Supreme Court Lets Stand Student's $675,000 Penalty For Downloading
npr.org
npr.org
The district judge reduced the judgment from $675,000 to $67,500, citing constitutional concerns analogous to those that were found for punitive damages in BMW v. Gore (1996), which put a cap on how big a multiplier punitive damages could be over actual damages (http://en.wikipedia.org/wiki/BMW_of_North_America,_Inc._v._G...). The Appeals Court reversed on somewhat technical grounds, arguing that common-law remittitur (a process for reducing excessive awards) should've been pursued before considering the constitutional question, under a doctrine of avoiding unnecessary constitutional questions. So on remand the District Court will be able to reduce the damages as excessive on non-Constitutional grounds, but in that case, unless Sony agrees to the reduced damages, they could ask for a new trial (whereas, if Tenenbaum had prevailed on his constitutional argument, that'd be that).
People were hoping the Supreme Court would take the case mainly as an opportunity to extend the reasoning of BMW v. Gore to statutory copyright damages, rather than only punitive product-liability damages. It's possible the Court didn't want to do so. Or, it's possible they wanted to wait for at least another Circuit Court to weigh in before looking at the question. Also, it's possible they thought this issue about whether to pursue remittitur first added an unwanted complication to the case that made it too messy to hear as a test case (the court often looks for test cases that cleanly present a Constitutional issue, free of entanglement with subsidiary questions and procedural messes).
edit: The introductory section of the Appeals Court decision, which is the one the Supreme Court declined to review here, is actually fairly readable as a summary of their holding: http://www.ca1.uscourts.gov/pdf.opinions/10-1883P-01A.pdf
In no circumstance should the denial of cert be considered an opinion one way or the other on the merits of the case.
Last year I led a Startup Weekend team for crowd-sourced legal defense, 1) for people mentioned above to pool together a large defense front so more cases like these would end up in court, and 2) for people already there like Joel, who are seriously outgunned financially which hurts society as a whole by allowing bad precedence to be set.
The inspiration for #2 came from George Hotz getting a mass of donations in under 2 days when he was sued by Sony for hacking the PS3, enough that he had to stop taking them.
I still think it's a great idea, although perhaps not legally tenable. In any case just throwing it out there.
But it is something I want to see in the world, so happy to throw the idea out if anyone wants to tackle it.
This differs from donating to the EFF in that you have a say over what specific cases you want to invest in.
http://www.techdirt.com/articles/20091207/1149277233.shtml
Additionally the other big case in this domain, Capital v. Thomas, has seen much of the same. Some very talented people working the case pro-bono, but seemingly doing this for the spotlight.
It's good to have options. It's good to not have these things turn into a circus if it can be helped. But then again, IANAL.
I haven't heard of a case where a defendant lost or had to pay damages simply for downloading - the "damages" are only the value of each song, rather than the value times the number of people who could have theoretically downloaded it from them.
Also, if your peer to peer network has you downloading the same thing over and over again, then your peer-to-peer network is broken.
Mostly true, but I feel like I must point out that fair use (what narrow legally defined version of it we have, anyways) overrides the copyright owner's wishes.
Not that this applied here, but it's an important point anyways.
Historically, I don't think this would come up as much in copyright law. General torts often involve a confluence of events triggered by multiple actors, whereas copyright violations have usually been clearly the act of a single person or entity, so I'm not sure there's much case law around this.
I guess you could argue that if 5 people worked together to steal a car, they all get charged with attempted theft of that car. In other words 1 person doesn't get charged and 4 get to go free, or they don't all get charged with attempted theft of 1/5 of a car.
I would think though that could be an argument against the supposed lost revenue. I'm sure the content companies are doing the math to show the highest figures possible.
Using the car example, the car owner shouldn't be awarded 4x the value of the car just because 4 people were involved.
Also, it's still copyright infringement to provide a copy to someone even if they already have it. I cannot, legally, provide a rip of a CD to anyone who has a cassette tape of the same album.
https://w2.eff.org/IP/eff_fair_use_faq.php
Although the legal basis is not completely settled, many lawyers believe that the following (and many other uses) are also fair uses:
Space-shifting or format-shifting - that is, taking content you own in one format and putting it into another format, for personal, non-commercial use. For instance, "ripping" an audio CD (that is, making an MP3-format version of an audio CD that you already own) is considered fair use by many lawyers, based on the 1984 Betamax decision and the 1999 Rio MP3 player decision (RIAA v. Diamond Multimedia, 180 F. 3d 1072, 1079, 9th Circ. 1999.)
Making a personal back-up copy of content you own - for instance, burning a copy of an audio CD you own.
Yes you can backup or transfer your copy to other formats or media. But you cannot redistribute that copy to others, even if those people have a license for it.
And yes, archival and format-shifting is possible because of fair use clauses, but those clauses do not extend to redistribution of the work as a whole, even if done for noble purposes and in the public interest.
And even in cases where you could redistribute parts of the work, with the purpose of criticism or parody, the end result and intent matter a lot when judging if fair use clauses apply or not.
I don't think it's clear either way.
One famous case is this one: http://en.wikipedia.org/wiki/L.A._Times_v._Free_Republic
The judge held that "while defendants' do not necessarily 'exploit' the articles for commercial gain, their posting to the Free Republic site allows defendants and other visitors to avoid paying the 'customary price' charged for the works".
(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes; (2) the nature of the copyrighted work; (3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and (4) the effect of the use upon the potential market for or value of the copyrighted work.
On the issue of downloading/uploading - that's just a technical detail that's being hidden away in modern protocols and clients, such as BitTorrent. When downloading torrents, everybody is an uploader.
I can see a clear difference here between a user that just wants to download some movie he likes and somebody that makes money out of it, or somebody that's interested in "sticking it to the man".
The data by itself has no meaning, unless interpreted.
So the question should be, did the user have any intent on sharing/distributing the creative work to others, or was he just a user of a protocol he didn't understand, ending up uploading just because that's how the protocol works?
A lot of non-technical users do not know that they are uploaders when using BitTorrent. They just have a client installed by a friend and upon clicking a link the download begins, just as it would through HTTP or FTP.
And I see a clear distinction here between somebody doing that, or somebody that does it for the money or for glory. For instance we have a lot of prowlers in my city that sell pirated CDs at street corners to people that are passing by. The PirateBay is also filled with movies shot with a web cam in a movie theater, done with the express intent to redistribute those movies, either for money or for the thrills. Many times movies that were distributed as press releases end up on the PirateBay in DVD-quality long before the DVD was released. A lot of hacked copies of Windows are also on the PirateBay, many times with customizations and mallware included. And so on.
There are many shades of gray here. You can't put all the people in the same bucket. And I think that the people that should get punished are those that start the redistribution chain in the first place, not kids, not grandmas, and not the online services that act as the middleman (many times without their knowledge).
This is another reason why I think DRM is a misguided and broken attempt to fix piracy, when watermarking is so much better from all points of view.
The reason the cases are like that is because they catch people by scanning for people sharing.
Note that I said per song shared, which will be more than the 24 songs that were specifically in the lawsuit. Generally in these cases the person is sharing thousands of songs. The RIAA only names a dozen or so in their suits because there is no point in suing over all of them. They have to prove proper copyright registration for each song and that they are authorized by the copyright owner to sue, so suing over all of them would require a ton of evidence.
With 24 songs, if they win and if they get the MINIMUM POSSIBLE statutory damages (which only happens if the court finds that the infringer was not aware and had no reason to believe they were infringing), that works out to about $5k. If the court finds that the infringer knew or had reason to believe that they were infringing, the minimum statutory damages on 24 songs would be $18k.
So, here's the situation from the point of view of someone that the RIAA catches distributing a few thousand songs: the RIAA will offer to settle for somewhere around maybe $3-5k. That will work out to about $1-2/song. Considering that it is typically $1/song to buy a copy of the song for personal use, being asked to pay $1 or $2 for a copy that you were sharing online is quite reasonable.
If you decide that you are going to make them go to court, and they sue over just a handful of the songs, and if you actually did share the songs and so are guilty and they can prove it, then you are GUARANTEED to have damages of more than what you could have settled for.
It doesn't take a game theorist to figure out that settling is a strictly dominant strategy here.
Note that there is no question of innocence or mistake. Tenenbaum basically admits he did it, that he knew it was illegal, and that he intends to keep doing it. The other defendant who was taking their case to trial (three times now, I believe), Jamie Thomas-Rasset, also was clearly guilty, although she still hasn't admitted it. She did perjure herself, got caught tampering with evidence, and tried to blame her children and boyfriend for her actions.
The RIAA has been sufficiently sloppy that they have pursued these cases in many situations where the facts were against them. In those it does not always make sense to settle.
And, even if the facts are against you, if you can prove that the RIAA screwed up in how they collected that information on you, they might not be allowed to actually present that evidence. The odds of this succeeding are low, but if even one person succeeds in that, the precedent will be good for everyone going forward. (Of course if you fail, you pay full costs.)
Admittedly it takes an unusual kind of person to prefer one of the latter two courses. But if they succeed, it could be very good for everyone else.
Disclaimer, I am not a lawyer, this is not legal advice, and I personally do not care much either way because I have never shared or downloaded copyrighted content in any public forum.
If you have any pressing questions I could probably pass them along.
Of course, the artists can't do much about it, since they've typically signed over these kinds of rights to the labels, but it could at least produce some bad PR if they raised more of a stink about it.
They could also "vote with their feet" and sign with a non-RIAA label. That unfortunately still seems quite uncommon. Of the artists on the list (http://en.wikipedia.org/wiki/Sony_BMG_v._Tenenbaum#31_songs), two subsequently went indie, Monster Magnet and NIN.
Torrents, of course, are an entirely different story altogether.
(1) Authors of literary and artistic works protected by this Convention shall have the exclusive right of authorizing the reproduction of these works, in any manner or form.
The law in the US (Title 17) is generally more restrictive. It used to be technically illegal to copy a program from disk to ram when you ran it, and Congress had to pass an amendment (Section 117) to allow that.