Billion Dollar Judgment Overturned on Copyright Infringement Case

In March, the Supreme Court reversed a billion-dollar judgment in favor of Sony Music Entertainment (“Sony”) who argued that Cox Communications (“Cox”) was liable for copyright infringement because it provided internet service to known infringers. The Fourth Circuit agreed with Sony’s argument and held that because Cox provided internet services to known infringers, Cox, itself, was a willful infringer.

Under the Copyright Act, owners of copyright are granted certain exclusive rights, such as the right to copy and distribute the work. When someone violates those exclusive rights, the violator has infringed on the copyright. If the violation is willful, the infringer faces increased statutory damages of up to $150,000 per work.

Sony and Cox worked initially worked together to identify IP addresses of copyright infringers and sent individual infringers up to 13 notices before subjecting an infringer to termination of internet service. However, Sony was not impressed with Cox’s enforcement. Sony alleged that Cox was contributorily liable by continuing to provide the infringers internet service.

Generally, the Copyright Act does not allow one party to be held liable for the infringement committed by another party. But some exceptions apply. A service provider, like Cox, can be held contributorily liable if they intend for their service to contribute to the infringement. It is not enough that a service provider merely have knowledge that their service is used for copyright infringement or that the service provider fails to take affirmative steps to prevent infringement. The courts look for affirmative intent to encourage infringement.

The Supreme Court held that Cox could not be held contributorily liable because they did not intend for their internet service to be used to commit copyright infringement. Cox did not advertise or encourage their users to commit copyright infringement. Thus, Sony cannot collect damages from Cox for the copyright infringement committed by Cox’s internet service users.

Cox Communications, Inc. et al. v. Sony Music Entertainment et al., 607 U.S. ---, 146 S.Ct. 959 (2026).