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Wednesday, March 25, 2026

SCOTUS: Cox Off the Hook for $1B Penalty


When the Supreme Court announced its unanimous decision today, it quietly upended a long, bitter fight between the music industry and internet service providers. The case began with a Virginia jury’s dramatic $1 billion verdict against Cox Communications, a punishment that record labels hailed as a rebuke to widespread online piracy. But that thunderous judgment never stuck.

Cox had been accused of enabling tens of thousands of customers to share more than 10,000 copyrighted works, a pattern that labels said cost the industry billions. The company insisted it never intended to facilitate theft; it merely provided internet access. Facing the prospect of ruinous damages, Cox appealed, arguing a court standard that punished providers for failing to cut off alleged infringers would force them to sever service to big institutional accounts — universities, hospitals, even entire towns — to avoid crippling judgments.

The Supreme Court has sided with Cox. Justice Clarence Thomas wrote that holding an ISP liable simply for continuing service would stretch secondary copyright liability beyond established precedent. In practical terms, the decision erased the threat that ISPs would be routinely punished for subscribers’ behavior and rejected the notion that passive provision of internet access equals complicity.

The ruling reflected broader stakes. Tech companies and the Justice Department had backed Cox, warning that a harsh liability standard would chill speech and push providers toward reflexive account shutdowns. The ACLU cautioned that such a rule could spill over to other speech platforms — bookstores, social networks — with troubling consequences for free expression.

For the music industry, the decision was a setback: the dramatic $1 billion headline faded, and the legal path to holding ISPs financially responsible narrowed. For ISPs and their defenders, the Court offered a reprieve and a clearer boundary between enabling access and actively assisting infringement. The debate over how best to curb piracy — without imperiling an open internet — will continue, but the Court’s ruling has reshaped the terrain.