Supreme Court to Review $1B Cox Digital Copyright Case

WASHINGTON — The Supreme Court on Monday agreed to decide a copyright dispute between Cox Communications and major music labels that could set the stage for a landmark decision on copyright infringement liability in the digital era.

The case is Cox Communications, Inc., et al. v. Sony Music Entertainment, et al.

At issue is whether an internet service provider can be held liable for copyright infringement based on a customer’s repeated acts of theft and piracy.

Secondarily, the justices are being asked to determine what conduct by an ISP would make its alleged contribution to the copyright infringement a willful act.

In 2018, Sony Music and more than 50 other record labels sued Cox Communications, accusing it of failing to stop its users from illegally downloading pirated copies of their music through peer-to-peer protocols like BitTorrent.

In their complaint, the labels said Cox essentially ignored thousands of copyright infringement notices from them and utterly failed to take any steps to curb music piracy.

Similar lawsuits have been brought against other internet service providers, including Charter Communications and Frontier Communications.

In December 2019, a jury in Alexandria, Virginia, found that Cox had committed “willful contributory and vicarious” copyright infringement of over 10,000 works.

Under the Copyright Act, the jury could have awarded statutory damages against Cox Communications ranging from as little as $750 per infringed work, for a total of $7.5 million, up to $150,000 per infringed work, for a total of $1.5 billion.

It went for a penalty closer to the top number, awarding the plaintiff labels nearly $100,000 in statutory damages per work, for a total of $1 billion.

Cox appealed to the 4th U.S. Circuit Court of Appeals, which reversed the jury’s finding in part — it held that Cox was not vicariously liable for the actions of its consumers.

However, it also ruled that Cox was liable for contributory infringement, remanding the case back to the lower court for a new trial on the damages.

In their petition to the Supreme Court, the labels said the 4th Circuit got the case completely wrong and that its decision was at odds with earlier decisions in other circuit courts.

In response, attorneys for Cox Communications argued that the 4th Circuit’s ruling had only served to compound “confusion, disruption and chaos on the internet.”

They also said that if it was held liable for the copyright infringements of its users, it would be forced to shut down internet access for “entire households, hospitals, universities,” and others, “merely because some unidentified person was previously alleged to have used the connection to infringe.”

Among those cheering the high court’s decision to take the case was the Recording Industry Association of America, which advocates for recorded music and the people and companies that create it.

“Under the Digital Millennium Copyright Act, Congress made ISPs immune from monetary liability if they act with a modicum of responsibility — namely, that they impose real consequences on users who repeatedly violate creators’ rights — an unprecedented approach by Congress intended to demonstrate its commitment to responsible technological innovation,” the association said. “Unfortunately, Cox breached its part of that bargain.

“We are confident that on full review of the record, the court — like the trial and appellate courts did before it — will find that Cox’s willful failure to follow well-settled law contributed to massive infringement of the plaintiffs’ copyrights and will return the case to the trial court for final determination of damages,” the RIAA said.

The outcome of the case could have a profound effect on copyright enforcement in the digital age.

If the justices choose to narrow contributory liability, they could insulate ISPs like Cox from broad accountability for their users’ online conduct.

If, on the other hand, they affirm the 4th Circuit ruling, they could create an incentive for stricter compliance and termination policies across the digital landscape.

Todd Smith, spokesperson for Cox Communications, said it was similarly please the Supreme Court decided to take up the case, saying the issues being raised, “
ould jeopardize internet access for all Americans and fundamentally change how internet service providers manage their networks.”

“Today’s development supports our goal of protecting consumers, preserving open internet access, and ensuring that broadband remains a reliable resource for the communities we serve. We look forward to presenting our arguments to the Court,” Smith said.

Dan can be reached at [email protected] and @DanMcCue