BMG v Cox principles applied in finding liability for ISP Grande

May 2020

COPYRIGHT: The fallout from the BMG v Cox case in the USA continues, with a court denying ISP Grande Communications the benefit of safe harbour protection in a case brought by the Recording Industry Association Of America (RIAA). In the earlier case, BMG had accused ISP Cox Communications of running a deliberately ineffective system for dealing with repeat infringers:  At first instance the jury awarded $25 million against Cox when they found the broadband carrier liable for piracy by its subscribers. The US appellate court reversed that verdict in what might have been seen as a defeat for the record label – but many said at the time that a careful look at the judgment, which reversed the jury on a technicality, was actually a win in the battle against piracy. 

The 4th Circuit took a long hard look at how and why Cox would be protected by US  “safe harbor” provisions that protect service providers from liability when users infringe copyright. – and here the Court ruled against Cox on a key point. The DMCA provides a degree of protection to ISPs and other platforms that respond expeditiously to takedown requests. But one of the requirements is that the ISP and other intermediaries to have “adopted and reasonably implemented … a policy that provides for the termination in appropriate circumstances of subscribers … who are repeat infringers.” 

The appeals judges said that as it STOOD, Cox wasn’t entitled to rely on safe harbor because it dID very little if anything even when told about repeat offenders – an important precedent. Grande had been accused of operating a similarly ineffective system for dealing with infringers and infringement and the RIAA pursued the ISP arguing that Grande should be liable for its users’ infringement, so was Grande. Now a US Court has agreed with that position in a summary judgement that quotes BMG v Cox and affirms that those seeking safe harbour protection in the US must “reasonably implement” a policy for disconnecting repeat infringers or they will lose safe harbour protection in circumstances where the “ISP has not ‘reasonably implemented’ a repeat infringer policy if the ISP fails to enforce the terms of its policy in any meaningful fashion”. 

The new decision notes the December Magistrate Judge’s opinion in this case, which concluded that the “undisputed evidence shows that though Grande may have adopted a policy permitting it to terminate a customer’s internet access for repeat infringement, Grande affirmatively decided in 2010 that it would not enforce the policy at all, and that it would not terminate any customer’s account regardless of how many notices of infringement that customer accumulated, regardless of the source of the notices, and regardless of the content of a notice”. The court agreed, saying Grande’;s systems were even worse that Cox’s:  “Grande thus did even less than Cox to ‘reasonably implement’ the kind of policy required for the protections of … safe harbour ….. if lax enforcement and frequent circumvention of existent procedures disqualifies a defendant from the safe harbour’s protections, the complete nonexistence of such procedures surely must do likewise”.

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