less than three years after launching. The company was litigated into the ground for reselling TV station signals to subscribers without securing contractual agreements.
“While we had significant victories in the federal district courts in New York and Boston and the Second Circuit Court of Appeals, the reversal of the Second Circuit decision in June by the U.S. Supreme Court has proven difficult to overcome,” wrote CEO Chet Kanojia at Aereo’s blog site. “The U.S. Supreme Court decision effectively changed the laws that had governed Aereo’s technology, creating regulatory and legal uncertainty. And while our team has focused its energies on exploring every path forward available to us, without that clarity, the challenges have proven too difficult to overcome.”
Aereo suspended service in June after the Supreme Court ruling. It filed in U.S. Bankruptcy Court for the Southern District of New York on Thursday. Lawton Bloom, managing director of New York-based Argus Management Corp. will be Aereo’s chief restructuring officer during the reorg.
“Chapter 11 will permit Aereo to maximize the value of its business and assets without the extensive cost and distraction of defending drawn out litigation in several courts,” Kanojia said.
Aereo was backed by former broadcast executive and Internet billionaire Barry Diller, who had a 23 percent stake in the company, according to Reuters. Aereo’s total funding reached around $96 million. It offered mobile access to local broadcast channels via downloaded app, plus cloud storage, for $8 and $12 a month, depending on service level. It was launched in more than a dozen cities around the country and secured fewer than 80,000 subscribers, according to an analysis of its July, 2014 filings with the U.S. Copyright Office.
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