Hosting companies, CDN platforms and consumer ISPs face an increasing risk of being held liable for the activities of their customers.
At least in theory, copyright law in both the United States and Europe should provide adequate protections for intermediaries but if a chink appears in the armor, nothing can stop rightsholders filing a lawsuit. When they do, things can get very expensive, very quickly.
According to its website, UK-based CDN company DataCamp shifts a lot of data via its CDN77 service; 120 Tbps network capacity over six continents, with 140+ private peerings connecting 3,000+ networks. In February 2022, U.S. broadcaster DISH Network filed a $32.5m lawsuit against DataCamp, claiming that it failed to deal with copyright infringing customers.
Filed in an Illinois district court, the complaint claimed that pirate IPTV services Banjo TV, Bollywood IPTV, Comstar TV, Express IPTV, Gennie TV, Gold TV, IPGuys, Istar, Red IPTV, Sky IPTV, and Zumm TV, were all customers of DataCamp.
DISH said it sent “hundreds of notices” requesting removal of content under the DMCA, along with copies of lawsuits and judgments relating to pirate IPTV services.
According to DISH, DataCamp’s response was lacking and since it failed to “adopt and reasonably implement” a repeat infringer policy despite having servers in the United States, the company could not rely on the safe harbor provisions of the DMCA.
“Tactical Leverage” Lawsuit
In a motion to dismiss, DataCamp described the DISH lawsuit as a means to “gain tactical leverage” over alleged direct infringers, i.e the people behind the named IPTV providers.
The company informed the court that knowledge of its customers’ activities would be “technologically impossible” since all traffic is completely encrypted, including between the providers and their customers. As for the infringement notices, DataCamp said it forwarded them to the relevant customers since they were best placed to remove any infringing content.
DISH wasted no time filing a response to DataCamp’s motion to dismiss and DataCamp was equally swift with its own reply. The filings revealed zero progress in the dispute and a canyon between each side’s interpretation of where safe harbors end and liability begins.
After a couple of weeks of relative calm, the parties agreed on a confidentiality order and from there, nothing but silence until December 2022. A status report revealed that DISH had served requests for production on DataCamp and that the company would engage in “rolling” document production.
As part of that process, DataCamp was required to hand over invoices and customer support ticketes for the eleven pirate IPTV services named in the DISH complaint.
In an apparent effort to provide at least some confidentiality, DataCamp said it had “designated its production of its customers’ information (which includes location and payment information) as Attorney Eyes Only under the protective order.”
The report further revealed that DISH and Datacamp had engaged in settlement discussions. DISH had made an intital offer back in October 2022 and DataCamp responded two weeks later. A week or so before Christmas last year, DataCamp still hadn’t received a response.
Motion to Dismiss Denied
Late March 2023, the Court dismissed DataCamp’s motion to dismiss, without prejudice to later refiling if their settlement negotiations come to nothing.
A settlement conference is currently scheduled for May 23, 2023, at the request of both parties. This week the court agreed an extension of the fact discovery deadline to allow the companies more time to resolve the lawsuit via a settlement before incurring additional costs associated with depositions.
In a joint status report filed on May 5, the parties report that DISH provided a settlement letter to DataCamp on May 2. The CDN company says that it will send its response to DISH by May 16. The contents of those letters are unlikely to appear in public but even for a successful, profitable company like DataCamp, the numbers probably won’t make for great reading.
Court documents referenced above can be found here (1,2,3,4,5, pdf)