Wednesday, September 04, 2013

Copyright Law - First Circuit - Is A $675,000 Judgment Against A Student For Downloading and Distributing Thirty Songs Constitutionally Excessive?

SONY BMG Music Entertainment v. Tenenbaum, 719 F.3d 67 (1st Cir. 2013). 
From 1999 through 2007, Tenenbaum downloaded as many as five thousand songs. In discovery, he lied about his activities and tried to blame burglars and a foster child.  Thirty violations were proven at trial and the jury awarded Sony $22,500 for each violation (15% of the statutory maximum) for a total of $675,000.  The district court accepted the argument that the award was so excessive as to violate Tenenbaum’s right to due process, relying on a U.S. Supreme Court case holding that an excessive award of punitive damages can violate due process and reduced the award to $67,500.  Sony appealed and obtained a vacate and remand.  On remand, the district court found that the award did not violate due process.  Tenenbaum appealed.  On this appeal, the First Circuit found that an award of statutory, as opposed to punitive damages, violates due process only “where the penalty prescribed is so severe and oppressive as to be wholly disproportioned to the offense and obviously unreasonable.”  Three key factors are to be considered in determining whether an award is constitutionally excessive.  First, the degree of reprehensibility of the defendant’s conduct; Second, the ratio of the punitive award to the actual or potential harm suffered by the plaintiff; and Third, the disparity between the punitive award issued by the jury and the civil or criminal penalties authorized in comparable cases.  The First Circuit applied Supreme Court precedent that permits Congress to link statutory damages to the “public wrong” that the statute was designed to address and rejected the district court’s linking of statutory damages to actual damages, particularly given the difficulty of proving actual damages in a copyright infringement case.  Accordingly, the award of $675,000 was held to be constitutionally permissible.

To read Judges Lynch, Torruella, and Howard's decision, click here.
 Copyright law, fine art and navigating the courts. All practice, no theory.Copyright Litigation Handbook (Thomson Reuters Westlaw 2012-2013) by Raymond J. Dowd
 Copyright Litigation Handbook on Westlaw


Robert E. Kohn said...

This decision by the First Circuit seems to confirm the old wisdom that the cover-up can be worse than the crime itself. Tenenbaum should not have lied about his activities and tried to blame "burglars" and his own foster child.

Ron Coleman said...

That may be true, Robert -- but should the Copyright Act (and everyone else who's going to get slammed for statutory damages under it based on this precedent) be punished for that?