Cox Loses DMCA Safe Harbor but Gets a New Trial on Contributory Infringement–BMG v. Cox

16 02 2018

BMG sued Cox for the alleged copyright infringement of its users. The court described Cox’s “graduated” policy for terminating subscribers:

The first notice alleging a subscriber’s infringement produces no action from Cox. The second through seventh notices result in warning emails from Cox to the subscriber. After the eighth and ninth notices, Cox limits the subscriber’s Internet access to a single webpage that contains a warning, but the subscriber can reactivate complete service by clicking an acknowledgement. After the tenth and eleventh notices, Cox suspends services, requiring the subscriber to call a technician, who, after explaining the reason for suspension and advising removal of infringing content, reactivates service. After the twelfth notice, the subscriber is suspended and directed to a specialized technician, who, after another warning to cease infringing conduct, reactivates service. After the thirteenth notice, the subscriber is again suspended, and, for the first time, considered for termination. Cox never automatically terminates a subscriber.

Cox also limited its processing of notes from copyright owners or agents.

BMG hired Rightscorp to monitor police infringements. Rightscorp issues takedown requests, and it asks ISPs to forward settlement requests to the subscribers. Prior to BMG having engaged Rightscorp, Comcast decided to cease processing takedown requests from Rightscorp. Rightscorp sent “millions of notices” to Cox on BMG’s behalf, but BMG never viewed any of these.

The trial court held that a reasonable jury could not conclude that Cox maintained a policy of terminating repeat infringers. BMG put forth evidence from which a jury could conclude that Cox knew of accounts being used to effect infringing activity but nevertheless failed to terminate such accounts. The case went to trial (essentially) on damages, and the verdict came back for $25MM in BMG’s favor.Case citation: BMG Rights Mgmt (US) LLC v. Cox Communications Inc., 2018 WL 650316 (4th Cir. Feb. 1, 2018).


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