Published by LawTechie - November 8, 2011 - LawTechie

intellectual property lawThe First Circuit’s recent ruling in Sony BMG v. Tenenbaum, Nos. 10-1883, 10-1947, 10-2052 (1st Cir., September 16, 2011) highlights wide latitude that the statutory damages provision of the Copyright Act bestow on juries and judges in copyright infringement cases.

In Tenenbaum, the jury awarded $22,500 per music track that the defendant shared via P2P with the total awarded damages for copyright infringement coming out to a staggering $675,000 for sharing 30 songs. The District Court ruled that such a number was unconstitutional — in violation of due process — and reduced the total to $67,500 which was still within the $750 to $150,000 per work that the Copyright Act prescribes in willful copyright infringement cases. Both Tenenbaum and plaintiffs appealed, whereby the First Circuit ruled that the District Court could have reduced the damages for “other reasons” and did not have to go and bring the constitution into play (which courts seek to avoid doing). Now the District Court has to decide again what is a reasonable statutory award in this case of copyright infringement.

Proof of Damages

These “other reasons” that the First Circuit instructed the District Court to consider is based on a court’s ability to apply reduction of damages through remittitur. In the copyright infringement context, remittitur is applied when the Court feels that the damages proven by plaintiff do not properly correspond to the jury award. This recalls the words of Ron Coleman of Likelihood of Confusion: “[S]tatutory damages are, contrary to popular belief, not intended to be a windfall for the lucky holder of an infringed copyright.”

What Ron meant to convey in his excellent article is that just because the Copyright Act allows damages of $750 to $150,000 per willful copyright infringement, doesn’t mean that the intellectual property owner no longer has a responsibility to prove that it was damaged that much. Again, to quote Ron:

In determining the measure of statutory damages to be awarded, courts consider the following factors:

[E]xpenses saved and profits gained by the defendants in connection with the infringements; revenues lost by plaintiffs as a result of defendants’ conduct; and the infringer’s state of mind, that is, whether willful, knowing, or merely innocent. Moreover, the court should consider the purposes of the Copyright Act, including restitution to prevent unjust enrichment, reparation of injury, and deterrence of further wrongful conduct by the defendants and others.

Walt Disney v. Video, 47, 972 F. Supp. 595, 603 (S.D. Fla. 1996) (citations omitted).

Certainly it is possible and even just to see the foregoing, tremendous damage awards in certain copyright infringement cases, particularly in cases where damages suffered by the plaintiff are difficult to prove. The statutory damages provision allows some leeway to plaintiffs who have no way of accurately proving all of the extent of damage caused to its right to license, republish, and perform works. In the end however, in copyright infringement cases, it is still up to the plaintiff to prove his case and the damage he suffered.

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.

Contact

Enter your email to get started.