SCOTUS overturns 5th Circuit ruling that told ISP to kick pirates off Internet

The Supreme Court yesterday overturned a 5th Circuit ruling that could have forced Internet service provider Grande Communications to terminate broadband subscribers accused of piracy.

Yesterday’s ruling follows a precedent-setting decision last month in which the Supreme Court threw out a 4th Circuit ruling against Cox Communications, another ISP accused by record labels of not doing enough to fight piracy. In the case involving Cox and Sony, the court said that “a company is not liable as a copyright infringer for merely providing a service to the general public with knowledge that it will be used by some to infringe copyrights.”

Cox is one of several cases in which record labels sought financial damages from ISPs that continued to serve customers whose IP addresses were repeatedly traced to torrent downloads or uploads. In October 2024, record labels Universal, Warner, and Sony got a win over Grande when the US Court of Appeals for the 5th Circuit decided the ISP was liable for contributory copyright infringement.

The conservative-leaning 5th Circuit court held in a 3-0 decision that “Grande knew (or was willfully blind to) the identities of its infringing subscribers” but “made the choice to continue providing services to them anyway, rather than taking simple measures to prevent infringement.” But the 5th Circuit now has to reconsider the Grande v. UMG case after a two-sentence ruling issued yesterday by the Supreme Court.

Grande’s petition “for a writ of certiorari is granted. The judgment is vacated, and the case is remanded to the United States Court of Appeals for the Fifth Circuit for further consideration in light of Cox Communications, Inc. v. Sony Music Entertainment,” the Supreme Court said.

Grande might have had to pay millions to the record labels if the Supreme Court had ruled differently. Grande once faced a $46.8 million damages verdict, but the 5th Circuit ruled that the amount was too high and ordered a new damages trial even though it otherwise sided with the record labels. Cox was once on the hook for a $1 billion jury verdict, but that specific damages amount was also overturned before the case reached the Supreme Court.