A New York federal judge has dismissed a request by the streaming service Locast for summary judgment in a copyright infringement lawsuit brought by the parent companies of the four major broadcast television networks.
Locast is a registered, non-profit company that picks up live broadcast signals in nearly three dozen markets and then retransmits those signals over the Internet to users who live in a specific geographic area.
The service has fueled the ire of major broadcast networks and local station owners who complain that Locast does not compensate them financially for the programming that airs to users.
For its part, Locast claims that its operation complies with US copyright law, which allows certain non-profit companies to rebroadcast broadcast television signals to users without first entering into retransmission agreements with station owners and networks.
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Locast does not charge its users in areas of the country where its service is offered, but it interrupts a user’s video feed four times per hour until a customer agrees to donate. Locast says this donation mechanism is intended to defer the costs associated with providing the service in an area.
However, on Tuesday, a New York federal judge overseeing a copyright infringement lawsuit brought by parent companies ABC, CBS, Fox and NBC used Locast’s solicitation for donations to deny the request for judgment. summary of the streaming service, noting that the amount of money Locast brought in last year – over $ 4.3 million – was almost double the $ 2.4 million that Locast supported in spending operating.
“Based on the undisputed facts, it is clear that the Locast service is not offered free of charge other than those” necessary to cover the actual and reasonable costs of maintaining and operating “its service,” wrote the judge. District Louis Stanton in the eight-page article. order.
“The payments defendants get from users are burdens imposed on users to avoid constant service interruptions …[it] is not just a recurring gift to a charitable cause, ”the judge wrote.
Part of the problem is how Locast uses the donations it collects from its users: in addition to keeping the costs of providing the service in areas where it is available, Locast has said in the past that funds are also used to expand to other parts of the country.
While certain exemptions in copyright law allow Locast to use donations to maintain and operate the service, the judge said there is no provision in the law allowing Locast to use these funds to develop the business.
“The expansion is not mentioned anywhere, and therefore is excluded from the granting of short, rigorously designed exemptions,” Stanton wrote.
The order dismissing Locast’s summary judgment motion means the case against the streaming service is likely to go to trial. The broadcasters who are claimants in the case are seeking unspecified monetary damages from Locast and its founder, David Goodfriend, as well as an order that would effectively shut down the streaming service.
A Locast spokesperson did not return a request for comment at press time. In April, Locast said it served more than 2.5 million streaming customers.