From Reuters:
Cox Communications, the cable television and internet service provider, convinced a U.S. appeals court to throw out a $1 billion jury verdict in favor of several major record labels that had accused it of failing to curb user piracy, setting the stage for a new trial on the matter.
The 4th U.S. Circuit Court of Appeals in Richmond, Virginia, ruled on Tuesday that the amount of damages was not justified and that a federal district court should hold a new trial to determine the appropriate amount.
. . . .
A Virginia jury in 2019 found Cox, the largest unit of privately-owned Cox Enterprises, liable for its customers’ violations of over 10,000 copyrights belonging to labels including Sony Music Entertainment, Warner Music Group and Universal Music Group.
. . . .
A spokesperson for Cox said that the company was pleased with the decision to set aside the verdict but disagreed with the ruling that it still infringed.
“Providing homes and businesses with the broadband service that so many depend on in their daily lives should not be a violation of copyright law,” the spokesperson said.
. . . .
More than 50 labels teamed up to sue Cox in 2018, in what was seen as a test of the obligations of internet service providers (ISPs) to thwart piracy.
The labels accused Cox of failing to address thousands of infringement notices, cut off access for repeat infringers, or take reasonable measures to deter pirates.
Atlanta-based Cox had told the 4th Circuit that upholding the verdict would force ISPs to boot households or businesses based on “isolated and potentially inaccurate allegations,” or require intrusive oversight of customers’ internet usage.
Link to the rest at Reuters
PG hasn’t read more than the summary of the case as reported by Reuters, but is surprised there was no mention of The Digital Millenium Copyright Act in the OP.
He’ll be doing a bit of poking about to determine how the DMCA worked or didn’t work for Cox.
The tl;dr version:
The 2024 opinion, and the OP, don’t spend much time on the DMCA because this case has been going since 2014 and the DMCA issues were definitively resolved against Cox (not eligible for the safe harbor) in a prior, 2018 appeal. See BMG Rights Mgt., LLC v. Cox Comms., Inc., 881 F. 3d 293, 301 (4th Cir. 2018). So the DMCA wasn’t even at issue in this opinion, thus its absence — except as to how the particular policy and evidence of “fail” was relevant to the jury’s holding of intentional infringement, which was not disturbed on appeal.
So this is actually just a delay by Cox, and a potential reduction in the damages. It has been remanded for trial, but Cox fails of the DMCA safe harbor (as of 2018) and of a defense of noninfringement (as of 2024); it’s now for retrial on damages, without the vicarious liability theory of infringement. Remember, always, that in the eyes of the guilty defendant — civil or criminal — justice delayed is justice.
Thanks for saving me a lot of time digging into DMCA details, C.
(Explanation for my overlapping posts: The first one disappeared for a while. This appears to be a WordPress/plug-in problem that PG shouldn’t have to resolve. But, in the grand tradition of externalizing customer support that has been the default in the software industry for about three decades now, he probably will have to do himself, if it’s a significant enough issue.)
This shark has read the whole case. And its predecessors. Not to mention that his work on the DMCA has been cited for two decades now, including in this opinion.
tl;dr: The DMCA was not mentioned in the OP or much in this 2024 opinion because DMCA issues had been already resolved in a prior appeal in 2018.
paid-by-the-word version: The reason that the DMCA isn’t really mentioned in the OP is that it wasn’t at issue: DMCA eligibility had been decided against Cox previously. See BMG Rights Mgt (US) LLC v. Cox Comms., Inc., 881 F.3d 293, 301–05 (4th Cir. 2018). In the 2018 decision, the Fourth Circuit determined that the evidence at the previous trial had been properly admitted, and showed that Cox was not eligible for the DMCA’s safe harbor because it had no reasonably implemented policy for dealing with repeat infringers. Id.,† citing 17 U.S.C. § 512(i) and Ellison v. America Online, Inc., 357 F.3d 1072, 1080 (9th Cir. 2004).‡ And under a doctrine called “the law of the case,” Cox doesn’t get to argue about it any more; it’s analogous to someone who was found liable, but there was a defect in the damages award, not being allowed to relitigate liability (only the damages award that was found defective).
So all that was left for the trial court to do was determine which theory or theories might support infringement, and determine damages. This time, the partial reversal is only as to the amount, because the rest of the 2024 opinion holds that on the evidence entered, Cox was contributorily liable but that the evidence did not support the jury’s verdict that Cox was vicariously liable — and the jury instructions and verdict form merged too much in calculating damages. So the remand will be only for calculating damages… unless, that is, Cox slows things down by filing a petition to have the Supreme Court hear it.
IMNSHO, this will not turn out well for Cox. Since there is an actual finding of liability, prejudgment interest will accrue in BMG’s (and its coplaintiffs’) favor as of right — back to the date the complaint was filed (November 2014), and it will continue accruing interest until the judgment, in whatever amount is finalized, is paid. Further, knocking vicarious liability out does not reduce the damages ceiling; the problem with the damages award is that it was impossible to tell how much the jury would have awarded for contributory liability alone, and that resulted from suboptimal lawyering and a suboptimal verdict form (and, perhaps, a judge who deferred too much to the parties on structuring that verdict form).
† That’s the stupid legal-citation abbreviation for Ibid., which is itself an abbreviation, and means “same source, same page number unless it says otherwise right afterward.”
‡ That’s this shark’s theory, and this shark argued and won it. It’s mine. It’s all miiiiiiiiiiiiiiiiiiiine. And it’s why this shark will never again set foot in Reston, Virginia, or at least not without an armored-infantry escort and substantial air support.