Court Rebuffs Record Industry In Battle Over Piracy By Broadband Users

Rebuffing the record industry, a federal appellate court said Tuesday it will not reconsider its recent decision to grant Cox Communications a new trial over allegations that it contributed to piracy.

The move lets stand a decision issued earlier this month by a three-judge panel of the 4th Circuit Court of Appeals, which reversed a $25 million verdict against Cox. The dispute dates to 2014, when the record label BMG sued Cox because its subscribers allegedly shared pirated files online. BMG argued that it informed Cox about subscribers' infringement, and that the broadband provider failed to take adequate measures to discourage piracy by users.

A jury decided in 2015 that Cox was liable for users' copyright infringement. That decision marked the first time that an Internet service provider was held responsible for piracy by users.

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Cox then appealed to the 4th Circuit, which ruled that the company would only have been liable for contributing to piracy if it knew about acts of infringement, or was willfully blind to them. The three-judge panel deciding the case ruled that Cox was entitled to a new trial because the judge at the original trial incorrectly told the jurors they could find Cox liable if it knew or should have known about infringement by users.

"The formulation 'should have known' reflects negligence and is therefore too low a standard," the appellate judges wrote. "Because there is a reasonable probability that this erroneous instruction affected the jury’s verdict, we remand for a new trial."

BMG then asked the entire 4th Circuit to reconsider that ruling. The Recording Industry Association of America and National Music Publishers' Association supported that request, arguing that the original jury instructions were correct.

The 4th Circuit Court of Appeals rejected that request in a two-sentence order, which said only that none of the judges on the circuit requested a vote on the record industry's application for reconsideration.

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