Can an Internet provider be held liable for subscribers who share pirated files? Yes, a Virginia federal jury ruled two years ago.
This verdict caused great uncertainty in the ISP industry, as several companies suddenly realized that they could become the next target.
Internet provider Windstream is among the companies that are worried about the fallout. With 1.1 million subscribers nationwide, it is one of the larger Internet providers in the United States. As such, it receives takedown notices on a regular basis.
Many of these notices come from music rights group BMG, which accused Windstream and its subscribers of various copyright infringements. These notices are issued by the monitoring outfit Rightscorp and often come with a settlement demand for the account holders.
When Windstream refused to forward these notices, as it’s not required to do so by law, BMG and Rightscorp increased the pressure. They threatened that the ISP could be liable for millions of dollars in piracy damages for failing to disconnect repeat infringers.
Faced with this threat, Windstream filed a request for declaratory judgment at a New York District Court last year, requesting a legal ruling on the matter. This preemptive lawsuit didn’t turn out as planned for the ISP.
In April the court ruled that there is no ‘actual controversy’ and that it can’t issue a hypothetical and advisory opinion without concrete facts. As such, the case was dismissed for lack of jurisdiction.
Windstream didn’t throw in the towel right away though and appealed the verdict. The ISP argued that the $150,000 in damages per infringement BMG claimed caused a real controversy.
“BMG’s accusations were not idle threats in light of the undisputed fact that BMG had recently obtained a $25,000,000 recovery against another conduit ISP based on similar claims,” the ISP wrote in a brief last month.
“Thus, the undisputed facts conclusively establish that an actual controversy exists to support Windstream’s request for a declaration that it is not liable for any alleged infringement of BMG’s copyrights.”
Despite Windstream’s initial persistence, something changed in recent weeks. Without any prior signs in the court docket, the company has now asked the Judge to dismiss the case entirely, with both parties paying their own costs.
“Windstream respectfully requests that this Court dismiss in full Windstream’s present appeal with prejudice against BMG and Rightscorp, with each party bearing its own costs in this appeal.”
While there is no mention of a settlement of any kind, BMG and Rightscorp do not oppose the request. This effectively means that the case is over. The same previously happened in a similar lawsuit, where Internet provider RCN demanded a declaratory judgment.
This means that all eyes are once again on the case between BMG and Cox Communications, which got this all started and is currently under appeal.