In August, a federal judge ruled that cable giant, Cox Communications, must pay $25 million to BMG, a music rights company. BMG utilized a company known as Rightscorp to monitor the Internet for illegal file-sharing activity and then provide a notice to Internet providers when it found evidence of any such activity. Rightscorp’s intended to send infringement notices to Cox users that included an offer for the user to immediately settle the infringement with a payment of between $20 and $30.
Cox was expected by BMG to deliver these notices to computer users. BMG alleged that Cox procrastinated and used various technical measures to prevent the notices from reaching their intended recipients. BMG’s argued that Cox should was liable because it had knowledge that its users were illegally downloading copyrighted materials, and because it contributed to the actual incidents of infringement.
This finding that Cox is liable for the piracy of its users is of great concern to other Internet providers. The ruling raises fresh issues and questions about the liability of Internet providers beyond copyright, as well as the creation of greater invasions of users’ privacy because of the perception that users need to be monitored and controlled.
For the last five years, Rightscorp warned U.S. Internet service providers of the risks of liability for any failure to implement and enforce policies under which they terminate the accounts of their subscribers who repeatedly infringe upon the copyrights of others.
In addition to the aforementioned notices that ISPs directly send to users suspected of copyright infringement, Internet providers have established policies that allow users a number of strikes before their access is terminated. These policies have provided some measure of insulation from direct legal action as they allow these companies to be eligible for a legal “safe harbor” as to liability. Judge Liam O’Grady felt that Cox didn’t qualify for safe harbor protection in this instance because it didn’t act aggressively enough to terminate the accounts of suspected violators. Some question whether Cox actually did anything wrong even though it was found to not qualify for safe-harbor protection. More to come.
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