First Circuit Reinstates $675,000 Verdict Against Boston University Student For Downloading Songs

For years, we have discussed the abusive litigation by the Recording Industry Association of America in seeking obscene damages against people for downloading songs. Congress, again, caved to demands by lobbyists to allow for such lawsuits. The result has been thuggish lawsuits where industry lawyers threaten not only citizens with ruin but, in the case of the Copyright Group, those who try to help them. Now, one of the most obscene verdicts against Boston University student Joel Tenenbaum has been reinstated by the First Circuit — $675,000 for downloading and sharing 30 songs. The court, however, takes the rare step of suggesting that Congress may want to look again at the law. The problem is that these citizens do not have well-paid lobbyists and massive campaign funds to motivate many members to act. The Obama Administration joined the industry in defending the law and the original fines as not unconstitutional.

We last discussed the case when the trial judge criticized defense counsel (a Harvard professor) for asking to hold a deposition in front of his class.

The jury award in 2009 was based on a calculation of $22,500 for each of songs he illegally downloaded and shared. U.S. District Judge Nancy Gertner wisely saw the absurdity of such an award and reduced it as constitutionally excessive to $67, 500. That was still too high in the view of many, including Tenenbaum who appealed. The First Circuit, however, reinstated the whole award at the demand of the RIAA.

There remains an anomaly in the treatment of citizens and companies. The Supreme Court has ruled that due process bars punitive damages against companies that are excessive in cases like Gore v. BMW. As little as a ten-to-one ratio between compensatory and punitive damages can be unconstitutional. Yet, the Court held that citizens can be sent to life imprisonment for a minor shoplifting offense under habitual offender laws — gutting the Eighth Amendment prohibition on cruel and unusual punishment. Likewise, courts around the country have found that it is not excessive to hit consumers with hundreds of thousands for downloading songs.

The First Circuit held that Gertner made a mistake by reducing the award as a constitutional matter rather than using her common law power for such reductions — and giving the RIAA a right to retry the case. That is probably what the court wanted to avoid since RIAA has a reputation for grinding citizens in litigation.

The appellate court rejects Tenenbaum’s claim while noting that the Congress was fully aware that it was giving industry the right to hit consumers with massive damages:

Congress did contemplate that suits like this were within the Act. Congress last amended the Copyright Act in 1999 to increase the minimum and maximum awards available under § 504(c). See Digital Theft Deterrence and Copyright Damages Improvement Act of 1999, Pub. L. No. 106-160, 113 Stat. 1774. At the time, Congress specifically acknowledged that consumer-based, noncommercial use of copyrighted materials constituted actionable copyright infringement.

The court faults the trial court for failing to address the concern over the excessive size of the award through common law remittitur, where a court may reduce an award and give the winning party the choice of accepting the lower award or a new trial.

In reaching and deciding that due process constitutional question, the district court also unnecessarily decided several related constitutional issues. The court determined that the statutory damage award was effectively a punitive damage award for due process purposes and applied the factors set forth in BMW v. Gore, 517 U.S. 559 (1996), to assess its constitutionality. The court declined to apply the Williams standard the Supreme Court had previously applied to statutory damage awards. See Tenenbaum, 721 F. Supp. 2d at 103. The district court’s tack also led to unnecessary resolution of Seventh Amendment issues. The decision to reduce the jury’s award without offering Sony a new trial implicitly presupposed that, in reducing a statutory damage award issued by a jury, a court need not offer plaintiffs the option of a new jury trial in order to comport with the Seventh Amendment.

It is astonishing to watch these cases which are something out of a Victor Hugo novel. It is unbelievable that the Administration and Congress has facilitated such lawsuits and watched passively as individual consumers are ruined by industry lawyers. I previously criticized the RIAA for its payments of free trips for members. In a demonstration of the hold of this lobby over legislators, lawmakers are falling over themselves to give the industry more powers and are putting industry lawyers on the bench despite the complaints of consumers and courts. It does not matter that these fines are not just excessive, they are indecent.

Here is the opinion: 10-1883P-01A

Source: Washington Post

16 thoughts on “First Circuit Reinstates $675,000 Verdict Against Boston University Student For Downloading Songs”

  1. Hmm, download/share 30 songs, pay over half a million….

    Defraud your own customers of $444 Mil in 4 years, and you probably pay a fine of about 30 dollars…

    Justice is injustice.

  2. Pete: You’re deaf too? 😀

    I cannot imagine any reason to make an individual pay 700k$ for a CD. From what I saw in various cases, the amount calculation is always based on wildly unrealistic estimates, with no solid basis.

  3. My aunt used to sing a song that seems appropriate. I hope it’s not copyrighted.

    “Pepsi Cola, pig’s @$$hola,
    Someone $#!+ in our Victrola,
    And the wind blew, and the $#!+ flew,
    And we couldn’t see for a day or two . . .

    “Good morning judge, why do you look so mean?
    Sorry Mr. Judge, what can the charges be?
    If there’s been trouble I will plead not guilty.
    It must be someone else, you know it can’t be me.”

    Whose estate do I owe a dime?

  4. Time for a boycott of any band or label tied in with these thugs. I will never give these bastards another dime.

  5. From blawg post: “It is unbelievable that the Administration and Congress has facilitated such lawsuits and watched passively as individual consumers are ruined by industry lawyers..”

    So, Today is the day DADT ends (and in an alternate universe where John McCain is President it’s just another day) but we still have the President and Congress supporting this kind of law.

    The actual damages are between 1. and 15.$ per CD/DVD in a case like this; punitive damages would be about 10. to 150.$ if the law was applied the same for all at 10X cap for punitive damages.

    Nobody makes money or loses money over gays serving openly in the military. That’s the difference I see. That’s the filter I apply these days when I look at who’s supporting what and try to guess what is politically doable.

  6. that song is someones property. they spent time and effort producing it and should be compensated.

    But Frankly is correct, the music industry corporate model is outdated. Personally I think they are done but just dont know it yet. With the Internet the bands have all of the power. They can flood the net with free songs and make money on concerts without paying the middleman for record, tape or CD production.

    Same for books what with kindle, anyone can be an author and sell a book for a couple of bucks. far more than they would probably make through a publisher as a first time author.

    The Internet is fantastic and has generated a great deal of wealth for people.

  7. mespo,

    If I recall in the Bankruptcy Code Intentional Act of Fraud are not dischargeable……So these folks are stuck with them…Unless they live in a state that has favorable debtor rights….such as Texas….Founded by folks running away from Debt…If I recall Houston left a 15K debt and came to what was then Mexico….

  8. AY:

    I agree with you, The fact is that traditional music stores are dying and the industry is unable to come to grips with the technology that is replacing it usefulness. These punitive suits against persons who could never pay the judgments is their way of proving their toughness to consumers. With their stooges in Congress they are suceeding, but how long can they command the tide not to rise is really the question.

  9. I do not believe that they can get putative unless it can be shown that it is an intentional act….

  10. And to think that Business are capped between 250 to 300K for damages in Tort cases….

  11. raf – true but you can’t ‘xerox’ a second copy to pass around.

    This is the act of an industry stuck on its old business model in a world that is leaving it behind. They could spend their time making a new business model that works in this new environment but instead have chosen to litigate their way into oblivion.

  12. Indecent is the right word. These alleged infringement cases are a stain on our system of justice. When I buy anything else, can’t I share it with whomever I want? When I buy a book, I can pass it around to countless readers without violating the law.

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