[gamblor956]

The ruling argued that collecting funds to expand more throughout the US was not valid for their non-profit status for some reason that made no sense.

The law granting them the exception from copyright law that would have allowed them to stream in the first place strictly limited the way funds could be raised and spent by entities claiming the non-profit exemption.

The law is several decades old, and predates the internet. It wasn't the subject of regulatory capture by the cable companies, who were in their infancy when the law was first passed.

Locast chose not to operate like a non-profit, and made a profit on their streaming services, in violation of the law. It's really that simple.

[enzanki_ars]

Edit: Not a lawyer, and what follows is intended to be more of outlining my understanding and trying to ask clarification on what I'm clearly missing. Sorry if it sounds a bit defensive. Just a very strange lawsuit, specifically in how the service was forced to shutdown instead of being allowed to continue to operate.

Isn't that a valid use of the non-profit status? That as long as the funding from donations was going towards that expansion only, it can still be considered a non-profit? Looking at the quick Wikipedia definition, that seems to be the case, if you consider Locast's mission is to provide retransmission of OTA broadcasts to all people in the US.

> "A second misconception is that nonprofit organizations may not make a profit. Although the goal of nonprofits isn't specifically to maximize profits, they still have to operate as a fiscally responsible business. They must manage their income (both grants and donations and income from services) and expenses so as to remain a fiscally viable entity. Nonprofits have the responsibility of focusing on being professional, financially responsible, replacing self-interest and profit motive with mission motive." [1]

PBS is also a non-profit, but PBS does something similar in that certain content is locked behind their "PBS Passport" subscription. If this ruling that requiring donations view without interruption, then PBS is also violating non-profit status based on your statement regarding "Locast chose not to operate like a non-profit." But Locast attempted to resolve that and remove the interruptions entirely, but was still required to completely shutdown and was given 0 chance to adjust... My understanding about hte reasoning for shutting down is that using collected funds, via any means, expansion across the US isn't allowed for some questionable reason under the section of the law Locast was using.

[1]: https://en.wikipedia.org/wiki/Nonprofit_organization#Managem...

[gamblor956]

1) This isn't about their 501 non-profit status, it's about their use of the non-profit exemption for re-transmission of copyrighted materials through a service that would otherwise be classified as violating copyrights.

1) No, it's not a valid use of the money under the restrictions of the non-profit exemption from copyright for re-transmission. The law is quite clear on this point: revenues derived from the violating service must not exceed the actual costs of providing that service. Expansion costs are not related to the costs of providing existing service, therefore they are not permitted under the exemption.

3) PBS is not even remotely the same thing, because it's not the non-profit status that is at issue. PBS owns and/or licenses the content they broadcast and stream, so it does not need an exemption from copyright laws. Locast does not own or license the content it streams, so it does need the exemption, and it violated the explicit requirements for the exemption it needed.

4) But Locast attempted to resolve that and remove the interruptions entirely, but was still required to completely shutdown and was given 0 chance to adjust Historically, using someone's IP without their permission resulted in statutory damages, and Locast should consider themselves lucky they're not on the hook for those, as statutory damages for copyright law can be as much as $150,000 per violation* for willful violations of copyright law. * Tech was able to get away with the ask for forgiveness business model for 3 decades, but generally the law does not operate on "ask for forgiveness" basis. It's irrelevant that they got "0 chance" to adjust since the onus was on them to plan their activities in a way that complied with the law.