America’s “Big Four” broadcast television networks have united in seeking to stop a digital app from streaming over-the-air channels to their users without the requisite retransmission consent agreements.
It will be up to a New York Federal District Court to decide whether or not their argument is strong enough to force Locast to cease the way it presently conducts business.
The NAB is fully in support of the networks, calling the David Goodfriend-led Locast a second coming of Aereo.
In a 27-page filing made Wednesday morning in U.S. District Court for the Southern District of New York, ABC, Disney Enterprises, Twentieth Century Fox Film Corp., CBS Broadcasting, CBS Studios, Fox Television Stations, Fox Broadcasting Company, NBCUniversal Media, Universal Television and Open 4 Business Productions came together as plaintiffs in filing a lawsuit against Goodfriend and “Sports Fans Coalition NY Inc.” seeking damages and injunctive relief for infringing their exclusive rights under the Copyright Act.
Goodfriend and Sports Fans Coalition NY are the parent of Locast, which describes itself as “a non-profit digital translator service streaming local broadcast TV over the Internet in select cities for free as it was always intended to be.”
But, is that legal?
“Unlike licensed cable, satellite, and streaming services, Locast neither obtains Plaintiffs’
permission nor pays for its exploitation of Plaintiffs’ exclusive rights to publicly perform their copyrighted content,” the networks assert. “Instead, Locast simply takes Plaintiffs’ copyrighted content and retransmits it to its registered users at will over the internet.”
Among Locast’s markets is New York, where it demonstrated how it could aid those in Manhattan who had difficulty receiving broadcast TV signals due to building height and line-of-sight obstructions.
In a White Paper describing the efforts in New York City, Locast noted that it could retransmit local broadcast TV signals without authorization pursuant to an exemption in the 1976 Copyright Act adopted to support government or other non-profit services that do nothing more than boost a local broadcast signal to those who cannot receive it, “without any purpose of direct or indirect commercial advantage,” and without any charge other than cost-defraying “assessments.”
But, the networks note, Locast is attempting to equate itself to a booster or translator station, which is what the Act written in 1976 focuses on.
“Locast is not a public service devoted to viewers whose reception is affected by tall buildings,” the lawsuit, filed by Gerson Zweifach of Williams & Connolly, states. “Locast is not the Robin Hood of television; instead, Locast’s founding, funding, and operations reveal its decidedly commercial purposes. Unlike legitimate booster and translator stations, Locast does not have the permission of the broadcast stations it retransmits, in New York or anywhere else.”
Locast markets are comprised of New York; Philadelphia; Boston; Baltimore; Chicago; Dallas; Denver; Houston; San Francisco; Los Angeles; Rapid City and Sioux Falls, S. Dakota; and Washington, D.C.
“We are trying to help broadcasters reach people just like you over the internet,” Locast notes. To do so, it open solicits for donations of anywhere from $5 per month to $100 per year.
Just after 1pm Eastern Wednesday, Locast counsel David Hosp of Orrick, Herrington and Sutcliffe, said, “Locast is an independent, non-profit organization that provides a public service retransmitting free over-the-air broadcasts. Its activities are expressly permitted under the Copyright Act. The fact that no broadcasters have previously filed suit for more than a year and a half suggests that they recognize this. We look forward to defending the claims — and the public’s right to receive transmissions broadcast over the airwaves — in litigation.”
But, could litigation result in a death sentence for Locast, mirroring what happened to Aereo?
Aereo was a New York-based tech company that offered a service in which the user could view live and time-shifted streams of over-the-air television on internet-connected devices. Backed by Barry Diller‘s IAC, Aereo debuted in March 2012.
On June 28, 2014, Aereo suspended its services, in the wake of a Supreme Court ruling made three days earlier that found Aereo infringed upon the rights of the copyholders — broadcast networks that are now suing Locast.
This hangs heavy over Locast and David Goodfriend, who founded it thanks to, the networks assert, “a sizable loan from a company founded by another former DISH executive.”
To make matters worse, Zweifach claims on behalf of the networks, AT&T recently disclosed a donation of $500,000 to Locast. AT&T is the owner of DirecTV, the just-renamed AT&T NOW vMVPD service, and U-Verse.
This is where Locast’s distribution gets thorny — and, perhaps, sets up a very tough counterargument for Hosp.
To avoid obtaining retransmission consent agreements from local broadcasters, Zweifach suggests, DISH is promoting a version of its Sling TV internet television service that does not carry local broadcast channels by telling potential customers that they can “supplement” Sling TV by getting the broadcast channels via Locast.
Because of this, the networks argue, “Locast is not the noncommercial, community public service it purports to be. It is a strategic play funded by and functioning for the benefit of decidedly commercial interests.”
The NAB agrees.
Dennis Wharton, EVP/Communications for the broadcast media industry advocacy group, said, the NAB “wholeheartedly backs today’s lawsuit against Locast. This firm is thinly disguised as a not-for-profit entity that mirrors failed predecessors Aereo and FilmOn in its bid to legitimize the theft of local TV broadcast signals. Locast is all about gaining a commercial advantage for its backers and others in violation of U.S. copyright law to the detriment of local broadcast TV viewers. We’re confident the courts will see through the AT&T/DISH/Locast ruse and uphold the integrity of U.S. copyright laws that sustain the economic viability of local broadcasting.”
