yearly estimates, beginning in 1999, of the revenues generated by their copyrights in the specific songs for which they intend to prove infringement at trial. They should separate physical and digital music sales and should provide Defendant with a description of the methodology used to arrive at these figures.Judge Gertner denied the rest of Tenenbaum's motion, criticizing his counsel, Harvard Law School Professor Charles Nesson, for his tardiness in seeking discovery:
Counsel filed his appearance in this case on September 22, 2008, when discovery was already underway. Yet he did not file his First Set of Interrogatories until May 8, 2009, more than seven months later, when the Court had already ordered that discovery would close on May 30, 2009.... Defendant's counsel protests that the case did not crystallize until early May and that his team's energies were consumed by the abuse of process counterclaims that the Court has now dismissed, the constitutional challenge that the Court has deferred, and the webcast dispute. Lawyers, however, constantly face strategic choices about how to expend limited time and resources to advance their client's case. Discovery is obviously a central tool in defending against a civil suit; it is hardly an afterthought. Moreover, many of the issues raised in the interrogatories -- the ownership of the copyrighted works and factors relating to damages -- have been at the core of this case from its inception. Having delayed seeking this discovery until the deadline was weeks away, and having failed to request a timely extension from the Court, Tenenbaum has forfeited his right to compel the Plaintiff to answer any interrogatories unrelated to the fair use issue.Interestingly, Judge Gertner also said that she may permit additional discovery on financial issues after the trial:
The Court will reconsider the need for discovery on any issues relating to actual damages if and when the Defendant's constitutional challenge becomes ripe -- i.e., should the jury award damages against him.While I admit I haven't researched the issue whether post-trial discovery is ever permitted, this seems improper to me. One of the main purposes of statutory damages is to relieve copyright owners of the obligation to prove actual damages, because doing so is often difficult or impossible. So wouldn't it undermine the very purpose of statutory damages to require a successful plaintiff to later prove up its actual damages?
Here's the entire order:
Judge Nancy Gertner: Electronic ORDER entered granting in part and denying in part [852] Motion to Compel. "The Defendant's Motion to Compel [852] is GRANTED in part and DENIED in part. As a general matter, the Defendant's discovery requests are untimely under Fed.R.Civ.P. 33(b)(2). Counsel filed his appearance in this case on September 22, 2008, when discovery was already underway. Yet he did not file his First Set of Interrogatories until May 8, 2009, more than seven months later, when the Court had already ordered that discovery would close on May 30, 2009. See February 23, 2009 Order at 3 (document # 759). Rule 33(b)(2) provides that a party shall have 30 days from the date of service to respond to interrogatories, unless that period is altered by stipulation or court order. As a result, in order to be considered timely, such requests must be served with enough time for responses to be made before the discovery deadline. See Thomas v. Pacificorp, 324 F.3d 1176, 1179 (10th Cir. 2003); Ginett v. Federal Express Corp., 166 F.3d 1213 (6th Cir. 1998) (unpublished); Whitman v. Proconex, Inc., 2009 WL 113740, at *4 (E.D. Pa. 2009); Williams v. Little Rock Mun. Water Works, 155 F.R.D. 188, 189 (E.D. Ark. 1993). Defendant's counsel protests that the case did not crystallize until early May and that his team's energies were consumed by the abuse of process counterclaims that the Court has now dismissed, the constitutional challenge that the Court has deferred, and the webcast dispute. Lawyers, however, constantly face strategic choices about how to expend limited time and resources to advance their client's case. Discovery is obviously a central tool in defending against a civil suit; it is hardly an afterthought. Moreover, many of the issues raised in the interrogatories -- the ownership of the copyrighted works and factors relating to damages -- have been at the core of this case from its inception. Having delayed seeking this discovery until the deadline was weeks away, and having failed to request a timely extension from the Court, Tenenbaum has forfeited his right to compel the Plaintiff to answer any interrogatories unrelated to the fair use issue. However, because the Court has held discovery open on fair use, discovery requests on this subject served prior to June 22, 2009, the deadline set by the Court, are treated as timely. See Revised Scheduling Order at 5 (document # 850). Yet even here the Defendant's late-breaking effort to add the fair use defense, and the imminent trial date reaffirmed today by the parties, necessarily limits the breadth of the available discovery. See Fed.R.Civ.P. 26(b)(2)(C). Thus, to the extent that Interrogatories 2, 3, and 8 seek information related to the fair use analysis under 17 U.S.C. 107(4) (requiring consideration of "the effect of the use upon the potential market for or value of the copyrighted work"), the Court will permit some investigation. By July 10, 2009, the Plaintiffs shall provide the Defendant with yearly estimates, beginning in 1999, of the revenues generated by their copyrights in the specific songs for which they intend to prove infringement at trial. They should separate physical and digital music sales and should provide Defendant with a description of the methodology used to arrive at these figures. The Court will reconsider the need for discovery on any issues relating to actual damages if and when the Defendant's constitutional challenge becomes ripe -- i.e., should the jury award damages against him." (Gaudet, Jennifer)
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I think she was suggesting that she would allow discovery to support an affirmative claim of unconstitutionality by the defense. Not requiring an affirmative showing of loss by the Plaintiffs.
ReplyDelete@Ben:
ReplyDeleteI agree with you that that would be the purpose of the discovery. My point is that it seems to be a back door way of forcing the plaintiffs to prove actual damages, a requirement that statutory damages is supposed to obviate.
Yes, but if the statutory scheme is unconstitutional then the scheme's intention does not matter, because it is outright invalid. IF the court finds that BMW v Gore applies to statutory damages cases, then the only way to prove unconstitutionality is to prove actual damages. To say that the statute was "intended" to obviate a showing of actual damages and should be honored as such would impermissibly put congress's intent above the constitution. The whole point of defendant's argument is that Congress's intent was unconsitutional, as applied to individual file sharers.
ReplyDeleteThis appears to be a huge win for the defendant. My understanding is that the riaa has resisted divulging revenue information about their songs ferociously and to the maximum extent of their abilities. Unfortunately, they will probably insist that this information be filed under seal, so the rest of the world will be unable to weigh in. But I wonder what riaa will do to prevent the information from falling victim to "radical transparency."
@Anonymous 2:41:
ReplyDeleteI see your point. But I also don't see how the defendant gets to re-open discovery long after the discovery cut-off, and even after trial. As Judge Gertner herself made clear, Nesson simply neglected to take discovery for many months when he could have. (Remember, he was even pressing to go immediately to trial last November, before I believe he had taken *any* discovery.)
As to whether this is "a huge win for the defendant": I think that significantly overstates the case. As I understand the order, the plaintiffs simply have to give "estimates" of "revenues generated" by each of the 7 songs from 1999-present. So Tenenbaum will now know that in 2005, song X generated revenue of $2 million physical and $1 million digital, and in 2006 $1.5 and $750,000, and so on. Well, so what? Those numbers alone tell you very little. They don't tell you profit, and they don't tell you what the numbers would have been absent piracy (Joel's or in general). Nesson may be able to argue "See, they make lots of money!" But that's not really probative of the actual issues involving fair use.
It's a philosophical win, not a case-outcome win; it's a way for Nesson to say "by the RIAA's own admission these songs only made X amount of money, and yet the RIAA(*) fined Tenenbaum more-than-X amount of money, CLEARLY this is UNCONSTITUTIONAL!!!"
ReplyDelete(*) well, actually, the jury, but God knows that after this trial Nesson's likely to pretend that the jury never existed...
There is minimal constitutional protection for purely economic rights, so an analysis of the constitutionality of the statutory damages clause would be under the rather lax rational basis standard of review. Having said that, the deterrence of infringing activities would presumably be a legitimate exercise of Congressional power, especially in an economy where intellectual creation comprises quite a significant portion of the country's GDP. And it falls on the shoulders of the challenger to satisfy that burden.
ReplyDeleteI'll look on with interest to see what happens if the court orders discovery on actual damages, given the conflict with the wording in the statute itself. Afterall, how would the plaintiffs provide anything short of mere speculation when it is impossible to know just how many infringements arose out of the defendant's actions? It is for that very reason that statutory damages provisions were crafted.
(different anonymous)
ReplyDeleteI think it's simpler than that. Look at it this way--suppose the jury comes back with a really big number (which is possible, because defense counsel appears to be a bit of a clown and the defendant himself looks.... shifty). Gertner then has to rule on constitutionality. If the award is Thomas-like, one could read this as an indication that she will set the award aside.
If that's true, then discovery on the actual damages is necessary, because if BMW v Gore-type multipliers are in fact constitutionally required (as was argued in, for example, the Legg Mason case in the Fourth Circuit), she will have to reduce the amount to a multiple of actual damages. (This argument has always struck me as BS, but if it's right, fighting parking tickets is going to be a whole lot more fun. How much $ does NY lose for being 10 min late on a 50 cent meter?). In that case, she'll have to retry the damage phase on far narrower grounds.