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Appeals Court Reinstates $675,000 Jury Award Against Joel Tenenbaum On Procedural Grounds

from the too-bad dept

Back in April, we went through the entire appeals court hearing concerning the appeal of Judge Nancy Gertner's reduction of the jury award in the Joel Tenenbaum case as "constitutionally excessive." The jury had awarded $675,000 or $22,500 per song. Gertner reduced it to $67,500, or $2,250, and argued that the higher rate was just ridiculous. Unlike Judge Michael Davis, who did something similar in the Jammie Thomas case, Gertner did not use the "remittitur" process.

As happens often enough in such things, almost nothing that was heard during the oral hearings really mattered in the decision. The question of due process and remittitur didn't even make it into the hearing -- or if it did, it was a very minor part that didn't make an impact. And yet, that issue was central to the court reinstating the original $675,000 award.

The key points here are really procedural. The court notes that Gertner jumped to the constitutional question, which judges are supposed to avoid if they can. The court also suggests that Gertner should have used the remittitur process, like Judge Davis, allowing the record labels to (as they would have) reject the lower amount and redo the trial. Of course, as we've seen in the Jammie Thomas situation, that seems to lead to a series of wasteful cases.

To summarize: the court here basically avoided the big questions and sent the ruling back, and reinstating the jury award because Judge Gertner jumped the gun, and went straight to the Constitutional questions, when there were still other steps in the process that needed to be taken. This seems disappointing and wasteful in terms of resources, but such are the rules.

Separately, the court, as pretty much everyone not named Tenenbaum or Nesson suspected, didn't give any weight at all to Tenenbaum's separate appeal arguing that the Copyright Act itself was unconstitutional. These arguments were never going to persuade the court, and seemed more like (wasteful) academic exercises all along. In particular, the court eviscerates the idea that mere "consumers" should be treated differently by copyright law than those who are doing more than consuming. It notes that such a distinction is not mentioned by Congress anywhere, and if it wanted to amend copyright law to fix that, it's had plenty of time.

So, for the most part, this ruling is procedural... though it does go out of its way to note that "this case raises concerns about application of the Copyright Act which Congress may wish to examine." Of course, by now we know that if Congress opened up the Copyright Act to tinker, the end result would almost certainly be worse.

Either way, I'm assuming this case is far from over, and Tenenbaum, Nesson and some other Harvard Law students will keep banging the drum -- though, to date, it hasn't been all that successful. This is definitely a disappointing ruling, but hardly a surprising one.

Filed Under: appeal, copyright, damages, joel tenenbaum

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  1. icon
    Jay (profile), 18 Sep 2011 @ 10:01am

    Re: Re: Re: Re:

    "Just curious, but what statutory damages level would you consider to be reasonable, and not exorbitant? There are those who advocate levels for all three that in effect would render a right holders monetary remedy for infringment in all three circumstances so miniscule that one of the purposes of statutory damages, to give an infringer a strong incentive to never do it again, would emasculate this purpose."

    I'm not seeing why the impetus is on the infringer to "never infringe again" when it's the prosecution that has to prove it. There's plenty of alternatives to the RIAA distribution models nowadays. Spotify, Jamendo, and Soundcloud are but a few. People can also watch Youtube. So honestly, the idea that an infringer will never "infringe" again, when they have places to continue to listen to music again seems to be an empty threat.

    But you could take out the "per work" wording and have the range become from $200 to $150,000. More leeway for punishments and people might have more respect for the law if it weren't so inflexible about the statutory damages clause. It should be noted that the economics of these mass lawsuits really isn't there. And if it were about relief, instead of quick settlement payouts, I'd probably have a different stance. Having seen this from the RIAA and the USCG as a trolling effort, I'm not entirely convinced this is the best use of our judicial system, since it supports these extortionist lawsuits.

    "Is a judge being accurate something to be frowned upon, and if so when and why?"

    I don't think anyone is saying that. But notice what Gertner says in her ruling:

    As this Court has previously noted, it is very, very concerned that there is a deep
    potential for injustice in the Copyright Act as it is currently written. It urges – no implores --
    Congress to amend the statute to reflect the realities of file sharing. There is something wrongwith a law that routinely threatens teenagers and students with astronomical penalties for an
    activity whose implications they may not have fully understood. The injury to the copyright
    holder may be real, and even substantial, but, under the statute, the record companies do not even
    have to prove actual damage. “Repeatedly, as new developments have occurred in this country,
    it has been Congress that has fashioned the new rules that new technology made necessary.”
    Sony, 464 U.S. at 430-31. It is a responsibility that Congress should not take lightly in the face
    of this litigation and the thousands of suits like it.

    Also, it's indeed ironic, she mentioned the Jammie Thomas case in her motion for remittitur ruling:

    The case most comparable to Tenenbaum’s is that of Jammie Thomas-Rasset, the only
    other file sharer to go to trial. The first jury to hear Thomas-Rasset’s case found her liable for
    willfully infringing twenty-four sound recordings and awarded the plaintiffs $9,250 per song, for
    a total award of $222,000. Although Chief Judge Davis, who
    presided over the case, ordered a new trial because of an error in the jury instructions, not because of the size of the award, he noted in dictum that “the award of hundreds of thousands of
    dollars in damages” for file-sharing was “unprecedented and oppressive.” When the
    second jury returned a verdict of $80,000 per song, for a total award of $1,920,000, Chief Judge
    Davis required that the plaintiffs accept a remitted award of $2,250 per song or submit to a new
    trial. Thomas-Rasset, 680 F. Supp. 2d at 1048, 1050.(As explained above, the plaintiffs
    rejected the reduced award.)

    In effect, I believe the Appeals Court shirked their duties by making this a procedural issue. Gertner was aware of the case and showed the problems of this type of litigation, which actually forced her to face the Constitutionality of the situation.

    "The appeals court determined that because the rights holders had placed notices of copyright on the works originally distributed to the public, she did not qualify for the reduction under the "innocent infringement" defense."

    Unfortunately, it doesn't help that she was 14 when litigation started, the "per work" is still a sticking point, and even with the reduced damages, it's the amount of a car loan. What do they gain by bankrupting her?

    But it is simply unconstitutional to make ANYONE pay such an excessive amount of money for listening to a few songs. Today, I am now 23 and a fresh new graduate from college. In addition to the loans that the majority of my generation takes in order to attend college, I have a $30,000 judgment against me that will give me severe financial troubles. This may force me to file for bankruptcy, a status that will ruin my young adult life.
    While juvenile criminals get a fresh start when they grow up, I’m still being dragged through the legal mud and will have to carry the burden of something I did when I was a kid.

    Why continue litigation when someone says they were willing to pay? Those are Whitney Harper's words. Jammie Thomas would be willing to pay for the songs, not the extortionary amounts. Even Tenenbaum might pay for his songs instead of something far outside of the realm of reality. If they're not getting money from the litigation, the best way to do this has always been through economic means. Making better alternatives than piracy is what has been working. I can't say that enough. The litigation angle has done no one any favors. Enforcing copyright claims will always lead to unnecessary heartache as evidenced with Andy Baio's situation, Whitney Harper's, and the JTs.

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