It’s one thing to take a stand against questionable copyright trolling, but it’s another thing to be a really bad defendant. We had this with both of the RIAA’s lawsuits against Jammie Thomas and Joel Tenenbaum. In both cases, they were bad defendants who clearly broke the law and then tried to play cute in defending themselves. In both cases we pointed out that they should have settled, and that fighting on when they had no case was a really bad idea. Yes, there are all sorts of ridiculous things about many of these cases, and there are all sorts of legal questions raised about them. But if you’re caught dead to rights infringing on the works of others, pretending that some magical fantasy world is going to open up in the back of the closet is just silly. Even worse: bad defendants create really bad case law that allows copyright trolls to use those cases to shake down lots of other people, many of which probably have much stronger cases.
Unfortunately, it looks like we have another example of this. Uber copyright troll/porn producer Malibu Media has won an easy lawsuit against a defendant who tried to blame everything on the fact that he used Kickass Torrents to download Malibu Media movies. 57 of them. That kind of blaming the middleman is never going to work. In fact, others have tried it in the past, and it doesn’t work. As the judge in the case noted:
Defendant has some quarrels with the details of how BitTorrent works, but nothing that the Court sees as a fundamental or material issue of fact. Even as Defendant describes the facts, using BitTorrent technology, he ultimately winds up with 57 unauthorized copies of Plaintiff?s works?copies that did not exist until Defendant himself engaged the technology to create new and unauthorized copies with a swarm of other users. True enough, the process is not identical to the peer-to-peer file sharing program in Grokster. It is, however, functionally indistinguishable from the perspective of both the copyright holder and the ultimate consumer of the infringed work. In both situations, the end user participates in creating a new and unauthorized digital copy of a protected work. It makes no difference from a copyright perspective whether the infringing copy is created in a single wholesale file transfer using a peer-to-peer protocol or in a swarm of fragmented transfers that are eventually reassembled into the new infringing copy.
Of course, one could make a reasonable argument that the fragmented transfers raise issues concerning the distribution right of copyright, but not the reproduction right. On the reproduction right, the defendant, Don Bui, is clearly cooked. And he and his lawyer should have recognized that much earlier. Instead, they get this ruling that, because of the bad defendant, makes a bunch of broad statements that go beyond just Bui’s immediate case and may create problems elsewhere. For example, the judge, Robert Jonker, cites the Aereo ruling to support this — even though that’s a dangerous way to read the Aereo ruling. Jonker seems to accept the “don’t look in the black box, just look at the end results” aspect of Aereo. But, under such a system, lots of things that aren’t infringement might now be judged infringing. It’s basically a shortcut to avoid careful analysis, and that’s what happens when you have bad defendants who clearly infringed.
Bui’s lawyer also tried the “poor immigrant who doesn’t understand English very well” argument and saw that shot down as well. Deservedly so. There are plenty of reasons to challenge questionable lawsuits. And plenty of reasons for some folks to legally attack the underpinnings of copyright trolling — including things like honeypots and abusing the judicial system to shake down people — but taking a bad defendant all the way through the legal process is a bad idea. And the end result is going to be that Malibu Media not only claims vindication for its activities, but waves them around to every reporter, judge and (most importantly) future targets of its shakedown game.
From very early on, we pointed out that Joel Tenenbaum’s defense to being sued by the record labels was a complete and total train wreck. There were some legitimate legal issues to be raised, but on the whole, Tenenbaum’s legal team either failed to raise them, or raised them so ridiculously that they were dismissed out of hand. At points, it appeared that they bet the whole game on the idea that downloading music would be seen by the court as “fair use,” when that was almost certainly never going to fly (and when the court rejected it, it seemed like Tenenbaum’s lawyers had no backup plan). This was all made much, much, much worse by the fact that Joel Tenenbaum was a terrible defendant. He never should have gone to trial and should have taken the first settlement offered to him for a very simple reason: he was guilty of massive amounts of file sharing, and there was no way he was going to get around that point in a trial. Even worse (much worse) he then lied, repeatedly, about this. It’s stunning that he didn’t just settle and move on. This was a clear cut case where he had no case, and fighting it has only served to set bad to awful precedents, each time clouded in large part by his behavior outside of just the file sharing.
So it’s no surprise that, on yet another appeal, Tenenbaum has lost again, as the appeals court has sided with the second district court ruling, which said that a $675,000 award for sharing 30 songs was perfectly reasonable. There is a legitimate issue of whether or not $22,500 per song for songs that were uploaded non-commercially is constitutional. But, partly because of Tenenbaum’s own bad behavior, the court has no problem at all with an award that high.
On appeal, Tenenbaum invites us to assume that he is “the
most heinous of noncommercial copyright infringers.” We need not
go so far as to accept his offer. The evidence of Tenenbaum’s
copyright infringement easily justifies the conclusion that his
conduct was egregious. Tenenbaum carried on his activities for
years in spite of numerous warnings, he made thousands of songs
available illegally, and he denied responsibility during discovery.
Much of this behavior was exactly what Congress was trying to deter
when it amended the Copyright Act. Therefore, we do not hesitate
to conclude that an award of $22,500 per song, an amount
representing 15% of the maximum award for willful violations and
less than the maximum award for non-willful violations, comports
with due process.
Basically, an award this high is okay because Tenenbaum was a brat. The court argues that because he was such a brat an award this high makes sense because it fits in with the “deterrent effect” intended by statutory damages awards. Of course, if you think about that logically, it makes little sense, because by Tenenbaum’s own actions, it appears that nothing was going to deter him from file sharing, just as other giant awards and greater levels of punishment have done little to nothing to deter others from file sharing. But, all of that is blurred by the fact that he lied, which mucked up the entire case, combined with a really piss poor strategy in court that never seemed to reach a point that was even half-baked.
There are legitimate questions about the constitutionality of copyright’s statutory damages awards, which are nowhere near proportionate with the “wrongs” they are supposedly “righting.” But, you don’t get good rulings on difficult cases when you have a defendant who acted badly and lied during discovery. Instead, you get a bad precedent like this one.
Let’s be clear on one thing: Joel Tenenbaum should never have allowed the record label lawsuit against him to go forward. As with Jammie Thomas before him, he was not a good defendant, and had too many factors that clouded the key questions concerning the statutory damages rates in copyright law. Even worse, he lied to the court and his lawyers seemed more focused on making a point than mounting a defense. As we said all along, he needed to find better lawyers (and he probably shouldn’t have fought this in the first place). Even the judge, who clearly was sympathetic to Tenenbaum’s side of the story, rejected his basic argument, on which his legal team seemed to bet their whole strategy — and then berated his legal team for their dreadful handling of the case.
Given all of that, it’s easy to conflate all of those other issues with the important one: are the statutory rates for copyright infringement, especially in cases of non-commercial, personal use, Constitutional? The original judge, Nancy Gertner, argued that they were unconstitutionally excessive, which became the focus of the appeals process. The appeals court rejected the process Gertner used to come to that conclusion, saying that she should have used “remittitur” to reduce the award and offer the RIAA a chance for a new trial (as happened in the Jammie Thomas case). Instead, Gertner effectively tried to jump the line, by going straight to a Constitutional argument. The appeals court noted that it was too early in the process for that, and she should have used remittitur first. As such, it reinstated the original jury award of $675,000 for sharing 30 songs. The Supreme Court then refused to hear the case, which wasn’t a huge surprise either.
So… back down at the district court, with a different judge, who doesn’t seem nearly as sympathetic. Given that the judge is 80-years-old, it’s perhaps not a surprise that she seemed to spend more time talking about what a naughty kid Tenenbaum was, rather than the actual reasonableness of the rates. The court has now said, not only does it not find $675,000 constitutionally excessive for sharing 30 songs, but that it doesn’t even qualify for remittitur, because $675,000 is not “grossly excessive, inordinate, shocking to the conscience of the
court.” In other words, a $675,000 judgment is perfectly reasonable for sharing 30 songs. The judge, not surprisingly, focuses on many of the elements that we discuss above in arguing why it’s not excessive, with Tenenbaum’s continued use of file sharing and his lies, to support the supposed reasonableness of the ruling. She never actually looks at whether the numbers make sense, but merely suggests that because he didn’t revere copyright law, that such an award is perfectly reasonable.
Unfortunately, it seems that Tenenbaum’s behavior — which we agree was not good at all — clouds the larger issue of just how insane the statutory damages are. Some, of course, will point out that he’s been accused of sharing a lot more than 30 songs, but that doesn’t matter. The trial was about 30 songs. We don’t punish people in a court for stuff they’re not charged with and which they can’t defend against. If you want to say that $675k is reasonable for thousands of songs, then he should have been charged with infringing on that many songs.
The judge argues that one of the factors that makes this “reasonable” is that if Tenenbaum had wanted to license the songs for distribution himself, the cost would have been “enormous,” according to the labels. But that’s a silly comparison, because this wasn’t a commercial venture and he wasn’t looking to set up a service — he was just doing what millions of people around the world do — whether you think it’s right or wrong. As such, any thinking person should recognize that a $675k fine for the personal sharing of 30 songs seems offensive to the senses, even if you agree that Tenenbaum is not particularly apologetic for what he did. It really is a situation where tons of people were doing it, and right or wrong, it had become the norm. Something is wrong with a legal system that burdens people with such out of proportion awards for doing what everyone’s doing.
And despite the RIAA cheering on this decision, claiming that it’s “pleased” with the decision, it actually hurts them too. When ordinary people see $675,000 judgments for sharing 30 songs, they respect copyright less, because it seems so out of proportion with reality.
This case probably isn’t over yet, and there will likely still be an appeal to get at the Constitutional questions. But, I’m worried that Tenenbaum’s own bad actions, separate from what he’s accused of, are clouding the water here, and actually make this a bad and potentially dangerous case. That the court has upheld the $675,000 isn’t a surprise, but it should still be worrisome to people in terms of the precedent it will set for the next group of people accused in this manner, who didn’t act the same way Tenenbaum did.
If you don’t recall, there are statutory rates for copyright infringement, which are ridiculously high, and it seems reasonable to question if those awards, which seem totally disproportionate to any “damages,” could be seen as excessive under the Constitution.
The district court judge, Michael Davis, clearly felt so. Ditto Judge Nancy Gertner in the Joel Tenenbaum case. However, the government apparently is going to argue that the statutory rate is the statutory rate and we must respect that. The argument is basically the same behind the implementation for statutory rates in the first place. To paraphrase: “man, it’s freaking hard to have to show actual damages (since there might not be any) and thus we shouldn’t have to do that — but should just be able to use these crazy high numbers.” This argument seems silly frankly. It’s basically saying that even if you could look at damages, you should never have to. That’s a big part of the problem. It leads to cases like this where people are heavily pressured to settle just to avoid the risk of crazy high statutory damages.
But where the government’s argument goes off the rails, is the idea that when it comes to statutory damages, there’s never a due process question over whether the rates are excessive. That makes no sense, but it’s the argument being made:
Contrary to defendant’s contentions, the Due Process Clause does not
require that the statutory damage award be proportional to the actual harm
defendant has caused the plaintiff. Defendant attempts to derive this rule from
BMW of North America, Inc. v. Gore, 517 U.S. 559 (1996). But as the district
court held, Williams, not Gore, establishes the applicable framework for
determining whether an award of statutory damages under the Copyright Act
comports with due process.
Gore is inapposite. It imposes limitations on a jury’s authority to award
punitive damages in circumstances where the legislature has not constrained the
jury’s discretion. It thus requires that the jury award not be grossly
disproportionate to the plaintiff’s injury or defendant’s misconduct. Absent such
limitations, the Gore Court reasoned, defendants could not have fair,
constitutionally sufficient notice of the magnitude of potential sanctions.
The Gore framework, however, does not apply to a statutory regime in
which Congress has specified in advance the range of appropriate damages. In
that circumstance, the statute itself supplies the constitutionally required notice
deemed missing in Gore. Moreover, unlike jury awards of punitive damages, an
award of statutory damages is based on legislative judgments that must be
accorded deference by the reviewing court. Williams, not Gore, sets forth the
appropriate standards for conducting such review.
To summarize this argument, it’s that Congress can do whatever the hell it wants in setting statutory rates, and no one can ever question if those rates are “excessive.” Effectively, it’s saying that Congress doesn’t have to obey the Constitution. That makes no sense. And yes, it relies on this Supreme Court ruling from 1919, which is a pretty narrow ruling, concerning conditions under which you could measure such regulatory fines against the due process clause. However, this argument really tries to make that case do a hell of a lot more than it was designed to do — while also trying to pretend that a whole series of other cases involving excessive fines as they relate to due process don’t matter.
Either way, the end result is that the administration is effectively saying that a $1.5 million award for sharing 24 songs isn’t just perfectly legal and reasonable, but that it’s what Congress intended. All it really does is reiterate just how out of touch the White House is to reality.
As we expected, the Supreme Court has refused to hear the appeal by Joel Tenenbaum’s lawyers to jump straight to the Constitutional questions concerning the ridiculous statutory damages awards for sharing a couple dozen songs. While reports are claiming that the Supreme Court has “upheld the $675,000” damages award, that’s slightly misleading. At this point, the court simply refused to hear the appeal. As we pointed out in our post last week, this is really a procedural issue now. A jury had awarded $675,000 and Judge Nancy Gertner reduced the award based on Constitutional reasoning, rather than going through the remittitur process (allowing the record labels to request a new trial). The Appeals court rejected this saying that judges are supposed to avoid the constitutional questions if there’s another way.
So, all this really means at this point is that the process is going to get extended (which certainly works in the RIAA’s favor). It seems likely that the judge will now use the remittitur process to lower the award, and the RIAA will (once again) choose to have the case heard again. Eventually, it might be able to make its way up the appeals chain again. Or, Tenenbaum could decide that too much of his life is being wasted on this and just settle (which is what the RIAA is hoping for). So, today’s refusal to hear the appeal isn’t as big a deal as some are making it out to be, but it sure sucks for the guy who’s at the center of this.
You may recall that, in the case of Joel Tenenbaum — who is in a legal battle with some major lbels for file sharing — a jury awarded the labels $675,000 for the sharing of just a few songs. The judge, Nancy Gertner, pointed out that this seemed unconstitutionally excessive and reduced the award to $67,500 — knocking 90% off the jury’s award. The appeals court in the case reinstated the original $675,000 on procedural grounds. It said that Judge Gertner jumped the gun in leaping to the constitutional question, rather than using remittitur, as had been done in the Jammie Thomas case. Remittitur would allow the RIAA to have the case happen all over again with a new jury. In the Jammie Thomas case there have already been three trials.
Tenenbaum, led by famed lawyer/law professor Charles Nesson, challenged the appeals court on all of this, but had that quickly rejected. As we noted at the time, Nesson seemed to (as he’s done in the past) argue points unrelated to the specific legal questions at issue. This seemed like a bad way to go about things in a court of law, even if it may help in the court of public opinion.
The latest is that Tenenbaum/Nesson have filed to raise the issue with the Supreme Court. At least the argument here is a bit more focused on the requirement for remittitur, with Tenenbaum’s team arguing that the statutory damages for non-commercial use is clearly a major Constitutional issue, and by forcing it through the remittitur process, all the courts are doing is pressuring people like Tenenbaum to settle, rather than ever allowing it to be judged on constitutionality. And that has consequences — namely in enabling copyright trolls to shake people down, without ever allowing them to challenge the constitutionality of massive statutory damages.
I actually think this is a much more persuasive argument than I’ve seen from Team Tenenbaum in the past, but it seems unlikely that the Supreme Court will actually take the case on. I hope I’m wrong (and then, if I am wrong on that, I hope I’m wrong in my guess as to how it will come out, because this version of the Supreme Court doesn’t appear to understand the issues around copyright law). Either way, we should find out soon enough.
I do think it’s interesting that Nesson is using the copyright troll issue as part of the argument. Eventually, this or an issue like it will get to the Supreme Court, and hopefully the Justices realize just how damaging such practices can be:
They use the asymmetric cost of litigation to make defense by the individual economically irrational.
This Court should do everything it can to remedy this misuse of process. Its effects are not ended because the RIAA has ceased suing individuals. Others are using the legal structure and litigation tactics they have put in place.4 The weight of federal litigation is not a tool appropriately used to suppress legal challenge. The absence of cases pending in the federal courts highlights the problem: a deeply misshapen judicial architecture has been set in place. Without review, it is unfixable. The suppression of ability to challenge a process that is repeatedly producing appalling results, not circuit splits, is exactly why this case is worthy of this Court’s present attention.
It’s an interesting argument to get around the lack of a circuit split (conflicting rulings in different circuits, which is one of the key reasons why the Supreme Court agrees to hear certain cases). However, I just don’t think the Court will think it’s a big enough deal to jump on it, perhaps figuring that it can bounce back up eventually. Of course, that only underlines the point: for that to happen, it means years more of Tenenbaum’s time wasted with this case. That seems unfortunate.
This one is hardly a surprise. We’ve been arguing for a while now that the choices by Joel Tenenbaum and his lawyers in his file sharing case haven’t made much sense. They’ve been arguing the case in a manner that basically begs the court to go against them. I really don’t understand the legal strategy here at all. Back in September, you may recall, the appeals court reinstated the $675,000 award against him for file sharing 30 songs. That had been the original jury award, that had been unilaterally reduced by the judge in the district court. However, the appeals court noted that the judge basically used the wrong procedure to do this, and had to first give Sony Music the option to redo the case. In other words, the entire issue at this point was a procedural issue. Thus, I can’t fathom why Tenenbaum and his legal team again tried to argue on the merits at this stage. It’s not the right time for that argument… but they still went ahead and asked to rehear the issue with the full slate of judges on the appeals court. That request has been rejected, as pretty much everyone expected. Even worse, it sounds like Tenenbaum’s didn’t just not focus on the procedural issue at hand, but also sought to talk about larger issues, like how statutory rates were a way to go after a “generation of kids.” Whether or not we agree with that general sentiment, there’s a time and place to bring that up… and this wasn’t it. What’s really dumb here is that this seems to undermine whatever small chance he might have had if the case was argued in good faith.
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.
The latest in the ongoing trial of Joel Tenenbaum, the student who was found guilty of sharing 30 songs online, and told to pay $675,000 for it, until the judge unilaterraly reduced the amount to $67,500. As we noted at the time, it really seemed like Tenenbaum had horrifically bad legal counsel, in the form of Harvard law professor Charlie Nesson, who still seems more focused on making the case a circus, rather than focusing in on the key issues. That does not, however, mean there aren’t key issues here, with the big one being the appropriate standards for determining how much one should have to pay if found guilty of file sharing.
The appeal was just heard on Monday, and you can listen to the oral arguments (mp3) from the court’s website. It’s definitely an interesting hearing and worth listening to. As with most appeals court situations, the bulk of the work is done in the briefs that were filed prior to the hearing, and which everyone is familiar with. The oral hearings get right to the point and drill down on where the panel of judges has questions.
The hearing opens with a representative of the US Department of Justice, which stepped in on the case, because it was concerned that the court might rule that the statutory rates for copyright infringement (which, of course, can go up to $150,000 per infringement in cases of willful infringement) were not meant for cases like a person sharing copyrighted music for their own pleasure, rather than any commercial purpose. The Justice Department sides with the RIAA (of course), in saying that it’s just fine to apply copyright law — which really was designed for commercial cases of infringement — to kids sharing files. At least one of the judges appears skeptical of this, asking directly:
Was file sharing in existence at the time the statute was passed?
The Justice Department tries to get around this by pointing to the legislative record from the last time the statutory damage rates were changed, but the judge is not buying it. He immediately points out that if this is what Congress intended, it’s quite odd that no such cases (or perhaps one other case — by which they’re referring to the Jammie Thomas case) have been tried, involving file sharing for non-commercial means. The judge clearly seems skeptical that copyright law was intended for such cases. While the lawyer tries to explain all of this away, with some claim about how everyone makes choices in who they sue, another judge chimes in and points out that for all the claims that Congress meant for these damages to cover non-commercial file sharing, wouldn’t Congress also know that the law had never been used that way.
The lawyer again goes on to insist that since file sharing “greatly multiplies the harm” to the copyright holder (um… citation needed on that one…), Congress must have meant for such ridiculous statutory rates to cover file sharing as well. Again, the judges seem skeptical, pointing out that in this particular case, the only evidence was that Joel Tenenbaum downloaded 30 songs, and the RIAA presented no evidence that anyone else copied from him. In other words, they immediately push back on the claims of “harm.” The lawyer, again says that there’s lots of other evidence, even though the labels chose not to bring it.
Once again, the court is skeptical. They ask the DoJ lawyer: if Tenenbaum had sat down in a single setting and downloaded 1,000 songs, would it be appropriate under the law to claim he owed $75,000 for each download. And the lawyer says, effectively, yes, after going through the specific statutory rates ($750 to $30,000 for non-willful, and up to $150,000 for willful). Realizing how ridiculous this sounds, the lawyer tries to focus on the fact that the judge can tell the jury about mitigating factors and be specific in the jury instructions.
From there, the lawyer for the record labels, Paul Clement, steps in, and claims that the ridiculously high damages are fine because Congress wanted to send a message about the harm of “willful” infringement. He then goes on to rail about how Tenenbaum’s downloading destroyed “the value of the copyright,” and complains about how the district court judge likened downloading to public performance rights. At that point, another judge interrupts, and says that he basically doesn’t understand “the mechanics” of infringement, and would like more specific info.
After explaining (somewhat misleadingly, but carefully) how file sharing works, Clement goes on to rail against file sharing as being incredibly damaging, because it pushes people who download to also upload… and immediately a judge cuts to the heart of one of the key legal questions:
Is “making available” the same as distribution?
Clement sidesteps this, by noting that while the RIAA obviously thinks it is, that’s “not an issue in this case.” The judge doesn’t want to give up, though, and asks him if the record labels “have the technological capacity to determine if distribution was actually effectuated?” Again, Clement tries to get around this, by saying it doesn’t matter in this case.
Another judge asks a pertinent question about damages, wondering if the actual damage to the record labels was just “the lost sales” from people not buying the music, and Clement, quite ridiculously, then tries to pin the entire demise of copyright law on Tenenbaum:
“It’s more than that, your honor. It’s really the complete undermining of the copyright. What I mean by that is you can’t just isolate what’s going on here as if it’s an individual’s, by copying it, has not gone and bought the work on iTunes or not bought the work in a record store when we used to have record stores. What happens is, by distributing it to others, there are… the viral nature of this technology, really has a substantial impact on the value of the work. And the way I’d ask you to think about it is this: one, I think, relevant question in a statutory damages case is, what would it cost to get a license for what the defendant has done. And, if all the defendant had done was making a copy and that was it, then maybe an analogy to just getting a copy off of iTunes would be appropriate. But here, by distributing it… if someone wanted to go to one of the record companies and say ‘we’d like to do what the defendant did in this case,’ the value of that license would be essentially the value of the entire copyrighted work. Because the effect of putting this work up on peer-to-peer technology is essentially you take a copyrighted work, and put it in the public domain.”
He goes on to blame the poor financial state of the record labels on file sharing, and seems to indicate that we should blame Tenenbaum for this.
After a brief, and somewhat inconsequential, discussion by Julie Ahrens, representing the EFF (which the judges clearly didn’t have much interest in, pointing out that any of the issues raised should have been raised to the jury, not to them — even though that would have raised questions by the RIAA folks of an attempt at jury nullification…), we move on to Tenenbaum’s own defense, which was handled (with permission) by a Harvard Law student, Jason Harrow. He kicks off his talk by pointing out that the Justice Department’s claim that companies didn’t bring such lawsuits for non-commercial infringement in the past because it wasn’t cost effective, is on its face ridiculous. After all, if you can get $150,000 per infringement for someone infringing on a $1 work, how is it not cost effective to bring that lawsuit over and over again (just ask the various mass file sharing lawsuit filers…). Instead, he notes that the better explanation is that “no one thought that the statute would apply to such consumer usage.”
One of the judges immediately jumps in and says that Congress could have made an exception, but didn’t. Harrow points out that perhaps it didn’t because the result would naturally be absurd: the idea that someone sitting at home, listening to music, would suddenly be liable for billions of dollars, doesn’t make any sense. The judges’ questioning of Harrow seems focused on the specific standards and jury instructions, rather than on the larger issue.
Finally, Charlie Nesson presents, and goes through the history of copyright law, and how statutory damages were clearly, originally intended for commercial infringement, not non-commercial. One of the judges points out that the RIAA began these lawsuits in 2003, and if Congress was upset about them, it’s had eight years to amend the statute to specify that statutory damages don’t apply to non-commercial use. Of course, that ignores the reality, which is that it’s effectively impossible for Congress to change copyright law in a manner that benefits consumers, since the entertainment industry would go ballistic. The court also chides Nesson a bit for “pushing the bubble” very far in some of his arguments.
Clement then comes back for a brief rebuttal, trying to claim that the very first Congress put in place statutory damages for copyright… which is immediately shot down by one of the judges, who notes that the Congress felt that statutory damages should not be punitive, which Clement tries to sidestep around (not very successfully, in my opinion).
And that’s about it. If you had asked me prior to the oral hearing, I would have said that the court would almost certainly uphold the statutory damage rates as being perfectly reasonable. It just seems like the sort of question that the courts don’t want to touch — especially (as mentioned by one of the judges in the case) noting that Congress has said nothing on the issue in the last decade. However, I have to admit that I was surprised at how (I believe) two of the judges really seemed to dig in against both the Justice Department lawyer and the RIAA/labels lawyer, on the big key questions, and suggested, repeatedly, that they’re not buying the overall claim. I’m still guessing that the court won’t say that the award was unconstitutionally excessive, but I’m not nearly as certain after listening to the hearing as I was before it…
Nesson, however, brushed aside the judge’s criticism and maintained that it was she who had gotten it wrong. “I was sorry she did not respond to our fair use defense. She had a considerable amount of trouble rejecting it,” he said.
From the rest of the article, it sounds like he wants a do over. He says that he wants to have a new trial where he’ll make a brand new argument: that Tenenbaum’s use was fair use because when he did the file sharing, there was no legal way to purchase that music digitally. As far as I can tell, that’s a misreading of what Gertner said might possibly work as a limited fair use claim, but there’s no indication that this is actually true in Tenenbaum’s case, and none of that addresses the basic procedural mistakes that Nesson made. It’s a shame that Nesson still can’t admit that he screwed this up entirely — despite being told that by plenty of folks who are very sympathetic to his position. At some point, one hopes that Tenenbaum himself will realize this and drop Nesson and find someone who can actually represent his interests.