Record labels’ war on ISPs and piracy nets multiple settlements with Charter

Charter Communications has agreed to settle piracy lawsuits filed by the major record labels, which accused the cable Internet provider of failing to terminate the accounts of subscribers who illegally download copyrighted songs.

Sony, Universal, Warner, and their various subsidiaries sued Charter in US District Court in Colorado in March 2019 in a suit that claimed the ISP helps subscribers pirate music by selling packages with higher Internet speeds. They filed another lawsuit against Charter in the same court in August 2021.

Both cases were settled. The record labels and Charter told the court of their settlements on Tuesday in filings that said, “The Parties hereby notify the Court that they have resolved the above-captioned action.” Upon the settlements, the court vacated the pending trials and asked the parties to submit dismissal papers within 28 days.

Charter subsidiary Bright House Networks also settled a similar lawsuit in US District Court for the Middle District of Florida this week. The record labels’ case in Florida was settled one day before a scheduled trial, as TorrentFreak reported Tuesday. The case was dismissed with prejudice after the settlement.

No details on any of the settlements were given in the documents notifying the courts. A three-week jury trial in one of the Colorado cases was scheduled to begin in June 2023 but is no longer needed.

The question for Internet users is whether the settlements mean that Charter will be more aggressive in terminating subscribers who illegally download copyrighted material. Charter declined to comment today when we asked if it agreed to increase account terminations of subscribers accused of piracy. We also contacted the big three record labels and will update this article if they provide any information on the settlements.

$1 billion Cox verdict may force ISPs to cut off subscribers

Even if the settlements have no specific provision on terminating subscribers, Charter presumably has to pay the record labels to settle the claims. That could make the country’s second-biggest ISP more likely to terminate subscribers accused of piracy in order to prevent future lawsuits.

A jury ruled in December 2019 that Cox must pay $1 billion in damages to the major record labels in a case filed in US District Court for the Eastern District of Virginia. That decision raised alarm bells for the Electronic Frontier Foundation (EFF), the Center For Democracy and Technology, the American Library Association, the Association of College and Research Libraries, the Association of Research Libraries, and consumer-advocacy group Public Knowledge.

Those groups warned in a June 2021 court filing that the verdict, if not overturned, “will force ISPs to terminate more subscribers with less justification or risk staggering liability.” The US Court of Appeals for the Fourth Circuit heard oral arguments in March 2022 and has not yet issued a ruling.

Charter motion to dismiss denied

In the Colorado court, the record labels’ complaint said Charter “has knowingly contributed to, and reaped substantial profits from, massive copyright infringement committed by thousands of its subscribers. Charter has insisted on doing nothing—despite receiving thousands of notices that detailed the illegal activity of its subscribers, despite its clear legal obligation to address the widespread, illegal downloading of copyrighted works on its Internet services, and despite being sued previously by Plaintiffs for similar conduct.”

Charter argued in a motion to dismiss the case that “a failure to terminate a customer’s access to the Internet based solely upon unverified (and unverifiable) notices alleging past infringement does not demonstrate the requisite intent by an ISP to encourage infringement.” Charter said it has a “policy to not terminate customer accounts based solely upon the receipt of notices containing unverifiable accusations of infringement.”

Charter also wrote that “[p]laintiffs do not (and cannot) allege that termination restricts access to the infringing content. It is common sense that terminating a customer’s Internet connection does not prevent a customer from finding another source of Internet access, nor does it impact the availability of the allegedly infringing content hosted via peer-to-peer networks or programs. Charter has no more ability to block access to peer-to-peer networks than a subscriber’s electric company.” Charter’s motion to dismiss the case was denied, and the company ultimately chose not to go to trial.

In Florida, the judge dismissed the record labels’ claim for vicarious liability, but the industry’s complaint also sought damages for vicarious copyright infringement.

Disclosure: The Advance/Newhouse Partnership, which owns 12.4 percent of Charter, is part of Advance Publications. Advance Publications owns Condé Nast, which owns Ars Technica.

https://arstechnica.com/?p=1871583