Locast Lawsuit by Networks Can Go to Trial, After Judge Says Donation to Avoid Ads “Not a Gift to Charitable Cause”
A copyright infringement lawsuit by ABC, CBS, Fox, and NBC will continue after Locast, the donation-based streaming service, was denied a summary judgement, as first spotted by FierceVideo. The broadcasters were granted a partial summary judgement in their favor.
Judge Louis Stanton, a federal judge in New York, denied Locast’s request for a summary judgement, saying “Based on the undisputed facts, it is clear that the Locast service is not offered without charges other than those necessary to defray the actual and reasonable costs of maintaining and operating’ its service.”
As part of the judgement, it was disclosed that Locast generated more than $4.3 million revenue, netting $1.9 million after $2.4 million in operational expenses. The Judge stated that the requirement to pay to avoid interruptions, is “not merely a recurring gift to a charitable cause.”
Locast contends that the profits are used to expand to new markets, which the Judge explained is not part of the exemption.
In a statement, Locast’s attorney R. David Hosp, Partner Orrick, Herrington & Sutcliffe said:
“We are disappointed in the ruling today and disagree with its conclusions and reasoning. Our client is in the process of evaluating the decision and formulating next steps. Locast provides a valuable service to its over 3 million users who are otherwise unable to access the over-the-air broadcasts to which they are entitled by virtue of their location or economic circumstances. Our client remains committed to its mission of delivering free, local broadcast TV service to all Americans, and particularly for those consumers who can’t afford pay-TV services like cable, satellite, or streaming, or who can’t get their local broadcast channels using an over-the-air antenna.”
If the case proceeds to trial, the court will now have to set a date. The Big Four media companies have already requested that it be pushed to 2022.
Locast was launched in January 2018. In July 2019, the “Big Four” filed a copyright infringement suit. The broadcasters claim that Locast is violating copyright laws. ABC, CBS, FOX, and NBC argue that Nielsen codes and other important details are stripped when Locast retransmits their signals. Locast also requires registration and gathers consumer data. The broadcasters claim that this wouldn’t be necessary if Locast was truly a nonprofit.
The streaming service filed a countersuit, accusing ABC, CBS, Fox, and NBC of collusion. Locast claims that the broadcasters interfered with a partnership with YouTube TV by “threatening business retaliation” against any potential partners.
Despite the pending lawsuit, Locast has continued to expand its reach. In late July, Locast launched service in Milwaukee, marking its 36th market nationally. With the addition, they now reach more than half the U.S. population, and as of last report had 2.8 million registered users.
Locast is a live TV streaming service offering access to local TV affiliates in 36 markets. The service has been suspended because of a legal fight with broadcasters. Whether or not it returns, viewers have other options to watch local channels for free.
While the service could be used for free, users who didn’t pay for the membership tier would get a prompt to donate every 15 minutes. After the prompt, users were kicked back to the home screen and booted off the channel they were watching.
Locast could be viewed within Sling TV on select devices.