Published by LawTechie - October 4, 2010 - LawTechie

Section 523(a) (6) of the Bankruptcy Code provides that damages for “malicious” injuries receive an exception from discharge during bankruptcy proceedings. In In Re Therese Pearman, 432 B.R. 495 (D. New Jersey June 23, 2010), Ms. Pearlman attempted to discharge her copyright infringement damages in bankruptcy when it was found that she had willfully infringed on a 1960s poem and where she had copied, published, and even sued (unknowingly) the original writer for infringement!

In copyright law, “willful” infringement occurs when the infringing party is found to have had knowledge of the copyright prior to infringing and where the infringer had no legal basis for believing that her actions were not infringement — this is more or less the definition of “malice” in all other areas of law. In this case, however, the court found that willful infringement did not constitute “malice” within the meaning of the Bankruptcy Code, so discharge was granted.

(Previous decisions in similar cases have also found that, under the Bankruptcy Code, something like a “higher malice,” rather than simple malice, would serve to prevent discharge of copyright infringement.)

LawTechie is a blog focusing on trends in tech and digital media. Areas covered include intellectual property, cyberlaw, venture capital, transactions and litigation as they relate to the emerging sectors. The blog is edited by the firm's partner Tim Bukher with contributions from the firm's experts in their respective areas of law.

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