The issue currently causing me the most befuddlement is the choice the order presents to the record label plaintiffs:
Plaintiffs are directed to either accept the remittitur or to schedule a new trial on the issue of damages. Plaintiffs shall file a notification of their decision regarding remittitur no later than seven days from the date of this Order. The Court will defer amending the Judgment pending notification of Plaintiffs’ position with regard to remittitur.I get what happens if the labels accept the reduced award: the case is over (other than the possibility of appeals, which is a whole other complicated issue). But I'm baffled as to how things would play out if the labels opt for a new trial on damages. Keep in mind that the court, in its Jan. 22 order, has already determined that $2,250 per work "constitutes the maximum amount a jury could reasonably award to both compensate Plaintiffs and address the deterrence aspect of the Copyright Act." Order at 25-26. So what happens if there's a new trial and the jury again comes back with an award greater than $2,250 per song? (Note that all three juries to have sat in individual peer-to-peer cases have awarded much higher than that: $9,250 (Thomas-Rasset #1); $80,000 (Thomas-Rasset #2); and $22,500 (Joel Tenenbaum).) Does the court then grant another remittitur, giving plaintiffs the same choice? Can this go on ad infinitum? Is this a real-life Groundhog Day?
And from the plaintiffs' perspective, what's the point of a new trial anyway? If a new jury awards greater than $2,250 per work, presumably Judge Davis will remit again; he's already said $2,250 is the upper limit, and its difficult to imagine that any facts presented at a new trial would cause him to alter his view. And if a jury awards less than that, then the labels are worse off from a financial perspective -- though I suppose that would mean that, unlike if they accept the reduced award, they could finally appeal the remittitur ruling. See Donovan v. Penn Shipping Co., 429 U.S. 648 (1977) (noting "settled rule that a plaintiff who has accepted a remittitur may not appeal to seek reinstatement of the original verdict.").
And how would a new damages trial actually work? Would the judge instruct the jury that the maximum they can award is $2,250 per work? Would such an instruction -- which seems to fly in the face of the statute, which permits statutory damages of up to $150,000 per work -- be allowed? And if the plaintiffs knew that the instruction would indeed restrict the jury to a maximum award of $2,250 per work, then what incentive would they have to opt for a new trial at which they could only end up with a lower award than the one placed on the table by the court?
Readers are invited to attempt to cure my befuddlement in the comments.
Update: thanks to readers/commenters who have alerted me to academic treatments of this very subject. It turns out that people who have spent much more time thinking about this issue than I have come to the same conclusion, namely that it makes little or no sense for a plaintiff confronted with the choice between a reduced award and a new trial to opt for the new trial. As professor Suja Thomas explains in her article Re-Examining the Constitutionality of Remittitur Under the Seventh Amendment, 64 Ohio St. L.J. 731 (2003):
Indeed, this article's study of remittitur in the federal district courts for the ten years from 1991 through 2000 demonstrates that remittitur effectively eliminates the plaintiff's constitutional right to have damages tried by a jury because the alternative of a new trial is not truly an option for the plaintiff. The study found that when judges remit-ted jury verdicts, in 98% of the cases the plaintiff either accepted the remittitur (in 71% of the cases) or settled the case (in 27% of the cases). In only 2% of the cases did the plaintiff take the new trial. It is noteworthy that federal judges use this unconstitutional practice to reduce uncertain damages, damages that cannot be calculated with mathematical certainty, for example, emotional distress damages. Of the remitted cases studied, 68% included un-certain damages as a component, 46% of which were emotional distress damages and 50% of which were in civil rights cases. In this subset of cases which involve uncertain damages, the study again shows that the new trial option is illusory. In 98% of these cases, the plaintiff accepted the remittitur or settled.Similarly, Joseph B. Kadane writes in his article Decision Analysis on Whether to Accept a Remittitur:
Given that a committed plaintiff is faced with the possibility of an unending sequence of damage trials until a jury is found that will return a damage award low enough to please the judge, it is not surprising that many plaintiffs choose to settle or to accept the remittitur, whether or not they perceive it as fair. The decision analysis shows that the choice of a new trial is only theoretical. As a practical matter, the judge imposes a damage award smaller than that awarded by the jury, and the plaintiff has little choice but to accept whatever the judge says.(footnote omitted).