by Dennis Crouch
This week the Supreme Court granted certiorari in Cox Communications, Inc. v. Sony Music Entertainment, No. 24-171, while denying the competing petition in Sony Music Entertainment v. Cox Communications, No. 24-181. This grant/deny pair follows the Trump Administration’s Solicitor General recommendation and sets up another major Supreme Court battle over the scope of contributory copyright infringement–this one focusing on how internet service providers handle allegations of user piracy.
USDOJ: Contributory Infringement Requires Conscious and Culpable Acts
The case centers on fundamental questions about when companies can be held liable for their users’ copyright infringement—issues that parallel similar debates in patent law regarding inducement under 35 U.S.C. § 271(b) and contributory infringement under 35 U.S.C. § 271(c). Patent and copyright cases share common purposes and a core tension of how to hold those who facilitate infringement accountable without stifling innovation or access.
The Sony v. Cox litigation began when a consortium of record companies and music publishers sued Cox Communications, an internet service provider with millions of customers, for copyright infringement based on actions by Cox’s subscribers during 2013-2014. During this period, anti-piracy company MarkMonitor sent Cox over 160,000 automated notices alleging that specific IP addresses on Cox’s network were being used to share particular copyrighted music via peer-to-peer networks like BitTorrent.
Cox had implemented what it called a “graduated response program” under which repeat infringers would receive escalating consequences: email warnings, temporary suspensions, and ultimately possible termination. However, Cox’s application of this policy was admittedly inconsistent. Over the relevant period, Cox terminated only 33 subscribers for copyright violations while terminating over 600,000 for nonpayment. Internal emails showed Cox employees expressing frustration with the volume of infringement notices and resistance to aggressive termination policies that would cost the company subscriber revenue.
The district court made several important rulings that shaped the ultimate trial:
- Cox was ineligible for the Digital Millennium Copyright Act’s safe harbor protection under 17 U.S.C. § 512 because Cox had not “reasonably implemented” a policy for terminating repeat infringers.
- The infringement notices from MarkMonitor established Cox’s knowledge of subscriber infringement as a matter of law, satisfying the knowledge element of contributory copyright liability.
At trial, the jury then found Cox liable for both contributory and vicarious infringement of more than 10,000 copyrighted works.
- Contributory Infringement requires some action that induces, causes, or materially contributes to conduct of another, that is known to be infringement. The doctrine is derived from common law aiding and abetting principles and requires both knowledge of the direct infringement and some form of material assistance or encouragement.
- Vicarious Liability is derived from agency law’s respondeat superior doctrine and attaches when the infringement by another is attributable to the defendant. This typically requires that the defendant have both the right and ability to supervise the infringing activity and has some direct financial interest in the activities. Vicarious liability can attach without knowledge of the infringement, provided the defendant controls the infringer and profits directly from the infringing acts.
The jury also concluded that the infringement was “willful” because Cox continued to provide services even though it “had knowledge that its subscribers’ actions constituted infringement.” The willfulness finding increased the statutory damages ceiling from $30,000 to $150,000 per work under 17 U.S.C. § 504(c)(2), enabling the $1 billion verdict.
On appeal, the Fourth Circuit affirmed on contributory liability but reversed on vicarious liability. The court also vacated the damages award and remanded for a new trial, although it upheld the willfulness finding. It is the contributory liability and willfulness findings in favor of the copyright holder that are now up for consideration by the Court. The court has declined to review the vicarious liability issue.
On contributory infringement, the Fourth Circuit focused-in on what constitutes “material contribution” for an ISP. In the leading case, of MGM v. Grokster, the Supreme Court explained that “mere failure to take affirmative steps to prevent infringement” is not enough to create liability. Metro-Goldwyn-Mayer Studios, Inc. v. Grokster, Ltd., 545 U.S. 913, 939 n.12 (2005). However, the appellate panel concluded that Cox’s conduct was not mere passivity. But rather Cox continued to supply a product that was indispensable to the infringement even having actual knowledge of repeated infringement by particular subscribers. According to the Fourth Circuit, this is “exactly the sort of culpable conduct sufficient for contributory infringement.”
The Fourth Circuit also upheld jury instructions that allowed a finding of willfulness based on Cox’s knowledge that its subscribers were infringing—the same knowledge required to establish contributory liability in the first place. Other circuits have required a jury instruction that goes further — that defendants also understood that their own conduct was unlawful, not merely that they knew others were infringing.
The granted petition asks two questions that challenge these Fourth Circuit holdings. Here, I reproduce the U.S. Gov’t rewriting of the questions:
The Copyright Act of 1976 (Copyright Act), 17 U.S.C. 101 et seq., grants copyright holders the exclusive rights to perform, display, reproduce, and distribute their protected works. 17 U.S.C. 106. Any person who violates those rights is a copyright infringer and is liable for actual or statutory damages. 17 U.S.C. 501; 17 U.S.C. 504. The questions presented in these petitions concern whether, and under what circumstances, an internet service provider (ISP) can be held secondarily liable for acts of copyright infringement committed by its subscribers. The questions presented are as follows:
1. Whether an ISP that continues to provide internet access to particular subscribers, after being notified that those subscribers’ accounts have been used to commit acts of copyright infringement, is contributorily liable for future copyright infringement on those accounts.
2. Whether a contributory copyright infringer “willfully” violates the Copyright Act under 17 U.S.C. 504(c)(2) when it acts with knowledge that the direct infringer’s actions are unlawful but does not know that its own conduct is unlawful.
Although the Trump Administration has generally indicated that it is pro-copyright, its actions seemingly otherwise. In particular, the Administration appears rightly concerned that copyright when over-extended could place a strong regulatory drag on development of information systems. This particularly extends to AI systems, not simply ISPs. See, Dennis Crouch, Using Intellectual Property to Regulate Artificial Intelligence, 89 Mo. L. Rev. 1 (2024).
In my view, the Cox case represents an inflection point that extends far beyond traditional ISP liability. The fundamental tension at stake mirrors the broader challenge I identified in my 2024 article: how copyright law, when overextended beyond its core purpose of incentivizing creativity, can become a significant regulatory drag on technological innovation. The questions presented in Cox—particularly around what constitutes sufficient “material contribution” for liability—have important implications for how we balance rights holder protection against the need for robust information systems that power modern AI development. While copyright holders understandably seek to protect their works from unauthorized use, an overly broad interpretation of contributory liability could and would fundamentally alter how platforms operate. This concern becomes particularly acute in the AI context, where systems rely heavily on vast datasets that may include copyrighted works for training purposes. The broader policy implications here align with my arguments that intellectual property should play a supporting rather than primary role in technology governance and regulation.
The Court will likely hear oral argument in the fall of 2025, with a decision expected spring 2026.
The worry here, Dennis, is that rulings like this attempt to force service providers to act as auxiliary police forces.
These are the first steps to totalitarianism. Reminds of little Pavlik Morozov.
Thanks. Yes I do have real concerns about non-governmental entities that have government like powers, but who are not bound by any democratic principles.