ABC, CBS, Fox, and NBC are suing free TV streaming app Locast

Broadcast TV streaming app Locast had hoped that qualifying itself as a not-for-profit might be enough to avoid the wrath of the major networks and the same demise as Aereo.

It was wrong on the first part. We’ll have to see about the second.

Today, all four of the big broadcasters — ABC, CBS, Fox, and NBC — filed a lawsuit against Locast under the argument that the free service is violating copyright law by retransmitting their also-free over-the-air television signals to its customers.

Locast doesn’t charge for streaming access, but it encourages users to make donations in order to keep the service running. “We really did our homework,” David Goodfriend, Locast’s founder, told The New York Times earlier this year. “We are operating under parameters that are designed to be compliant within the law.”

At that point, Locast had drawn in over 60,000 subscribers, and the broadcasters had already taken notice but not yet taken action. Now, here we are. Goodfriend said he was ready for a potential face-off with ABC, CBS, Fox, and NBC. There’s an exemption in copyright law for retransmission by a nonprofit, and that’s what the company will bet its defense on. A court loss could be damaging for the networks, but that’s not dissuading them from trying to sue Locast into oblivion.

Locast believes its not-for-profit status protects it from copyright lawsuits

“Locast’s operation is an acknowledged effort to devalue the entire market for the rights to retransmit Plaintiffs’ copyrighted content,” the court filing reads. “Indeed, Defendants have candidly admitted that their unauthorized streaming service aids authorized services that pay for the rights to stream or otherwise retransmit over-the-air broadcasts in their efforts to negotiate lower fees for those rights.” This likely references a report that Charter representatives were briefly pointing customers toward Locast during a blackout that stemmed from a retransmission fee dispute.

But the broadcasters are going a bit further and pulling AT&T and Dish into this fight because of their support of Locast. “Locast not only is securing important commercial advantages for itself, in forms including nationwide distribution of its application and valuable viewer data, but it is also operating in collaboration with, and for the commercial benefit of, two companies that are among the largest pay-TV distributors in the country,” the complaint reads. Having Locast as a convenient backup would make TV providers more willing to drop local stations from their cable packages, the broadcasters are arguing.

The broadcasters claim Locast is unlawful and could make it easier for TV providers to drop local stations

AT&T added the Locast app to DirecTV and U-verse set-top boxes back in May and has contributed funding to the service. That level of integration seems a step too far for the networks. As for Dish, Goodfriend previously worked at the satellite provider under Charlie Ergen, who has regularly criticized the rising retransmission fees that networks collect. “No, Charlie hasn’t given me any money,” Goodfriend told the Times. “Charlie just said, ‘Good luck.’’ ABC, CBS, Fox, and NBC seem to believe that the connection runs deeper than goodwill and motivational support.

This situation is somewhat similar to that of Aereo, a paid subscription service that provided access to the big four broadcast networks. Aereo’s defense was different: it gave every subscriber their own mini-antenna and insisted this strategy adhered to the law. The broadcasters vehemently disagreed, and the case went all the way to the US Supreme Court where Aereo was handed a defeat that quickly put it out of business.

The parallel is not lost on the broadcasters. “Locast is simply Aereo 2.0, a business built on illegally using broadcaster content,” the lawsuit says. “While it pretends to be a public service without any commercial purpose, Locast’s marketing and deep connections to AT&T and Dish make clear that it exists to serve its pay-tv patrons.”

“Locast is not the Robin Hood of television. Instead Locast’s founding, funding, and operations reveal its decidedly commercial purposes.”

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