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Internet provider Cox Communications has dropped its lawsuit against Rightscorp and BMG. The ISP accused the companies of sending abusive and unfair DMCA takedown notices to fabricate massive copyright infringement claims. Despite these strong words and harsh allegations, the parties managed to resolve the matter out of court.

Internet provider Cox Communications has been on the sharp end of several piracy lawsuits in recent years.

In December 2015, a Virginia federal jury held Cox Communications responsible for pirating subscribers, ordering the company to pay music publisher BMG Rights Management $25 million in damages.

This damages figure was reduced in a settlement agreement but, soon after, the Internet provider was hit with a $1 billion jury verdict in a similar case, which is still under appeal.

Cox Updated Its DMCA Policy

These lawsuits were a wake-up call for Cox. To cope with the constant stream of DMCA notices, the company spent millions to improve its takedown systems and processes. In 2017, DMCA notices were separated from other abuse complaints. After that, rightsholders were directed to use a new email address which is also listed a registered agent at the Copyright Office.

Most copyright holders began sending their takedown notices to the new email address, but there was one outlier. Despite repeated alerts and warnings, BMG and its anti-piracy partner Rightscorp continued to use the old [email protected] address.

This presented a problem for the ISP, which didn’t want to risk ignoring these notices. That’s understandable, as doing so could potentially open the door to millions of dollars in new damages claims. In fact, Cox suspected that this was BMG and Rightscorp’s plan all along.

Cox Sues BMG and Rightscorp

In a lawsuit filed earlier this year, the Internet provider described Rightscorp’s business plan as “corrupt” as it basically attempts to “extort” Internet subscribers into paying settlements. In a similar vein, the ‘refusal’ to use the new email address was seen as an attempt to get Cox in trouble again.

“It is obvious that Defendants’ tactic is a thinly veiled attempt to exploit the procedures set forth by the [DMCA], with the goal of leveraging their improper notices to attempt to extract windfall judgments for BMG and Rightscorp’s other prospective clients. Their approach is improper and unlawful, and should be stopped,” Cox wrote.

A few months have passed without an official response in court from either BMG or Rightscorp. Behind the scenes, however, the legal teams of all parties were working hard to resolve the issue without much bloodshed.

Resolving Matters Out of Court

Two weeks ago, the three companies submitted a joint motion asking to extend the reply deadline. According to this filing, Cox, BMG, and Rightscorp were engaged in “active discussions” to resolve the matter outside court.

These discussions were fruitful as Cox decided to drop the lawsuit in its entirety this week.

The motion to dismiss doesn’t explain how the matter was resolved but we can assume that Rightscorp will use the correct email address going forward. Whether Cox was also compensated for the damages it claimed is not clear.

For Cox, it was probably most important to prevent any future copyright infringement claims from BMG. And with the appeal against the $1 billion verdict in another lawsuit still pending, the company has other priorities as well.