Jury Awards $46.7M to Record Labels in Copyright Suit Against ISP Over Illegal Music Downloading

On Thursday, a federal jury convened in the Western District of Texas returned a verdict in favor of more than a dozen record labels, including Atlantic, Sony, and UMG Recordings, of $46.7 million. The case concerns allegations that Grande Communication Networks LLC and its parent company facilitated copyright infringement by allowing its internet subscribers to illegally download the labels’ copyrighted music over BitTorrent systems. 

In their 2017 complaint, the plaintiffs accused the Texas-based internet service provider serving customers in Austin, Dallas, San Antonio, and other locales of complicity in more than one million blatant infringements of copyrighted works. This was so, the complainants said, despite Grande’s awareness of the infringement and the record labels’ repeated pleas to Grande to curb illegal user behavior.

Instead, the lawsuit claimed that Grande chose to protect “a significant revenue stream that [it] receives every month from its many infringing subscribers.” Grande’s “effective acquiescence” in the alleged violation of the plaintiffs’ rights combined with its failure to adopt and implement a policy to stop repeat infringers, excludes the defendant from the safe harbor protections of the Digital Millennium Copyright Act, the complaint alleged.

After years of litigation, including extensive motion practice, the case culminated in a two week-plus jury trial before Judge David A. Ezra. According to the verdict, the jury held Grande liable for 1,403 instances of willful copyright infringement, working about to about $33,000 per violation.

Grande may now file post-trial motions should it choose to challenge the outcome.

In a statement provided to Law Street Media, the Recording Industry Association of America’s Chairman and CEO Mitch Glazier commented, “[t]his is the latest validation by US courts and juries that unchecked online infringement will not stand. The jury’s strong action here sends an important message to Internet Service Providers. Artists, songwriters, rightsholders, fans and legitimate services all depend upon a healthy digital music ecosystem that effectively protects creative works online.”

The record labels are represented by Jenner & Block LLP, Stein Mitchell Beato & Missner LLP, and Scott Douglass & McConnico LLP.

Grande Communications is represented by Armstrong Teasdale LLP and Kelly Hart & Hallman LLP.