ISPs may face ‘huge liabilities’ for music use after BMG’s $25m payout from Cox

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BMG enjoyed a major legal victory over ISP Cox Communications last Monday (August 8) –  a ruling which may have widespread repercussions for online copyright infringement in the US.

Eastern Virginia District Court dismissed Cox’s appeal of an earlier verdict, which ordered Cox to pay BMG $25m in damages for copyright infringement.

The court decided that Cox did not do enough to stop users pirating music from BMG, and therefore did not qualify for Digital Millennium Copyright Act (DMCA) ‘safe harbor’ protections.

Crucially, BMG provided evidence that it had identified individual infringers and then alerted Cox to their wrongdoing.

Rightscorp, one of the world’s best-known providers of litigation services against online copyright infringers, is celebrating BMG’s victory – and suggesting Cox’s payout may spell worrying news for other ISPs in the States.

In a statement, Rightscorp said: “For nearly five years, Rightscorp has warned US internet service providers (ISPs) that they risk of incurring huge liabilities if they fail to implement and enforce policies under which they terminate the accounts of their subscribers who repeatedly infringe copyrights.

“Over that time, many ISPs have taken the position that it was simply impossible for an ISP to be held liable for its subscribers’ actions – even when the ISP had been put on notice of massive infringements and supplied with detailed evidence.

“There had never been a judicial decision holding an ISP liable.

“That all changed [last] Monday, when the first court to decide the issue held that an ISP can, indeed, be liable for the infringing activity of its subscribers.”

“Many ISPs have taken the position that it was impossible for them to be held liable for their subscribers’ actions… that all changed last week.”

Rightscorp isn’t just hopeful of this outcome on principal.

The company posted a $3.43m net loss last year (2015), following a $2.85m net loss the year before.

Turns out – who knew? – making money from piracy isn’t easy. But now, Rightscorp thinks it may have the precedent it needs to turn around its fortunes.

“Although Rightscorp was not a party in this case, we are delighted with the outcome. The Federal District Court declared the liability of ISPs to be precisely what Rightscorp has been saying it is for years,” said Rightscorp CEO Christopher Sabec.

“With this final Federal Court ruling, not only has our position on ISP liability been confirmed, but our Company’s technology and processes for collecting and documenting evidence of peer-to-peer copyright infringement on ISP networks has been validated as well.”

Sabec added, “As we have consistently told ISPs, we stand ready to assist those ISPs that desire to work in a constructive way with the copyright community in order to reduce the massive infringements that occur every day on their networks.

“But our company has also amassed a vast amount of data documenting infringements that have occurred over the past five years on the network of essentially every ISP in the country. That data will be made available to copyright holders that wish to enforce their rights against ISPs that are not inclined toward a cooperative solution.”

Sabec concluded by saying, “Whether this ruling results in cooperative initiatives between ISPs and copyright holders or further litigation between them, our Company expects it will be part of the process. We are proud of the value that we have brought to our shareholders by assisting in the effort that produced Monday’s ruling.”Music Business Worldwide

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