Google’s Scoop: Piracy Verdict against Cox Communications Overturned
Cox Communications Wins Appeal, $1 Billion Piracy Verdict Reversed
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A federal appeals court today overturned a $1 billion piracy verdict that a jury handed down against Cox Communications in 2019. Judges rejected the claim that Cox profited directly from copyright infringement committed by users of its cable broadband network.
The appeals court verified the jury’s finding of “willful contributory infringement.” However, it reversed the vicarious liability verdict and ordered a new damages trial, indicating that the sum to be paid by Cox to Sony, Universal, Warner, and other plaintiffs will likely be significantly smaller.
The Verdict Under Scrutiny
On its part, Cox Communications managed to avoid a massive financial blow but did not escape blame entirely. The court’s unanimous decision clarified that Cox did not profit from its subscribers’ acts of infringement, a critical condition for vicarious liability. According to the judges, the correct legal standard was not applied in the district court, and if it had, “no reasonable jury could find that Cox received a direct financial benefit from its subscribers’ infringement of Plaintiffs’ copyrights.”
Sony and other music copyright holders initiated the legal action against Cox, alleging the ISP’s failure to adequately combat piracy on its network and terminate repeat infringers. A jury in the Eastern District of Virginia found Cox liable for the infringement of 10,017 copyrighted works.
However, Cox’s appeal argues that the multimillion-dollar piracy-related verdict has far-reaching implications. Advocacy groups, including tech policy-supportive organizations like the Electronic Frontier Foundation (EFF), have shown concern that such judgments may force internet service providers (ISPs) to disconnect users based solely on copyright infringement accusations. The court’s ruling has reignited the debate on striking a balance between safeguarding intellectual property and protecting internet access and user rights.
Profit and Infringement
The recent court ruling established that “Sony failed, as a matter of law, to prove that Cox profits directly from its subscribers’ copyright infringement.” The court clarified that vicarious liability for copyright infringement arises when a defendant profits directly from the infringement and is in a position to supervise the infringer. In Cox’s case, the ISP argued that it does not directly profit from infringement, as subscribers pay the same monthly fee regardless of legal copyright usage.
Moreover, the ruling highlighted that the financial benefit must flow directly from the third party’s acts of infringement to establish vicarious liability. Thus, the central question in such cases becomes whether there is a causal relationship between the infringement and the financial benefit.
Key Takeaways
• Cox Communications successfully overturns a $1 billion piracy verdict that found the ISP liable for copyright infringement committed by its subscribers.
• Federal appeals court overturns the vicarious liability verdict, prompting a new damages trial where the amount to be paid to the plaintiffs is expected to be significantly smaller.
• Debate on ISPs disconnecting users based on copyright infringement accusations rekindled.
