Ridiculous Statutory Damages Rules Mean Judge Regretfully Awards $3.6 Million For Circumvention Of DRM

from the totally-out-of-touch-with-reality dept

Eric Goldman points us to yet another example of ridiculous statutory damages rules around copyright creating awards in court cases that have no connection to any real harm. And, this time, it involves the violation of the highly questionable (and controversial) anti-circumvention clause of the DMCA. The case involves an online game, MapleStory, and some people who set up an alternate server, UMaple, allowing users to play the game with the official game client, but without logging into the official MapleStory servers. This kind of thing happens all the time.

In this case, the people behind UMaple apparently ignored the lawsuit, leading to a default judgment. However, even there, it appears that MapleStory went too far, and the judge is clearly annoyed with them at times. Even though judges often side entirely with winners in default judgments, in this case, the judge repeatedly expresses skepticism about arguments made for determining "damages" to be awarded. Thus on most of the claims, the judge seems to look for ways to avoid giving MapleStory much, if any, money. For example, in determining profits made by UMaple, the judge repeatedly knocks MapleStory for failing to show what profits were specific to UMaple's infringement, telling it that it can't just assume all money made by UMaple belongs to MapleStory. So the judge dumps a request for $68,764.23 in profits made by UMaple down to just $398.98.

But... then we get to the anti-circumvention stuff. Here, the ridiculous statutory rates set a minimum of $200 per infringement. Multiply that by 17,938 users of UMaple... and you get $3.6 million. MapleStory, of course, asked for the statutory maximum of $44,845,000, which the court refuses to grant. In fact, the judge chides MapleStory for its request for the maximum -- even to the point of noting that the arguments by MapleStory make it "question very seriously whether Plaintiff intended to actively mislead the Court or whether these oversights were merely the result of poor legal research."

The court then notes that the minimum statutory amount -- the $3.6 million -- is already "a significant windfall to Plaintiff far in excess of any amount necessary to deter future infringing conduct," and also that the "award here likely bears little plausible relationship to Plaintiff’s actual damages." In fact, it sounds like the court would very much like to decrease the amount, but notes that "nevertheless, the court is powerless to deviate from the DMCA's statutory minimum."

As Goldman says, this is "guffaw-inducing", because the minimum award seems to have no bearing on the actual seriousness of the infringement. As he points out:
this case does provide an excellent example of the ridiculousness of anti-circumvention statutory damages. $3.4M can't be the right damages award in this case, and it's so guffaw-inducing that it further erodes the legitimacy of our copyright rules.
Indeed. And yet no one seems interested in exploring just how disconnected statutory damages are from reality.

Filed Under: anti-circumvention, damages, dmca, eric goldman, maplestory, umaple


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  1. identicon
    Anonymous Coward, 18 Apr 2012 @ 8:07pm

    Re:

    If the punishment was "actual damages only", there would be no incentive for anyone to follow the law. If you don't get caught, you get for free, and if you do get caught, you just have to pay "actual damages", which wouldn't be any more than you would have paid before. The risk / return would be insanely tilted towards those who choose to break the law. The statutory minimums are there for a reason - it gives the courts an easy, simple way to determine what is the minimum for the infraction. The judge doesn't have to do anything except apply it.

    I totally agree. Statutory damages are about more than just actual damages, and there's a lot of good reasons to use them. But I think the amount of statutory damages needs to be reasonably related to the amount of actual damages. When you get a high multiplier like the one here, even the minimum of the range gets ridiculous. A kid with one iPod full of tunes could be looking at tens of millions of dollars in liability. It's clearly problematic. I think a simple fix would be to make the statutory range suggestive, with a judge having latitude to a variance either up or down depending on the circumstances.

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