Record Labels Are Willing to Settle ‘Repeat Infringer’ Case with ISP

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 labels, 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 disagreed, however, and were not ready to let any claims go. In May they submitted a motion for leave to file an amended complaint including new evidence obtained during discovery. Among other things, they argued that Grande willingly kept pirating subscribers abroad, to generate more revenue.

While both sides were going head to head in court, the labels also attempted a peace offering. Court documents submitted this week show that the record labels offered a settlement agreement to the ISP two months ago.

Per the court’s scheduling order, Grande was required to respond to the offer within a month, but thus far a response has yet to come in. In a new status report submitted his week, the labels say they are still open to a settlement.

“Plaintiffs remain ready and willing to participate in a meaningful attempt to resolve the case without further litigation, including through a mediation, which Plaintiffs previously proposed to Grande and Patriot Media Consulting, LLC,” the labels write.

“Otherwise, if Grande and Patriot have no interest in discussing settlement, Plaintiffs will continue vigorous prosecution of this case to recover damages for Grande’s and Patriot’s extensive and harmful infringement of Plaintiffs’ copyrighted sound recordings.”

The details of the settlement offer remain unknown, but it’s likely that they will come at a cost for the ISP. Grande’s attorney informed the labels that more time was needed to prepare a thorough response, something the company also told the court this week.

“Due to the nature of Plaintiffs’ written offer of settlement, Grande notified Plaintiffs that it would require additional time to prepare and transmit its official written response.” Grande’s attorney notes.

The ISP now expects to have its response to the settlement offer ready next week. Given that it took nearly two months to reply, this will likely be more complex than a simple yes or no.

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The record labels’ letter is available here (pdf), and Grande’s response can be found here (pdf).

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