
Siding with Grande Communications, the Supreme Court on
Monday vacated a lower-court decision that the internet service provider contributed to copyright infringement by failing to disconnect subscribers who allegedly shared music files.
The court returned the case to the 5th Circuit Court of Appeals with instructions to reconsider the matter in light of last month's decision clearing Cox Communications of liability for failing to
terminate accused infringers. The order issued Monday clears the way for the 5th Circuit to dismiss all claims against Grande.
"Under our precedents, a company is not liable as
a copyright infringer for merely providing a service to the general public with knowledge that it will be used by some to infringe copyrights," Justice Clarence Thomas wrote in the decision in favor of Cox.
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"The provider of a service is contributorily liable for the
user's infringement only if it intended that the provided service be used for infringement," he added.
The dispute between the record companies and Grande dates to 2017, when
Universal Music Group, Warner Records and others accused Grande of contributing to piracy by failing to move against alleged file-sharers.
The record companies alleged in a
complaint brought in federal court in Austin that Grande “refused to take any meaningful action ...let alone suspend or terminate subscribers who repeatedly commit copyright infringement through
its network.”
A jury found in 2022 that Grande contributed to infringement and awarded the record companies around $47 million in damages.
Grande
appealed to the 5th Circuit, arguing that the verdict should be reversed for several reasons -- including that merely providing people with an internet connection doesn't amount to contributing to
copyright infringement.
The 5th Circuit judges rejected that argument and upheld the liability finding, though they did return the case to the trial court for a new hearing on
damages. (The jury found Grande contributed to infringement of 1,403 works, and awarded damages of $3,333 per work. But the appeals court said the 1,403 figure was too high because it included
individual songs on albums.)
Grande isn't the only company that stands to benefit from the Supreme Court's recent decision.
For instance, Universal,
Warner and Sony are suing Verizon for allegedly facilitating copyright infringement by failing to disconnect alleged file-sharers. The record companies alleged in a complaint brought in 2024 that
Verizon ignored notices about subscribers who allegedly shared thousands of tracks.
Verizon sought a fast dismissal of the lawsuit, arguing that companies that provide online
access shouldn't be held responsible for activity by subscribers.
“When people do bad things online, their internet service providers are not typically the ones to
blame,” Verizon wrote in its bid for a quick victory.
Last July, U.S. District Court Judge Margaret Garnett in the Southern District of New York paused that matter until
after the Supreme Court issued a ruling in the battle between Cox and the record labels.