The same New York District Court judge that forced a temporary shutdown of Locast, which streamed over the air broadcasts inside their communities of service, has dealt what is likely a final death blow against the non-profit group, issuing a permanent injunction that forbids the service from operating.

Judge Louis L. Stanton signed the two-page permanent injunction on Wednesday:

ORDERED that, Defendants, along with their officers, agents, servants, employees, attorneys and other persons who are in active concert or participation with Defendants or the officers, agents, servants, employees, or attorneys (if they receive actual notice pursuant to Rule 65 (d) (2) of the Federal Rules of Civil procedure) are permanently restrained and enjoined from operating Locast.

Two weeks earlier, Judge Stanton found Locast’s arguments that it was operating legally under an exemption to the Copyright Act to be uncompelling. Locast had argued it was operating a translator service on a not-for-profit basis, offering TV stations improved coverage within their broadcast service area at no charge to station owners or viewers. But Judge Stanton found Locast was nagging viewers with persistent requests for donations, interrupting the signal every 15 minutes for those who did not contribute at least $5 a month. In his mind, that made Locast a de facto subscription service, and an apparently profitable one, collecting at least $2 million more than it needed to operate the service in the past year.

Stanton ruled Locast’s profits disqualified the service from being considered exempt from the Copyright Act, and rejected Locast’s arguments that as a translator service, it did not need the permission of local stations to stream their signals.

Locast earlier predicted it planned to appeal. Unless it does and wins an appeal ruling in its favor, the three-year old service will remain permanently closed down.

Locast, like Aereo and Ivi before it, has ceased streaming local, over the air television signals on a non-profit basis after a New York federal court judge ruled the service is violating U.S. copyright law by receiving more funding than it needs. But in developments this afternoon, there is word an appeal is planned.

Since January 2018, Locast has attempted to provide its service legally by operating as an independent “translator service,” extending streams of over-the-air signals to viewers within the acknowledged viewing range of the stations. Locast used geofencing technology to block more distant viewers, and sought support for its service with a suggested contribution of $5 a month. Non-paying viewers were nagged with donation request messages that interrupted each stream every 15 minutes.

Despite its limited service areas, Locast amassed over 3 million regular users in its 36 served TV markets over the last three years. That growth represented a threat to lucrative retransmission fee revenue collected by TV station and network owners, who promptly sued Locast in federal court in 2019. A part of that lawsuit was decided Tuesday in favor of the broadcasters.

Judge Louis L. Stanton rejected Locast’s claim it was exempt from Section 111 (a) (5) of the U.S. Copyright Act, which allowed it to stream over the air signals without getting permission from those stations in advance. That section of the Copyright Act was designed to provide a loophole for independent non-profit translator stations, which in some rural areas pick up difficult to receive TV stations and rebroadcast them locally on other channels. Some of these translator operations existed before the days of cable and satellite television, and well before the internet as we know it ever existed. But many of these services were provided through low-power transmitters operated inside large apartment complexes or hotels for the enjoyment of tenants or guests. The Copyright Act allowed groups to retransmit TV signals as long as they lacked “direct or indirect commercial advantage” and did not charge viewers in excess of the “actual and reasonable costs of maintaining and operating the secondary transmission service.”

What got Locast in trouble with the judge is the fact the service nagged viewers to make $5 donations if they wanted the nagging messages to end, and those contributions delivered healthy revenue to Locast of $4.51 million in 2020, while the costs to provide the service were just $2.43 million that same year.

“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,” Judge Stanton wrote. Stanton also rejected arguments that excess revenue was used to expand Locast into new markets, claiming the law was quite clear limiting charges only to the “actual and reasonable costs” incurred providing the service, not for expanding it. Stanton ruled Locast could not charge viewers to raise funds to expand into new markets. Had Judge Stanton accepted Locast’s argument that it was pouring excess revenue into expanding its service, not to make a profit, the broadcaster’s legal case could have been seriously weakened and Locast would have continued operating pending the final disposition of the lawsuit.

Instead, perhaps bowing to the court’s judgment that Locast’s contribution system was hampering its case, last evening Locast notified users it was suspending requests for contributions aired every 15 minutes, and hoped supporters would continue contributions anyway. But early this morning, Locast went further and announced the immediate suspension of its video streaming service.

In an e-mail to supporters, Locast announced:

We are suspending operations, effective immediately.

As a non-profit, Locast was designed from the very beginning to operate in accordance with the strict letter of the law, but in response to the court’s recent rulings, with which we respectfully disagree, we are hereby suspending operations, effective immediately.

Thank you.

Judge Stanton

The Electronic Frontier Foundation (EFF), which has supported Locast with legal assistance in this case, criticized the judge’s ruling.

“We are disappointed that the court ruled against Locast on its copyright defense,” the EFF said in a statement. “The court interpreted the law in an artificially narrow way. Congress wrote copyright’s nonprofit retransmission exception to make sure that every American has access to their local broadcast stations, and expanding access is exactly what Locast does.”

The EFF said Judge Stanton’s ruling may not be the end of Locast, however.

“Locast has decided to suspend its operations. The case will continue, likely including an appeal, to resolve the remaining issues in the case. The problem remains: broadcasters keep using copyright law to control where and how people can access the local TV that they’re supposed to be getting for free,” a lawyer at the EFF said in a statement.

Theoretically, Locast could be restructured to spin off each of its markets into independent non-profit entities responsible for raising funds to maintain current operations and possibly be found “legal” under the U.S. Copyright Act provisions. New markets could be launched independently as well, starting with fundraisers to launch the service and then additional fundraising to maintain each operation.

Any legal appeal would likely be based on Stanton’s determination that “expansion” was disallowed under the Copyright Act, even though most non-profit entities raise funds to expand their operations all the time.

But for now, Locast will likely remain dark until the remaining legal issues are settled or determined.

Cleveland, Ohio area residents now have access to over 70 over-the-air channels from northeast Ohio thanks to the efforts of Locast, a nonprofit service that streams local broadcast stations online with the request of a monthly donation.

The Cleveland broadcast market includes the cities of Cleveland, Akron, Ashland, Ashtabula, Canton, Mansfield, and Sandusky and encompasses almost four million viewers. Locast’s app and website use location verification to provide service only to those living or traveling inside one of their 30 service areas. To access Cleveland-area stations, online viewers must be inside Ashland, Ashtabula, Carroll, Cuyahoga, Erie, Geauga, Holmes, Huron, Lake, Lorain, Medina, Portage, Richland, Stark, Summit, Tuscarawas, or Wayne County.

Among the stations included: WKYC NBC 3, WEWS ABC 5, WJW FOX 8, WOIO CBS 19, PBS and PBS Kids, as well as DABL, Univision, Azteca America, CourtTV, Mystery, MeTV, TrueCrime, QUBO, Circle, The CW, BOUNCE, Movies!, LAFF, COMET, cheddar, ION, GRIT, Charge!, and more.

Locast now has more than 2.5 million registered users nationwide in 30 markets reaching approximately half of the U.S. population. In 2020, Locast added over 1 million users. The service selects new cities to cover based on donations and requests. Locast also looks favorably on requests that volunteer a safe and permanent location where it can locate its equipment to receive and stream over the air stations.

A small sample of Locast’s program guide for Phoenix viewers.

Internet customers in Phoenix and Atlanta can now watch local, over the air TV stations for free thanks to Locast, a not-for-profit streaming TV service that is fighting the escalating costs of online streaming of network and local television programs.

That brings a total of 15 cities to the Locast roster, and the service has also expanded the number of stations it streams in many of its existing markets to include additional digital sub-channels it neglected previously.

Locast geofences its service, requiring viewers to allow Locast to verify location data proving a viewer is within a Locast service area. That is an effort to comply with current copyright law, which allows Locast to operate as a local relay service. That has not stopped a coalition of TV networks from suing Locast, claiming it violates that copyright law and is only masquerading as a non-profit organization. The lawsuit cites Locast’s increasingly aggressive fundraising messages found on its app and as a pre-roll streaming message each time a viewer switches channels. Some viewers claim the only way to get rid of those messages is to enroll as a donor member and contribute several dollars a month to the service.

Locast says it uses contributions to bolster its legal defense fund and also acquire equipment and resources to launch the service in new cities. Locast officials claim they will eventually launch in all 210 TV markets if contributions are adequate to cover the costs.

Locast carries all major network affiliates, independent and PBS stations, and most ethnic language and general interest sub-channels. Some religious stations are also included, but most home shopping channels and those dedicated to airing paid commercial programming 24/7 are omitted. In Atlanta, Locast carries nearly three dozen local channels. In Phoenix, 40 stations are available.

Locast does not offer time-shifting DVR service or on-demand programming. It relies entirely on live streaming, but offers viewers an on-screen program guide.

AT&T today announced it was donating $500,000 to the non-profit group behind Locast, the online streaming service offering free access to local TV stations in more than a dozen U.S. cities.

AT&T’s altruism is a thumb in the eye of high-cost retransmission consent agreements with the corporate owners of local free over the air television stations. AT&T added Locast’s app to U-verse and DirecTV receivers at the end of May, giving subscribers a quick and easy way to access over the air stations if one or more are “blacked out” over a contract renewal dispute. AT&T also continues to offer antennas to customers that integrate with both services’ electronic program guides so subscribers can quickly access their favorite channels.

The Sports Fan Coalition, the group behind Locast, will use the money to further expand its service into other cities. At present, Locast is available to almost one-third of American TV homes, amounting to more than 32 million potential viewers. But the service has a very long way to go to stream local stations from all 210 U.S. TV markets.

AT&T will likely use Locast as a leveraging tool when negotiations become heated, letting TV station owners know they can simply point customers to Locast to continue watching stations. AT&T cannot legally redistribute Locast TV streams to customers without running afoul of copyright law, but it can provide customers with access to the independent Locast app and the internet connectivity that allows that app to function. AT&T does not currently plan to drop local stations already on the lineup in favor of pointing customers to Locast. But it will let customers know that blacked out stations are still available to customers through the Locast app.