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"Cancelling donation" was simply cancelling the subscription service that repeated the donation. Locast took care of that cancellation when they ceased providing a service (cancelling then future recurring payments). There are notes on their website about changing donation level and frequency that explain how to avoid being charged both monthly and annually. "Cancelling donation" did not involve any refund for unused time left on the subscribed period. It just prevented the donation from recurring.
 

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Like I said earlier, the Locast website would not let me cancel my existing donation. However, just for the heck of it, I went ahead and submitted my Locast Cares application anyway. Who knows? Maybe I will get a year of free service if and when they ever resume operations.
You're basing that on the court's "fee for service" determination instead of it being a donation with no strings attached other than removing the promos. If/when an appeals court over rules the early ruling, what will you base your claim on then?
 

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Opinion and Order

Based on the undisputed facts, it is clear that the Locast service is not offered without charges other than those "necessary to defray the actual and reasonable costs of maintaining and operating" its service .

The payments defendants elicit from users are charges assessed on users to avoid constant service interruptions, regardless of whether defendants euphemistically call them publicly "recommended donations". Locast users pay the minimum $5 monthly fee in exchange for month-long , uninterrupted service. It is not merely a recurring gift to a charitable cause. It is of no consequence that a number of users employ the service without paying. SFCNY still solicits, and receives, substantial amounts in charges from recipients for its uninterrupted service.

In 2020, Locast's total costs (including depreciation) were $2.436 million. According to defendants, those costs "represent what it costs to operate the Locast service in 2020, when the Locast service began operating in 16 markets and gradually expanded to 25 markets." Locast's total revenue in 2020 was $4.519 million, comprised of $4.372 million from users and $147,161 from other sources. 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.

Defendants argue that Locast's funding qualifies for the statutory exemption because payments from users are reinvested in the organization to cover costs of "maintaining an operating an expanding system", and the costs of expansion are part of the operation.

Defendants aver that contributions from users are essential to the expansion of the Locast service. They argue that disallowing use of the assessments for that purpose would prevent expansion, which they say was not intended by Congress when granting the exemptions.

But under the statute, income made from charges to recipients can only be used to defray the actual and reasonable costs of maintaining and operating the service, not of expanding it into new markets. The argument that Section lll(a)(5) should not "prevent" a natural process of expansion misconceives the statutory structur . Retransmissions (i. e., secondary performances of copyrighted matter) are already penalized
("prevented") by the Copyright Law in its main section. See 17 U. S. C. § 501 ("Anyone who violates any of the exclusive rights of the copyright owner .. is an infringer of the copyright or right of the author, as the case may be.". Nothing in Section 111 specifies that an expansion of the number of infringing transmissions is exempt from that law, and it is not for a court to infer that Congress really meant to allow them. It would have been simple for Congress to add one word to paragraph (5) to make it read ".. costs of maintaining, expanding, and operating the secondary transmission service." But expansion is nowhere mentioned, and it is therefore excluded from the short, tightly-crafted grant of exemptions.

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).

[Court document references removed. "Undisputed facts" are those that Locast did not dispute.]
This is why I believe bookkeeping may have saved Locast. They could have continued to accept a fee from users but needed to have a separate donation for expansion (or anything else not allowed by user fees). In my opinion, they should have had a 100% separate donation mechanism for service expansion and not required users to donate toward expansion in order to receive service.

Locast was finished off by "undisputed facts". They agreed that they performed the retransmission and collected funds for expansion as part of the fee they charged for preferred uninterrupted service. The only dispute they maintained was over how the law allowed them to spend the donations. An appeals court (if one hears the case) cannot overturn "undisputed facts". They can only rule on disputed issues.

20-20 hindsight. Locast should have charged $2/mo or $24/year for access and had a separate fund for expansion. Doing so would have increased the number of subscribers so they would need to watch the economy of scale to make sure their access fee remained at or below the cost of retransmission.
 

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You're basing that on the court's "fee for service" determination instead of it being a donation with no strings attached other than removing the promos. If/when an appeals court over rules the early ruling, what will you base your claim on then?
Wow, that was fast! My Locast Cares application was Approved! :)
I got this email from Locast last night:
"Hello,
Locast has approved your request to be part of the Locast Cares Program. This gives you uninterrupted access to Locast even though you cannot help support our mission financially.
The Locast Cares Program is a limited offer and provides one year of uninterrupted Locast service. Your account has already been updated and you should now be able to watch Locast without donation requests.
If you experience any issues viewing your service, please submit a ticket at https://helpcenter.locast.org.
Thank you,
The Locast Team"

I logged into my account, and it still says that my membership is set to expire on March 17, 2022. So, I still have no idea if this supposed "one year of uninterrupted Locast service" (assuming service ever resumes) would last until:
  • One year from when my original membership was set to expire (March 17, 2023)
  • One year from when my Locast Cares application was approved (September 23, 2022)
  • One year from whatever date service actually resumes,
  • One year from the date service actually resumes, plus an additional credit for the previously paid (but undelivered) time, or
  • I would need to reapply whenever service resumes, regardless of any previously paid or previously approved free period.
In any event, I did whatever was currently in my power to try to get some kind of extension on my service period, and I did not have to make any additional donation to Locast in order to do so. So, this process (detailed in post number 195) may still be worth trying for anyone else who is in a similar situation to the one I was left in.

If the appeals court over rules the early ruling (lifts the permanent injunction) then service should resume at that point.
 
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So, I got my Homerun receiver for my network and.... not good.

View attachment 31728

Either my antenna needs alignment, or I need a signal booster. DFW has more than two OTA channels.
I moved my antenna around and depending on the direction, I got some channels and not others. The trick was to find the sweet spot. I'm sure you will have one if you keep moving it around.
 

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From the section of the court order quoted above in post number 202:
"But under the statute, income made from charges to recipients can only be used to defray the actual and reasonable costs of maintaining and operating the service, not of expanding it into new markets. The argument that Section lll(a)(5) should not "prevent" a natural process of expansion misconceives the statutory structur . Retransmissions (i. e., secondary performances of copyrighted matter) are already penalized
("prevented") by the Copyright Law in its main section. See 17 U. S. C. § 501 ("Anyone who violates any of the exclusive rights of the copyright owner .. is an infringer of the copyright or right of the author, as the case may be.". Nothing in Section 111 specifies that an expansion of the number of infringing transmissions is exempt from that law, and it is not for a court to infer that Congress really meant to allow them. It would have been simple for Congress to add one word to paragraph (5) to make it read ".. costs of maintaining, expanding, and operating the secondary transmission service." But expansion is nowhere mentioned, and it is therefore excluded from the short, tightly-crafted grant of exemptions."


I did some more thinking about this. If the law had been written the way the court had suggested it should be written in order to allow expansion, then what would happen if Locast had successfully expanded to cover every market in the United States? Would Locast then be allowed to expand even further than that? Where do they go from there? Could funds collected from subscribers in the United States be used to cover the costs of delivering stations in Canada and Mexico? Where does it end? It seems to me that if Locast had not only been allowed, but actually required, to spend all remaining funds collected toward expanding their service, then it would not really be quite as simple as the court seems to be envisioning.
 

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The law does not allow user fees to be used for expansion. Any "what ifs" beyond that is irrelevant.
 

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The law does not allow user fees to be used for expansion. Any "what ifs" beyond that is irrelevant.
On the flip side of that, how are they supposed to be able to launch a service in the first place? Carrying their very first channel in their very first market would be an "expansion." Some reasonable amount of expansion must be allowed, or else that section of law holds absolutely no meaning at all. There is plenty of precedent for courts finding that Congress does not pass laws that cannot actually be used. If Congress put the exception into the law, then that means that Congress intended for that exception to actually be used by someone. The questions then are: who, where, when, how, and why?
 

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Some reasonable amount of expansion must be allowed, or else that section of law holds absolutely no meaning at all.
The service can expand all that the provider wants. The law does not prohibit expansion. The law (as written) prohibits spending the donations users paid for access on expansion. They needed to get their expansion donations from sources other than users paying for service. In my opinion a separate "service expansion fund" would have solved the problem - going back and retroactively reclassifying donations does not solve the problem.
 

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The law (as written) prohibits spending the donations users paid for access on expansion.
I still say that must leave Locast with a whole lot of money that they are now no longer allowed to spend on anything. Somebody must be earning interest on those funds, unless Locast's access to the money is now locked completely (seized by the government).
 

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it would be interesting to see the breakdowns of the cost per stations along with who makes what..
Yes, just like it would be interesting to know the actual dollar figures involved in the retrans agreements. But don't hold your breath waiting for either one to be made public...
 

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I still say that must leave Locast with a whole lot of money that they are now no longer allowed to spend on anything. Somebody must be earning interest on those funds, unless Locast's access to the money is now locked completely (seized by the government).
SFCNY is the underlying non-profit entity that received the donations. I don't believe the government would have any basis for seizing any Locast related funds from them since the court ruling did not include any financial penalties.
 

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SFCNY is the underlying non-profit entity that received the donations. I don't believe the government would have any basis for seizing any Locast related funds from them since the court ruling did not include any financial penalties.
Well, if the money is not being spent (per the court ruling that it cannot be spent on anything other than providing service) but is earning interest, then I wonder if that interest income would still be attributable to income earned "from service fees." Or, would such income be indirect enough that the interest earned on those funds would be allowed to be spent toward expanding service? (This may not help Locast, while they are subject to the permanent injunction. However, any other organization thinking about setting up a similar service may be interested in the legal status of such interest income.)
 

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Well, if the money is not being spent (per the court ruling that it cannot be spent on anything other than providing service) but is earning interest, then I wonder if that interest income would still be attributable to income earned "from service fees." Or, would such income be indirect enough that the interest earned on those funds would be allowed to be spent toward expanding service? (This may not help Locast, while they are subject to the permanent injunction. However, any other organization thinking about setting up a similar service may be interested in the legal status of such interest income.)
I expect the legal fees are adding up as Mr. Goodfriend and the EFF prepare for an appeal of the judges mis-application of the law (my opinion). At no time did Locast ask for payment of any "service fees", they only asked for "donations" that were rewarded with the removal of the donation pitch. The court ruled that the law did not allow the donations to be used for expansion, but neither does the law prohibit expansion. The court ruled that all the donations were in fact "service fees", when the law only says "without charge to the recipients of the secondary transmission other than assessments necessary to defray the actual and reasonable costs of maintaining and operating the secondary transmission service." In my opinion, the court can't have it both ways. If the donations collected are considered by the court to be "assessments" that can only be used to maintain the service, then any amounts collected above those costs must by definition actually be "donations" to the non-profit that can be used for other purposes. Such as expansion of the service...

I'm really looking forward to seeing what the appeals process shows us. I won't be surprised to see the 10th Amendment brought up. "The powers not delegated to the United States by the Constitution, nor prohibited by it to the states, are reserved to the states respectively, or to the people."
 

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Another thing that occurred to me: If another organization tried to set up a similar service while Locast is still subject to the permanent injunction, would Locast be allowed to donate to that other organization? Or does the injunction prohibit Locast from having anything to do with any streaming service, even if Locast is not the organization operating it?

I'm really looking forward to seeing what the appeals process shows us. I won't be surprised to see the 10th Amendment brought up. "The powers not delegated to the United States by the Constitution, nor prohibited by it to the states, are reserved to the states respectively, or to the people."
I like the principle of the 10th Amendment. Of course, that could lead to Locast (or any successor organization) needing to obtain a license from each state in which the service operates.
 

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Another thing that occurred to me: If another organization tried to set up a similar service while Locast is still subject to the permanent injunction, would Locast be allowed to donate to that other organization? Or does the injunction prohibit Locast from having anything to do with any streaming service, even if Locast is not the organization operating it?
Keep in mind that Locast is not the non-profit collecting the donations, SFCNY is.In reading the court ruling, I don't see anywhere that they say how the donations can be spent since the Locast service is shut down.

I like the principle of the 10th Amendment. Of course, that could lead to Locast (or any successor organization) needing to obtain a license from each state in which the service operates.
State licenses would only be needed if the individual states passed their own laws prohibiting the service. I don't see that happening, so the "or to the people" part of the 10th would apply as I see it.
 
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