Aereo Inc., the online video streaming service backed by businessman and Television Hall of Fame member Barry Diller, filed for bankruptcy protection on Thursday night, five months after an unfavorable Supreme Court ruling.
The service had allowed subscribers to watch, pause and record live TV on their computers. In June, the Supreme Court ruled that the start-up violated copyright law because it was similar to a cable service, but wasn't paying to transmit copyrighted material. The company argued that it was an antenna service and did not have to comply with copyright law.
The 6-3 decision in the case of ABC vs. Aereo was a blow to the company, forcing it to rethink its business model. Aereo suspended its services three days after the ruling, and earlier this month laid off most of its staff.
Aereo Chief Executive Chet Kanojia wrote on the company's website on Friday that the ruling has created "regulatory and legal uncertainty," and "without that clarity, the challenges have proven too difficult to overcome."
Kanojia said that the Chapter 11 filing will allow Aereo Inc. to maximize the value of its business while avoiding the cost and distraction of litigation.