Late 2022, several of the world’s largest music companies including Warner Bros. and Sony Music prevailed in their lawsuit against Internet provider Grande Communications.

The record labels accused the Astound-owned ISP of not doing enough following complaints about pirating subscribers. Specifically, the labels alleged that the company failed to terminate repeat infringers.

The trial lasted more than two weeks and ended in a resounding victory for the labels. A Texas federal jury found Grande guilty of willful contributory copyright infringement, and the ISP was ordered to pay $47 million in damages to the record labels.

$47 Million Appeal

Last September, Grande filed its opening brief in which it again argued that the lower court reached the wrong conclusion. Internet providers shouldn’t be held liable for pirating customers based on third-party allegations, the company noted.

Among other things, the ISP believes that it shouldn’t have to terminate Internet access so easily. This view was supported by several telecom industry groups, who all object to disconnecting subscribers’ internet access based on copyright claims.

The record labels countered the appeal , arguing that the jury’s verdict should be upheld. Any other outcome would make it almost impossible to tackle the online piracy problem.

The labels explained that ISPs play a central role in BitTorrent-based piracy, as they are the only ones who can link an IP-address to a subscriber. This means that when rightsholders or their anti-piracy partners sent infringement notifications to Grande, the ISP was the only party that could address this conduct.

Grande Responds to Labels

This week, Grande submitted a reply brief in which it counters the music companies’ arguments. The ISP maintains that it shouldn’t be held liable for pirating subscribers, citing last year’s ‘ Twitter vs. Taamneh ‘ Supreme Court ruling.

The U.S. Supreme Court held that social media platforms aren’t liable for ISIS terrorists who used their services to recruit and raise funds. In a similar vein, Grande believes that it shouldn’t be held liable for subscribers who pirate content.

The record labels previously argued that the Supreme Court ruling shouldn’t be directly translated into a copyright context. That would essentially change the concept of contributory copyright infringement based on a case that has nothing to do with copyright, they reasoned.

Understandably, Grande believes that the Supreme Court decision is directly relevant and quite essential.

“The central contributory copyright infringement issue before the Court is whether providing internet service to a direct copyright infringer, standing alone, is sufficient to support contributory liability. The Supreme Court recently made clear that it is not,” the ISP writes.

Grande cites the Supreme Court, which concluded that it would “run roughshod over the typical limits on tort liability” to “effectively hold any sort of communication provider liable for any sort of wrongdoing merely for knowing that the wrongdoers were using its services and failing to stop them.”

“Dramatic Expansion of Copyright Liability”

The ISP notes that the record labels are essentially asking the Court to authorize a dramatic expansion of secondary copyright infringement liability. This means that if an ISP fails to take “simple measures” to stop piracy, it becomes responsible for the activity.

However, if the court of appeals relies on the recent Supreme Court ruling, Grande should not be held liable. This leaves the court with two options, Grande says.

(1) Follow the Supreme Court’s precedents on the proper scope of secondary liability for copyright infringement (as Grande argues)

(2) Deem those precedents inapplicable and instead expand contributory liability (as the district court did) by adopting the Ninth Circuit’s “simple measures”

In its attempt to avoid liability, Grande explicitly points a finger at other parties in the BitTorrent ecosystem, while also highlighting that rightsholders have the option to sue pirates directly.

Suing Pirates, Torrent Sites, or Torrent Client Devs

The record labels previously argued that it’s important to hold ISPs liable because they are the only party that can match IP addresses to individual subscribers; Grande doesn’t deny that. Instead, it points out that rightsholders can use the information to sue pirates directly.

“They can file a John Doe lawsuit against an alleged infringer known only by IP address and then serve a subpoena on the ISP to obtain their identity,” Grande explains.

The Supreme Court rejected the claim that Twitter and others aided and abetted terrorist activity because it didn’t “consciously and culpably” participate in the illegal activity. According to Grande, Internet providers are even further distanced from any wrongdoing.

Another option would be to go after the operators of torrent sites or the developers of BitTorrent clients, the ISP adds.

“The Labels can also pursue claims against people who actually induce and encourage BitTorrent file sharing, like the creators and distributors of BitTorrent software and the operators of BitTorrent websites,” Grande writes.

“That it may be easier for the Labels to sue Grande is not a legitimate basis for expanding the scope of common law contributory liability.”

Grande doesn’t explain why or when developers of torrent clients should be held liable for piracy. Popular torrent clients and sites that distribute this software are typically content-neutral and don’t actively encourage piracy. That is similar to the defense Grande relies on.

“ISPs that actively encourage infringement — for example, by instructing customers on how to engage in piracy — would be contributorily liable. ISPs that merely provide content-neutral internet access to their subscribers would not.”

Material Contribution

The ISP adds that it did not materially contribute to any copyright infringement. Instead, it argues that its actions remained distanced from any piracy activity.

“Grande neither ‘facilitated’ nor ‘provided tools for’ copyright infringement, however one might understand those terms. The only affirmative thing Grande did was provide content-neutral internet service to all its customers”

The reply again brings up the suggestion that there are many other actors who, unlike Grande, directly enable BitTorrent file-sharing. In addition to mentioning torrent client developers, BitTorrent inventor Bram Cohen, tracker operators, and hosting providers all get a mention.

“Each of these actors plays a direct role in the sharing of copyrighted music files over BitTorrent. Grande, in contrast, stands far removed from the infringing conduct,” Grande writes.

Going Forward

We assume that many of the mentioned parties will entirely disagree with the insinuation that they could be liable for piracy. Similarly, the record labels will have a different outlook on the matter as well, as will become clear as the case progresses.

The above is just a small selection of the arguments and counterpoints presented in the 70-page reply brief. Among other things, it also reiterates that would be a “draconian overreaction” to terminate Internet connections because someone in a household may be pirating.

What’s clear, however, is that the stakes are high in this case. Not just for the $47 million that’s on the line here, but also for other ISPs and their subscribers.

—

A copy of Grande’s reply brief, filed at the U.S. Court of Appeals for the Fifth Circuit, is available here (pdf) .

From: TF , for the latest news on copyright battles, piracy and more.

Early last year, a group of filmmakers obtained a subpoena, requesting Reddit to reveal the identities of users who commented on piracy-related topics.

The movie companies said they were not planning to go after these people in court but wanted to use their comments as evidence in an ongoing piracy lawsuit against Internet provider RCN.

Reddit wasn’t willing to go along with the request. Instead, the company objected , arguing that handing over the requested information would violate their users’ right to anonymous speech.

Reddit I, II and III

A California federal court eventually agreed with this defense , concluding that Redditors’ First Amendment rights outweigh the interests of rightsholders. According to Magistrate Judge Laurel Beeler, the filmmakers have other options to obtain this type of information, including through RCN itself.

A few weeks after this setback, the rightsholders filed another request , seeking similar information for use in their lawsuit against ISP Grande. This second attempt wasn’t successful either, and Redditors’ right to anonymous speech prevailed once again.

Attorney Kerry Culpepper, who represented different line-ups of filmmakers in these cases, wasn’t prepared to give up on this route to evidence quite so easily. Earlier this month he was back in court with a similar, but tweaked, request. This time it relates to a lawsuit targeting Internet provider Frontier Communications.

IP addresses & Anonymity

In general terms, this case is comparable to the others. The film companies, Voltage Holdings and Screen Media Ventures, want to use comments made by six Redditors to show that the ISP didn’t take proper action against repeat infringers, or that ‘lax’ enforcement acted as a draw to potential pirates.

Reddit, again, refused to hand over information, arguing it would violate their users’ right to anonymous speech. This prompted the filmmakers to return to court for a third time.

In their latest motion to compel, the rightsholders introduce a new angle. They are no longer looking for any names or email addresses, only the applicable IP address logs. This would allow the commenters to remain anonymous, they argue.

“Reddit asserts that the information Movants request is not permissible under the First Amendment. However, Movants’ subpoena does not request anonymous users’ identities. Rather, the subpoena is limited to requesting the Reddit users’ IP address logs,” they write.

Reddit Opposes in Court

In a response to the motion this week, Reddit counters that disclosing IP addresses would still violate users’ rights to anonymous speech, adding that no court has ever ruled otherwise.

According to Reddit, users’ IP addresses would be useless as evidence if they didn’t identify the targets in any shape of form.

“First, and most obviously, Movants’ subpoena exclusively seeks the IP addresses of the targeted Reddit users. Were IP addresses not identifying information, they would hold no evidentiary value to Movants whatsoever and the subpoena would be pointless.”

Secondly, since Reddit doesn’t require users to verify their identities, IP addresses are sensitive information. They can be used to obtain the targets’ personal information, for example, by serving a subpoena on their Internet provider.

“Movants know, the process of unmasking a Reddit user turns on Reddit’s disclosure of an IP address because Reddit does not require its users to provide their real names or addresses. For that reason, provision of an IP address is unmasking subject to First Amendment scrutiny.

“After learning an IP address, the Movants need only subpoena the ISP for the subscriber information associated with that IP address, and the ISP does not share Reddit’s interest in protecting the anonymity of that user,” Reddit adds.

Other Options Preferred

In their motion, the filmmakers haven’t explained what value the IP addresses offer in addition to the anonymous comments that are already publicly available. According to Reddit, there are other and ‘less invasive’ options for the filmmakers to get what they want.

The film companies already have IP addresses of pirating Frontier subscribers, Reddit argues. These can be used to obtain the identities of account holders, so they can be questioned for evidence.

The rightsholders previously noted that Frontier is not willing to share the identities of users, but Reddit points out that this is an outdated stance from the ISP which has since changed.

“Here, Movants again admit that they already have ‘pirating [IP] addresses’. And, as described above, Frontier has already indicated that it will provide Movants with identifying information for those IP addresses upon receipt of a subpoena,” Reddit’s opposition reads.

If allegedly pirating subscribers can be targeted directly, Reddit believes that putting the anonymity of its users at risk by exposing their IP addresses is unnecessary.

The filmmakers further argued that, unlike the ISPs’ ‘pirating IP addresses’, the Reddit comments specifically serve as evidence that lack of enforcement against repeat infringers served as a draw to potential Frontier customers.

Once again, Reddit doesn’t believe that disclosing the IP addresses of its users adds anything to the publicly available comments.

“[T]o the extent Movants are suggesting that the Reddit posts themselves are ‘documented evidence,’ Movants need not unmask the Reddit users to admit that documented evidence; Movants could lay the evidentiary foundation for, and authenticate, those posts themselves,” Reddit writes.

The response from Reddit shows that once again, it will be for the court to decide whether the company has to hand over any information. That will happen after the matter is discussed at a hearing in a few weeks.

In addition to the main question, there’s also a request pending from film companies Killing Link Distribution, Family of the Year Productions, and Laundry Films, who want to join the rightsholder’s motion.

—

A copy of Reddit’s opposition to the motion to compel, filed at the U.S. District Court for the Northern District of California, is available here (pdf)

From: TF , for the latest news on copyright battles, piracy and more.

Under U.S. copyright law, Internet providers must terminate the accounts of repeat copyright infringers “in appropriate circumstances.”

The law doesn’t specify what these circumstances are but in recent years federal courts have provided more context.

Cox and Grande Communications were both ordered to pay many millions of dollars in damages, for example. While these cases are under appeal, new ones are being filed at U.S. courts.

Internet provider RCN, which operates under the Astound brand, has been one of the most frequent targets.

The company first launched a proactive lawsuit against music rights group BMG in 2016, which ended in a settlement . In the years that followed, it was sued by several record labels , and later by film companies too .

Movie Company Lawsuit Expansion: Denied

The movie company lawsuit includes the makers of films such as The Hitman’s Wife’s Bodyguard, London Has Fallen, and Hellboy. This case is ongoing and a few weeks ago an amended complaint sought to add several new rightsholders to the case.

The amended complaint would’ve expanded the scope of the case by adding 14 additional plaintiffs and 343 new works. Since that would substantially increase the nature of the lawsuit, RCN asked the court to deny the request.

After reviewing the positions of both sides, New Jersey Magistrate Judge Tonianne J. Bongiovanni allowed some new parties to join, but not all. Specifically, the inclusion of independent movie distributor Screen Media Ventures was denied as that would expand the lawsuit with more than 320 new works.

“Plaintiffs’ proposed addition of Screen Media and its 320+ copyrighted works is an extensive broadening of the case RCN now faces, and the burden of engaging in the likely discovery, motion practice and trial associated with same would be unfairly prejudicial to RCN.

“As a result, Plaintiffs request to join Screen Media and its 320+ copyrighted works to this litigation is denied,” Judge Bongiovanni added.

Screen Media Ventures Objects

On the surface, the decision makes sense. On top of potentially adding hundreds of new films, allowing Screen Media Ventures to join would also introduce two additional piracy tracking systems to the suit. That would require substantially more work in terms of evidence vetting.

The plaintiffs disagreed. They opposed the denial pointing out that the final claims will focus on a much smaller number of works than the cited 320. Also, consolidating the claims in one case could actually save resources and offer more convenience than a separate lawsuit.

“Plaintiffs respectfully submit that the Order incorrectly assumes […] that the burdens are purely additive, whereas in fact litigating all of the issues together is vastly simpler than the alternative of having SMV file a separate complaint concerning the 320+ works,” the filmmakers write.

New Lawsuit Makes a Statement

To prove this point, Screen Media Ventures (SMV) went ahead and filed a new case that is pretty much identical to the one it previously tried to join, listing all 324 works.

In its complaint, SMV mentions that it has invested significant financial resources, time, and effort in marketing its movies. Ideally, those investments should be recouped through sales but online piracy gets in the way.

“Massive piracy of these motion pictures on the Internet via peer-to-peer networks by subscribers of Internet Service Providers (‘ISPs’) such as Defendants and the willful failure of the ISPs to deal with this issue despite clear notice of it have hindered this opportunity,” the new complaint reads.

Millions in Damages and Site Blocking

In theory, the 324 works could result in as much as $48,600,000 in statutory copyright infringement damages. However, SMV will likely focus on the works that were most frequently pirated, as previously indicated.

Nonetheless, with additional damages for DMCA violations on the line, the prospective damages could easily run in the millions of dollars.

The movie distributor also requests a broad injunction. Specifically, the company wants RCN to terminate the accounts of subscribers who receive more than three copyright infringement notices in 72 hours.

On top of that, an injunction should further require the provider to block access to “known” pirate sites, as identified by the US Trade Representative. Those include The Pirate Bay, 1337x, and TorrentGalaxy.

Whether this ‘parallel’ case will continue to trial has yet to be seen. However, it sends a clear signal to RCN and the court that denying SMV’s request to join the other lawsuit won’t necessarily save resources.

—

A copy of the complaint Screen Media Ventures against RCN Telecom Services, filed at the US District Court for the District of New Jersey, is available here (pdf)

From: TF , for the latest news on copyright battles, piracy and more.

On December 14, 2022, a group of music rightsholders including BMG, UMG, and Capitol filed a complaint at a Texas district court, accusing Altice, the parent company of ISP Optimum, of facilitating massive copyright infringement.

Just days ahead of that lawsuit’s one-year anniversary , Altice now finds itself fighting a second and substantially similar lawsuit, filed by 49 member labels of the RIAA at the same Texas court.

Different Plaintiffs, Same Underlying Allegations

Filed at the United States District Court for the Eastern District of Texas, the complaint has Warner Records, Sony Music, plus another 47 recording labels, alleging contributory and vicarious copyright infringement against Altice, owner of ISP Optimum.

The ISP “knowingly contributed to, and reaped substantial profits from, massive copyright infringement committed by thousands of its subscribers” the labels claim.

By now the base allegations are very familiar. The labels claim that many of the ISP’s 200,000 Texas-based subscribers used Altice’s network to “directly and repeatedly infringe” the plaintiffs’ copyrights by sharing their musical works on BitTorrent networks. After failing to suspend or terminate the accounts of these customers, even after receiving multiple notices of their infringing activity, the plaintiffs say that Altice must now be held to account.

“Specifically, Plaintiffs seek relief for claims that accrued between December 2020 – December 2023…for infringement of works by Altice subscribers after those particular subscribers were identified to Altice in multiple infringement notices,” the complaint notes.

Egregious Repeat Infringers

To highlight the extent of infringing conduct by Altice customers, the complaint provides information on three “egregious repeat infringers” believed to be located in Tyler, Athens, and Jacksonville respectively.

Identified only by an IP address, the first subscriber was reportedly caught distributing (uploading) copyrighted works owned by the plaintiffs over 75 times between January 2023 and March 2023. A second subscriber was observed uploading the labels’ copyrighted works over 70 times between August 2021 and April 2023, while a third was caught over 100 times between December 2021 and June 2022.

The plaintiffs say that in all three cases and for each instance of observed infringement, notifications were sent to Altice advising the ISP that infringement was ongoing. According to the labels, no action was taken to either suspend or terminate the accounts of these and other repeat infringers, despite the ISP having the right and ability to do so.

Infringement Contrary to Altice Policies, and the Law

The labels claim they were forced to file a lawsuit against Altice because the ISP “has gone out of its way not to take action against subscribers engaging in repeated copyright infringement, at the expense of copyright owners.”

The complaint alleges that Altice’s failure to take action stands contrary to its own policies.

The company’s ‘Copyright Infringement Policy’ states that subscribers must not “store, distribute or otherwise disseminate” content in a manner that infringes third-party intellectual property rights. The labels claim that Altice failed to follow its own rules which state that its response to infringement may include account suspensions or terminations “in appropriate circumstances.”

“[A]ltice knew that its subscribers routinely used its networks for illegally downloading and uploading copyrighted works, especially music,” the complaint continues.

“Plaintiffs repeatedly notified Altice that thousands of its subscribers were actively utilizing its service to infringe Plaintiffs’ copyrighted works. Those notices gave Altice the specific identities of its subscribers engaged in copyright infringement, referred to by their unique Internet Protocol or ‘IP’ addresses. Altice also received millions of notices from other copyright owners, some of which undoubtedly addressed the same subscribers as Plaintiffs’ notices.”

No Safe Harbor Under DMCA

According to the complaint, between February 2020 through November 2023, the plaintiffs sent 70,000 DMCA-compliant copyright infringement notices which detailed specific infringements carried out by specific Altice subscribers using P2P protocols including BitTorrent.

Previously, evidence was supplied by anti-piracy company Rightscorp but in this case monitoring was carried out by OpSec LLC, previously known as MarkMonitor.

Using proprietary technology, OpSec’s system connected with Altice subscribers using P2P software and confirmed, in each instance, (1) that the subscriber was online, (2) that the subscriber was running a file sharing program, (3) that the subscriber told OpSec that it possessed a confirmed infringing file, identified by a unique “hash” value, and (4) that the subscriber in fact began to distribute the confirmed infringing file, identified by unique “hash” value. OpSec also verified the file hashes to confirm that Plaintiffs’ copyrighted works were being distributed. Once OpSec had collected this evidence of infringement, OpSec generated and sent a notice of infringement to Altice.

“Put another way,” the complaint continues, “while Plaintiffs undertook the burden and responsibility of monitoring Altice’s network for infringement of Plaintiffs’ copyrighted works, only Altice could take action against its subscribers for violating Altice’s own Copyright Infringement Policy and Terms of Service by infringing Plaintiffs’ works.”

Instead, the labels add, Altice turned a blind eye to massive infringement, despite knowing which subscribers were engaged in repeat infringement while having the right and ability to end it, including by suspending or terminating their accounts.

Contributory and Vicarious Copyright Infringement

The complaint describes Altice as a willful, intentional, and purposeful contributory infringer, and therefore liable for the direct infringements carried out by its subscribers. The labels seek up to $150,000 in statutory damages for each infringement or an amount to be determined at trial.

The labels say that Altice is also liable as a vicarious infringer after deriving “an obvious and direct financial benefit from its customers’ infringement” including through the collection of “illicit revenue” from subscribers who should’ve been suspended but were not. Again, the labels seek up to $150,000 in statutory damages for each infringement or an amount to be determined at trial.

The complaint is available here (pdf)

Full list of plaintiffs as follows:

Warner Records Inc.
Atlantic Recording Corporation
Atlantic Records Group LLC
Bad Boy Records LLC
Big Beat Records Inc.
Elektra Entertainment Group Inc.
Fueled by Ramen LLC
Lava Records LLC
Maverick Recording Company
Nonesuch Records Inc.
Rhino Entertainment Company
Rhino Entertainment LLC
Roadrunner Records, Inc.
Rykodisc, Inc.
Warner Music Inc.
Warner Music International Services Limited
Warner Music Nashville LLC
Warner Records/QRI Venture, Inc.
Sony Music Entertainment
Arista Music
Arista Records, LLC
LaFace Records, LLC
Sony Music Entertainment US Latin LLC
Ultra Records, LLC
Volcano Entertainment III, LLC
Zomba Recording LLC
Warner Chappell Music, Inc.
Cotillion Music, Inc.
Gene Autry’s Western Music Publishing Co.
Golden West Melodies, Inc.
Intersong U.S.A., Inc.
Unichappell Music Inc.
W Chappell Music Corp.
W.C.M. Music Corp.
Warner-Tamerlane Publishing Corp.
Sony Music Publishing (US) LLC
Colgems-EMI Music Inc.
EMI April Music Inc.
EMI Blackwood Music Inc.
EMI Consortium Music Publishing, Inc.
EMI Consortium Songs, Inc.
EMI Entertainment World Inc.
EMI Gold Horizon Music Corp.
EMI Miller Catalog Inc.
EMI Mills Music Inc.
EMI Robbins Catalog Inc.
EMI U Catalog Inc.
EMI Unart Catalog Inc.
Famous Music LLC
Jobete Music Co., Inc.
Screen Gems-EMI Music Inc.
Stone Agate Music
Stone Diamond Music Corp.

From: TF , for the latest news on copyright battles, piracy and more.

Late 2022, several of the world’s largest music companies including Warner Bros. and Sony Music prevailed in their lawsuit against Internet provider Grande Communications.

The record labels accused the Astound-owned ISP of not doing enough to stop pirating subscribers. Specifically, they alleged that the company failed to terminate repeat infringers.

The trial lasted more than two weeks and ended in a resounding victory for the labels. A Texas federal jury found Grande guilty of willful contributory copyright infringement, and the ISP was ordered to pay $47 million in damages to the record labels.

$47 Million Appeal

This September, Grande filed its opening brief in which it again argued that the lower court reached the wrong conclusion. Internet providers shouldn’t be held liable for pirating customers based on third-party allegations, the company noted.

“This appeal presents important questions of first impression in this Circuit about whether, and in what circumstances, an internet service provider may be held secondarily liable for the conduct of users of its service,” the ISP wrote.

Among other things, the ISP believes that it shouldn’t have to terminate Internet access so easily. This view was supported by several telecom industry groups, who all object to disconnecting subscribers’ internet access based on copyright claims.

Record Labels Counter

In a recent 89-page response brief, the record labels counter Grande’s appeal. According to the music companies, the jury reached a sound verdict that should be upheld on appeal; the alternative would make it almost impossible to tackle the online piracy problem.

The labels explain that ISPs play a central role in BitTorrent-based piracy, as they are the only ones who can link an IP-address to a subscriber. This means that when rightsholders or their anti-piracy partners sent infringement notifications to Grande, the ISP was the only party that could address this conduct.

Before 2010, Grande did indeed take action against subscribers but when the private equity firm ABRY Partners purchased the ISP, it stopped terminating pirating subscribers. This went against the requirements under U.S. law, the music companies say.

“At trial, Plaintiffs demonstrated that Grande understood these legal obligations, but consciously ignored them,” the labels write.

“Instead, Grande decided in 2010 to maximize its revenues by continuing to collect subscription fees from subscribers it knew were repeat copyright infringers and providing them with the tools necessary to continue infringing, namely Grande’s high-speed internet services.”

Piracy v.s Profits

Grande could have avoided liability if it had adopted and reasonably implemented policies to terminate repeat infringing subscribers. However, the music companies argue that the ISP chose to increase the company’s profits instead.

The rightsholders believe that Grande’s decision was financially motivated. The company reportedly terminated the accounts of many subscribers who failed to pay their bills but took no action against repeat infringers.

“For nearly seven years, Grande enabled and facilitated massive copyright infringements by subscribers of its internet services as a result of its conscious decision to provide subscribers it knew were using those services to infringe with the very tools they needed to continue doing so.”

Grande now hopes to overturn the massive damages award, but the record labels claim its arguments fail to hold water.

Evidence?

The lawsuit relies on data collected by anti-piracy company Rightscorp which, according to Grande, is insufficient. The rightsholders disagree with that characterization and point out that plenty of support for the evidence was presented at trial.

“The trial record is replete with evidence about how Rightscorp reliably detected infringement by Grande’s subscribers, sent Grande more than one million notices of infringement, and downloaded copies of infringing files directly from Grande’s subscribers.”

Pirates and Terrorists

The second point of contention is whether Internet providers should be held responsible for the actions of individual users. This lies at the heart of the contributory copyright infringement concept, which ultimately resulted in the $47 million damages ruling.

To support its appeal, Grande draws heavily on the recent Twitter vs. Taamneh ruling, in which the U.S. Supreme Court recently held that the social media platforms aren’t liable for ISIS terrorists who used their services to recruit and raise funds.

The Supreme Court rejected the claim that Twitter and others aided and abetted terrorist activity because it didn’t “consciously and culpably” participate in the illegal activity. According to Grande, Internet providers are even further distanced from any wrongdoing.

The record labels believe that this ruling shouldn’t be directly translated into a copyright context. If the court applied the ruling here, it would essentially change the concept of contributory copyright infringement based on a case that has nothing to do with copyright.

“To rule otherwise would require this Court to conclude that the Supreme Court changed fundamental principles of copyright liability without saying so in a case that was not about copyrights,” the labels note.

In addition, they point out that both cases are fundamentally different. In the Twitter case, terrorists didn’t commit their terror attacks on Twitter. However, the contested copyright infringements did take place through Grande’s network.

“Unlike in Twitter — where ISIS did not use the social media companies’ services to complete its terrorist attack — this case involves tortfeasors that directly relied on and used Grande’s services to carry out their torts,” the response brief reads.

As is often the case in these disputes, the parties have opposing viewpoints that zoom in on aspects that favor their position. It is now up to the U.S. Court of Appeals to decide which party makes the most sense.

—

A copy of the music companies’ response, countering Grande’s appeal, is available here (pdf) .

If the court decides to vacate the existing judgment, the music companies also want to raise a counter-appeal, asking the court to clarify that taking affirmative steps to make a copyrighted work available for others to download online violates the exclusive right of distribution.

From: TF , for the latest news on copyright battles, piracy and more.

Under U.S. copyright law, Internet providers must terminate the accounts of repeat infringers “in appropriate circumstances.”

This legal requirement remained largely unenforced for nearly two decades but a series of copyright infringement liability lawsuits, including a billion-dollar damages award against Cox, have shaken up the industry.

Music Companies Sue Optimum

While Internet terminations are more common today, that hasn’t stopped the lawsuits. Last December, a group of music rightsholders including BMG, UMG, and Capitol filed a complaint at the Eastern District of Texas, accusing Optimum’s parent company Altice USA of facilitating massive copyright infringement.

The pirating activity of subscribers shouldn’t be a surprise for the ISP, plaintiffs argued, as the company received numerous copyright infringement notices. This included those sent by the tracking company Rightscorp , which were paired with settlement demands .

“Rather than work with Plaintiffs or take other meaningful or effective steps to curb this massive infringement, Altice chose to permit infringement to run rampant, prioritizing its own profits over the Plaintiffs’ rights,” the complaint read.

To make the music companies whole, they demanded roughly a billion dollars in damages and an order requiring Optimum to prevent repeat copyright infringements on its network going forward.

Questioning the Evidence

Optimum’s parent company fiercely denies the allegations and argues that it’s protected by the DMCA’s safe harbor. To mount a proper defense, the ISP is conducting discovery for the upcoming trial, showing particular interest in Rightscorp’s piracy evidence.

Specifically, the ISP believes that the reliability and accuracy of Rightscorp’s detection system are central to its defense. Thus far, however, the piracy tracking company has failed to hand over all requested information.

To force the matter, Altice submitted a motion to compel Rightscorp to comply with the subpoenaed information. In its request, the company also scolds the music companies for trying to turn ISPs into copyright police, while characterizing Rightscorp’s copyright notices as ‘spam’.

“This case is the latest attempt by the music industry to engineer a copyright-liability regime that makes ISPs responsible for all infringement that takes place on the internet—and thereby turn ISPs into their de facto enforcers.

“Rightscorp intentionally sends out millions of notices a year, and includes threatening settlement demands therein, as it stands to gain a portion of each settlement received as a result of each notice. In reality, the volume of these notices is so high that it risks crippling Altice’s systems,” the motion adds.

More Information Needed

If the music companies want to hold Optimum liable for the copyright infringements of its subscribers, the ISP wants to review all underlying evidence in detail. Although Rightscorp has handed over some information, including notices and spreadsheets with metadata, the ISP seeks more.

For example, Rightscorp should be able to share information on its agreements with the music company plaintiffs, assessments of the accuracy of its piracy detection system, documents related to settlements with the ISP’s customers, and more.

“Given that the notices are at the center of the lawsuit between the Plaintiffs and Altice, Altice is seeking evidence concerning the accuracy and reliability of Rightscorp’s systems for detecting infringement and sending notices, as well as the data, evidence, records, or information on how Rightscorp verified the files before sending such notices,” the motion reads.

The complaint itself doesn’t include any of this information. Instead, the plaintiffs refer to Rightscorp, which takes a central role in this case as a result.

Rightscorp has yet to file a response to the motion, which is due mid-December. After that, the court will decide whether the piracy tracking company must hand over additional information, or not.

—

A copy of Optimum’s patent company Altice USA’s request for a motion to compel Rightscorp to comply with the subpoena is available here (pdf)

From: TF , for the latest news on copyright battles, piracy and more.

Two years ago, several movie production companies, including the makers of Hellboy, Rambo V, The Hitman’s Bodyguard, and Dallas Buyer’s Club, sued Internet provider Grande Communications.

The filmmakers accused the Astound-owned ISP of not doing enough to stop pirating subscribers. Specifically, they alleged that the company failed to terminate repeat infringers.

In addition to millions of dollars in damages, the plaintiffs asked the court to impose strict anti-piracy measures. The requests included a three-strikes termination policy against alleged pirates and an outright block of various pirate sites including the notorious Pirate Bay.

Millions At Stake

There have been several of these types of ‘repeat infringer’ cases in the US, filed by both movie and music companies. Previous lawsuits have made it crystal clear that the stakes are high, with a billion-dollar damages award against Cox as the prime example.

Grande Communications can draw from personal experience. Last fall, a federal jury found the Texas-based provider liable for willful contributory copyright infringement and ordered the ISP to pay $47 million in damages to a group of record labels.

With that judgment under appeal, the ISP hoped to prevent a similar outcome in the movie company case. Grande submitted a motion to dismiss, which was denied , but it continued to push back against the piracy liability allegations, pointing out that there’s nothing wrong with its repeat infringer policy.

When the film companies tried to amend the complaint by adding additional rightsholders and piracy detection company Irdeto, Grande successfully objected. The original copyright claims remained intact, however, and the same was true for the trial scheduled for next year.

Film Companies Drop Lawsuit

Today, that trial is off the table. In a surprising turn of events, both parties filed a stipulation to dismiss the case. There is no settlement agreement and both parties will pay their own costs.

The legal paperwork doesn’t explain why the lawsuit was dismissed but Grande’s parent company Astound is celebrating it as a clear win. According to the Internet provider, it shows that there is nothing wrong with its DMCA policy.

“This completely vindicates our DMCA program. The plaintiffs had an opportunity to vet our program, and after doing so they decided the case was not worth pursuing,” Astound’s General Counsel Jeff Kramp explains.

To be clear, we did not pay a cent to resolve this case because we believe strongly in the effectiveness of our DMCA policy,” Kramp added.

But Why?

To find out more, we reached out to the filmmakers’ attorney who declined to comment at this time. We can only speculate on the reasons.

While it’s possible the filmmakers prefer to focus their efforts elsewhere, dropping a case doesn’t make much sense if you believe that you’re ahead, so that may factor into it as well.

Whatever the reasons, Astound isn’t completely free of the film companies just yet. Many of the same outfits filed a repeat infringer lawsuit against Astound subsidiary RCN, which remains pending .

From: TF , for the latest news on copyright battles, piracy and more.

Last year, a Texas federal jury found Grande Communications liable for willful contributory copyright infringement and ordered the ISP to pay $47 million in damages to a group of record labels.

The ISP was held liable for infringing 1,403 copyrighted songs, as it failed to terminate persistent pirates’ internet access.

District Court Judge David Ezra confirmed the judgment in January. This prompted the ISP to request a do-over but that motion was ultimately declined. As a result, Grande took the matter to the appeals court.

Grande Appeals

Last month, Grande filed its opening brief in which it again argued that the lower court reached the wrong conclusion. Internet providers shouldn’t be held liable for pirating customers based on third-party allegations, the company argues.

“This appeal presents important questions of first impression in this Circuit about whether, and in what circumstances, an internet service provider may be held secondarily liable for the conduct of users of its service,” the ISP writes.

The ISP believes that it shouldn’t have to terminate Internet access this easily. This view is bolstered by a recent Supreme Court decision in favor of Twitter and other social media platforms, which held that they’re not liable for terrorist messages.

Grande is not alone in this appeal. The company is supported by several telecoms organizations, through a joint amicus curiae brief submitted by broadband association USTelecom and the the CTIA , which represents wireless providers.

Terminating Internet Access a Basic Measure?

According to Grande, the District Court went too far when it informed the jury that a provider can be found liable for contributory infringement if it didn’t take “basic measures” to terminate accounts of repeat infringers. According to Grande, this strong language lacks nuance.

The ISP notes that the ‘basic measures’ theory first emerged more than two decades ago in the Napster lawsuit. In that case, however, Napster failed to remove pirated tracks from its servers, while ISPs only pass on bits and bytes.

“The ‘simple measures’ or ‘basic measures’ theory has its roots in the Labels’ case against Napster. […] Before filing suit, the Labels notified Napster of specific infringing files available on Napster’s service, but Napster declined to remove them.”

The common feature of these cases is that the ‘simple measures’ standard has only been applied to defendants who directly control online content. That is because those defendants can readily remove or disable access to specific infringing content.

The amici support this argument while going into more detail on how Internet terminations can affect the public. They believe that Internet terminations should not be taken lightly.

‘Drastic and Overbroad’

USTelecom and CTIA point out that terminating Internet access can have a negative impact beyond the alleged wrongdoers. It could impact entire households, coffee shops, offices, schools, libraries, or hospitals. That doesn’t qualify as a “basic measure”.

“Termination thus prevents everyone — in a household, coffee shop, office, school, library, or hospital — who relies on a shared internet connection from using the internet for any purpose, whether remote work, accessing educational or health resources, seeking news or other information, or for entertainment.

“It is instead a drastic and overbroad remedy, with severe consequences for non-infringers. Yet the district court’s approach could compel internet service providers to engage in wide-scale terminations to avoid facing crippling damages, like the $1 billion judgment entered against Cox Communications,” the amici add.

These terminations take place with no judicial oversight and run contrary to the initiatives of lawmakers, who freed up billions of dollars to invest in American broadband infrastructure.

“It would also create massive disincentives for providers to invest in the new broadband networks that Congress recognizes are needed to close the digital divide,” the telecoms groups note.

Supreme Court’s Terrorist Ruling

Grande’s appeal also draws heavily on the aforementioned Twitter vs. Taamneh ruling, in which the U.S. Supreme Court recently held that the social media platforms aren’t liable for ISIS terrorists, who used their services to recruit and raise funds.

The Supreme Court rejected the claim that Twitter and others aided and abetted terrorist activity, because it didn’t “consciously and culpably” participate in the illegal activity. According to Grande, Internet providers are even further distanced from any wrongdoing.

“The pleaded allegations in Twitter are illuminating. There, the plaintiffs alleged that Twitter, Facebook, and Google allowed ISIS to upload videos and messages for public display, and that they actively delivered ISIS’s posts to other users based on those users’ information and use history.

“The social media companies failed to remove known ISIS accounts, instead letting ISIS benefit from the companies’ recommendation algorithms…”

The Supreme Court ultimately concluded that the social media companies didn’t engage in purposeful, culpable conduct. Instead, they simply offered their “infrastructure” to the parties. In addition, the Supreme Court suggested that ISPs are even further removed.

“[W]e generally do not think that internet or cell service providers incur culpability merely for providing their services to the public writ large,” the Supreme Court wrote.

The telecoms groups bring up the same case and stress that the Supreme Court ruling suggests that it was an error by the court to hold Grande liable for pirating subscribers. As such, the appeal court should overturn it.

Needless to say, the music companies will have a different take on the matter. They also made this clear when Cox brought up the Twitter ruling a few weeks ago and will likely do the same here.

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A copy of Grande’s appeal brief can be found here (pdf) and the amicus curiae submission from USTelecom, The Broadband Association and CTIA is available here (pdf)

From: TF , for the latest news on copyright battles, piracy and more.

Last fall, a Texas federal jury found Grande Communications liable for willful contributory copyright infringement and ordered the ISP to pay $47 million in damages to a group of record labels.

District Court Judge David Ezra confirmed the judgment in January. This was a clear mistake, according to Grande, which hoped to have it overturned.

Do-Over Denied

In March, the Internet provider filed a renewed motion for judgment as a matter of law. Put simply, Grande wanted the Judge to overrule the jury . This is warranted if the evidence clearly weighs in favor of the requesting party but when a jury finds otherwise.

If that was not an option, the ISP asked the court for a new trial to allow the piracy liability issues to be raised again before a new jury.

U.S. District Court Judge David Ezra reviewed the motion but eventually denied both requests. According to the Judge, there was nothing wrong with the jury verdict and the court didn’t make any clear errors either.

“Neither Grande’s legal nor evidentiary arguments warrant judgment as a matter of law or a new trial,” Judge Ezra’s conclusion read.

Appeal Without Bond

With dozens of millions in damages on the line, Grande wasn’t planning to let the issue go. The ISP filed an appeal at the Fifth Circuit which is just getting started.

To save costs, the ISP requested to postpone the damages payment until the appeal concludes. Such a request is not unique, but Grande additionally asked the court to waive the bond it would have to post.

Courts can allow such postponements in extraordinary circumstances, when there’s no doubt that the losing party can easily pay their dues at a later stage, for example.

According to Grande, the company and its parent Astound have plenty of financial resources to enable payment when the time comes. The company further notes that posting a bond for the full $47 million judgment is a ‘waste of money’, as that would cost millions.

“Requiring Grande to post bond or other security when there is no dispute as to Grande’s financial security would be a ‘waste of money.’ A bond for the full amount of the current judgment would cost Grande approximately $4 million per year.

“Because Grande is capable and will continue to be capable of satisfying the judgment, it would serve no legitimate purpose to require Grande to incur this substantial annual expense, which would benefit the issuer of the bond and no one else.”

Music Companies Oppose

The request sounds straightforward, but the music companies have a different take on the matter. They don’t want the bond waived and point out that Grande’s current stance is contrary to the one it took at trial.

The ISP now highlights the financial backing of its parent, the Astound group , but previously asked for Astound’s financial strength to be excluded from the trial.

“The Court’s ruling excluding this evidence was based on the adamant representations of Grande’s counsel that Grande is an independent entity from Astound and that Astound’s finances were wholly irrelevant to this case,” the music companies note.

“Grande now argues that it should be permitted to ride Astound’s financial coattails and rely wholly on Astound’s present-day assets and revenues to avoid this automatic procedural rule and waive the bond requirement that applies to every defendant that loses at trial.”

The music companies ask the court to deny Grande’s request, arguing that the company fails to provide evidence to demonstrate its own financial position.

Grande’s comments about the “waste of money” are not sufficient either according to the plaintiffs. This argument is backed up by a statement by Astound’s Chief Financial Officer, but that is self-serving and lacks proper documentation, the music companies counter.

Post The $47m Bond, Or Else

After reviewing the arguments from both sides, Magistrate Judge Dustin Howell agreed with the music companies, denying Grande’s request to waive the bond.

In addition, Judge Howell grants the music companies cross-motion, which requires the Internet provider to post the required $47 million bond within two weeks. Failure to do so means that the company must pay the full damages amount right away.

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A copy of U.S. Magistrate Judge Dustin Howell’s order is available here ( pdf ). Grande’s original motion and the opposition from the music companies can be found here ( 1 , 2 )

From: TF , for the latest news on copyright battles, piracy and more.