Damages in Dissonance: The 'Shocking' Penalty for Illegal Music File-Sharing

• Author: Jeffrey Stavroff
• Position: J.D. candidate, Capital University Law School, expected 2011
• Pages: 659-721

DAMAGES IN DISSONANCE: THE “SHOCKING”

PENALTY FOR ILLEGAL MUSIC FILE-SHARING

JEFFREY STAVROFF*

I. INTRODUCTION

Downloading music without paying for it has its benefits and risks.

The obvious benefit is getting music for free. The cost, however, of

illegally downloading music is anything but trivial. It might cost the

average person hundreds of thousands or even millions of dollars.

Copyright is one of the pillars of intellectual property.1 The authors of

creative works, including but not limited to music, often seek copyright

protection to control the destiny of their respective works.2 Copyright

provides authors with certain rights that allow the author to protect,

license, and exploit their works.3

The Framers of the Constitution of the United States granted Congress

―the Power . . . [t]o promote the Progress of Science and useful Arts, by

Securing for limited Times to Authors and Inventors the exclusive Right to

their Respective Writings and Discoveries.‖4 That power is, indeed, a

great power, and the federal courts have generally refused to encroach

upon it.5 Exercising its enumerated powers, Congress enacted laws such as

Copyright © 2011, Jeffrey Stavroff.

* J.D. candidate, Capital University Law School, expected 2011; B.M., summa cum

laude, Berklee College of Music, 2008. I would like to thank Professor David Mayer for

his guidance and expertise throughout the publication of this comment.

I would like the reader to pay close attention to the timing of this comment‘s

publication. Many of the court cases that are the subject of this comment are currently

pending. However, regardless of new court decisions, the voice of this comment remains

the same: th e Copyright Act‘s statutory damages clause is unworkable in today‘s tech-

driven society. Today, individuals innovate, invent, collaborate, and share things with one

another using electronic communication vehicles like the internet. Congress must update

the current statutory damages clause to account for these cultural and technological

changes.

1 See BLACK‘S LAW DICT IONARY 824 (8th ed. 2004) (―[Intellectual property] comprises

primarily trademark, copyright, and patent rights . . . .‖).

2 See infra Part II.

3 See 17 U.S.C. § 106 (2006).

4 U.S. CONST. art. I, § 8, cl. 8.

5 See, e.g., Eldred v. Ashcroft, 5 37 U.S. 186, 198 (2003) (discussing the Copyright

Term Extension Act and holding that th e ―Court has been . . . deferential to the judgment of

Congress in the realm of copyright ‖). The deference paid to Congress by the federal courts

in matters of copyright legislation is discussed in Part IV.B.1 infra.

660 CAPITAL UNIVERSITY LAW REVIEW [39:659

the Copyright Act of 1976 that provide authors with adequate remedies for

copyright infringement—the unauthorized use of an author‘s work.6 Under

current copyright law in the United States, authors may commence legal

action against an alleged infringer for either actual damages caused7 or

statutory damages.8 The latter provides a predetermined range of damages

that is akin to liquidated damages in contract matters.9

Because the digital marketplace has made policing copyrights and

placing an ―actual‖ value on injury from copyright infringement

increasingly difficult, copyright owners in music-related copyright

infringement lawsuits have opted for statutory damages in lieu of actual

damages.10 After all, statutory damages relieve the copyright owner of the

burden of proving actual damages11 and permit the owner to collect a

potential windfall, ranging from $750 to $30,000 per infringement12 and up

to $150,000 if the infringement is ―willful.‖13 Why bother calculating the

actual harm caused by a copyright infringement when the law expressly

permits copyright owners to opt for the statutory formula?

In an era where downloading a song is as simple as double-clicking a

mouse, individuals who download music from file-sharing networks have

6 17 U.S.C. § 501 (2006); see infra Part II.C.

7 17 U.S.C. § 504(b).

8 Id. § 504(c).

9 See ABRAHAM L. KAMINSTEIN, REGISTER OF COPYRIGHT, H. COMM. ON THE JUDICIARY,

87TH CONG., REGISTER‘S REPORT ON THE GENERAL REVISION OF THE U.S. COPYRIGHT LAW

103 (Comm. Print 1961).

10 See, e.g., TERENCE P. ROSS, INTELLECTUAL PROPERTY LAW: DAMAGES AND REMEDIES

§ 6.02(2)(b)(i) (2003) (arguing that calculating actual damages for copyright infringement

over the internet is difficult because ―the sheer scope of the infringement and corresponding

injury might be impossible to determine‖); J. Cam Barker, Gro ssly Excessive Pena lties in

the Battle Against Illegal File–Sharing: The Troubling Effects of Aggregating Minimum

Statutory Da mages for Copyright Infringement, 83 TEX. L. REV. 525, 545–46 (2004); see

also La Resolana Architects, PA v. Clay Realtors Angel Fire, 416 F.3d 1195, 1199 (10th

Cir. 2005) (―[W]hen actual damages are difficult to ascertain . . . statutory damages are

available under 17 U.S.C. § 504.‖).

11 See 4 MELVILLE B. NIMMER & DAVID NIMMER, NIMMER ON COPYRIGHT § 14.04(A)

(2010); see also Ariel Katz, A Network Effects Perspective on Software Pira cy, 55 U.

TORONTO L.J. 155, 205 (2005) (―[A] plaintiff might still elect to recover statutory

damages instead of actual damages, avoiding the burden of proving his injury.‖).

12 17 U.S.C. § 504(c)(1).

13 Id. § 504(c)(2).

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been and continue to be subjected to severe statutory damages penalties.14

In the summer of 2009, two federal juries awarded statutory damages to

music copyright owners for infringements stemming from unauthorized

file-sharing.15 Both defendants—a single mother and a graduate student—

were found liable for copyright infringement; at one point, both defendants

owed a combined amount that exceeded $2 million dollars.16

The defendants in these lawsuits, as well as defendants in prior

copyright infringement actions, challenged the constitutionality of the

Copyright Act‘s statutory damages system. The arguments against the

statutory damages clause include assertions that such damages are

excessive, and therefore, violate notions of fairness and due process of

law.17 Additionally, litigants have asserted that these fines are

unconstitutionally excessive in violation of the Eighth Amendment.18

Despite challenges to its validity, the federal courts have not expressed an

intention to invalidate the entirety of the Copyright Act‘s statutory

damages clause, and they seem unlikely to do so.19

Congress created the statutory damages provision of the Copyright Act

pursuant to an enumerated power of the Constitution—a power to which

the federal courts substantially defer.20 Therefore, although arguments for

reforming the statutory damages clause will probably continue to resonate

in courtrooms across the country, the federal courts will almost certainly

refrain from making reforms from the bench and instead defer to

Congress.21 Moreover, it is simply not the duty of the federal courts to

reform congressional acts like the Copyright Act; that task is best left to a

14 See Sarah McBride & Ethan Smith, Music Industry to Abandon Mass Suits, WALL ST.

J., Dec. 19, 2008, at B1. The RIAA commenced its litigation campaign against individuals

in 2003. Recently, the RIAA announced that it would not commence any further lawsuits

but would continue litigating pending lawsuits. Id.

15 See Sony BMG Music Entm‘t v. Tenenbaum, 721 F. Supp. 2d 85, 85 (D. Mass.

2010); Capital Records Inc. v. Thomas-Rasset, 680 F. Supp. 2d 1045, 1045 (D. Minn.

2010); see also discussion infra Parts II.B–II.C.

16 See Thomas-Rasset, 680 F. Supp. 2d at 1045; Tenenbaum, 721 F. Supp. 2d at 85.

17 See Thomas-Rasset, 680 F. Supp. 2d at 1050.

18 E.g., Zomba Enters., Inc. v. Panorama Records, Inc., 491 F.3d 574, 586 (6th Cir.

2009).

19 See, e.g., Columbia Pictures Television, Inc. v. Krypton Broad. of Birmingham, Inc.,

259 F.3d 1186, 1192 (9th Cir. 2001) (declining to declare unconstitutional the statutory

damages provision of the Copyright Act).

20 See, e.g., Eldred v. Ashcroft, 537 U.S. 186, 198 (2003).

21 See infra Part V.A.