On December 17, 2015, a six-person Virginia federal jury found that Internet service provider (“ISP”) Cox Communications (“Cox”) must pay music publisher BMG Rights Management (“BMG”) $25 million for illegal music downloads by its subscribers. The verdict follows a decision issued by the Eastern District of Virginia on December 1, 2015, dismissing Cox’s DMCA “safe harbor” defenses and finding genuine issues of material fact as to whether BMG’s distribution right was infringed. The jury found Cox guilty of willful contributory copyright infringement, but not liable for vicarious copyright infringement. The statutory damages provision of the Copyright Act allows for awards as high as $150,000 per work in willful infringement cases and the verdict includes damages for infringement of more than 1,000 BMG copyrights covering various songs from popular artists.
During the two-week trial, BMG argued that Cox ignored notices sent to alert the ISP of user piracy. The notices were sent by BMG’s copyright enforcer, Rightscorp, which uses software to detect instances of infringement, and then forwards notices to ISPs along with settlement demands for $10 or $20 per song. BMG also presented internal emails from Cox’ management suggesting Cox had a policy of reactivating the accounts of repeat infringers as a way to maintain subscriber revenue.