Supreme Court Reverses $1B Label Suit
• The U.S. Supreme Court ruled unanimously on Wednesday that Cox Communications cannot be held liable for music piracy committed by its users, rejecting a $1 billion lawsuit filed by major labels.
As reported by Variety, 53 music companies — including Sony Music, Warner Music Group, Universal Music Group, Sony/ATV Music Publishing, Warner Chappell and Universal Music Publishing Group — sued Cox Communications in 2018, alleging that Cox had ignored tens of thousands of infringement notices and allowed repeat offenders to continue to use its service, essentially turning a blind eye to the practice. Jurors awarded $99,830.29 for each of the more than 10,000 infringed works, according to Music Business Worldwide. The following year, the labels won their lawsuit with a $1 billion award.
In 2024, the 4th U.S. Circuit Court of Appeals in Richmond, VA, ruled that the $1 billion in damages was not justified, and that a federal district court should hold a new trial to decide an appropriate amount. The Supreme Court picked up the case last June, and oral arguments were held in December.
In this latest ruling, Justice Clarence Thomas wrote, “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. Accordingly, we reverse.” Thomas added, “Cox provided internet service to its subscribers, but it did not intend for that service to be used to commit copyright infringement. Holding Cox liable merely for failing to terminate internet service to infringing accounts would expand secondary copyright liability beyond our precedents.”
In response to the Supreme Court’s decision, Mitch Glazier, RIAA Chairman & CEO, commented, “We are disappointed in the Court’s decision vacating a jury’s determination that Cox Communications contributed to mass scale copyright infringement, based on overwhelming evidence that the company knowingly facilitated theft. To be effective, copyright law must protect creators and markets from harmful infringement and policymakers should look closely at the impact of this ruling. The Court’s decision is narrow, applying only to ‘contributory infringement’ cases involving defendants like Cox that do not themselves copy, host, distribute, or publish infringing material or control or induce such activity.”
