Court Slams Cox With $1B Copyright Fine

In a very unwelcome holiday present, a Virginia federal court jury slammed Cox Communications with a $1 billion verdict late last week in a copyright infringement case that accuses the MSO of willfully allowing its subscribers to download music illegally.

The suit, filed in U.S. District Court for the Eastern District of Virginia in July 2018, claims that Cox allowed its customers to download copyrighted songs illegally even after it was notified by music publishers that this was happening. Some 53 music publishers, including such major ones as Sony Music Entertainment, Universal Music Group and Warner Music, sued Cox over the downloads.

In all, the publishers toted up 10,017 instances of copyright infringement by Cox customers. The Virginia jury ruled that all of these instances had merit, calculating a value of $99,830.29 for each work to establish the grand total of $1 billion.

Calling the verdict "unwarranted and unjust," Cox plans to appeal the ruling to a higher court.

The suit alleges that Cox "deliberately refused to take reasonable measures to curb its customers from using its Internet services to infringe on others' copyrights -- even once Cox became aware of particular customers engaging in specific, repeated acts of infringement." The music publishers said they sent "thousands" of notices to Cox about the acts but the cableco, instead of working with them to halt the copyright infringements, "imposed an arbitrary cap on the number of infringement notices it would accept from copyright holders, thereby willfully blinding itself to any of its subscribers' infringements that exceeded its 'cap.' "

The publishers also argue that Cox refused to cancel the service of customers who were illegally downloading the copyrighted materials. Instead, the publishers claim, the MSO only carried out " 'soft terminations' with virtually automatic reinstatement, or it simply did nothing at all."

Taking a victory lap, the Record Industry Association of America (RIAA) said the ruling should put other US broadband providers on notice as well. "The jury's verdict sends a clear message -- Cox and other ISPs that fail to meet their legal obligations to address piracy on their networks will be held accountable," RIAA's chief legal officer Kenneth Doroshow said in a statement. "The jury recognized these companies' legal obligation to take meaningful steps to protect music online and made a strong statement about the value of a healthy music ecosystem for everyone -- ranging from creators to fans to the available outlets for legitimate music consumption."

For its part, Cox expressed deep disappointment with the verdict and said it plans to vigorously appeal the judgment. The cableco argues that it should not be held responsible for the bad behavior of some of its customers.

"The judgement is unwarranted, unjust and an egregious amount," Cox said in a statement. "Today, you can download a song for a dollar. This judgement is for nearly $100,000 per song. We plan to appeal the case and vigorously defend ourselves. We provide customers with a powerful tool that connects to a world full of content and information. Unfortunately, some customers have chosen to use that connection for wrongful activity. We don't condone it, we educate on it and we do our best to help curb it, but we shouldn't be held responsible for the bad actions of others."

Cox also stressed that it was the first ISP to develop a graduated response system for handling notices from copyright holders, developing a model for the record industry. In addition, it argued that it "continues to provide top-rated Internet service," which supports the music industry's shift to a streaming model and that "no one, including Cox, profits from or markets to those who choose to illegally download copyrighted works."

— Alan Breznick, Cable/Video Practice Leader, Light Reading