Just a few months after the Supreme Court ruled that Aereo's service is in violation of copyright law, a New York federal judge has issued a preliminary injunction against the Internet streaming service, denying the company's request for a license that would've allowed it to operate as a cable company.

"Doing its best to turn lemons into lemonade, Aereo now seeks to capitalize on the Supreme Court's comparison of it to a (cable) system", US District Judge Alison Nathan said in her ruling.

Launched back in 2012 and backed by billionaire Barry Diller's InterActiveCorp, Aereo focused on providing online television services by retransmitting broadcast television signals to consumers in real time via the Internet, for which it charged a low monthly fee but did not pay broadcasters.

In its decision, the Supreme Court had concluded that Aereo was analogous to a cable company which doesn't pay networks for programming licenses, and hence violates the Copyright Act, following which the startup changed its legal argument, and has since been pushing the courts and regulators to treat it like a cable provider, eligible for a license under the Copyright Act.

Terming it as a "fallacy", Judge Nathan rejected Aereo's claim, effectively saying that merely retransmitting airwaves doesn't make it a cable firm. "Stated simply, while all cable systems may perform publicly, not all entities that perform publicly are necessarily cable systems, and nothing in the Supreme Court’s opinion indicates otherwise", she said.

Although the ruling comes as a severe blow to Aereo, which while filing an emergency plea to Nathan in August said that the company was "figuratively bleeding to death", there's still a ray of hope, given that the judge did not include the company's DVR functions in her ruling. Aereo had argued that it would be legal to retransmit content after “a modest delay, such as 10 minutes”.

Moving forward, Nathan ordered both parties to come up with final submissions on the topic of the DVR issues. "We are reviewing the decision and evaluating our options moving forward", an Aereo spokesperson said.