Pirate Site Blocking Demands Shelved as Filmmakers Settle With U.S. ISP

A pending settlement between movie companies and ISP Frontier has significantly altered the scope of an upcoming copyright trial. The movie studios are expected to withdraw their claims, including their demand for pirate site blocking, leaving Frontier to face only major record labels in court. With the music companies seeking potentially over a billion dollars in damages for subscribers' piracy activities, the stakes remain exceptionally high.

stop dangerIn recent years, music and movie companies have filed several lawsuits against U.S. Internet providers, for failing to take action against pirating subscribers.

One of the main allegations is that ISPs fail to terminate the accounts of repeat infringers in “appropriate circumstances”, as the DMCA requires.

These lawsuits resulted in multi-million dollar judgments against Cox and Grande. Meanwhile, more companies are at risk too, including Frontier Communications, which emerged from bankruptcy four years ago.

Frontier vs. Movie and Music Companies

Frontier is fighting not one, but two legal battles. After the company was sued by several prominent record labels including UMG, Sony Music and Warner Music, a group of independent film companies filed a similar lawsuit.

Progress was slow in both cases but after the court denied Frontier’s motions to dismiss last year, the parties began preparing for a trial starting next week.

With damages that could run to hundreds of millions of dollars, the stakes are high. The music companies alone listed 7,758 sound recordings; based on the statutory maximum of $150,000 per willfully infringed work, that could translate to over $1 billion in damages.

The movie and music company plaintiffs separately alleged that Frontier is secondarily liable for copyright infringement because it allegedly provided internet service to known repeat infringers.

The movie companies sought additional relief, most notably a request for an injunction that was bound to pique wider interest due to a site blocking component.

Pirate Site Blocking Measures (Shelved)

In a pretrial order published last week, the parties shared their contentions in advance of the scheduled trial at the New York Bankruptcy Court. The movie companies listed their site-blocking demand as one of the key questions to be answered.

The companies argued that the domains thepiratebay.org, 1337x.to, YTS.MX and (the currently offline) torrentgalaxy.to, should be blocked.

“MCCs further request the Court grant an injunction ordering Frontier to terminate accounts of customers that have repeatedly infringed MCCs’ Works and block access on the domain name service (‘DNS’) level of foreign piracy websites thepiratebay.org, 1337x.to, YTS.MX and torrentgalaxy.to and any of their proxy websites,” the pretrial order reads.

If granted and carried through to conclusion, this would’ve been the first time that a major U.S. Internet provider had blocked pirate sites. However, not long after the joint pretrial order was published, Frontier and the movie companies announced that they were aiming to settle the case.

Movie Companies and Frontier Settle “In Principle”

Last Friday, the parties submitted a joint notice of settlement to the court, mentioning that a settlement is being finalized. As a result, the movie companies asked to be excused from the trial next week.

“Parties have arrived at a settlement in principle, which the Parties are working quickly to document and finalize. Accordingly, the Parties request that the Court excuse MCCs from participating in the trial […] to give the Parties an opportunity to effectuate their settlement and file a stipulation for dismissal,” the update reads.

settlement
The court has yet to grant this request, but it shows that the movie companies seem unlikely to participate in the trial. In fact, two of the movie companies have already finalized their settlement.

This significantly narrows the scope, since the trial will focus on the music company claims alone. Since the movie companies requested the site blocking injunctions, this request will naturally be off the table as well.

Music Companies go to Trial with Frontier

Regardless of the outcome, the music companies’ claims remain, and Frontier will have to put up a defense at trial, of which the company shared a glimpse in the pretrial order.

Among other things, the ISP plans to argue that it lacked sufficient knowledge of the infringements based on the notices sent by copyright holders. Frontier will further point out that it did not encourage or materially contribute to any infringement, emphasizing the substantial non-infringing uses of its service.

The ISP will also highlight its repeat infringer policy, which included warnings and termination of accounts when appropriate. It will argue that the policy should be sufficient for the ISP to benefit from the DMCA’s safe harbor provision.

All in all, it’s clear that the scope of the trial will be significantly reduced if the movie companies and Frontier settle. That said, with a billion dollars in potential damages still in play, significant risk remains.

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