Charter Can’t Sue Over False DMCA Notices, Record Labels Argue

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Last year Internet provider Charter Communications was sued by several record labels for not doing enough to curb piracy. A few weeks ago, the ISP hit back, suing the music companies for sending inaccurate takedown notices. The retaliatory move could promise fireworks but not according to the labels, who argue that Charter's claims fall flat.

Legal battles between copyright holders and Internet providers are not new. In most countries these disputes revolve around site blocking but, in the US, a different trend has emerged.

Over the past years, several major ISPs have been sued for failing to terminate accounts of alleged repeat infringers.

These lawsuits are serious business. Late last year, for example, Cox was found guilty by a jury that awarded a billion dollars in damages. While the judgment is being appealed, other ISPs are on high alert.

This is also true for Charter Communications, one of the largest Internet providers in the US. The company was sued last year by several major music companies, including Capitol Records, Warner Bros, and Sony Music, which argued that the ISP is liable for pirating subscribers.

Last month Charter replied to the record labels’ complaint. In addition to denying many of the allegations, the ISP also went on the offensive. Charter submitted a counterclaim accusing the labels of sending inaccurate DMCA takedown notices.

The claim comes after the music companies removed 272 sound recordings and 183 music compositions from their initial complaint. These were dropped after the record labels were ordered to produce further evidence that they indeed owned the rights.

Charter believes that the companies have sent many inaccurate takedown notices in the past. These notices reportedly cause damage to the ISP, which says it incurred costs and reputational damage by forwarding the “false accusations.”

“Charter is injured when it processes inaccurate notices, causing it to forward false accusations to its subscribers, to the extent this creates tension with the impacted subscribers, negatively affects goodwill, and causes reputational harm to Charter,” the counterclaim reads.

This could be a serious problem, especially since some of the claimed works were also used to calculate the damages in the Cox trial. However, the music companies now argue that the allegations don’t hold water and they, therefore, ask the court to allow them to file a motion to dismiss the counterclaim.

In a reply, received last week by the US District Court in Denver, Colorado, the music companies point out that under the DMCA, misrepresentation claims only hold up if the receiving party removed or disabled access to the infringing content.

In this case, Charter didn’t. The ISP went on the record stating that it could not remove any content, or stop users from sharing any files.

“Here, Charter does not allege that it removed or disabled access to any infringing material or activity identified in Plaintiffs’ notices. In fact, Charter concedes that it cannot remove infringing content, nor restrict its users’ access to it. Thus, no amendment could cure the deficiency, and the claim should be dismissed with prejudice,” the labels write.

In addition, the labels point out that the ISP failed to state a claim. While mistakes may have happened while sending takedown notices, Charter has no evidence showing that the labels had “actual knowledge” of any misrepresentations, they counter.

“Charter’s claim is based entirely on speculation arising from Plaintiffs’ decision in February 2020 to drop from this suit a few hundred of more than 11,400 copyrighted works included in their original complaint.

“Charter also has not identified any material misrepresentation or a single infringement notice that it claims was inaccurate, as required,” the labels add.

Finally, the music companies point out that the DMCA’s three-year statute of limitations has expired for Charter’s claims. The notices at issue were sent nearly four years ago, they point out.

Based on these arguments, the labels want to ask the court to dismiss the ISP’s counterclaim. To do so, they first ask for permission to file an official motion to dismiss. On top of that, they also want Charter’s request for a declaratory judgment on contributory liability dismissed.

Here is a copy of the record labels’ reply with the request to permit a motion to dismiss(pdf).

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