Cox Hit With $1 Billion Verdict Over Users' Piracy

Internet service provider Cox Communications must pay $1 billion due to piracy by subscribers, a federal jury in Alexandria, Virginia decided Thursday.

The verdict stems from a lawsuit filed against Cox in July 2018 by Sony Music Entertainment and dozens of other music companies. They argued that Cox was responsible for users' piracy because it allegedly refused to take “reasonable measures” to stem copyright infringement by its subscribers.

The music companies alleged they sent “hundreds of thousands” of notifications about piracy to Cox.

“Rather than working with Plaintiffs to curb this massive infringement, Cox unilaterally imposed an arbitrary cap on the number of infringement notices it would accept from copyright holders, thereby willfully blinding itself to any of its subscribers’ infringements that exceeded its 'cap,'” the complaint alleged.

Cox says it plans to appeal.

“The verdict is unwarranted, unjust and an egregious amount,” the company stated Friday. “Today, you can download a song for a dollar. This verdict is for nearly $100,000 per song. We plan to appeal the case and vigorously defend ourselves.”

Cox previously settled a similar lawsuit by the record label BMG. Before resolving that case, Cox argued it was protected by the federal copyright law's so-called "safe harbor" provisions.

Those provisions immunize Internet service providers from liability for users' activity, but only if the ISPs have policies for handling repeat offenders.

A trial judge and the 4th Circuit Court of Appeals ruled that Cox wasn't entitled to rely on those safe harbors, because it didn't implement its repeat-offender policy.

In an opinion issued in February of 2018, a three-judge panel of the 4th Circuit wrote that Cox didn't enforce its “13-strike” repeat offender policy, which would have required the company to consider terminating subscribers after they received 13 notices of copyright infringement.

"Indeed, in carrying out its thirteen-strike process, Cox very clearly determined not to terminate subscribers who in fact repeatedly violated the policy,” the appellate judges wrote.

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