Frontier Communications Corporation
Memo Opinion and Order, For Publication (2024)
Rule of Law:
The Supreme Court's decision in Twitter, Inc. v. Taamneh, which addressed secondary liability for aiding and abetting terrorism, does not alter the well-established common law principles of secondary copyright infringement liability, including both contributory and vicarious infringement, applicable to internet service providers.
Facts:
- Frontier Communications Corporation (Frontier) provides telecommunications and internet services.
- Record Company Claimants and Movie Company Claimants (Claimants) hold copyrights to numerous musical works and motion pictures.
- Frontier subscribers allegedly engaged in infringements of Claimants' copyrighted works.
- Claimants sent hundreds of thousands of copyright infringement notices to Frontier, identifying specific subscribers who were repeatedly infringing these works.
- Claimants allege that Frontier is liable for these infringements based on common law theories of contributory and vicarious liability.
Procedural Posture:
- On April 14, 2020, Frontier filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York.
- On August 27, 2020, the Bankruptcy Court confirmed Frontier’s Chapter 11 plan of reorganization.
- On April 30, 2021, the plan became effective, and Frontier emerged from Chapter 11.
- Record Company Claimants and Movie Company Claimants (Claimants) filed proofs of claim (Bankruptcy Claims) in the Bankruptcy Court for pre-petition and post-petition (pre-effective date administrative expenses) copyright infringement against Frontier.
- Frontier objected to the Bankruptcy Claims.
- Claimants also filed separate actions (District Court Actions) against Frontier in the U.S. District Court for the Southern District of New York, alleging post-effective date copyright infringement, which are pending before Judge Analisa Torres.
- Claimants filed motions to withdraw the reference of the Bankruptcy Claims from the Bankruptcy Court to the District Court, which Judge Torres denied in two written orders.
- Judge Torres determined that discovery for both the Bankruptcy Claims and District Court Actions should proceed together in the Bankruptcy Court.
- Frontier filed a motion for judgment on the pleadings in the Bankruptcy Court regarding the Bankruptcy Claims, arguing that Twitter, Inc. v. Taamneh requires dismissal of secondary copyright infringement liability claims against it.
- Movie Company Claimants and Record Company Claimants filed objections to Frontier's motion.
- Frontier filed a reply to the objections.
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Issue:
Does the Supreme Court's decision in Twitter, Inc. v. Taamneh regarding aiding and abetting terrorism liability implicitly alter or foreclose claims for secondary copyright infringement liability (contributory and vicarious) against an internet service provider?
Opinions:
Majority - Martin Glenn, Chief United States Bankruptcy Judge
No, the Supreme Court's decision in Twitter, Inc. v. Taamneh does not alter or foreclose claims for secondary copyright infringement liability against an internet service provider. Chief Bankruptcy Judge Martin Glenn determined that Twitter addressed aiding and abetting liability under the Justice Against Sponsors of Terrorism Act (JASTA) for acts of terrorism, which is a distinct legal branch from the long-established common law doctrines of secondary copyright infringement. The court emphasized that copyright secondary liability, comprising contributory and vicarious infringement, has been refined over decades, including specific application to ISPs. For contributory infringement, the court reaffirmed that liability arises from knowledge of infringing activity plus either inducement or material contribution. It rejected Frontier's argument that providing internet service constituted 'mere passive nonfeasance,' holding that continuing to provide the 'crucial conduit' of internet access despite specific knowledge of repeated subscriber infringement constitutes 'material contribution' under Sony and Grokster. This action, supplying a product with knowledge of its use for infringement, is considered 'culpable conduct.' The court also dismissed Frontier's 'attenuated nexus' argument, distinguishing the direct link of infringement occurring via Frontier’s network from the distant connection between a social media platform and a terrorist attack in Twitter. Regarding vicarious infringement, the court noted that Twitter did not address or alter this theory, which originates from respondeat superior principles and does not require knowledge. The elements of the 'right and ability to supervise' (e.g., the capacity to terminate subscriber accounts) and a 'direct financial interest' in the infringing activity remain the applicable standards. The court clarified that the Digital Millennium Copyright Act (DMCA) safe harbors are affirmative defenses that an ISP may invoke, but only after a prima facie case of infringement is established, and they require adherence to conditions such as implementing a reasonable repeat infringer policy under DMCA § 512(i). DMCA notices, while not triggering a 'take down' duty for conduit providers under § 512(a), are crucial for establishing the knowledge element of contributory liability and assessing compliance with § 512(i). Finally, the court concluded that secondary liability claims under DMCA § 1202 (regarding Copyright Management Information) also survive, as they rely on the same, unaltered secondary liability theories.
Analysis:
This case significantly clarifies that the Supreme Court's Twitter v. Taamneh decision has a specific scope, applying to terrorism-related aiding and abetting liability, and does not implicitly redefine or weaken established common law principles of secondary copyright infringement against internet service providers. It reinforces that 'material contribution' liability for ISPs, predicated on providing essential services with knowledge of repeat infringement, remains a viable legal theory. The decision provides crucial guidance for both plaintiffs and ISPs, affirming the ongoing vitality of copyright infringement claims in the digital age and underscoring an ISP's potential responsibility when it receives repeated notifications of subscriber infringement and fails to act. This prevents ISPs from using a terrorism liability precedent to escape their traditional common law obligations in copyright.
