BMG Scores 'Substantial Settlement' With Cox

Cox still faces another similar suit, but settlement could cause other ISPs to tighten up their enforcement policies for digital piracy.

Jeff Baumgartner, Senior Editor

August 24, 2018

3 Min Read
BMG Scores 'Substantial Settlement' With Cox

In a settlement that could cause some other ISPs to toughen up their piracy policies, music company BMG Rights Management announced Friday that it had secured a "substantial settlement" with Cox Communications stemming from a long-standing digital copyright case.

Financial terms were not announced, but the settlement comes nearly three years after BMG was awarded $25 million in damages and $8.5 million in costs after the court found Cox Communications Inc. liable for contributory copyright infringement.

The verdict was later overturned on a technicality -- a mistake in jury instructions -- and was to be retried. Ahead of the retrial, BMG said US District Court Judge Liam O’Grady last week confirmed that BMG was entitled to use words such as "stealing" and "theft" in relation to Cox’s activities.

BMG went after Cox for contributory copyright infringement tied to Cox customers allegedly pirating the music of BMG songwriters and alleging that ISP went soft on broadband customers found to be stealing content. BMG handles rights for individual artists and bands such as Bruno Mars, Iron Maiden, Scorpions, David Crosby, Janet Jackson and the late David Bowie.

The court disagreed with Cox's assertion that the MSO was entitled to "safe harbor" from the Digital Millennium Copyright Act (DMCA), which protects internet companies from unknowingly enabling third parties to infringe on copyrighted works, though they must still have systems that seek to remove infringing content or go after infringing activity of those customers. BMG argued that Cox refused to terminate the accounts of infringers because it would cause them to lose customers.

Cox had used a "thirteen-strike policy" to handle issues, but BMG contended that Cox would not toss those pirates for good, and instead apply a "soft termination" policy in which it would quickly reinstate accounts that were temporarily disconnected, according to TorrentFreak.

"I can confirm we've reached a settlement with BMG," a Cox official said in an emailed statement. "We're honoring the confidentially agreement and not commenting beyond that."

With the settlement in hand, BMG called it a "landmark case." It also put other ISPs on notice, hoping it will persuade other US ISPs "to tighten up their procedures on copyright infringement."

"Other ISPs should take note that the law gives protection to the work of artists and songwriters. We will not hesitate to take action where necessary," Keith Hauprich, BMG North America's general counsel, said in a statement.

A group of other major labels, including Sony, Universal and Warner Bros recently filed a similar suit against Cox. That suit is still active.

Sony Music Entertainment, Warner Music, and Universal Music, represented by the Recording Industry Association of America, have also thrown the book at Grande Communications . Digital Music News reports that the RIAA offered to settle with Grande about three months ago.

Back in 2013, ISPs such as Comcast, Time Warner Cable (now part of Charter Communications), AT&T, Verizon Communications and Cablevision Systems (now part of Altice USA), participated in a so-called "six strikes" program with the Center for Copyright Information that aimed to educate, rather than punish, broadband users about pirating activities. (See ISPs Boot Up 'Six Strikes' Anti-Piracy Plan.)

Under that controversial program, "mitigation measures" such as temporary speed throttling and the redirecting of users to landing pages with information about digital piracy would ensue after six alerts were sent to a customer. Account termination wasn't part of the system, which was shuttered in January 2017, with members committing to address copyright issues voluntarily.

— Jeff Baumgartner, Senior Editor, Light Reading

About the Author(s)

Jeff Baumgartner

Senior Editor, Light Reading

Jeff Baumgartner is a Senior Editor for Light Reading and is responsible for the day-to-day news coverage and analysis of the cable and video sectors. Follow him on X and LinkedIn.

Baumgartner also served as Site Editor for Light Reading Cable from 2007-2013. In between his two stints at Light Reading, he led tech coverage for Multichannel News and was a regular contributor to Broadcasting + Cable. Baumgartner was named to the 2018 class of the Cable TV Pioneers.

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