BMG, COX Settle As Major Labels Lawsuit Begins
BMG has reached a settlement with Cox Communications in its 2015 lawsuit alleging the ISP contributed to copyright infringement. BMG called the sealed settlement, originally set by a jury at $33 million, "substantial."
Cox is also fighting all 3 major labels in court. Earlier this month Sony, UMG and WMG filed suit against the cable and internet provider seeking $1.5 billion in damages.
“This was a landmark case in which BMG took on the third biggest internet service provider in the United States to defend and establish the principle that in order to benefit from a so-called ‘safe harbor’ defense, an ISP has responsibilities. While the financial terms of the settlement are confidential, we are happy they reflect the seriousness of this case.” BMG North America General Counsel Keith Hauprich said in a press statement.
“Other ISPs should take note that the law gives protection to the work of artists and songwriters. We will not hesitate to take action where necessary.”
The case stems from a 2014 lawsuit BMG brought against Cox, alleging that Cox, one of the largest internet service providers in the US, took inadequate measures to prevent its customers from repeatedly infringing on BMG’s copyrights.
During the litigation, Cox argued that it was protected by the safe harbor provision of the Digital Millennium Copyright Act of 1998, which protects companies like Google and ISPs from accusations of copyright infringement activity by users on their service, but requires that they “adopted and reasonably implemented…a policy that provides for the termination” of repeat infringers” using their services.
BMG argued that Cox was not entitled to this “safe harbor” defense because despite knowing that some of its subscribers were repeatedly infringing BMG copyrights, Cox refused to terminate the accounts of infringers because it would cost them revenue.
The judge in the case agreed with BMG and issuing a landmark ruling that Cox “knew or should have known” that its subscribers were repeatedly infringing on BMG’s copyrights and the jury awarded BMG a $33m settlement in the case
However, the case was overturned on appeal and Fourth Circuit Judge Diana Motz overturned the lower court’s rejection of Cox’s safe harbor defense. At the same time, Judge Motz was persuaded by the argument that Cox had taken insufficient steps to curtail infringing activities on its service and ordered a retrial.
Last week, with the retrial looming, US District Court Judge Liam O’Grady ruled that BMG could use words like “stealing” and “theft” to describe copyright infringement allegations against Cox, and a week later, Cox appears to have settled the litigation out of court.
The financial terms of the settlement are confidential but a statement from BMG said the company “extremely happy at the level of the settlement.”
Cox settling the case also comes against the backdrop of similar litigation filed earlier this month against Cox by a list of plaintiffs that included numerous other record labels and which cited the BMG case in its complaint.
