Contributory Infringement or Settlement Negotiations?

On Saturday, Cablevision and NewsCorp, owner of the Fox television stations, settled their ongoing dispute over programming fees.

During the two week long battle, in which over 3 million Cablevision customers in the New York/Philiadelphia area were without News Corp's channels, Fox apparently sent a cease and desist letter to Cablevision accusing the company of copyright infringement.

Fox is accusing Cablevision of contributing or vicariously infringing on its copyrights by having the Cablevision service representatives advising its customers how to obtain content from Fox (and its other networks such as National Geographic Channel and Fox Business) via networks such as Ivi.

Ivi offers a subscription based service which delivers television live over the internet. Unlike websites such as Hulu, where someone can access episodes of previously aired shows, the Ivi player shows the original broadcast of whatever the television stations are airing at the time.

No specific companies were named in the letter, which can be seen here. However, Fox is part of a group of broadcasters, who include ABC, NBC, and CBS among others, who last month sued Ivi for copyright infringement. The case is WPIX Inc v. Ivi Inc, 10-7415, Southern District of New York.

Fox will likely need to show that Cablevision knew that it was inducing others to infringe on Fox’s copyrights. It may also need to show that Cablevision knew or instructed its customer services representatives to advise its customers how to obtain the programming.

Could the actions of Cablevision be further complicated if Cablevision was aware or received complaints about the Ivi website as either an Internet provider (unlikely due to the safe harbor provisions as currently interpreted by the Court in Viacom v. YouTube) or as a content provider themselves (Cablevision's subsidiary Rainbow Media Holdings owns such networks as AMC, IFC and the Sundance Channel)?

Was this a mere ploy by Fox to settle on more favorable terms? Could Cablevision bring a declaratory judgment action for a finding that it is not infringing on Fox’s rights? Now that an agreement has been reached by Fox and Cablevision, will Fox follow through or stop pursuing the claim for copyright infringment?