Updated with a statement from Locast’s legal team.
ABC, CBS, Fox, and NBC scored a win against Locast in a court decision today. A New York judge has denied Locast’s request for summary judgment.
Broadcasters took legal action against Locast in July 2019, over a year after the local channel streaming service launched. ABC, CBS, Fox, and NBC sued to shut the service down. Locast responded, saying that it “provides a public service retransmitting free over-the-air broadcasts. Its activities are expressly permitted under the Copyright Act.”
While Locast has continued to use its “free” status to maintain that the service is allowed to operate a secondary transmission service, U.S. District Court Judge Louis Stanton wrote that income from the $5 donations required for uninterrupted viewing was used for expanding the service, which isn’t permitted under an exemption to the Copyright Act, Hollywood Reporter reported Tuesday.
“Since portions of its user payments fund Locast’s expansion, its charges exceed those “necessary to defray the actual and reasonable costs of maintaining and operating the secondary transmission service”, which is the only exemption granted in Section 111 (a) (5).”
In 2020, Locast’s operating costs were $2.436 million while revenue for the year totaled $4.372 million.
“On those undisputed facts, in 2020 Locast made far more money from user charges than was necessary to defray its costs of maintaining and operating its service,” the document says.
Locast’s Locast’s attorney R. David Hosp, Partner Orrick, Herrington & Sutcliffe responded with a statement, saying
“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.”