American ISP Cox Communications has lost its copyright-infringement battle with music publisher BMG, in a high-profile case that saw the telco denied the ability to use a safe-harbour defence.

A Virginia federal jury awarded BMG $25m of damages in a case that hinged on Cox’s policies for passing on settlement letters from BMG’s anti-piracy partner Rightscorp, as well as its approach to repeat infringers among its customers.

Internal emails between Cox staff played a crucial role in the case, revealing that the company was immediately reconnecting customers whose internet access had been ‘terminated’ on DMCA grounds.

“As we move forward in this challenging time we want to hold on to every subscriber we can. With this in mind if a customer is terminated for DMCA, you are able to reactivate them after you give them a stern warning,” explained one.

“We must still terminate in order for us to be in compliance with safe harbor but once termination is complete, we have fulfilled our obligation. After you reactivate them the DMCA ‘counter’ restarts; The procedure restarts with the sending of warning letters, just like a first offense. This is to be an unwritten semi-policy.”

The judge in the case had been clear about the impact of these emails on Cox’s communications of pleading a safe-harbour defence.

“Even viewed in the light most favorable to Cox, the Court finds the contents of the emails cannot be explained away,” wrote Judge O’Grady. The jury agreed, although don’t expect its verdict to be the last we hear of the case.

“We are unhappy with the decision,” the ISP’s spokesperson told Ars Technica. “We will review the ruling in detail and are considering our options, including appeal.”

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