Take the line lock off and very slowly fill it with fluid on the bench. Do whatever you can to ensure there is absolutely no air in the line lock itself. Carefully reinstall it without spilling the fluid in it or allowing air to get back inside. I would then bleed the system by loosening the flare nut on the "in" side of the lock till you have no bubbles and then do the same bleeding it at the "out" port. Then bleed the brakes normally at the rear axle. This should do the trick.
If that doesn't work, try bleeding the lock on the "out" port but rotate it into different positions to help the air work its way out.
When air gets trapped in hydraulic systems, it can act just like a dam. An air bubble can completely stop fluid movement if it is in the right place. It's weird but true. Sometimes bleeding slowly can help too, since greater fluid velocity will magnify the effect of the trapped air.
