With Cox V. Sony The Supreme Court Provides Yet Another Internet-Protecting Decision
The Supreme Court has now issued its decision in Cox Communications v. Sony Music Entertainment. This was a case where Cox, a broadband provider, had been held liable for the alleged copyright infringements of its users, in this case via filesharing. It appealed, arguing that such secondary liability was not something that copyright law allowed. And the Supreme Court has now agreed. Cox won its appeal, in a pretty big way. But the implications may be even bigger, for copyright law, but especially for the Internet because, once again, the Court has limited secondary liability for platforms—and that’s a big deal for Internet law.
Setting the stage
While direct liability is about holding a wrongdoer responsible for their actions, secondary liability is about holding someone else liable for the wrongdoer’s actions. It’s a concept that comes from common law, but it has historically been limited in its applicability because it can be so chilling to helpful behaviors we might want to encourage—like platforms providing Internet services—when engaging in them can put the helper on the hook if someone they helped does something wrong. Our sense of justice and fair play also tends to want there to be more culpability on the part of the helper before it would seem right to subject them to shared liability with whomever they helped.
But that restraint has been diminishing in modern jurisprudence. In the copyright space it started to be lost a century ago, as some expansive theories of secondary copyright liability began to take hold allowing defendants to be held liable for other people’s infringements. Although the Supreme Court’s 1984 Sony v. Universal Music decision held the line on this expansion, where Sony was not held liable for the fact that people could use its VCRs to infringe copyrights because the VCR was also capable of substantial non-infringing uses as well, liability theories continued to expand up through the Court’s 2005 decision in MGM Studios v. Grokster, where it found Grokster liable for other people’s filesharing, and beyond. This case of Cox v. Sony is one of several similar cases that have been working their way through lower courts, where broadband ISPs were being held liable for the filesharing of their users using secondary liability theories that were even more expansive than anything the Supreme Court had previously endorsed.
And in the Internet law space secondary liability pressure has continued to increase as well, both by platforms becoming subject to more and more regulatory pressure predicated on liability that would attach based on how people used their systems if the platforms didn’t take active steps to curb those uses, and by the statutory protection that could have shielded them from it, like Section 230 and Section 512 of the Digital Millennium Copyright Act, starting to be weakened in favor of allowing liability. There may be several reasons for this trend, but one big one is that the more accepted secondary liability has been in copyright law, and the more tolerated the censorial consequences of such pressure in copyright law have been, the more it seemed reasonable to apply secondary liability to other forms of liability as well, censorial consequences be damned. Which is why this case is such a big deal, because it helps put the brakes on that platform liability trend.
The decision itself
As the Court noted in its decision, the copyright statute itself only provides for direct liability for infringement. [Majority p.6]. So if there’s going to be secondary liability, it will be something for the Courts to infer using traditional common law principles. [Concurrence p.3-4]. Over the years such inferences have led courts to fine to two avenues for there being secondary copyright infringement: “contributory” liability and “vicarious” liability. [Majority p.2]. “Vicarious” liability wasn’t an issue in this case because the Fourth Circuit had already concluded that Cox did not “receiv[e] a direct financial benefit from its subscribers’ infringement,” and the Court had declined to review Sony’s appeal of that aspect of the decision. [Majority p.6]. But with respect for contributory liability, the Court says that it can attach for only two reasons: because a defendant has distributed or provided a product or service that is incapable of substantial non-infringing uses (which it took from the Sony decision), or a defendant has induced another to infringe (which it took from Grokster).
The provider of a service is contributorily liable for a user’s infringement if it intended its service to be used for infringement. To establish that a provider intended its service to be used for infringement, a copyright owner must show one of two things. First, it can show that a party affirmatively “induc[ed]” the infringement. Or, second, it can show that the party sold a service tailored to infringement. [Majority p.2]
Furthermore, contributory liability could only apply when there was the intent that the defendant’s service be used for infringement.
The provider of a service is contributorily liable for the user’s infringement only if it intended that the provided service be used for infringement. The intent required for contributory liability can be shown only if the party induced the infringement or the provided service is tailored to that infringement. A provider induces infringement if it actively encourages infringement through specific acts. […] A service is tailored to infringement if it is “not capable of ‘substantial’ or ‘commercially significant’ noninfringing uses.” [Majority p.7]
And perhaps more importantly, the Court found that intent could not be construed by the defendant having some knowledge that infringement could be occurring.
This Court has repeatedly made clear that mere knowledge that a service will be used to infringe is insufficient to establish the required intent to infringe. In Kalem Co., the Court explained that “mere indifferent supposition or knowledge on the part of the seller” that the buyer will use the product unlawfully is “not enough” to make the seller liable for the buyer’s conduct. 222 U. S., at 62. In Sony, the Court explained that “[t]here is no precedent in the law of copyright” for liability based only “on the fact that [the defendant] has sold equipment with constructive knowledge of the fact that its customers may use that equipment to make unauthorized copies of copyrighted material.” 464 U. S., at 439. And, in Grokster, the Court confirmed that “a court would be unable to find contributory infringement liability merely based on a failure to take affirmative steps to prevent infringement.” 545 U. S., at 939, n. 12. [Majority p.8-9]
Ultimately, the Court found that neither theory of contributory liability applied to Cox because it lacked the intent for its services to be used for infringement.
Thus, Cox is not contributorily liable for the infringement of Sony’s copyrights. Cox provided Internet service to its subscribers, but it did not intend for that service to be used to commit copyright infringement. Holding Cox liable merely for failing to terminate Internet service to infringing accounts would expand secondary copyright liability beyond our precedents. Cox neither induced its users’ infringement nor provided a service tailored to infringement. As for inducement, Cox did not “induce” or “encourage” its subscribers to infringe in any manner. Id., at 930. Sony provided no “evidence of express promotion, marketing, and intent to promote” infringement. Id., at 926. And, Cox repeatedly discouraged copyright infringement by sending warnings, suspending services, and terminating accounts. As for providing a service tailored to infringement, Cox’s Internet service was clearly “capable of ‘substantial’ or ‘commercially significant’ noninfringing uses.” Id., at 942 (Ginsburg, J., concurring). Cox did not tailor its service to make copyright infringement easier. Cox simply provided Internet access, which is used for many purposes other than copyright infringement. [Majority p.9].
In a concurring opinion, Justice Sotomayor, joined by Justice Jackson, took issue with the majority’s analysis, raising the concern that there were more possible vectors of secondary liability than the two the majority addressed, like “aiding and abetting” liability, and that prior precedent had left open the possibility that they could apply. Yet the majority here had not only ignored these other approaches but effectively shut the door to them ever applying in the copyright space.
The majority holds that Cox is not liable solely because its conduct does not fit within the two theories of secondary liability previously applied by this Court. In so doing, the majority, without any meaningful explanation, unnecessarily limits secondary liability even though this Court’s precedents have left open the possibility that other common-law theories of such liability, like aiding and abetting, could apply in the copyright context. [Concurrence p.1]
Her concurrence was a concurrence, however, and not a dissent, because she, too, found that even aiding and abetting liability wouldn’t apply to Cox because it also lacked the intent such liability required.
Plaintiffs must prove that Cox intended to aid, and therefore help make succeed, copyright infringement committed by those who use its network. To do so, plaintiffs point out that Cox, having received copyright-violation notices, knew that specific connections it services have been, and will continue to be, used to infringe copyrights. Because Cox nonetheless continued to service those connections, plaintiffs argue that the jury could have found that Cox intended to facilitate infringement committed using those connections. This record, however, cannot support finding the necessary intent for aiding-and-abetting liability to attach. To begin, Cox is merely supplying internet service to its customers. Nothing about that conduct is inherently culpable: Most internet traffic is lawful, and supplying an internet connection is just as consistent with lawful purposes as it is with unlawful purposes. See id., at 292 (“[R]outine and general activity that happens on occasion to assist in a crime . . . is unlikely to count as aiding and abetting”). Nor have plaintiffs shown that Cox intended to aid specific instances of infringement. That is because, based on plaintiffs’ evidence, Cox does not actually know that specific users will commit infringement using Cox’s network. Cox supplies internet connections to a wide range of customers, ranging from single users all the way to smaller regional ISPs. When Cox receives a copyright violation notice, however, the notice specifies only which connection was used to infringe, not who used it to commit infringement. [Concurrence p.10-11]
The implications
Despite the disagreement between Justices Sotomayor and Thomas, the decision is still good news for platforms. Even if she’s right and secondary liability may now technically be more limited than it should be in the copyright context, the upshot is that it’s still limited, and the decades, if not century-long expansion of secondary liability for copyright has now been halted. And even if her view of a more expansive catalog of secondary liability sources were to eventually be applicable, even per the concurrence these sources would still require more careful and limited application than has been the trend.
All of which is good for several reasons. First, because it brings copyright law back in line with general common law doctrine that counsels restraint in applying secondary liability. Copyright law had started to be treated as exceptional, where that restraint was cast aside with little policy justification, especially given that even Congress itself was not building secondary liability into its own copyright statute. Furthermore, by bringing copyright law back in line with traditional common law principles it means it can no longer stand as a model to encourage secondary liability expansion with respect to other forms of liability. For too long the exception had started to become the rule, where an attitude of “well if it’s ok for copyright it must be ok for this…” so having the Supreme Court say it is not actually ok for secondary copyright liability to be so expansive will hopefully be tempering for all forms of secondary liability.
It is also significant that both the majority and concurring opinions express concerns with how “knowledge” has often been construed to equate to culpable conduct. Neither accepts that what Cox technically “knew” about potential user infringement could amount to culpability. Sony had argued that because Cox hadn’t (by and large) terminated accused infringers it was therefore liable for their infringements, and this theory was largely rejected. Indeed, both authoring justices seemed especially disturbed by the fact that IP addresses were being used as a proxy for knowledge of an individual infringement when, given that so many connections were shared by households, coffee shops, hospitals, or other institutions, such an inference was often impossible to arrive at. [Majority p.3].
Given this degree of removal from the infringing activity and Cox’s incomplete knowledge, Cox cannot be found to have intended to aid in any specific instance of infringement committed using the connection that Cox provides to the regional ISP. The same is true for connections Cox provides to university housing, hospitals, military bases, and other places that are likely to have many different users. Without proof that Cox knew more about individual instances of infringement, and without evidence of “pervasive, systemic, and culpable assistance” needed to support a more generalized theory of liability, see Twitter, 598 U. S., at 502, plaintiffs have at most shown that Cox was “indifferent” to infringement conducted via the connections it sells. Id., at 500. Mere indifference, however, is not enough for aiding and abetting liability to attach. Smith & Wesson, 605 U. S., at 297. [Concurrence p.12]
It’s also the practical effect of this decision on platforms that stands to be most important for the Internet. The fear of expansive secondary liability has provided immense pressure on platforms to proactively, if not also needlessly, censor the user expression they facilitate in order to avoid it. It certainly has in the copyright space, where platforms have had to remove speech, and even speakers, in an attempt to avoid it, and there has been increasing concern that such secondary liability for other forms of alleged wrongdoing would result in platforms finding themselves taking similar censorial action against other expression they facilitate in order to avoid it as well. They still potentially could, if such secondary liability is prescribed by statute. But there are now several Supreme Court decisions that such a statute would need to overcome: this one, which says that such liability would be an exception from traditional common law rules, and NRA v. Vullo, which points out how statutes seeking to censor via regulatory pressure on intermediaries is unconstitutional, should a regulator try to statutorily create such an exception anyway.
This decision should also hopefully take some pressure off the statutory protections from liability that platforms still depend on, namely the DMCA and Section 230. Indeed, with this decision we’ve come a long way from 2020 when Justice Thomas terrified everyone who cares about the Internet by waxing poetic about whether it was time to revisit the jurisprudence allowing Section 230 to work the way it does. Without Section 230 doing its job of insulating platforms from liability in the user expression they facilitate, and liability from how they moderate it, it would make it difficult if not impossible to even have Internet platforms available to do either of those important things that make the Internet work. And the same with the DMCA, which protects platforms from the copyright liability that Section 230 doesn’t cover, although its protection has been more porous, which is why platforms have had to take down so much expression in order to avoid copyright liability that could potentially adhere in the statutory protection’s coverage gaps.
The decision doesn’t obviate the statutory protection, however, as Justice Sotomayor worried. In her concurrence she wondered what the point of the DMCA would be after this decision if there is no secondary liability to be had without it. [Concurrence p.5-7]. For his part, Justice Thomas noted that it would still provide a defense, but no more could the potential failure to qualify for a safe harbor be automatically considered the grounds for liability. [Majority p.10]. But both the DMCA and Section 230 still have an important job to play. After all, they still protect platforms from being drained by unmeritorious litigation because it’s the cost of the defense and not just the potential liability that are so destructive to platforms ability to be platforms. As it is, we’ve already lost platforms who were bankrupted by the cost of finding out they weren’t liable, and we still need the statutory protection, for both copyright, with the DMCA, and everything else, with Section 230, to operate to make sure no more platforms will suffer a similar extinctive fate.
But it does make both statutes a lot less load-bearing in how they insulate platforms from that actual liability itself, because with this decision, as well as the earlier Twitter v. Taamneh decision—both ironically written by Justice Thomas—underlying liability should now be a lot harder to find.