Friday, June 19, 2009

A ruling of U$S174,545.45 per song and a result that the RIAA should cry for

In Capitol v Jammie Thomas-Rasset the jury just handed down a sentence of U$S1,920,000 against the defendant for the wilful copyright infringement of 24 songs, which they found Mrs Thomas-Rasset made available for others to download through Kazaa. The claimant (plaintiff in the case because is in the US), Capitol Records, alleged that the defendant made available to others thousands of songs but it decided to concentrate on 24 songs for which it had more evidence. At the end, it seems that the claimants specialists could only link 11 songs to the defendant’s computer, so the actual tag is not U$S80,000 per song as the jury decided but U$S174,545.45 per song (for the other 13 songs even the claimant’s specialists recognized that they couldn’t probe that they had been actually shared). For the remaining 11 songs, there are suggestions that all the evidence was circumstantial, although a lot of it.
The legal issues that the ruling raises are so many and so contentious that several papers can be written out of it (which for sure they will), but there are a couple that stand out as especially relevant. The first is the clarification that the music industry argument that “making available for download” is copyright infringement in the US is wrong. The case had to be retried because in the original case the judge had instructed the jury that making available for downloading was copyright infringement, which clearly contradicted the letter and spirit of the law. In the new trial, there was some evidence, albeit circumstantial, that somebody had downloaded 11 songs from the defendant’s computer, making her liable for copyright infringement by distributing the protected content (one of the exclusive acts reserved for the copyright holder). The other issue is the amount of damages.
The “loss” of the music industry would be in the range of 70 cents per song, which is what it would get of the 99 cents paid for legally downloading each of the songs in questions, so getting an award of U$S174,545.45 per song seems a “little” excessive and, even more, unconstitutionally excessive. In State Farm Mutual Automobile Insurance Co. v. Campbell (2003), 538 U.S. 408, 123 S. Ct. 1513, the U.S. Supreme Court decided that a punitive damage award of $145 million when compensatory damages were $1 million were excessive and violated the due process clause of the Fourteenth Amendment. According to the ruling, compensatory damages have as purpose to compensate a plaintiff for a loss, while punitive damages act as a deterrence and retribution and serve the same purpose as criminal penalties. Civil defendants are not afforded constitutional protections given to criminal defendants, therefore, there is a danger of deprivation of property without due process of law. The Supreme Court used BMW of North America, Inc. v. Gore, where it was established that three factors have to be considered in assessing punitive damages:

1) the degree of reprehensibility of misconduct;
2) the disparity between the actual or potential harm and the punitive damage award; and
3) the difference between punitive damages awarded by the jury and the civil
penalties authorized or imposed in comparative cases.

Futhermore, in order to determine the reprehensibility of misconduct, the most important factors must be:

1) the harm is physical rather than economic;
2) the conduct exhibits indifference or reckless disregard to the health or safety of others;
3) the conduct involves repeated actions rather than an isolated event; and
4) the harm results from intentional malice, trickery or deceit, not just an accident.

Needles to say that the conduct of the defendant Jammie Thomas-Rasset does not get even close to any of the necessary factors needed to justify such a disproportion between the actual loss and the punitive damages.
The RIAA should better put the champagne back in the fridge because when they think that they have won, they actually have handed on a silver plate to those in favour of digital freedom the opportunity to clearly establish that making available for download is not copyright infringement in the US (as already decided) and that their damages cannot not be as outrageous as they currently are.

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