Epidemic Sound, AB v. Meta Platforms, Inc.

Opinion

EPIDEMIC SOUND, AB, Case No. 22-cv-04223-JSC

Plaintiff, ORDER RE: MOTION TO STAY v. Re: Dkt. No. 275 Defendant.

Epidemic Sound, AB sues Meta Platforms, Inc., f/k/a Facebook, Inc. “to stop the theft of music . . . occurring knowingly, intentionally and brazenly by Meta on its Facebook and Instagram social media platforms on a daily basis.” (Dkt. No. 1 ¶ 1.) Now pending before the Court is Meta’s motion to stay the case “pending the Supreme Court’s decision in Cox Communications, Inc. v. Sony Music Entertainment, No. 24-171, 2025 WL 1787701 (U.S. June 30, 2025), or, in the alternative, an order continuing all case deadlines (except for expert discovery cut-off) until after the Supreme Court’s decision in Cox.” (Dkt. No. 275 at 2.) Having carefully considered the parties’ submissions, and with the benefit of oral argument on August 28, 2025, the Court GRANTS in part Meta’s motion. The Court VACATES the trial date and will hold trial after the Supreme Court’s ruling in Cox. However, the Court will proceed with summary judgment on all issues, subject to reconsideration, if appropriate, after Cox is decided. The Court understands the parties will submit a stipulation proposing modified summary judgment deadlines. “Epidemic is the owner of a catalog of over 38,000 top quality music works in over 160 Epidemic requires users to license its tracks.” (Id. ¶ 22.) “Meta has been offering, and continues to offer Epidemic’s music to all users on Meta’s platforms such as Facebook and Instagram, without authorization.” (Id. ¶ 24.) Meta’s “Music Library”—in which Meta curates and stores music for its Instagram and Facebook users to download, stream, and use in video content and posts—contains over 950 Epidemic tracks. (Id. ¶¶ 26-28.) “By including Epidemic’s Tracks in its Music Library without authorization, Meta is actively offering Epidemic’s Tracks for download, streaming, user synchronization, reproduction and distribution to its (unlicensed) users without a proper license or any other authorization from Epidemic.” (Id. ¶ 29.) The complaint alleges Meta “has actively infringed, as well as participated in, encouraged and enabled such infringement,” including by “creat[ing] tools whose primary purpose is to increase the amount of theft on Facebook and Instagram.” (Dkt. No. 1 ¶ 1.) One tool is the Original Audio feature. When a user posts a “Reel” containing music not procured from Meta’s Music Library, “Meta’s Original Audio feature presumes that such music is owned by the user posting the Reel, and then Meta includes a ‘button’ identifying that music as ‘original audio.’” (Id. ¶ 32.) Other users who view the Reel can “click on that ‘button’ to ‘rip,’ or separate that music from the video content, and use a copy of that music for themselves and, upon information and belief, to download or save ‘original audio’ to curate personal music libraries on the Meta platforms for future use.” (Id.) “In other words, the Original Audio feature allows Meta to extract, or separate the music from the original video content in which it was incorporated, and reproduce it for any of their billions of users who wish to incorporate it into their own video content, irrespective of whether Meta (or anyone else) has any authority to offer, reproduce, distribute or otherwise use that music in the first instance.” (Id. ¶ 34.) Meta’s “Reels Remix feature . . . similarly facilitates and enables massive infringements on its platforms” by “allow[ing] and encourag[ing] its users to take another user’s audiovisual content, including any music used therein whether authorized or unauthorized, and incorporate it into their own Reel, irrespective of whether anyone has the authority to synchronize or otherwise reveals that a substantial number of Epidemic’s Tracks being used without authorization on Meta’s platforms have . . . been improperly reproduced in subsequent Reels through Meta’s Original Audio and Reels Remix features.” (Id. ¶ 38.) Epidemic alleges three causes of action: (1) direct copyright infringement, (2) inducement of copyright infringement, and (3) contributory copyright infringement. (Id. at 14-17.) As part of the requested relied, Epidemic seeks “a declaration that Meta has directly and/or secondarily infringed Epidemic’s copyrights under the Copyright Act” and “a declaration that such infringement is and/or was willful.” (Id. at 18.) Epidemic filed suit in July 2022. (Dkt. No. 1.) Under the amended case schedule, the deadline for filing dispositive motions is September 11, 2025, with a hearing on November 6, 2025. (Dkt. No. 273 at 4.) The pretrial conference is scheduled for December 18, 2025, with trial scheduled to commence on January 21, 2026. (Id.) Meta moves to stay the case pending the Supreme Court’s decision in Cox, “or, in the alternative, an order continuing all case deadlines (except for expert discovery cut-off) until after the Supreme Court’s decision in Cox, such that the dispositive motions deadline is 30 days after the Supreme Court’s decision, with all other dates in the remaining schedule shifting accordingly.” (Dkt. No. 275 at 2.) Meta argues “a retrial on liability, damages, or both will likely result if the summary judgment and trial proceedings move ahead without the benefit of the Supreme Court’s forthcoming direction.” (Id. at 4.) The Supreme Court granted certiorari to review the Fourth Circuit’s decision in Sony Music Entertainment v. Cox Communications, Inc., 93 F.4th 222 (4th Cir. 2024). The defendant in that case, Cox Communications, is an internet service provider that “sells internet, telephone, and cable television service to 6 million homes and businesses across the United States.” Id. at 227. The plaintiffs are record companies and music publishers that own copyrighted musical works. Id. “Some users of Cox’s internet service infringed Plaintiffs’ copyrights by downloading internet service provider “to hold it responsible for its customers’ copyright infringement.” Id. “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.” Id. On appeal, the Fourth Circuit affirmed the jury’s contributory infringement finding. Id. at 227. “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.” Id. at 233 (cleaned up). The Fourth Circuit noted “‘mere[ ] . . . failure to take affirmative steps to prevent infringement’ does not establish contributory liability ‘in the absence of other evidence of intent.’” Id. at 236 (quoting Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd., 545 U.S. 913, 939 n.12 (2005)). But, the court continued, “supplying a product with knowledge that the recipient will use it to infringe copyrights is exactly the sort of culpable conduct sufficient for contributory infringement.” Id. The court concluded the evidence at trial—for example, that Cox knew of specific instances of repeat copyright infringement and chose to continue providing those users with internet access and Cox’s “increasingly liberal policies and procedures for responding to reported infringement”—“showed more than mere failure to prevent infringement.” Id. at 236- 37. The evidence was thus “sufficient to support a finding that Cox materially contributed to copyright infringement occurring on its network and that its conduct was culpable.” Id. at 237. On June 30, 2025, the Supreme Court granted certiorari on the following two questions:

1. This Court has held that a business commits contributory copyright infringement when it “distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps to foster infringement.” Metro-Goldwyn- Mayer Studios, Inc. v. Grokster, Ltd., 545 U.S. 913, 919 (2005). The courts of appeals have split three ways over the scope of that ruling, developing differing standards for when it is appropriate to hold an online service provider secondarily liable for copyright infringement committed by users. Did the Fourth Circuit err in holding that a service provider can be held liable for “materially contributing” to copyright infringement merely because it knew that people were using certain accounts to infringe and did not terminate access, without proof that the service provider affirmatively fostered infringement or otherwise intended to promote it? 2. Generally, a defendant cannot be held liable as a willful violator of the law—and subject to increased penalties—without proof that it an instruction allowing the jury to find willfulness if Cox knew its subscribers’ conduct was illegal—without proof Cox knew its own conduct in not terminating them was illegal. Did the Fourth Circuit err in holding that mere knowledge of another’s direct infringement suffices to find willfulness under 17 U.S.C. § 504(c)? Question Presented, Case No. 24-171, Cox Commc’ns, Inc. v. Sony Music Ent. (June 30, 2025), https://www.supremecourt.gov/qp/24-00171qp.pdf. Pursuant to the Cox parties’ request to extend the briefing deadlines, the matter will be fully briefed by November 14, 2025. Docket, Case No. 24-171 (July 17, 2025).1 By Meta’s estimation, the Court will issue a decision in Cox “no later than June 2026.” (Dkt. No. 275 at 6.) “[T]he power to stay proceedings is incidental to the power inherent in every court to control the disposition of the causes on its docket with economy of time and effort for itself, for counsel, and for litigants.” Landis v. N. Am. Co., 299 U.S. 248, 254 (1936). In deciding whether to grant a stay, a court may weigh the following: (1) the possible damage which may result from the granting of a stay; (2) the hardship or inequity which a party may suffer in being required to go forward; and (3) the orderly course of justice measured in terms of the simplifying or complicating of issues, proof, and questions of law which could be expected to result from a stay. CMAX, Inc. v. Hall, 300 F.2d 265, 268 (9th Cir. 1962). A district court’s decision to grant or deny a Landis stay is a matter of discretion. See Dependable Highway Exp., Inc. v. Navigators Ins. Co., 498 F.3d 1059, 1066 (9th Cir. 2007). “[I]f there is even a fair possibility that the stay . . . will work damage to [someone] else,” the burden is on the moving party to “make out a clear case of hardship or inequity in being required to go forward.” Landis, 299 U.S. at 255. A. Orderly Course of Justice 1. Contributory Infringement In this case, staying the trial will preserve resources by clarifying the standard for contributory infringement—one of the three claims Epidemic asserts. In Grokster, the Supreme Court articulated the following standard for contributory infringement: “one who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, is liable for the resulting acts of infringement by third parties.” 545 U.S. at 919. The Cox petition for certiorari argues the Fourth Circuit misinterpreted Grokster “and create[d] a three-way circuit split on the proper threshold for material-contribution liability”: Adhering to Grokster’s requirement of “purposeful, culpable expression and conduct” for secondary liability, 545 U.S. at 937, the Second and Tenth Circuits hold that mere knowledge of direct infringement is not enough; rather, the plaintiff must prove that the service provider took affirmative steps to foster infringement. In the Ninth Circuit, knowledge of infringement is also insufficient, but the plaintiff does not necessarily need to prove affirmative steps under Grokster; a service provider can also be held liable if it knew of infringement and failed to take available, simple measures to stop it. The Fourth Circuit alone holds that where a service provider is aware that a particular subscriber is likely to infringe, the service provider can be held liable merely for failing to terminate them. Petition for Writ of Certiorari (“Petition”), Cox Commc’ns, Inc. v. Sony Music Ent. Case No. 24- 171 at 17 (Aug. 15, 2024), https://www.supremecourt.gov/DocketPDF/24/24-171/322523/ 20240815090212089_240802a%20Petition%20for%20efiling.pdf. Because the Supreme Court in Cox will consider the standard for contributory infringement, and because Epidemic asserts a claim for contributory infringement, a finite stay pending Supreme Court guidance will ensure the parties argue and the Court applies the correct legal standard at trial. This is particularly so when the Cox petition puts the Ninth Circuit’s contributory infringement standard at issue. The petition cites Perfect 10, Inc. v. Amazon.com, Inc., 508 F.3d 1146 (9th Cir. 2007) as articulating the Ninth Circuit’s “middle-ground position” on contributory infringement. Petition at 3. In that case, the plaintiff, Perfect 10, “market[ed] and [sold] copyrighted images of nude models.” Id at 1155. “Some website publishers republish[ed] Perfect 10’s images on the Internet without authorization” and when this occurred, “Google’s search engine may automatically index the webpages containing these images and provide thumbnail versions of images in response to user inquiries.” Id. at 1157. The Ninth Circuit considered whether, pursuant to Grokster, Google could be liable for contributory infringement. Id. at 1170. infringing Perfect 10 images were available using its search engine, could take simple measures to prevent further damage to Perfect 10’s copyrighted works, and failed to take such steps.” Id. at 1172. The Ninth Circuit has since elaborated on its “simple measures” standard, including in the context of other online services. See, e.g., Perfect 10, Inc. v. Giganews, Inc., 847 F.3d 657, 671 (9th Cir. 2017) (holding “there were no simple measures available that Giganews failed to take to remove Perfect 10’s works from its servers”); VHT, Inc. v. Zillow Grp., Inc., 918 F.3d 723, 745 (9th Cir. 2019) (“Zillow did not have appropriately ‘specific’ information necessary to take ‘simple measures’ to remedy the violation.”). Here, for Epidemic’s contributory infringement claim, the parties’ summary judgment briefs will likely cite and apply the Ninth Circuit’s “simple measures” standard. Clarity on that standard’s applicability—including whether it is consistent with Grokster—will thus benefit the parties, the Court, and the orderly course of justice. Epidemic argues a stay is inappropriate because Cox is not factually analogous to the present case. Specifically, Epidemic argues “[Cox] concerns the actions or failure to act by a pure [internet services provider]—the entity simply providing a connection to the internet,” whereas Meta “does not supply customers with internet connections.” (Dkt. No. 284 at 8.) While the Cox defendant is an internet service provider, the cases creating the circuit split on contributory infringement did not involve internet service providers. See EMI Christian Music Grp., Inc. v. MP3tunes, LLC, 844 F.3d 79, 85 (2d Cir. 2016) (considering contributory infringement on defendant’s websites, which “operated as a locker service for storing digital music” and “allowed users to search for free music on the internet”); Greer v. Moon, 83 F.4th 1283, 1288 (10th Cir. 2023) (considering whether defendant, who operated a website onto which users uploaded the plaintiff’s self-published book and copyrighted song without authorization, was liable for contributory infringement); Perfect 10, 508 F.3d at 1157 (considering contributory infringement as to Google’s search engine). As such, it is unlikely the Supreme Court’s decision will be limited to “pure [internet service providers]” as Epidemic asserts. (Dkt. No. 284 at 8.) Instead, the Supreme Court will likely resolve the circuit spit by clarifying the contributory infringement standard for digital service providers more broadly. See Petition at 38 (“The material-contribution theory at march of technological progress enhances the need for this Court to update secondary-liability rules for the modern internet era.”). Furthermore, the Cox certiorari petition separately argues the Fourth Circuit’s decision conflicts with Twitter, Inc. v. Taamneh, 598 U.S. 471 (2023), in which the plaintiffs—injured by a terrorist attack carried out by ISIS—sued Facebook, Twitter, and Google “for allegedly aiding and abetting ISIS.” Id. at 478. The court concluded the plaintiffs’ claims rested “less on affirmative misconduct and more on an alleged failure to stop ISIS from using these platforms,” which was insufficient under the aiding and abetting statute at issue. Id. at 499. The Cox petition thus argues “[b]y permitting liability based on passive provision of internet services with knowledge of infringing conduct, the Fourth Circuit’s decision conflicts with . . . Twitter’s rejection of liability based on mere knowledge of wrongful conduct.” Petition at 24. So, as the issue is teed up in the petition, the Cox decision may address Meta’s liability for the “provision of . . . infrastructure,” see Twitter, 598 U.S. at 499, which is at issue in this case. (Dkt. No. 1 ¶ 76 (alleging “Meta is liable as a contributory copyright infringer” by “providing tools to its users to enable them to reproduce distribute, synchronize, and perform Epidemic’s works without authorization.”).) Epidemic also argues a stay is “inappropriate in light of the direct infringement claims Epidemic has asserted against Meta.” (Dkt. No. 284 at 8.) Epidemic argues if it “prevails on all of its direct infringement claims (as it certainly expects to), the secondary liability claims may not be necessary to litigate in every instance.” (Id.) Despite Epidemic’s expression of confidence in its direct infringement claim, Epidemic continues to assert a contributory infringement claim, plus a related inducement of copyright infringement claim. See Erickson Prods., Inc. v. Kast, 921 F.3d 822, 831 (9th Cir. 2019) (“A party engages in contributory copyright infringement when it (1) has knowledge of another’s infringement and (2) either (a) materially contributes to or (b) induces that infringement.”) (cleaned up) (emphasis added). The Supreme Court’s decision in Cox will bear on these claims. 2. Willfulness The Cox decision will also clarify the standard for willfulness. See 17 U.S.C. § 504(c) (“In infringement was committed willfully, the court in its discretion may increase the award of statutory damages to a sum of not more than $150,000.”). The Cox petition for certiorari explains the Fourth and Eight Circuits “adopted irreconcilable answers” to the following question: “Once a defendant has been found secondarily liable for infringement, what else must the plaintiff prove to show willful infringement and subject the defendant to increased statutory damages?” Petition at 29. In the Eighth Circuit case, a retailer’s knowledge its customers’ actions violated copyright law did “not show that the [retailers’] employees understood their own actions to be culpable.” RCA/Ariola Int’l, Inc. v. Thomas & Grayston Co., 845 F.2d 773, 779 (8th Cir. 1988) (emphasis added). Because “willfulness entails knowledge that an act constitutes an infringement,” and because it was not shown the retailers believed their own conduct constituted copyright infringement, the district court did not err in concluding the retailers’ infringements were not willful. Id. In contrast, the Fourth Circuit upheld a jury instruction that “Cox’s contributory or vicarious infringement is considered willful if [the plaintiff] proves by a preponderance of the evidence that Cox had knowledge that its subscribers’ actions constituted infringement of [the plaintiff’s] copyrights . . .” Cox, 881 F.3d at 313 n.7 (emphasis added). Thus, in Cox, the Supreme Court will consider whether “the Fourth Circuit err[ed] in holding that mere knowledge of another’s direct infringement suffices to find willfulness under 17 U.S.C. § 504(c).” In this case, Epidemic alleges Meta’s infringement was willful. (Dkt. No. 1 ¶¶ 63, 70, 77 (“Meta’s acts of infringement are willful, intentional and purposeful, in disregard and indifferent to Epidemic’s rights.”).) Epidemic thus alleges it “is entitled to maximum statutory damages, pursuant to 17 U.S.C. § 504(c), in the amount of $150,000 with respect to each work infringed, or such other amounts as may be proper under 17 U.S.C. § 504(c).” (Id. ¶¶ 64, 71, 78.) Because Epidemic seeks damages for willful infringement, and because the Supreme Court in Cox will consider what constitutes willful infringement, a stay will provide clarity on the damages available to Epidemic. *** Given the likelihood the Cox decision will simplify questions of law regarding Epidemic’s favors granting a stay of the jury trial. The hardship or inequity factor likewise favors a stay because both parties will expend unnecessary resources by trying the contributory infringement and willfulness claims without the benefit of the Supreme Court’s forthcoming guidance. But, even more significantly, the public’s resources—namely, jury resources—will be conserved by waiting to empanel a jury until the Supreme Court has spoken. B. Damage Meanwhile, staying the trial pending the Supreme Court’s decision in Cox will not harm or damage Epidemic. Epidemic asserts “[t]his case involves the yearslong, systematic, and knowing infringement of Epidemic’s copyrighted works by Meta,” which “continue[s] . . . to this day.” (Dkt. No. 284 at 9.) Epidemic thus contends “[a]llowing further delay in adjudication of this case, especially where Meta refuses to address the ongoing infringement on its own platforms in the meantime, will result in further irreparable harm to Epidemic.” (Id.) But Epidemic does not support its assertion that delay will create “irreparable harm”; meanwhile, Meta presents evidence it will not. (Dkt. No. 290-7 at 3 (Meta expert concluding Epidemic will not suffer irreparable harm in the absence of an injunction because “Epidemic has chosen to monetize its catalog through licensing” so “Epidemic has demonstrated that it views royalty payments as an acceptable form of compensation for use of the tracks in its catalog”).) Moreover, Epidemic’s delay in bringing this lawsuit undermines its present assertion of irreparable harm. The complaint alleges Epidemic discovered the infringement in at least November 2017. (Dkt. No. 1 ¶ 48.) Epidemic filed the complaint over four years later, in July 2022. For the past several years, the parties have been engaging in discovery, including stipulated agreements to extend the discovery deadlines. (See, e.g., Dkt. No. 151.) Given the substantial time and resources the parties have already invested in this case, a finite delay of trial pending Supreme Court guidance on the standards for contributory infringement and willfulness outweighs any harm or damage caused by delay. For the reasons stated above, the Court GRANTS in part Meta’s motion. The January 1 Supreme Court decision in Cox. Summary judgment, however, will not be stayed and the Court 2 looks forward to the parties’ stipulation proposing a modified summary judgment briefing 3 schedule. 4 This Order disposes of Docket No. 275. 6 Dated: August 28, 2025 7 8 ne CQWELINE SCOTT CORLE 9 United States District Judge 10 11 12

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