The Marathon Legal Battle Continues: Court Grants Cox Stay Request Pending Appeal in Major Label Infringement Showdown

Close to two months after ordering a new damages trial in the long-running infringement battle between Cox Communications and the major labels, the Fourth Circuit Court of Appeals has officially agreed to stay the underlying mandate as the ISP pursues an appeal.

Cox submitted the motion to stay the mandate in late March, and the record-label plaintiffs expressed support for the move soon thereafter. While the ISP when seeking the stay cited an ongoing liability appeal and an effort to bring the case before the Supreme Court, the plaintiffs (and later the court) only concurred with the former reason.

For a bit of (relatively) quick background, last time we checked in on the lengthy copyright confrontation, the mentioned appellate court in late March rejected requests from both sides to review elements of the initially highlighted February decision.

The latter saw the three-judge panel vacate the staggering $1 billion infringement verdict that a jury had slapped Cox with towards 2019’s conclusion. Also included in the decision was an order for a fresh trial not to determine Cox’s liability – the court upheld the jury’s contributory infringement findings – but the amount owed to the major-label plaintiffs.

Once again in the interest of brevity, the appellate court, notwithstanding this determination, must still consider Cox’s appeal concerning its actual liability for infringement.

And this consideration, the ISP argued in more words, should occur prior to the aforesaid mandate’s finalization and the adjacent district-court damages trial.

“The district court would be proceeding in parallel with retrial proceedings that purport to settle Cox’s rights and obligations on damages issues,” the ISP wrote, “while two appellate courts evaluate whether liability is appropriate in the first instance.

“This Court should not issue the mandate before all litigation challenging the liability judgment is complete,” Cox spelled out.

“Indeed, allowing the district court to proceed to damages retrial on the flawed (and related) liability verdict gives rise to the possibility that the new damages verdict would rest on the very same errors challenged in the Rule 60(b) appeal, inviting yet further piecemeal litigation,” the company penned.

As noted, the major labels, despite criticizing Cox’s arguments (including those pertaining to the sought Supreme Court appeal) and indicating that the “appeal lacks merit and will be disposed of in due course,” agreed with the stay motion.

“Plaintiffs nevertheless agree that judicial economy would be best served by this Court resolving all of Cox’s challenges to the underlying trial and then remanding for a retrial on damages,” the labels communicated.

(Cox’s arguments regarding the Supreme Court appeal are especially interesting, with the ISP targeting various courts’ perceived “three-way conflict over what constitutes a ‘material contribution’ to infringement” and exploring the precise circumstances where “providing a service with myriad lawful uses renders the provider contributorily liable when someone uses that service to infringe.”)

Consequently, the court has stayed the mandate pending appeal – while denying the requested writ of certiorari pause. Of course, it’ll be worth closely monitoring the development’s impact on the marathon litigation, particularly when it comes to the timing of the potentially involved (and decidedly high-stakes) damages retrial.