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Supreme Court rules ISPs not liable for subscribers' copyright infringement

Supreme Court rules ISPs not liable for subscribers' copyright infringement

Rule Changes

Unanimous decision overturns $1 billion verdict against Cox Communications, setting a new standard for secondary copyright liability in the internet age

March 25th, 2026: Supreme Court unanimously rules ISPs not liable

Overview

For more than a decade, major record labels have tried to make internet service providers pay for their subscribers' music piracy. On March 25, 2026, the Supreme Court shut that door unanimously. Justice Clarence Thomas, writing for a 9-0 court, held that a company providing internet service cannot be held liable as a copyright infringer simply because it knows some customers will use that service to download music illegally.

The ruling overturns a $1 billion jury verdict that Sony Music, Warner Music Group, and Universal Music Group had won against Cox Communications, one of the largest copyright verdicts in American history.

The decision sets a new standard: an internet provider is contributorily liable for user infringement only if it intended its service to be used that way. That requires either encouraging the infringement or designing the service specifically to facilitate it. For the roughly 100 million households that get broadband in the United States, the question of whether their provider could be forced to police their downloads has been answered.

Why it matters

This ruling determines whether your internet provider must monitor and police what you download — and who pays when users pirate content.

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Key Indicators

$1B
Jury verdict overturned
The 2019 jury awarded roughly $99,830 per work across more than 10,000 copyrighted songs — one of the largest copyright verdicts in U.S. history.
9-0
Unanimous decision
All nine justices agreed Cox was not liable, though Justices Sotomayor and Jackson wrote separately to criticize the majority's reasoning as overly broad.
10,017
Copyrighted works at issue
The number of songs the record labels claimed Cox subscribers illegally downloaded between 2013 and 2014.
$17.7B
U.S. recorded music industry revenue
The annual size of the domestic recorded music market affected by this ruling on secondary liability.

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People Involved

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Timeline

November 2014 March 2026

9 events Latest: March 25th, 2026 · 4 months ago
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  1. Supreme Court unanimously rules ISPs not liable

    Latest Decision

    In a 9-0 decision, Justice Thomas writes that a company cannot be held liable as a copyright infringer for "merely providing a service to the public with knowledge that it will be used by some to infringe copyrights." The Court reverses the Fourth Circuit and holds that contributory liability requires intent — the provider must have either encouraged infringement or designed the service to facilitate it.

Historical Context

3 moments from history that rhyme with this story — and how they unfolded.

January 1984

Sony Corp. v. Universal City Studios — the 'Betamax case' (1984)

Universal Studios sued Sony, arguing that the Betamax VCR enabled consumers to record copyrighted television programs. In a 5-4 decision, the Supreme Court ruled that Sony was not liable for contributory infringement because the VCR was "capable of substantial noninfringing uses." Justice John Paul Stevens wrote the majority opinion establishing the staple article of commerce doctrine in copyright law.

Then

The home video recording industry survived, and VCR sales boomed. Studios initially feared revenue losses but soon earned billions from home video sales and rentals.

Now

The decision established the foundational principle that technology providers are not liable for users' infringement when the technology has substantial lawful uses — a principle that shaped internet law for decades.

Why this matters now

Cox's core argument echoed Sony/Betamax: internet service, like a VCR, has overwhelmingly lawful uses and should not create liability simply because some users employ it for infringement. Justice Thomas's opinion built on this foundation, requiring intent to facilitate infringement rather than mere knowledge of it.

June 2005

MGM Studios v. Grokster (2005)

The Supreme Court unanimously held that Grokster and StreamCast, makers of peer-to-peer file-sharing software, could be liable for inducing copyright infringement. Unlike the neutral VCR in the Betamax case, evidence showed Grokster actively courted former Napster users, marketed itself as a piracy tool, and derived advertising revenue tied to the volume of infringing downloads.

Then

Grokster shut down and paid $36 million to settle with the record labels. The peer-to-peer file-sharing era effectively ended as a mainstream consumer phenomenon.

Now

The decision created the "inducement" standard for secondary copyright liability — a provider that distributes technology with the object of promoting infringement is liable, regardless of whether the technology has lawful uses.

Why this matters now

The Thomas majority in Cox v. Sony drew directly on the Grokster inducement standard, holding that contributory liability requires either encouragement of infringement or a service designed to facilitate it. Cox, unlike Grokster, never marketed its internet service as a tool for piracy.

April 2012

Roadshow Films v. iiNet — Australia's ISP liability ruling (2012)

Australia's High Court ruled unanimously that ISP iiNet was not liable for "authorizing" subscribers' copyright infringement through BitTorrent. The court found that providing internet access — even with knowledge that some subscribers used it for piracy — did not constitute authorization of infringement under Australian copyright law. iiNet could disconnect users but could not prevent specific infringements.

Then

Australian ISPs were shielded from copyright damages. The entertainment industry pivoted to seeking site-blocking injunctions against specific piracy websites rather than suing ISPs.

Now

Australia passed the Copyright Amendment (Online Infringement) Act in 2015, creating a legislative framework for courts to order ISPs to block foreign piracy websites — addressing infringement through targeted injunctions rather than broad ISP liability.

Why this matters now

The iiNet ruling is the closest international parallel to Cox v. Sony, reaching the same conclusion through different legal reasoning. Both courts held that merely providing internet connectivity, even to known infringers, does not make the ISP liable. Australia's post-ruling legislative response — site-blocking rather than ISP liability — may preview the path the U.S. music industry now pursues.

Sources

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