March 26, 2024
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A U.S. appeal court reportedly found in favour of American telecommunications and internet service provider, Cox Communications (“Cox”), overturning a $1 billion jury verdict awarded to several record labels in a copyright infringement dispute.
The action commenced in 2018, when over 50 record labels, including Universal Music Group, Sony Music Entertainment, and Warner Music Group, alleged Cox failed to restrict its users from downloading and distributing music without appropriate authorization. The labels specifically accused Cox of disregarding thousands of copyright infringement notices and failing to terminate subscribers alleged to have pirated music.
As a result, a Virginia jury found Cox liable for infringement of 10,017 songs owned by the various labels and awarded approximately $99,000 for each song, totaling $1 billion in damages. This is reportedly one of the largest damages awards granted in an intellectual property lawsuit.
On appeal, the Court held that the damages award was partially unjustified as “Cox did not directly profit from its subscribers’ infringement.” However, the internet provider remains on the hook for damages, as the Court affirmed its liability for contributory copyright infringement.
Accordingly, the case will reportedly be retried on the issue of damages.
Authors: Ayesha Khanna and Kasia Donovan