Friday, July 9, 2010

Court slashes Tenenbaum award by 90% on constitutional grounds

Judge Nancy Gertner has slashed the jury's award against admitted peer-to-peer user Joel Tenenbaum from $675,000 down to $67,500, taking the apparently unprecedented step of holding an award of copyright statutory damages unconstitutional. Wrote Judge Gertner in her 62-page order:
There is no question that this reduced award is still severe, even harsh. It not only adequately compensates the plaintiffs for the relatively minor harm that Tenenbaum caused them; it sends a strong message that those who exploit peer-to-peer networks to unlawfully download and distribute copyrighted works run the risk of incurring substantial damages awards. Tenenbaum’s behavior, after all, was hardly exemplary. The jury found that he not only violated the law, but did so willfully.

Reducing the jury’s $675,000 award, however, also sends another no less important message: The Due Process Clause does not merely protect large corporations, like BMW and State Farm, from grossly excessive punitive awards. It also protects ordinary people like Joel Tenenbaum.
Judge Gertner's opinion thus differs significantly from that of Judge Michael Davis in the Jammie Thomas-Rasset case, which reduced an award of copyright statutory damages on common law remittitur (i.e., non-constitutional) grounds.

Keep in mind that while the reduced award of $67,500 -- $2,250 multiplied by the 30 songs on which the record labels sought damages -- is certainly better from Tenenbaum's perspective than $675,000, he could have easily settled long ago for $4,000. And he has told the Boston Globe that the lower amount is still "unpayable to me."

I'll have additional analysis once I've had the chance to read the entire opinion.
Order on motion for new trial/remittitur in Joel Tenenbaum case


  1. As you review Judge Gertner's, perhaps you may wish to consider if she gave due consideration to rights infringed other than "duplication" (e.g., "distribution").

  2. Shazam, got ya on Due Process.

    The amount is clearly still excessive considering the person to whom the decision is directed. If it were MJ, Britany, Gates, or some other million-billionaire then perhaps a decision in the tens of thousands would be a reasonable deterrent. As is, a couple hundred at most, perhaps a thousand in the most egregious case of individual infringement possible, is better based in reality.

  3. Did I read this right? Remittitur (as was the case in Minnesota) has been bypassed in favor of a decision based upon substantive due process?

  4. Ben, a clear and well written opinion but I think the court got it wrong. Let me explain (if I can at some length)

    There are a number of reasons why the Gore guideposts do not apply:

    A. Gore dealt with punitive damages which are designed to punish in amounts that are usually unrestrained. But statutory damages are different. They are not only intended to punish but to compensate, impose appropriate damages on wrongdoers, deter future infringements and promote the creation of intellectual property.

    B. Gore’s guideposts derive from the need to give defendant notice of the severity of the penalty that may be imposed. But the statutory damages scheme gives notice. Congress has established and periodically adjusted the range of statutory damages and a verdict within that range is entitled to substantial deference.

    C. The second Gore guidepost weighs the relationship between the punitive award and the actual harm. But this guidepost has no application to statutory damages which may be awarded without any showing of harm.

    D. The third Gore guidepost judges the propriety of the award by focusing on its relationship with the applicable civil penalty. But this guidepost makes no sense here because the award is by definition the applicable civil penalty.

    Tenenbaum attempted to avoid the identity between the award and the penalty by deciding that Congress did not intend to apply the statutory damages scheme to “noncommercial infringers sharing and downloading music through peer-to peer networks.” The court reached this extraordinary conclusion by a “careful review” of the “legislative history” of the Digital Theft Deterrence Act of 1999. But the history the court credited consisted of off-hand comments made by Senators Hatch and Leahy at hearings held after Congress passed that statue.

    Hopefully this result will be reversed on appeal. If not it will erode copyright enforcement. If a copyright owner has to demonstrate actual damages as a condition of recovering statutory damages many cases will never be prosecuted for a number of reasons. First, the value of a copyright is, by its nature, difficult to establish. How much is an unpublished novel worth? Second, in cases involving public performances, the only direct loss is the lost license fee; as the Copyright Office recognized years ago, an award in such amount is an invitation to infringe with no risk of loss to the infringer. Third, actual damages are often less than the cost of detecting, investigation and, for sure, litigating. So why bother.
    I have just posted many of these comments plus the post trial briefs of the plaintiffs and the government on my blog at Ben, I hope your readers find all of this useful.

  5. Great job Gertner! Now there's all the more incentive for multinational companies to pirate content to their hearts content, with FREE immunity!!:

  6. Did the Judge just ignore the doctrine of constitutional avoidance?

  7. I'm a little offtopic here, I apologize in advance.

    But why are there so many LAWYERS with pro-copyright blogs? Engineers/technical blogs tend to be more anti-copyright.

    Copyright must be a really big money maker for the law industry, more so then for the technology industry.

    I also think you are using the word "copyleft" incorrectly. Copyleft is not a political faction, or a adjective for a person or a group. It is a category of copyright license that encourges wide dissemination instead of restriction.


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