It is a nearly two-decade-old tale; record labels, publishers and other music intellectual property owners fight file-sharing of copyrighted music. Typically it has been peer-to-peer (“P2P”) services and the people who use the P2P services that have been the targets. For the most part, Internet service providers (“ISP”) have been exempt from being named as parties in music piracy lawsuits because of the Digital Millennium Copyright Act’s (“DMCA”) safe harbor provision, however that changed in a big way in 2014 when music publisher BMG Rights Management (“BMG”) sued Cox Enterprises Inc. (“Cox”) for engaging in piracy.
BMG claimed Cox violated the DMCA’s requirement that it implement a policy to combat repeat infringers of copyrighted material, and because Cox failed to implement such a policy, it was no longer shielded by DMCA’s safe harbor provision. BMG maintained that not only did it notify Cox of thousands of infringement violations, but by ignoring the notices and failing to implement a policy to stop repeat infringers, Cox had allowed its users to steal BMG’s songs. In February 2018, BMG was handed a favorable verdict and awarded $25 million in damages.
The BMG Rights Management LLC v. Cox Enterprises Inc. verdict was ultimately tossed out and a new trial was ordered, but because the Fourth Circuit court ruled that Cox had forfeited its copyright immunity for failing to terminate repeat copyrighter infringers, it was only a matter of time before other music companies and copyright owners were going to consider their options against Cox. Not surprisingly, on Tuesday, July 31, 2018, a group of major record labels (including Sony, Universal, Arista and Warner) sued Cox for having knowingly contributed to and financially benefitted from massive copyright infringement committed by thousands of its users. The lawsuit asserts the mass piracy is causing harm to the record labels, their recording artists and songwriters.
The record labels claim they have sent hundreds of thousands of notices to Cox over an extended period of time advising the ISP giant of users who are using its services to illegally download, copy and distribute copyrighted music through Internet file-sharing services. The record labels assert that Cox has arbitrarily capped the number of infringement notices it is willing to receive from copyright owners and that users who repeatedly engage in copyright infringement are never permanently banned.
The outcome of this lawsuit could have serious financial repercussions for Cox because the record labels are seeking $150,000 in damages per song from a list of over 10,000 alleged pirated works. Additionally, other ISP companies are on notice that DMCA’s safe harbor provision is not impenetrable to litigation. Stay tuned.