$675K damages for downloading 30 songs, really?

Somehow I missed this week that the Supreme Court of the United States has declined to review the damages award of $675,000 for downloading 30 songs. Plenty of non-lawyers don’t understand what factors the Supreme Court uses to decide whether to review a case, but lawyers should recall that this decision does not necessarily mean the Supreme Court liked the lower court’s ruling.

From what I understand, the jury in the case awarded the $675K award, and the trial judge reduced it. The plaintiff record companies appealed, and the federal appellate court reinstated the award, but told the trial court judge to use a different method to decide whether the damages should be reduced. The defendant sought review from the Supreme Court, but the Court opted not to take up the issue. So, the defendant is headed back to the trial court.

The damages award was apparently based on the Copyright Code’s statutory damages provision. The Copyright Code allows a plaintiff to recover damages of $22,500 for each act of willful copyright infringement (unless the plaintiff wants to pursue actual losses as its damages).

Although the jury’s decision on the amount of damages may be legally correct, it seems to me that the damages provisions of the Copyright Code are out of whack. They do not take into consideration, for example, the question of whether the defendant had any intent to profit from the infringement. A reasonable approach would be to increase the damages if there is a finding that the defendant acted with certain motives, including the goal of making money. It would also be reasonable to decrease the damages if the act of infringement was relatively minor. Keep in mind that this defendant today could download the songs from iTunes for roughly 30 bucks. A damages award of 50 times the iTunes price, or $1,500 (plus possible attorney fee recovery by the plaintiffs) ought to serve as a sufficient deterrent. A damages award of 22,500 times the actual cost seems to be grossly unfair.

I am no fan of piracy, but there needs to be some real balance in the copyright laws when it comes to statutory damages.


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