Certiorari granted by Supreme Court, June 30, 2025
`PUBLISHED
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`UNITED STATES COURT OF APPEALS
`FOR THE FOURTH CIRCUIT
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`No. 21-1168
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`SONY MUSIC ENTERTAINMENT; ARISTA MUSIC; ARISTA RECORDS,
`LLC; LAFACE RECORDS LLC; PROVIDENT LABEL GROUP, LLC; SONY
`MUSIC ENTERTAINMENT US LATIN LLC; VOLCANO ENTERTAINMENT
`III, LLC; ZOMBA RECORDINGS LLC; SONY/ATV MUSIC PUBLISHING
`LLC; EMI AI GALLICO MUSIC CORP.; EMI ALGEE MUSIC CORP.; EMI
`APRIL MUSIC INC.; EMI BLACKWOOD MUSIC INC.; COLGEMS-EMI
`MUSIC INC.; EMI CONSORTIUM MUSIC PUBLISHING INC., d/b/a EMI Full
`Keel Music; EMI CONSORTIUM SONGS, INC., d/b/a EMI Longitude Music;
`EMI FEIST CATALOG INC.; EMI MILLER CATALOG INC.; EMI MILLS
`MUSIC, INC.; EMI UNART CATALOG INC.; EMI U CATALOG INC.; JOBETE
`MUSIC COMPANY, INCORPORATED; STONE AGATE MUSIC; SCREEN
`GEMS-EMI MUSIC, INCORPORATED; STONE DIAMOND MUSIC CORP.;
`ATLANTIC RECORDING CORPORATION; BAD BOYS RECORDS LLC;
`ELEKTRA ENTERTAINMENT GROUP, INCORPORATED; FUELED BY
`RAMEN LLC; ROADRUNNER RECORDS, INC.; WARNER-TAMERLANE
`PUBLISHING CORPORATION; WB MUSIC CORPORATION;
`UNICHAPPELL MUSIC, INCORPORATED; RIGHTSONG MUSIC INC.;
`COTILLION MUSIC, INCORPORATED; INTERSONG U.S.A., INC.; UMG
`RECORDINGS, INCORPORATED; CAPITOL RECORDS, LLC; UNIVERSAL
`MUSIC CORPORATION; UNIVERSAL MUSIC-MGB NA LLC; UNIVERSAL
`MUSIC PUBLISHING INC.; UNIVERSAL MUSIC PUBLISHING AB;
`UNIVERSAL PUBLISHING LIMITED; UNIVERSAL MUSIC PUBLISHING
`MGB LIMITED; UNIVERSAL MUSIC - Z TUNES LLC; UNIVERSAL/ISLAND
`MUSIC LIMITED; UNIVERSAL/MCA MUSIC PUBLISHING PTY. LIMITED;
`POLYGRAM PUBLISHING, INC.; SONGS OF UNIVERSAL, INC.; WARNER
`RECORDS, INC., f/k/a W.B.M. Music Corp.; WARNER CHAPPELL MUSIC,
`INC., f/k/a Warner/Chappell Music, Inc.; W.C.M. MUSIC CORP., f/k/a W.B.M.
`Music Corp.,
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` Plaintiffs – Appellees,
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`and
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`NONESUCH RECORDS INC.; WARNER BROS. RECORDS, INC.;
`WARNER/CHAPPELL MUSIC, INC.; W.B.M. MUSIC CORP.; UNIVERSAL -
`POLYGRAM INTERNATIONAL TUNES, INC.; UNIVERSAL - SONGS OF
`POLYGRAM INTERNATIONAL, INC.; UNIVERSAL POLYGRAM
`INTERNATIONAL PUBLISHING, INC.; MUSIC CORPORATION OF
`AMERICA, INC., d/b/a Universal Music Corporation; RONDOR MUSIC
`INTERNATIONAL,
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` Plaintiffs,
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` v.
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`COX COMMUNICATIONS, INCORPORATED; COXCOM, LLC,
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` Defendants – Appellants.
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`INTERNET ASSOCIATION; ELECTRONIC FRONTIER FOUNDATION;
`CENTER FOR DEMOCRACY AND TECHNOLOGY; AMERICAN LIBRARY
`ASSOCIATION; ASSOCIATION OF COLLEGE AND RESEARCH LIBRARIES;
`ASSOCIATION OF RESEARCH LIBRARIES; PUBLIC KNOWLEDGE; NTCA
`THE RURAL BROADBAND ASSOCIATION; CTIA - THE WIRELESS
`ASSOCIATION; USTELECOM THE BROADBAND ASSOCIATION;
`INTERNET COMMERCE COALITION; INTELLECTUAL PROPERTY LAW
`PROFESSORS,
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`Amici Supporting Appellant,
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` and
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`NATIONAL MUSIC PUBLISHERS ’ ASSOCIATION; NASHVILLE
`SONGWRITERS ASSOCIATION INTERNATIONAL; SONGWRITERS OF
`NORTH AMERICA; COPYRIGHT ALLIANCE,
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` Amici Supporting Appellee.
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`Appeal from the United States District Court for the Eastern District of Virginia, at
`Alexandria. Liam O’Grady, Senior District Judge. (1:18-cv-00950-LO-JFA)
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`Argued: March 9, 2022 Decided: February 20, 2024
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`Before HARRIS and RUSHING, Circuit Judges, and FLOYD, Senior Circuit Judge.
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`Affirmed in part, reversed in part, vacated in part, and remanded by published opinion.
`Judge Rushing wrote the opinion, in which Judge Harris and Senior Judge Floyd joined.
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`ARGUED: E. Joshua Rosenkranz, ORRICK, HERRINGTON & SUTCLIFFE LLP, New
`York, New York, for Appellants. Catherine Emily Stetson, HOGAN LOVELLS US LLP,
`Washington, D.C., for Appellees. ON BRIEF: Michael S. Elkin, Jennifer A. Golinveaux,
`Geoffrey P. Eaton, WINSTON & STRAWN LLP, New York, New York; Mark S. Davies,
`Sheila A. Baynes, Washington, D.C., Christopher J. Cariello, Rachel G. Shalev, Alexandra
`Bursak, ORRICK, HERRINGTON & SUTCLIFFE LLP, New York, New York, for
`Appellants. Matthew J. Oppenheim, Scott A. Zebrak, Jeffrey M. Gould, OPPENHEIM +
`ZEBRAK, LLP, Washington, D.C.; Jo-Ann Tamila Sagar, Patrick C. Valencia, HOGAN
`LOVELLS US LLP, Washington, D.C., for Appellees. Joseph C. Gratz, Samuel J. Zeitlin,
`DURIE TANGRI LLP, San Francisco, California, for Amicus Internet Association.
`Mitchell L. Stoltz, Corynne McSherry, ELECTRONIC FRONTIER FOUNDATION, San
`Francisco, California; Erik Stallman, Juliana DeVries, Samuelson Law, Technology &
`Public Policy Clinic, UC BERKELEY SCHOOL OF LAW, Berkeley, California, for
`Amici Electronic Frontier Foundation, Center for Democracy and Technology, American
`Library Association, Association of College and Research Libraries, Association of
`Research Libraries, and Public Knowledge. David E. Weslow, Megan L. Brown, Ari S.
`Meltzer, Kevin G. Rupy, Adrienne J. Kosak, WILEY REIN LLP, Washington, D.C., for
`Amici NTCA – The Rural Broadband Association, CTIA – The Wireless Association, and
`USTelecom – The Broadband Association. Andrew L. Deutsch, DLA PIPER LLP (US),
`Los Angeles, California, for Amicus Internet Commerce Coalition. Phillip R. Malone,
`Juelsgaard Intellectual Property and Innovation Clinic, Mills Legal Clinic, STANFORD
`LAW SCHOOL, Stanford, California, for Amici Intellectual Property Law Professors.
`Danielle M. Aguirre, Kerry M. Mustico, Christopher A. Bates, NATIONAL MUSIC
`PUBLISHERS’ ASSOCIATION, Washington, D.C.; Ruthanne M. Deutsch, Hyland Hunt,
`Alexandra Mansbach, DEUTSCH HUNT PLLC, Washington, D.C., for Amici National
`Music Publishers’ Association, Nashville Songwriters Association International, and
`Songwriters of North America. Nancy Wolff, Sara Gates, COWAN DEBAETS
`ABRAHAMS & SHEPPARD LLP, New York, New York, for Amicus The Copyright
`Alliance.
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`RUSHING, Circuit Judge:
`Defendant Cox Communications sells internet, telephone, and cable television
`service to 6 million homes and businesses across the United States. Plaintiffs —Sony
`Music Entertainment and numerous other record companies and music publishers—own
`some of the most popular copyrighted musical works of our time. Some users of Cox’s
`internet service infringed Plaintiffs’ copyrights by downloading or distributing songs over
`the internet without permission. Rather than sue those individuals, Plaintiffs sued Cox,
`seeking to hold it responsible for its customers’ copyright infringement.
`Federal law protects internet service providers from monetary liability for copyright
`infringement committed by users of their networks, but only if those service providers
`reasonably implement a policy to terminate repeat infringers in appropriate circumstances.
`In a prior case, our Court held that Cox had failed to reasonably implement an anti-piracy
`program and therefore did not qualify for the statutory safe harbor.
`This case proceeded to trial on two theories of secondary liability: vicarious and
`contributory copyright infringement. The jury found Cox liable for both willful
`contributory and vicarious infringement of 10,017 copyrighted works owned by Plaintiffs
`and awarded $1 billion in statutory damages. Cox appealed.
`We affirm the jury’s finding of willful contributory infringement. But we reverse
`the vicarious liability verdict and remand for a new trial on damages because Cox did not
`profit from its subscribers’ acts of infringement, a legal prerequisite for vicarious liability.
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`I.
`Copyright owners possess the “exclusive rights” to “reproduce,” “distribute,”
`“perform,” “display,” or “prepare derivative works based upon” their copyrighted works,
`subject to limitations not relevant here. 17 U.S.C. § 106. Anyone who violates any of
`these exclusive rights of the copyright owner is “an infringer of the copyright.” Id.
`§ 501(a). A copyright owner may “institute an action” against an infringer, i d. § 501(b),
`and receive either statutory damages, id. § 504(a)(2), or actual damages plus the infringer’s
`profits, id. § 504(a)(1). Although the Copyright Act “does not expressly render anyone
`liable for infringement committed by another,” the Supreme Court has long held that
`vicarious and contributory liability for copyright infringement rest on firm legal footing.
`Sony Corp. of Am. v. Universal City Studios, Inc., 464 U.S. 417, 434–435 (1984).
`Congress recognized that internet service providers may get caught in the crossfire
`when infringers use the internet to reproduce or distribute copyrighted works, so it created
`a safe harbor defense in the Digital Millennium Copyright Act (DMCA). See 17 U.S.C.
`§ 512. To be eligible for the defense, an internet service provider must have “adopted and
`reasonably implemented . . . a policy that provides for the termination in appropriate
`circumstances of subscribers and account holders of the service provider’s system or
`network who are repeat infringers.” Id. § 512(i)(1)(A). This Court previously held that
`Cox did not qualify for the safe harbor because its repeat infringer policy as implemented
`was inadequate under the DMCA. See BMG Rts. Mgmt. (US) LLC v. Cox Commc’ns, Inc.,
`881 F.3d 293, 301– 305 (4th Cir. 2018). The claim period in this case coincides with the
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`period during which Cox was ineligible for the safe harbor, so Cox faces the secondary
`liability claims here without that protection.1
`This lawsuit began when Sony and other owners of copyrighted musical works
`(collectively, Sony or Plaintiffs) sued Cox for infringement committed by subscribers to
`Cox’s internet service from 2013 to 2014. During the claim period, Cox provided internet
`service to residential and commercial subscribers, charging different flat fees for different
`download speeds according to a tiered pricing plan.
`Plaintiffs are members of the Recording Industry Association of America (RIAA),
`which hired the anti-piracy company MarkMonitor to catch infringements of its members’
`copyrights on peer-to-peer networks using file-sharing protocols like BitTorrent and
`others. See BMG , 881 F.3d at 298– 299 (explaining peer- to-peer file sharing and
`BitTorrent). When MarkMonitor discovered an internet user downloading or distributing
`a copyrighted music file, it notified the user’s internet service provider. Only the service
`provider can match an alleged infringer’s internet protocol address to its owner’s identity.
`When Cox received infringement notices from MarkMonitor, Cox’s automated system sent
`notices to the infringing subscribers. The notice Cox sent varied by how far along the
`subscriber was in Cox’s thirteen-strike policy, ranging from an email warning to a
`temporary suspension. See BMG, 881 F.3d at 299 (describing the thirteen-strike policy).
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`1 The DMCA safe harbor defense is not exclusive, so Cox remains “entitled to all
`other arguments under the law” in its defense. CoStar Grp., Inc. v. LoopNet, Inc., 373
`F.3d 544, 552 (4th Cir. 2004); see 17 U.S.C. § 512(l).
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`Over time, Cox developed various methods to stem the tidal wave of infringement
`notices it was receiving and mitigate the consequences for its subscribers. It capped the
`number of notices it would accept from RIAA, eventually holding it at 600 notices per day.
`It took no action on the first DMCA complaint for each subscriber , limited the number of
`account suspensions per day, and restarted the strike count for subscribers once it
`terminated and reinstated them. MarkMonitor sent Cox 163,148 infringement notices
`during the claim period. Over that time, Cox terminated 32 subscribers for violation of its
`Acceptable Use Policy , which prohibits copyright infringement among other things. By
`comparison, it terminated over 600,000 subscribers for nonpayment over that same time.
`Frustrated with Cox’s lackluster response to the notices, Sony sued Cox for vicarious and
`contributory copyright infringement.
`After discovery, Sony and Cox cross- moved for summary judgment . Two of the
`district court’s rulings at that stage are relevant for this appeal. First, the district court
`concluded that the infringement notices MarkMonitor sent to Cox proved Cox’s knowledge
`of infringement as a matter of law. That knowledge established one element of
`contributory liability. Second, the district court denied Cox’s motion to reduce the number
`of copyrighted works in suit. Cox argued that, for the purpose of statutory dama ges, all
`songs included on a single album constitute one work, and a sound recording and the music
`composition it embodies likewise count as a single work. See 17 U.S.C. § 504(c)(1)
`(authorizing statutory damages for infringement “with respect to any one work” and
`explaining that “all the parts of a compilation or derivative work constitute one work”).
`The district court found that issues of material fact remained and so this claim should “be
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`resolved at trial.” Sony Music Ent. v. Cox Commc’ns, Inc., 426 F. Supp. 3d. 217, 236 (E.D.
`Va. 2019).
`The parties presented their case to the jury over the course of twelve days. Plaintiffs
`limited their case to Cox subscribers who received three or more infringement notices. In
`the end, the jury found Cox liable for vicarious and contributory infringement of all 10,017
`copyrighted works alleged. The jury also found that Cox’s infringement was willful, which
`increased the available maximum statutory damages to $150,000 per work. See 17 U.S.C.
`§ 504(c)(1)–(2). The jury awarded Sony $99,830.29 per infringed work, for a total of $1
`billion in statutory damages.
`After the verdict, Cox renewed its motion for judgment as a matter of law, which
`the district court ultimately denied in full. Regarding liability, the district court rejected
`Cox’s arguments that the evidence did not prove vicarious or contributory infringement.
`Cox also sought again to reduce the number of works—and with it, damages—to account
`for compilations and derivative works. The district court rejected Cox’s request as to
`compilations but invited Cox to submit a calculation of the derivative works that were
`allegedly double counted. After receiving Cox’s submission, however, the district court
`denied any reduction in the number of works, reasoning that Cox’s posttrial arguments
`required factfinding within the province of the jury and that Cox had failed to present
`evidence sufficient to enable the jury to make the adjustments it requested.
`Now on appeal, Cox raises numerous questions of law concerning the scope of
`secondary liability for copyright infringement and what constitutes a compilation or
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`derivative work in the internet age. Ultimately, we find we must answer only some of these
`novel questions to resolve this appeal.
`II.
`We begin with Cox’s contention that the district court erred in denying it judgment
`as a matter of law on Sony’s vicarious infringement claim. We review that ruling de novo.
`Russell v. Absolute Collection Servs., Inc., 763 F.3d 385, 391 (4th Cir. 2014). Judgment
`as a matter of law is proper if, viewing all evidence and reasonable inferences in the light
`most favorable to the nonmoving party, “a reasonable jury would not have a legally
`sufficient evidentiary basis to find for [that] party.” Fed. R. Civ. P. 50(a)(1). A district
`court should grant judgment as a matter of law “if the nonmoving party failed to make a
`showing on an essential element of his case with respect to which he had the burden of
`proof.” Russell, 763 F.3d at 391 (internal quotation marks omitted).
`A defendant may be held vicariously liable for a third party’s copyright
`infringement if the defendant “[1] profits directly from the infringement and [2] has a right
`and ability to supervise the direct infringer .” Metro-Goldwyn-Mayer Studios Inc. v.
`Grokster, Ltd., 545 U.S. 913, 930 n.9 (2005); see also CoStar Grp., Inc. v. LoopNet, Inc.,
`373 F.3d 544, 550 (4th Cir. 2004) (“[A] defendant who ‘has the right and ability to
`supervise the infringing activity and also has a direct financial interest in such activities’ is
`[vicariously] liable.” (quoting Gershwin Pub. Corp. v. Columbia Artists Mgmt., Inc., 443
`F.2d 1159, 1162 (2d Cir. 1971))). Cox contests both elements on appeal. Because we
`conclude Sony failed, as a matter of law, to prove that Cox profits directly from its
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`subscribers’ copyright infringement, we do not reach the additional question of Cox’s right
`and ability to supervise its subscribers.
`Cox argues that it does not profit directly from its subscribers’ infringement because
`“[a]ll subscribers pay Cox a flat monthly fee for their internet access package no matter
`what they do online.” Opening Br. 27. Whether a subscriber uses her internet acce ss for
`lawful or unlawful purposes, Cox receives the same monthly fee, and a subscriber’s
`decision to download or distribute a copyrighted song without permission does not benefit
`Cox. The district court rejected this argument, concluding that Sony had proven Cox’s
`direct financial interest by showing that Cox repeatedly declined to terminate the accounts
`of infringing subscribers in order to continue collecting their monthly fees. To understand
`this issue, some legal background is necessary.
`Vicarious liability for copyright infringement is an “outgrowth of the agency
`principles of respondeat superior.” Fonovisa, Inc. v. Cherry Auction, Inc., 76 F.3d 259,
`262 (9th Cir. 1996); see also A&M Records, Inc. v. Napster, Inc., 239 F.3d 1004, 1022 (9th
`Cir. 2001). It extends beyond a strict employer-employee relationship to other settings in
`which a defendant similarly “‘has the right and ability to supervise the infringing activity
`and also has a direct financial interest in such activities.’” Costar Grp., 373 F.3d at 550
`(quoting Gershwin Pub. Corp., 443 F.2d at 1162). So, for example, we have held that a
`property owner was vicariously liable for its closely related developer’s infringing use of
`copyrighted architectural drawings in a construction project. Nelson-Salabes, Inc. v.
`Morningside Dev., LLC, 284 F.3d 505, 513–514 (4th Cir. 2002). In addition to its control
`over the project, the property owner had “an obvious and direct financial interest in the
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`[developer’s] infringing activities” because the owner “enjoyed the benefit of any increase
`in the Project’s value resulting from [the developer’s] infringement” of the copyrighted
`drawings. Id. at 514. In another example, a company that sold nutritional supplements
`was vicariously liable for its distributors’ infringing use of copyrighted photographs to
`advertise its products because the company could control the distributors and stood to
`benefit from increased sales spurred by the infringing advertisements. Leonard v. Stemtech
`Int’l, Inc., 834 F.3d 376, 389 (3d Cir. 2016).
`The landmark case on vicarious liability for infringing copyrighted musical
`recordings is Shapiro, Bernstein & Co. v. H. L. Green Co., 316 F.2d 304 (2d Cir. 1963).
`There a department store was held accountable for the infringing sale of “bootleg” records
`by a concessionaire operating in its stores. Id. at 307–308. The store retained the ultimate
`right to supervise the concessionaire and its employees, demonstrating its control over the
`infringement. And the store received a percentage of every record sale, “whether ‘bootleg’
`or legitimate,” giving it “a most definite financial interest” in the infringing sales.
`2 Id.
`Courts have recognized, however, that a defendant may possess a financial interest
`in a third party’s infringement of copyrighted music even absent a strict correlation
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`2 In an analysis that courts still use today, the Shapiro court contrasted two types of
`relationships: (1) landlords and tenants and (2) dance halls and bands. Shapiro, 316 F.2d
`at 307; see Sony, 464 U.S. at 437 n.18 (picking up this comparison); Leonard, 834 F.3d at
`388–389 (same). A landlord is not vicariously liable for a tenant’s copyright infringement,
`the court explained, because he exercises no supervision over the tenant and charges a fixed
`rental fee regardless of whether the tenant infringes co pyrights in the rented house.
`Shapiro, 316 F.2d at 307. But the dance hall proprietor who hires a band can control the
`premises, and the band’s infringing performances of copyrighted songs “provide the
`proprietor with a source of customers and enhanced income,” exposing him to vicarious
`liability. Id.
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`between each act of infringement and an added penny of profits. For example, Fonovisa
`concerned the operator of a swap meet who allowed vendors to sell infringing records. The
`complaint alleged that the operator collected “admission fees, concession stand sales and
`parking fees” —but no sales commission —“from customers who want[ed] to buy the
`counterfeit recordings at bargain basement prices.” Fonovisa, 76 F.3d at 263. These
`allegations sufficed to state a direct financial benefit to the swap meet operator, the court
`held, because “the sale of pirated recordings at the . . . swap meet [was] a ‘draw’ for
`customers.” Id. The infringing sales “enhance[d] the attractiveness of the venue to
`potential customers,” giving the swap meet operator a financial interest in the infringement
`sufficient to state a claim for vicarious liability. Id.
`Applying these principles to copyright infringement in cyberspace, courts and
`Congress agree that “‘receiving a one-time set-up fee and flat periodic payments for
`service’” from infringing and noninfringing users alike ordinarily “‘would not constitute
`receiving a financial benefit directly attributable to the infringing activity.’” Ellison v.
`Robertson, 357 F.3d 1072, 1079 (9th Cir. 2004) (quoting S. Rep. 105-190, at 44 (1998)).
`But “‘where the value of the service lies in providing access to infringing material,’” those
`flat fees may constitute a direct financial benefit. Id. (quoting S. Rep. 105-190, at 45).
`For example, the file -sharing service Napster had a direct financial interest in its
`users’ exploitation of copyrighted music. An increasing volume of pirated music available
`for download drew more users to register with Napster, and its “future revenue [was]
`directly dependent upon increases in userbase.” Napster, 239 F.3d at 1023 (internal
`quotation marks omitted).
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`By contrast, America Online (AOL) was not vicariously liable for copyright
`infringement occurring over an online forum to which it provided its subscribers access.
`Although access to online forums encouraged overall subscription to AOL’s services, there
`was no direct financial benefit from infringement where no evidence indicated “that AOL
`customers either subscribed because of the available infringing material” or “canceled
`subscriptions” when the material was no longer available. Ellison, 357 F.3d at 1079.
`Without “evidence that AOL attracted or retained subscriptions because of the
`infringement or lost subscriptions because of [its] eventual obstruction of the
`infringement,” “no jury could reasonably conclude that AOL received a direct financial
`benefit from providing access to the infringing material.” Id.
`As these cases illustrate, the crux of the financial benefit inquiry is whether a causal
`relationship exists between the infringing activity and a financial benefit to the defendant.
`If copyright infringement draws customers to the defendant’s service or incentivizes them
`to pay more for their service, that financial benefit may be profit from infringement. See,
`e.g., EMI Christian Music Grp., Inc. v. MP3tunes, LLC, 844 F.3d 79, 99 (2d Cir. 2016).
`But in every case, the financial benefit to the defendant must flow directly from the third
`party’s acts of infringement to establish vicarious liability. See Grokster, 545 U.S. at 930
`& n.9; Nelson-Salabes, 284 F.3d at 513.
`To prove vicarious liability, therefore, Sony had to show that Cox profited from its
`subscribers’ infringing download and distribution of Plaintiffs’ copyrighted songs. It did
`not.
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`The district court thought it was enough that Cox repeatedly declined to terminate
`infringing subscribers’ internet service in order to continue collecting their monthly fees.
`Evidence showed that, when deciding whether to terminate a subscriber for repeat
`infringement, Cox considered the subscriber’s monthly payments. See, e.g., J.A. 1499
`(“This customer will likely fail again, but let’s give him one more chan[c]e. [H]e pays
`317.63 a month.”). To the district court, this demonstrated the requisite connection
`between the customers’ continued infringement and Cox’s financial gain.
`We disagree. The continued payment of monthly fees for internet service, even by
`repeat infringers, was not a financial benefit flowing directly from the copyright
`infringement itself. As Cox points out, subscribers paid a flat monthly fee for their internet
`access no matter what they did online. Indeed, Cox would receive the same monthly fees
`even if all of its subscribers stopped infringing. Cox’s financial interest in retaining
`subscriptions to its internet service did not give it a financial interest in its subscribers’
`myriad online activities, whether acts of copyright infringement or any other unlawful acts.
`An internet service provider would necessarily lose money if it canceled subscriptions, but
`that demonstrates only that the service provider profits directly from the sale of internet
`access. Vicarious liability, on the other hand, demands proof that the defendant profits
`directly from the acts of infringement for which it is being held accountable.
`Sony responds that, even if we disagree with the district court, the jury heard other
`evidence of Cox’s direct financial interest in its subscribers’ copyright infringement. But
`none of Sony’s alternative theories supports vicarious liability here.
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`First, Sony contends that the jury could infer from the volume of infringing activity
`on Cox’s network that the ability to infringe was a draw for customers. In support, Sony
`highlights evidence that roughly 13% of Cox’s network traffic was attributable to peer-to-
`peer activity and over 99% of peer-to-peer usage was infringing. Even if the jury believed
`Sony’s characterization that this was a high volume of infringing activity in general, the
`evidence falls considerably short of demonstrating that customers were drawn to purchase
`Cox’s internet service, or continued to use that service, because it offered them the ability
`to infringe Plaintiffs’ copyrights. Cf. Ellison, 357 F.3d at 1079. Many activities of modern
`life demand internet service. No one disputes that Cox’s subscribers need the internet for
`countless reasons, whether or not they can infringe. Sony has not identified evidence that
`any infringing subscribers purchased internet access because it enabled them to infringe
`copyrighted music. Nor does any evidence suggest that customers chose Cox’s internet
`service, as opposed to a competitor’s, because of any knowledge or expectation about
`Cox’s lenient response to infringement.
`Second, Sony asserts that “subscribers were willing to pay more for the ability to
`infringe,” but the evidence does not go nearly so far. Response Br. 36. Cox had a tiered
`pricing structure by which it charged customers higher monthly fees for increased data
`allowances. According to Sony, peer-to-peer activity is “bandwidth-intensive,” “more data
`usage requires more speed,” and Cox advertised its network speeds in relation to how
`quickly a user could download songs. Response Br. 37. Further, Sony explains,
`“residential subscribers who were the subject of 20 or more infringement notices from 2012
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`[to] 2014 paid Cox more per month, on average, than residential subscribers who were the
`subject of only 1 or 2 infringement notices.” Response Br. 34.
`None of this raises a reasonable inference that any Cox subscriber paid more for
`faster internet in order to engage in copyright infringement. As Sony’s expert testified,
`other data intensive activities include legally streaming movies, television shows, and
`music, as well as playing video games. Subscribers may have purchased high speed
`internet for lawful streaming and downloads or because their households had many internet
`users; Sony’s expert didn’t claim to know why any customer purchased a higher tier of
`service. Sony has not identified any evidence that customers were attracted to Cox’s
`internet service or paid higher monthly fees because of the opportunity to infringe
`Plaintiffs’ copyrights.
`At bottom, Sony offered no legally adequate theory to establish the required causal
`connection between subscribers’ copyright infringement and increased revenue to Cox.
`While Cox profited from the sale of internet service, Sony has not shown that Cox, in any
`sense, had a financial interest in its subscribers committing infringement. See Costar Grp.,
`373 F.3d at 550. And it is the infringement itself that must in some fashion profit the
`defendant for vicarious liability to attach. Accordingly, under the correct legal standard,
`no reasonable jury could find that Cox received a direct financial benefit from its
`subscribers’ infringement of Plaintiffs’ copyrights. We therefore conclude that Cox is not
`vicariously liable for its subscribers’ copyright infringement and reverse the district court’s
`denial of Cox’s motion for judgment as a matter of law.
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`III.
`We turn next to contributory infringement. Under this theory, “‘one who, with
`knowledge of the infringing activity, induces, causes or materially contributes to the
`infringing conduct of another’ is liable for the infringement, too.” CoStar Grp., 373 F.3d
`at 550 (quoting Gershwin Pub., 443 F.2d at 1162). The district court resolved the question
`of Cox’s knowledge on summary judgment, while the jury found material contribution at
`trial, so we address Cox’s challenge to each element separately.
`A.
`We review the district court’s grant of summary judgment de novo, applying the
`same standard the district court was required to apply. See Variety Stores, Inc. v. Wal-Mart
`Stores, Inc., 888 F.3d 651, 659 (4th Cir. 2018). Summary judgment is appropriate when
`“there is no genuine dispute as to any material fact and the movant is entitled to judgment
`as a matter of law.” Fed. R. Civ. P. 56(a).
`Our Court has recently clarified the intent necessary to prove contributory
`infringement by an internet service provider based on its subscribers’ direct infringement.
`In BMG Rights Management v. Cox Communications, we held that intent to cause
`infringement may be shown by willful blindness—which is not at issue in this appeal —or
`by “know[ledge] that infringement [was] substantially certain to result from the sale” of
`internet service to a customer. 881 F.3d at 307. General knowledge of infringement
`occurring on the defendant’s network is not enough; “[s]elling a product with both lawful
`and unlawful uses suggests an intent to cause infringement only if the seller knows of
`specific instances of infringement.” Id. at 311. Applying these principles to Cox in that
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`case, we held that Cox could not be contributorily liable absent “knowledge that
`in