Sony BMG attorney: 'We were shocked' by size of verdict; concedes $1.92 million award could be reduced on appeal

Usually when plaintiffs win huge damages at trial, they and their lawyers jump for joy, crowing loudly and happily that the defendant got exactly what she deserved. Not so the record labels after the stunning $1.92 million award against Jammie Thomas-Rasset was handed down by a Minneapolis jury late Thursday afternoon. The labels and their attorneys exercised their right to remain silent, leaving it to an RIAA spokesperson to issue a terse statement noting, "We are pleased that the jury agreed with the evidence and found the defendant liable," and reiterating the labels' willingness to settle. No explicit mention of the award itself.

Well, today we learned a little about what at least one of the labels' top attorneys thought of the verdict. Speaking at a Columbia Law School reunion event Saturday, Sony BMG attorney Wade Leak echoed the sentiments of observers in the courtroom and around the world:

We were shocked. I suspected we were going to win, but I really thought they would come in with a lower number.

Leak was the plaintiffs' first witness at trial, serving as the vehicle for the admission of 8 Sony copyright registrations at issue in the lawsuit. He also explained to the jury the basic functions of a record label, and outlined the steps labels take to fight piracy. Leak testified in general terms as to the harm piracy had done to his company, pegging the losses at "thousands" of jobs and "billions" of dollars. In one of the trial's more dramatic moments, Leak was pressed to answer whether an award of $150,000 per infringed work would be appropriate. After resisting several times, Leak eventually responded, "Certainly!" The jury ended up awarding about half that, $80,000 per work for each of 24 songs.

Also, according to a press release issued by Columbia:

Leak conceded the verdict could be reduced on appeal, given that Davis, who presided at the retrial, expressed concerns at the size of the damage award in the first trial.

Leak's reference was to Judge Michael Davis' September 2008 order vacating the verdict in the first trial, which included an award of $222,000 for infringement of the same 24 songs pursued in the just-ended re-trial. In the 2008 order, Judge Davis urged Congress to reduce the amount of statutory damages available against individual infringers, opining that "the damages awarded in this case are wholly disproportionate to the damages suffered by Plaintiffs."

Here is the relevant portion of the Columbia Law School press release:

Aggressive Pursuit of Illegal File-Sharers Defended by Top Music-Industry Lawyer

A Big Court Test over Fair Use; Columbia Law School Alumni Examine Cutting-Edge Copyright Issues

***

New York, June 20, 2009 – When the recording industry launched more than 30,000 lawsuits against people accused of illegally downloading music, it turned into a public-relations nightmare.

Twelve-year-olds and a grandmother accused of downloading hip-hop tracks were among those named in lawsuits.

But as G. Wade Leak ’89 sees it, the bigger problem is the damage inflicted on the music business, as a generation grows up believing that paying for music is more a nuisance than obligation.

“I’ve seen thousands of people lose their jobs and it’s all because people are getting their music for free,” said Leak, senior vice president and associate general counsel at Sony BMG.

Leak spoke at a forum called “Artists’ Rights in the YouTube Era” held June 20 as part of Reunion 2009 at Columbia Law School. Eva Subotnik ’03, a Fellow at the Kernochan Center for Law, Media and the Arts, moderated.

Earlier this week, Leak had a front-row seat to how this issue is playing out when he testified as a[] witness at the only file-sharing case to go to trial. The Recording Industry Association of America sued a Minnesota woman for illegally downloading 24 songs.

A federal court jury Thursday found the woman violated copyrights and was liable for $1.9 million in damages, or $80,000 per song. A $222,000 verdict against the woman in 2007 was reversed by U.S. District Judge Michael Davis, who said he had given improper jury instructions.

“We were shocked. I suspected we were going to win, but I really thought they would come in with a lower number,” Leak said.

Indeed, Leak conceded the verdict could be reduced on appeal, given that Davis, who presided at the retrial, expressed concerns at the size of the damage award in the first trial.

The Minnesota case reached court because defendant Jammie Thomas-Rasset refused to settle. That is also the case with artist Shepard Fairey, who is suing the Associated Press, which demanded payment for an image that the news cooperative said Fairey used to create a now-iconic poster of Barack Obama.