The Supreme Court on Monday granted Cox Communications' petition to review a lower court ruling that held the company responsible for illegal music downloads by broadband subscribers.
The court's decision to hear Cox's appeal comes in a battle dating to 2018, when Sony Music Entertainment and dozens of other music companies sued Cox for allegedly facilitating piracy. The music companies alleged that they sent “hundreds of thousands” of notifications about piracy to Cox, and that the company failed to terminate repeat offenders.
Cox was found liable and, in late 2019, a jury ordered the broadband provider to pay $1 billion to the record companies -- or nearly $100,000 per work for around 10,000 pieces of downloaded or shared music. The maximum statutory damages for copyright infringement is $150,000 per work infringed.
Cox then appealed to the 4th Circuit Court of Appeals, which upheld a finding that Cox contributed to copyright infringement by failing to disconnect alleged file-sharers, but returned the matter to the trial court for a new trial on damages.
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Cox recently asked the Supreme Court to review that 4th Circuit ruling.
“The only way Cox could have avoided liability was by terminating ... internet connections,” the company wrote in its petition for intervention. “That means terminating entire households, coffee shops, hospitals, universities, and even regional internet service providers.”
Cox added that the consequences of the 4th Circuit's ruling will be “dangerous and drastic.”
“Grandma will be thrown off the internet because Junior visited and illegally downloaded songs,” Cox wrote. “An entire dorm or corporation will lose internet because a couple of residents or customers infringed.”
Cox isn't the only internet service provider sued by record labels. Verizon is currently facing a similar suit, and other broadband providers -- including Frontier and Charter -- have settled lawsuits over music downloads by users.
Verizon and other internet service providers backed Cox's petition for review, arguing to the Supreme Court that failing to disconnect suspected infringers isn't grounds for liability.
“Terminating a customer’s internet access prevents anyone from using that connection not just for copyright infringement, but also for any legitimate purpose,” the companies argue.
“Termination prevents everyone who relies on a shared internet connection -- in a household, coffee shop, office, school, library, or hospital -- from using the internet for any purpose,” the companies added. “They cannot look for a job, pay their bills, read the news, communicate with co-workers, post homework assignments, or check prescription medications.”
The Trump administration also supported Cox, arguing in a friend-of-the-court brief that liability "requires more than knowledge that others have put the defendant’s products to infringing uses."
"If Cox had explicitly or implicitly marketed its service as being particularly useful for infringers, or if it had encouraged subscribers to use Cox’s internet service to infringe, liability might be appropriate," the Department of Justice argued. "But as the court of appeals acknowledged, Cox’s business model was indifferent to whether its subscribers used the internet for lawful or unlawful purposes."
The Supreme Court hasn't yet set a schedule for arguments.