In the latest development in the case between ISP Grande Communications and Universal Music Group, a judge has ruled that Grande shouldn't be able to use the DMCA's 'safe harbor' defense since the ISP failed to terminate infringers.
Guest post by Mike Masnick of Techdirt
We've written a few times about a key DMCA case in Texas, involving the ISP Grande Communications and Universal Music Group (and, by proxy, the copyright trolling operation Rightscorp). The case has had a lot of up and downs, with the judge tossing UMG's "vicarious infringement" claims, while letting the "contributory infringement" claims move forward. In October, the court rejected UMG's attempt to bring back the vicarious infringement claims which had already been dismissed, with some fairly harsh words directed at UMG for attempting that.
The latest, as first noted by Torrentfreak, is that the magistrate judge has recommended rejecting Grande's use of the DMCA safe harbor defense. I still have general issues with the idea that the "repeat infringer" part of the DMCA is being accurately described in these cases (specifically: the courts are now applying it to accusations of infringement, rather than actual infringers, which requires a court adjudication). However, the magistrate basically points out that Grande can't make use of the safe harbors because... it had no repeat infringer policy at all. Or, rather, it did, but in 2010 it stopped using it, and then never had a policy through 2016.
So, without a policy, they couldn't have reasonably implemented it... and thus, no safe harbors. Given the facts of the case, that's perhaps not that surprising. The DMCA requires you to have a reasonably implemented policy (Cox lost its similar lawsuit not because it didn't have a policy, but because it didn't follow its own policy).
Of course, that doesn't necessarily mean that UMG is going to win the case. Not having the safe harbor makes it harder for Grande, but not fatal. UMG will still need to prove contributory infringement, which is going to be fairly difficult to show. Earlier in the case, the court had noted "that this is not yet a well-defined area of law, and that there are good arguments on both sides of this issue." Effectively, UMG will need to show that Grande "induced" infringement by its actions, and Grande will claim it did no such thing. But it can't just use the DMCA safe harbors to get the case dismissed, rather it will need to focus specifically on the question of whether it induced people to infringe.