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What Are the Constitutional Limits on Awards of Statutory Damages in Copyright Litigation? By Andrew Berger, Esq. For the John Marshall Law School Center.

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Presentation on theme: "What Are the Constitutional Limits on Awards of Statutory Damages in Copyright Litigation? By Andrew Berger, Esq. For the John Marshall Law School Center."— Presentation transcript:

1 What Are the Constitutional Limits on Awards of Statutory Damages in Copyright Litigation? By Andrew Berger, Esq. For the John Marshall Law School Center For Intellectual Property

2 Sony BMG v. Tenenbaum Jury verdict of $675,000 in file sharing case Tenenbaum willful infringer Judge Nancy Gertner reduces award by 90% to $67,500

3 Some History: Skyrocketing Awards and Judicial Response Awards Threatening Research and Development of New Products Awards Threatening Research and Development of New Products Gore held a punitive damages award of $2 million unconstitutional Gore held a punitive damages award of $2 million unconstitutional The Gore Guidelines: The Gore Guidelines: Reprehensibility Reprehensibility Ratio between actual damages and punitive award Ratio between actual damages and punitive award Difference between the punitive award and applicable civil penalty Difference between the punitive award and applicable civil penalty

4 St. Louis Railway v. Williams Two sisters each overcharged by 66 cents Statutory damages award of $75 apiece- 114 times more than the actual damage Award constitutional

5 Williams Defers to the Judgment of Congress Does the statutory damage scheme adequately respond to the public interest, the opportunities for committing the offense and the need to secure uniform adherence to the law?

6 When Will An Award Violate Due Process Under Williams? The award must be so severe as to be disproportionate to the offense and obviously unreasonable Remedies for public wrongs do not have to be proportioned to the actual damage

7 Are the Gore Guidelines Applicable? Punitive damage awards raise notice and limits concerns But statutory damages provide notice and limits Punitive damages are designed to punish but statutory damages serve other purposes

8 More on Whether Gore Guidelines Applicable Statutory damages authorized by Congress and therefore entitled to deference Punitive damages awarded without statutory authorization and thus present no basis to defer to a legislative judgment

9 The First Guideline: Reprehensibility Reprehensibility is already calibrated in Copyright Act: damage floor for innocent infringer; cap for non-willful and willful infringement Only question should therefore be whether the statutory damage scheme is rational

10 Second Guideline: Relationship Between the Award and Harm No application because statutory damages may be awarded without any showing of harm Statutory damages are not conditioned on availability of actual damages Williams: statutory damages are not to be compared with harm One of the purpose of statutory damages is to relieve the copyright holder from the burden of proving actual damages

11 Third Guideline: Relationship Between the Award and Penalty Irrelevant because the award = the penalty Tenenbaum created safe harbor for non- commercial file sharers Court relied on post-hoc comments by two Senators made after Digital Theft statute passed College students may be toasting result

12 Tenenbaum s Damage Calculation Problematic Court first determined actual damages at $1 per song Court relied on doctrine of treble damage But did not treble the actual damages it determined Instead court trebled $750, the statutory minimum

13 The Verdict Satisfies Williams Need to defer to Congress Jury s verdict of $22,500 toward the low end of the willful range which extends to $150,000 Tenenbaum s conduct defines willfulness

14 Consequences if Tenenbaum Affirmed Meritorious copyright claims may never be brought because of the inability to show actual damages Relegating litigants to actual damages will also end may litigations because actual damages are often inadequate and may be too expensive to demonstrate There may be no lost profits or none that can be established

15 What will the Supreme Court Do? It will likely be deferential to the judgment of Congress

16 But Williams Needs Some Updating It is nearly a century old Copyright landscape has changed Copyright holders now post on social media hoping their works will be copied As copyright infringement becomes more commonplace judicial response to infringement may change

17 Questions? Contact Andrew Berger at (212) or Also visit


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