This is another lawsuit against IAPs for subscribers’ BitTorrent activity. As I wrote previously:
lawsuits against IAPs are problematic for many reasons, including the failure of 512(a), the danger of assuming that notices of claimed infringements (NOCIs) actually reflect infringing behavior, and the mismatch between the wrongdoing of alleged copyright infringement and the remedy of terminating Internet access
The courts seem unimpressed with these concerns. The result has been a string of disconcerting rulings that put every IAP in jeopardy.
In this case, the IAP RCN sought a motion to dismiss. Due to the procedural inferences in favor of the copyright owners, the court hands the plaintiffs a terribly lopsided win. Will the court change its tune at the summary judgment stage? Or is this just how it’s going to go? Some lowlights from the opinion:
Plaintiffs sufficiently allege that Defendants’ subscribers, or those using their accounts, employ Defendants’ internet service to copy and distribute the Works to which Plaintiffs hold legitimate copyrights…
The fact that Defendants reserve the right to terminate the accounts of infringing subscribers suggests, at least at the early pleading stage, that Defendants do, in fact, contemplate responsibility over their accounts regardless of the individual accessing the account
Reminder: the DMCA requires RCN to disclose and reasonably implement its repeat infringer policy, yet the court seems to be holding that against RCN? And where is the volitional doctrine in all of this?
Plaintiffs have stated allegations sufficient to satisfy the knowledge requirement at the pleading stage, based on the allegation that Maverickeye sent notices to Defendants concerning infringement of copyright protected Works at IP addresses assigned to Defendants from ARIN… [Eric’s note: reminder about the problems of assuming subscribers’ infringing activity based on takedown notices.]
Plaintiffs sufficiently allege conduct that encourages or assists infringement, specifically, that “Defendants continued to provide service to their subscribers despite knowledge that their subscribers were using the service to engage and facilitate massive piracy of Plaintiffs’ copyright protected Works.” Therefore, Plaintiffs have pled that they informed Defendants of the infringing activity, and that Defendants continued to provide service to these accounts without further inquiry. [Eric’s note: so this court is currently embracing the remedy mismatch of canceling Internet access based on takedown notices]
Regarding right and ability to control:
Plaintiffs have adequately pled this element by alleging “Defendants monitor and/or control the content that their subscribers access or which websites they visit,” and “Defendants have the ability to determine whether their subscriber’s service is being used for operating file-sharing programs such as BitTorrent and whether the subscriber’s service is being used to distribute copies of copyright protected content”. According to Defendants’ policies, Defendants reserve the right “to remove or block access to, either permanently or temporarily, any files which [Defendants] suspect[ ] or which a third party alleges are associated with a violation of the law[.]”
I thought the courts had stopped treating these kinds of contractual reservation of rights as evidence of control back in the 1990s, but I guess retro is back in fashion.
Regarding direct financial interest, the court credits these allegations:
Plaintiffs allege, “[t]he ability of subscribers to use Defendants’ high-speed service to infringe Plaintiffs’ Works without having their services terminated despite multiple notices being sent to Defendants acts as a powerful draw for subscribers of Defendants’ service.” Plaintiffs further allege in this case that Defendants advertise their higher downloading and uploading speed, which is at an increased cost to “Download an HD movie in a Snap” and to “Download a TV show, an album or photos in a Flash,” and that this draws customers who wish to utilize high-speed internet service to facilitate piracy on the BitTorrent network.
Marketing fast Internet is evidence that the service is trying to profit from copyright infringement…? I guess RCN can better manage its copyright liability exposure by advertising that it provides shitty connections.
The court says it’s possible to contributorily violate 1202. Ugh. The court then collapses much of the 1202 analysis into the 512 analysis, because hey! they were both in the DMCA. Ugh ugh ugh.
The 512(a) analysis get this treatment in a footnote:
To the extent Defendants have asserted safe harbor, the Court finds Plaintiffs have plausibly alleged that Defendants do not qualify. According to the FAC, “[Defendants] ha[ve] adopted a policy that provides for the termination in appropriate circumstances of subscribers and account holders who are repeat infringers,” but that Defendants have failed to reasonably implement it (see FAC ¶ 133 (providing an excerpt of Defendants’ user agreement, advising subscribers that failure to obey applicable copyright laws may result in account suspension or termination); see id. ¶¶ 119-31, specifically ¶ 130 (“Defendants completely ignored the [notice] letter and continued to provide service to even the subscribers engaged in prolific piracy detailed in the letter.”); see also id. ¶¶ 143-51 (providing “examples of Defendants’ failure to reasonably implement the requisite policy)). Therefore, Plaintiffs have adequately pled that Defendants are not eligible for safe harbor under the DMCA to warrant dismissal at this stage of the proceedings.
Case citation: Bodyguard Productions v. RCN Telecom Services, LLC, 2022 WL 6750322 (D.N.J. Oct. 11, 2022)
BONUS: Millennium Funding, Inc. v. Private Internet Access, Inc., 2022 WL 7560395 (D. Colo. Oct. 13, 2022)
The court rejects direct copyright liability by a VPN service provider. The court thinks the 10th Circuit would adopt the volitional conduct requirement. Thus, “to state—and eventually succeed on—a claim for direct copyright infringement, there must be some causal nexus between the named defendant and the alleged direct infringement.” Aereo doesn’t specify otherwise; “the Aereo decision did not adopt or reject a volitional-conduct requirement.”
With respect to volitional conduct:
Plaintiffs’ allegations suggest that PIA advertises or represents that its users can “unblock” Netflix to circumvent the streaming service’s geographic restrictions, and encourages its users to do so. But Plaintiffs cite no authority demonstrating that, by encouraging or advertising its services, PIA has effectively engaged in “volitional conduct” in the copyright context, and the Court cannot conclude that these allegations are sufficient…the Second Amended Complaint does not contain any specific factual allegations establishing specific volitional conduct on the part of PIA that is directly linked to any specific infringement, and thus, there are insufficient facts to state a claim of direct infringement against PIA
More confusing discussion about 1202, though.