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In re Subpoena Issued To Birch Communications, Inc.

United States District Court, N.D. Georgia, Atlanta Division

May 5, 2015

IN RE SUBPOENA ISSUED TO BIRCH COMMUNICATIONS, INC. f/k/a CBeyond Communications, LLC

OPINION AND ORDER

WILLIAM S. DUFFEY, Jr., District Judge.

This matter is before the Court on Rightscorp, Inc.'s ("Rightscorp") Objections [19] to Magistrate Judge Janet F. King's January 16, 2015, Order [18].[1] In her January 16th Order, Magistrate Judge King granted CBeyond Communications, LLC's ("CBeyond")[2] Motion to Quash [1] a subpoena issued by Rightscorp, but denied CBeyond's request for sanctions, contained in its Motion to Quash. Also before the Court is CBeyond's Second Motion for Sanctions [21], contained in its Response to Rightscorp's Objections.

I. BACKGROUND

Rightscorp is a "representative of various copyright owners... on matters involving the infringement of their copyrighted sound recordings." (Mot. to Quash [1] at 2) (quoting Rightscorp Decl. at ¶ 1).

CBeyond is a regional Internet Service Provider ("ISP") that provides internet access to its customers. (Id.).

On September 19, 2014, Rightscorp obtained from the United States District Court for the Central District of California a subpoena (the "Subpoena"), pursuant to the Digital Millennium Copyright Act ("DMCA"), 17 U.S.C. § 512.[3] The Subpoena seeks the "name, address, telephone number, and email address sufficient to identify the alleged infringers of copyrighted sound recordings identified by [Internet Protocol ("IP")] addresses in the notices attached to... th[e] Subpoena." ([1.1] at 2). The notices attached to the Subpoena detail 1, 326 separate instances of alleged copyright infringement by CBeyond customers using 71 unique IP addresses.[4]

On October 17, 2014, CBeyond filed its Motion to Quash [1]. CBeyond argues, among others, that Section 512(h) authorizes issuance of a subpoena only to an ISP that performs a storage function, and because CBeyond does not store or host the allegedly infringing materials referenced in the Subpoena, the Subpoena is not valid.[5] CBeyond also seeks to recover its attorney's fees and costs incurred in defending against the Subpoena.

On January 16, 2015, Magistrate Judge King issued her Order granting CBeyond's Motion to Quash. Magistrate Judge King found that Section 512(h)(2) requires a copyright owner to submit, with its request for subpoena, a copy of a notice containing information required under Section 512(c)(3)(A); that Section 512(c)(3)(A)(iii) requires that the copyright holder identify the allegedly infringing material to be removed "and information reasonably sufficient to permit the service provider to locate the material;" and that a copyright owner cannot comply with this requirement regarding conduit ISPs, like CBeyond, that merely allow for transfer of information between its users, because there are no infringing materials maintained by those types of ISPs. Magistrate Judge King thus concluded that the Subpoena was not authorized under Section 512(h). Magistrate Judge King also declined to award sanctions against Rightscorp, concluding that issuance of a subpoena to a conduit ISP under Section 512(h) was an issue of first impression in our Circuit, and that Rightscorp's interpretation of Section 512(h), "although not persuasive, is not frivolous, and... Rightscorp's issuance of the subpoena [was not] unreasonable." (Order at 9-10).

On January 30, 2015, Rightscorp filed its Appeal of Magistrate Judge King's January 16th Order.

On February 12, 2015, CBeyond filed its Response and again moved for sanctions against Rightscorp.

II. DISCUSSION

A. Standard of Review

The parties dispute whether the Motion to Quash is a dispositive motion and thus whether Magistrate Judge King had the authority to decide it. Rightscorp contends that the Court should construe the January 16th Order as a Report and Recommendation ("R&R"), subject to a de novo review of Rightscorp's objections. CBeyond argues that, because a motion to quash is not listed as a matter excepted from a magistrate judge's authority, Magistrate Judge King's Order should be reviewed under the "clearly erroneous or contrary to law" standard.

Under 28 U.S.C. § 636(b)(1)(A), a magistrate judge has the authority to hear and determine any nondispositive pretrial matter, and "the court may reconsider any pretrial matter [within the jurisdiction of the magistrate judge] where it has been shown that the magistrate judge's order is clearly erroneous or contrary to law." 28 U.S.C. § 636(b)(1)(A); see also Fed.R.Civ.P. 72(a) (district judge "must consider timely objections and modify or set aside any part of ...


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