Several major record labels have filed a lawsuit against Verizon Communications Inc. (NYSE:VZ), one of the largest internet service providers in the U.S., for allegedly facilitating "massive copyright infringement" by its subscribers. The lawsuit, filed on Friday, seeks over $2 billion in damages.

What Happened: The lawsuit, filed on Friday in New York, accuses Verizon of being complicit in widespread copyright infringement by its subscribers, reported Music Business Worldwide. The plaintiffs include major record labels such as Sony Music, Universal Music Group, Warner Music Group, and ABKCO MUSIC.

The labels claim that Verizon knowingly provides high-speed internet to a large community of online pirates who repeatedly use the service to infringe on the labels' copyrights. Despite receiving "hundreds of thousands of copyright infringement notices" over the past few years, Verizon allegedly failed to take the required action.

The lawsuit further alleges that Verizon continued to provide its high-speed service to known repeat infringers, allowing them to "continue to collect millions of dollars" while ignoring the law. The labels claim to have sent over 340,000 infringement notices to Verizon since early 2020.

The labels seek up to $150,000 in statutory damages for each violation, potentially adding up to $2.6 billion based on the list of allegedly infringed works. The lawsuit accuses Verizon of ignoring the infringement notices and prioritizing its profits over its legal obligations.

Why It Matters: This lawsuit adds to a series of legal actions filed by record companies against ISPs in the U.S. Other ISPs, including Bright House Networks, Grande Communications, and Cox Communications, have also faced similar allegations.

In 2019, a court ordered Cox to pay the labels total damages of around $1 billion, but in February of this year, the court struck down the verdict. In March, a U.S. federal appeals court turned down a request to rehear a ruling from February, in which it overturned the $1 billion award against Cox.

Meanwhile, Altice USA, a cable television provider, was also hit with two copyright infringement suits over its subscribers' alleged music piracy, with music companies including BMG, Universal Music, Capitol Records, and Concord Music Group seeking $1.6 billion in one case, and Sony Music and Warner Music Group seeking $1.6 billion in another.

These lawsuits reflect a growing trend of record companies holding ISPs accountable for copyright infringement by their subscribers.

This lawsuit comes at a time when Verizon Communications is already under significant scrutiny and facing competitive pressures. Recently, Verizon and AT&T clashed over a $14 billion FirstNet spectrum proposal aimed at enhancing services for emergency responders.

Additionally, Goldman Sachs recently previewed upcoming earnings for major telecom players, including Verizon. Analyst James Schneider noted that the wireless telecom sector is poised for growth, driven by positive market dynamics and competitive pricing actions.

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This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote