ISP Has No ‘Safe Harbor’ Defense in Piracy Case, Record Labels Argue

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Last year several major record labels, represented by the RIAA, filed a lawsuit against ISP Grande Communications accusing it of turning a blind eye to pirating subscribers.

According to the RIAA, the Internet provider knew that some of its subscribers were frequently distributing copyrighted material, but failed to take any meaningful action in response.

Grande refuted the accusations and filed a motion to dismiss the case. The ISP partially succeeded as the claims against its management company Patriot were dropped. The same was true for the vicarious infringement allegations, as the court saw no evidence that the ISP had a direct financial interest in the infringing activity.

The labels were not willing to let go so easily.

They submitted a motion for leave to file an amended complaint including new evidence obtained during discovery. And a few days ago, they upped the pressure with a motion for summary judgment, arguing that Grande has no safe harbor defense.

In order to get safe harbor protection, the DMCA requires ISPs to adopt and reasonably implement a policy for terminating the accounts of repeat copyright infringers. According to the motion, it is clear that Grande failed to do so. As such, the company should be held directly liable.

“For years, Grande claimed in its online ‘Acceptable Use Policy’ that it had a policy of terminating repeat infringers. Grande continued to assert that claim in its pleadings and written discovery responses in this suit.

“None of that was true. The undisputed record evidence establishes that Grande’s Acceptable Use Policy was a sham,” the labels’ motion reads.

There can be little dispute over Grande’s failing policy, the labels state. They point out that corporate paperwork and testimony of Grande’s senior executives clearly show that there wasn’t an adequate repeat infringer policy.

“Indeed, the documents and testimony demonstrate that rather than a policy for terminating repeat infringers, Grande consciously chose the opposite: a policy allowing unlimited infringement by its subscribers,” the labels write.

At the same time, there was no lack of DMCA notices. The labels note that the ISP received at least 1.2 million notices of alleged copyright infringement between 2011 and 2016. This includes hundreds of thousands of notices from Rightscorp.

Despite these repeated warnings, the company didn’t terminate a single subscriber from October 2010 until June 2017, the labels allege. This changed after the lawsuit was filed, but even then the number remained minimal, with ‘only’ twelve terminations.

Based on the provided information, the record labels ask for a summary judgment in their favor.

“Grande’s failure to adopt and reasonably implement a repeat infringer policy renders Grande ineligible for the DMCA safe harbor. The Court should grant Plaintiffs’ motion for partial summary judgment and reject Grande’s DMCA safe harbor defense as a matter of law,” the labels say.

If the court sides with the record labels, Grande will be at a severe disadvantage, to say the least.

Without safe harbor protection, the company can be held liable for the copyright infringements of its users, which could potentially lead to dozens of millions of dollars in damages.

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A copy of the record labels motion is available here (pdf).

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