Billion Dollar Music Piracy Lawsuit Against Optimum is Over, Permanently

In December 2022, music industry giants including BMG, UMG, and Capitol, filed a massive copyright infringement lawsuit against Altice, owners of internet service provider Optimum. The complaint followed the familiar 'repeat infringer' format, with damages for works in suit worth over a billion dollars and everything on the line. A joint filing this week reveals that the lawsuit has been dismissed with prejudice, never to see the light of day again.

After filing copyright lawsuits against early peer-to-peer file sharing services and emerging mostly victorious, the global music industry found that any depressant effect, on pirate content availability and consumption, was insufficient.

Content was soon being consumed by an expanding pool of internet users, and relentless demand was met being met by increased availability and supply. Since robust peer-to-peer networks had few issues taking care of mass distribution, music industry lawyers switched to suing tens of thousands of music pirates instead. That eventually became unpleasant for everyone and as an anti-piracy strategy, also insufficient.

We Can Do This The Easy Way, Or The Hard Way. No Pressure

Having sued piracy platforms and their users, attention turned to residential ISPs. Approached as potential allies, progress over the years was rarely much more than a mixed bag. When it became increasingly clear that cooperation would involve ISPs suppressing their own customers – those that the music companies had previously failed to suppress – lawsuits against the internet’s gatekeepers were inevitable.

After music giant BMG sued Cox Communications for failing to take action against repeat infringer customers, the matter was settled in BMG’s favor via a “substantial settlement.” With big money at stake, repeat infringer lawsuits are now widespread in the United States; in 2022, BMG hit the owners of Optimum with a similar lawsuit carrying a billion-dollar payload.

The Hard Way It Is Then

Filed in the Eastern District of Texas, the complaint featured plaintiffs BMG Rights Management, UMG Recordings, Capitol Records, Concord Music Group, and Concord Bicycle Assets.

The defendants, Altice USA and CSC Holdings, were described as the operators of one of the largest ISPs in the United States. Sold under ‘Optimum’ branding and available in at least 21 states, high-speed connections made available by the defendants were allegedly being used by thousands of persistent pirates responsible for millions of infringements.

The plaintiffs informed the court that efforts to encourage the ISP to suspend or disconnect alleged infringers, had come to nothing.

“Rather than work with Plaintiffs or take other meaningful or effective steps to curb this massive infringement, Altice chose to permit infringement to run rampant, prioritizing its own profits over the Plaintiffs’ rights,” the complaint continued.

With David Bowie, Justin Bieber, Katy Perry, Keith Urban, and Lady Gaga among around 8,000 artists suffering the consequences of the alleged inaction, the stage was set for a billion dollar showdown.

After 18 Months of Litigation, Case Dismissed – Permanently

If obtaining a settlement was the plan, the next 18 months of litigation failed to give much away. The discovery process, for example, led to claims that certain materials were being withheld based on unsupported assertions of privilege. Deposition notices served on the CEOs of both BMG and Concord were challenged and eventually quashed.

Anti-piracy company OpSec Online, which had been hired by the plaintiffs to track infringement carried out on BitTorrent networks, was required to hand over considerable amounts of data. That included copies of its source code (23,693 files) and more than a million pages of documents.

Altice also sought to obtain information from the RIAA relating to repeat infringer lawsuits targeting other ISPs. Then on Wednesday this week, the parties suddenly advised the court that the lawsuit was over.

Having been dismissed with prejudice, the matter won’t see the light of day again, but the filing itself offers no information to explain why. Similar cases against other ISPs were dismissed just hours before trial, so that seemed the most likely outcome here.

Parties Agreed to Settle

Confirmation that the parties did indeed settle can be found in Altice SEC filings.

“On July 1, 2024, we and the BMG Plaintiffs settled this lawsuit and as part of the settlement we expect a stipulation of dismissal with prejudice to be filed by the parties on or before August 20, 2024. The settlement amount was accrued for as of June 30, 2024,” the document reveals.

No specific settlement figure is mentioned by Altice, but the company does reference its ongoing legal battle with Warner, Sony, and other members of the RIAA, which makes similar ‘repeat infringer’ claims while also seeking massive damages.

“We intend to and are vigorously defending against the claims in the Warner Matter. In addition to contesting the claims of liability, we have an affirmative defense under the Digital Millennium Copyright Act that, if successful, would preclude or limit monetary damages against us in connection with some or all of the Warner Plaintiffs’ asserted claims. There can be no assurance as to the outcome of this litigation,” the filing warns.

The stipulation of dismissal (with prejudice) is available here (pdf)

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