Altice Liable for Contributory, Vicarious Infringement, Says Sur-Reply

Altice’s motion to dismiss the recording industry’s contributory copyright infringement complaint rests on the “false premise” that Altice, as an internet service provider, “can never be held liable under any legal theory for copyright infringement committed by its customers using its services on its watch,” said the plaintiffs’ sur-reply Monday (docket 2:22-cv-00471) in U.S. District Court for Eastern Texas in Marshall in opposition to the motion.

As Altice pursues dismissal of the action brought by BMG Rights Management and several record labels, the parties agreed to the mediation of their dispute under the watch of retired U.S. Magistrate Judge Suzanne Segal for Central California in Los Angeles (see 2303210004). The plaintiffs allege Altice ignored the infringing conduct of its high-speed internet subscribers. One of Altice’s defenses is that it can’t be expected to police the internet. Another is that it never profited from the infringing activity.

Altice’s position is “belied” by “well-established doctrines” of contributory and vicarious copyright liability, said the sur-reply. A Digital Millennium Copyright Act “statutory safe-harbor defense” is available to shield qualifying service providers from “the very liability contemplated by the complaint,” it said. “This is not a case of first impression based on novel legal theories,” it said. None of the other nine cases filed against service providers like Altice “has been dismissed outright at the pleading stage,” it said.

The complaint details why and how Altice “is both contributorily and vicariously liable for copyright infringement,” said the sur-reply. Altice ironically asks the court “to depart from the overwhelming thrust of decisions on point,” yet it insists the plaintiffs are the parties “distorting the applicable law,” it said. “Altice is incorrect,” it said. Its motion should be denied, it said.

The complaint “amply alleges” Altice gets “a direct financial benefit attributable to the infringement,” satisfying the vicarious liability claim, said the sur-reply. The complaint alleges Altice would make less money “if it exercised its authority and ability” to terminate the accounts of infringing subscribers, it said. “Conversely, it made more money because it declined to exercise that authority and ability,” it said.

Altice is “directly incentivized” to allow subscribers to engage in copyright infringement using its system, said the sur-reply. “Why else would Altice allow infringement to take place on the scale alleged in the complaint, despite the ability to prevent it?”

Altice has received millions of detailed notices of infringement, yet it continued to provide its services “even to known, chronic infringers,” said the sur-reply. That satisfies the recording industry’s contributory infringement claims, it said. “None of the prior nine cases involving contributory liability against an internet service provider resulted in dismissal at this stage,” it said. “Altice, nevertheless, recycles the same failed arguments in reply.”