A federal appeals court overturned a staggering $1 billion verdict against Cox Communications, calling for a fresh trial to determine the appropriate damages for illegal downloads facilitated by its customers.
This case originated from a 2018 copyright infringement lawsuit filed by major record companies and music publishers such as Sony, Universal Music, and Warner Music.
Instead of pursuing individual downloaders, the labels targeted Cox for allegedly failing to prevent its subscribers from unlawfully downloading and sharing songs.
In 2019, a jury in Virginia found Cox accountable for infringing on over 10,000 copyrighted works owned by the music labels and awarded $1 billion in damages.
However, a three-judge panel of the Fourth U.S. Circuit Court of Appeals delivered a nuanced ruling. While agreeing with the plaintiffs that Cox inadequately policed infringement on its network and thus contributed to the infringement, the panel also scrutinized the enormous damages award.
Judge Allison Jones Rushing, speaking for the majority, drew a comparison to criminal law, stating, “Lending a friend a hammer is innocent conduct; doing so with knowledge that the friend will use it to break into a credit union ATM supports a conviction for aiding and abetting bank larceny.”
However, the panel found that the evidence did not sufficiently demonstrate that Cox directly profited from its subscribers’ infringement, providing a boost for the company.
