Monday, July 6, 2009

Thomas-Rasset moves for new trial; calls $1.92 million damages award 'excessive, shocking, and monstrous'

Jammie Thomas-Rasset today filed a Motion for a New Trial, Remittitur, and to Alter or Amend the Judgment, asking Judge Michael Davis to reduce or toss the $1.92 million award a Minnesota jury ordered her to pay for downloading and distributing 24 songs. Argues Thomas-Rasset:
The statutory damages awarded in this case — which are nearly an order of magnitude greater than the statutory damages assessed in the first trial — bear no reasonable relation to the actual injury suffered by the plaintiffs. The damages awarded are grossly in excess of any reasonable estimate of that injury. The plaintiffs did not even attempt to offer evidence of their actual injuries, seeking, instead, an award of statutory damages entirely for purposes of punishment and deterrence. The closest they came was in identifying, mainly in arguments by counsel, injuries to their industry as a whole caused by illegal music sharing as a whole; when pressed, their witnesses — recall the testimony of Mr. Leak — were not able to attribute any particular part of this injury to Mrs. Thomas’s alleged actions. An award of statutory damages of $1.92M for 24 songs assessed as punishment, not compensation, shocks the conscience and must be set aside.
The defense brief offers Judge Davis -- who termed the first jury's award of $222,000 "wholly disproportionate to the damages suffered by Plaintiffs" and "unprecedented and oppressive" -- three routes to set aside the award here:
First, Mrs. Thomas contends that the statutory-damages provision of the Copyright Act, as applied in her case, offends the Due Process Clause and is not law. If she is correct, then the statutory-damages portion of the verdict, which rests on this unconstitutional provision, must be set aside under Rule 59(e). Importantly, this would not be a remittitur, but the correction of an unconstitutional verdict: the plaintiffs are not entitled to elect a new trial, but, having declined to seek a jury finding on actual damages on which judgment could be entered instead, must accept a take-nothing judgment.... Second, in the alternative, Mrs. Thomas contends that even if the statutory damages provision of the Copyright Act is constitutional, the jury’s application of it inthis case is excessive, shocking, and monstrous so that remittitur is appropriate as a matter of federal procedural law.... Mrs. Thomas contends that even the minimum statutory damages, $18,000, which would result in punishment ratios of 1:581 in terms of $1.29 songs and 1:50 in terms of $15 albums, would be unconstitutional if assessed in her case. But if any award is appropriate, it would be the minimum. Accordingly, in the alternative, Mrs. Thomas seeks remittitur of the statutory-damages award to $18,000. Third, in the alternative, if this Court prefers to allow a third jury to select a different, lower, number, Mrs. Thomas respectfully requests a new trial on all issues.
The brief goes on to make now-familiar arguments that the constitutional limits on punitive damages under BMW v. Gore and its progeny should apply to statutory damages -- an argument that has been raised in several copyright cases but, as far as I am aware, never actually embraced by any court.

Two big questions in my mind:

1) What is the Department of Justice going to do? After the first trial, DoJ filed a brief in defense of the constitutionality of the $222,000 award, concluding that that sum "did not violate the Due Process Clause [because it was] not 'so severe and oppressive as to be wholly disproportioned to the offense or obviously unreasonable.' Williams, 251 at 67." Does DoJ feel the same way about an award of $1.92 million for the same misconduct? Will it defend this award as well, or sit this one out?

2) What are the plaintiffs going to do? Within 5 minutes of the verdict, plaintiffs indicated that they remained willing to settle, and they have assiduously avoided saying that the size of the award was correct. Thomas-Rasset has, so far, refused to settle. But could the plaintiffs use this defense motion as a vehicle to effectively force a settlement? Here's what I mean: What if the labels filed a brief saying something like this:
Plaintiffs maintain that the amount the jury awarded does not exceed what is permitted under either the US Constitution or federal common law. However, the court need not decide these difficult issues. Plaintiffs are willing to accept an award of minimum statutory damages, only $750 per work, or $18,000 total -- a reduction of 99% from the actual jury award. Such an award is at the bottom of the range of what Congress permits, and is by definition by constitutional and reasonable...
The court could then rule, "I hereby accept the Plaintiffs' offer to reduce the award to $18,000, find that amount constitutional and reasonable, and order that the judgment be amended to reflect a reduced amount of $18,000." Such a dramatic move would be unusual, and I haven't researched whether it's even procedurally viable, but I think it could be a very attractive for the judge, who clearly thinks the $1.92 million is excessive, but may not want to take the (I think) unprecedented step of declaring unconstitutional a copyright statutory damages award. And I very much doubt Judge Davis wants to sit through a third trial of this defendant.

Watch for a flood of amicus briefs on this very important issue. It could be many months before this is resolved.


  1. The defense brief is extremely weak, relying on the same tenuous reasoning regarding due process cases that simply, on their own facts, don't apply to statutory damages.

    I find the defense's statement that "no one could have expected $1.92 million for 24 songs" to be not only disingenuous but outright false. Section 504 is quite clear on the penalties, citing a low and high end range, so to claim that one cannot expect a number between those extremes defies logic.

    This isn't a case where you get sued for $4,000 in paint damage and end up with a $4 million dollar judgment against you. When you're sued for copyright infringement, according to the damages provision, you have sufficient notice of the potential damages you may be liable for.

    She chose not to settle, and did so at her own risk.

  2. Wouldn't the court accepting a plaintiff's offer to settle AFTER a jury has awarded and thereby ordering the defence to accept be in itself open to an appeal . It could be shown that the plaintiffs are influencing the court after the fact showing due process has not been served.

    Remember the right of refusal of a settlement (especially after finalisation of a matter) is Thomas-Rasset's only. For the court (or plaintiff) to order a contractual acceptance (yes a settlement by its very nature is a contract) is bordering on duress.

    Though US civil due process could be different??

  3. "no one could have expected $1.92 million for 24 songs" would be outright false? Well, if you're not living in wonderland, you certainly remarked how mass media, even in Turkey,reported the verdict. They were clearly surprised to say the least. Now, the majors are apparently willing to keep the scary effect of the verdict, but they know very well that they'll never get that money, so there's also offering a settlement. Precisely to avoid bad PR and prevent the verdict (an "educational one", remember) from being overturned.

    My personal opinion that the amount is outright crazy. It's basic commons sense, and that's the reason of the settlement offer anyway, so I guess I'm not the only one thinking that. No need to be a lawyer, the system obviously went crazy: there's a critical bug that needs to be fixed.

  4. Being surprised and thinking a number is "crazy" is actually far different than no one could have expected this--and that laypeople and non-legal newspapers are surprised doesn't say anything about what is expected under the law. The first poster is correct in that the statutory amounts are clear, so its well within the "expected" range--in fact, it's almost exactly in the middle of the expected range. It's also not unprecedented, which is why every one in the actual legal community "expects" the Usenet damages amount to be in the hundreds of millions of dollars (potentially close to a billion), just like was. I can certainly tell you from my own IP representation of many companies that if Jammie Thomas was a corporation with insurance, the number that the insurance company would be focused on would be $3.6 million (24 songs * max $150,000 per song). And if, Ms. Thomas's lawyers didn't instruct her that up to $3.6 million was a possibility, they would be committing malpractice.
    I will say, however, that from a theoretical standpoint, the constitutional argument is not completely specious. Statutory damages have always been upheld and they have no case law to rely upon. However, I do suppose that one could say: doesn't there have to be some number at the top of a statutory amount at which that number, while finite, is "effectively" infinite, as in what if the amount was not $150,000 per song, but $50,000,000? Or, isn't $150,000 per song effectively infinite for the average citizen? That being said, I think those questions are better served for Congress than Judge Davis.

  5. I think you're not giving the jury enough credit. These were twelve people who sat through days of testimony, and as Ben documented, the defendant not only came across as an unrepentant liar, but also admitted to willfully hiding evidence by producing the wrong hard drive. That's not the portrait of a stalwart martyr aflame on an RIAA stake; it's the picture of a small-time thief blaming someone else rather than owning what she did.
    There are several factors considered in statutory damage analysis, including “(1) ‘the expenses saved and profits reaped,’ (2)
    ‘the revenues lost by the plaintiff,’ (3) ‘the value of the copyright,’ (4) ‘the deterrent
    effect on others besides the plaintiff,’ (5) ‘whether the defendant’s conduct was innocent
    or willful,’ (6) ‘whether a defendant as cooperated in providing particular records from
    which to assess the value of the infringing material produced,’ and (7) ‘the potential for
    discouraging a defendant.’” The jury saw through her act--it's clear that she made them really angry. If you followed what went on in the trial, it's not much of a surprise.

    Thomas chose to roll the dice on these, and lost.

  6. It looks like she feels, or has been counceled, that the climate is right for continued challenge to this verdict. Her defense has always been feeble at best and I can't imagine she hopes to take a chance at winning. Her strategy looks to be to challenge copyright law in the public court. It doesn't so much matter to people how much is or isn't acceptable damages, but more to the point, why does she even have to justify being put in the position? She is counting on a shift in IP perception and law. She already has seen slight movement with Davis' position on the award in the first trial. Plus, the RIAA is really on the PR defensive here and she knows it. They have clearly offered to settle and she won't budge. She must think she can win or she's hoping to make a statement. As long as there is no clearly defined way to deal with digital IP, somebody's gonna have to do it sooner or later.

  7. Sorry. Damages which are deliberately in a punitive capacity -- which these statutory damages are -- are subject to the same restrictions as punitive damages -- *and as fines*, the original punitive monetary amount.

    There's a constitutional clause prohibiting excessive fines, and it simply doesn't matter whether people are "notified" of the fines in advance. This colors the reading of the rest of the Constitution.

    Thomas-Rasset is absolutely trying to set precedent; why shouldn't she? And she's going to succeed -- her judge has a sense of justice, which is a sign.

    Statutory damages in a punitive capacity will be treated like punitive damages when this case is over. As they obviously should be.

  8. @Anonymous 10:24:

    You say:

    "Damages which are deliberately in a punitive capacity ... are subject to the same restrictions as punitive damages."

    Do you have a case where an award of statutory damages (copyright or otherwise) was subject to BMW v. Gore-type punitive damages analysis?


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