Record Labels Basically Admit That Statutory Damages Out Of Proportion As They Ask For Third Jammie Thomas Trial

from the groundhog-day dept

I guess it's fitting that this happens in early February. Slashdot points us to the news that, as was widely expected, the record labels have opted for a third trial of Jammie Thomas-Rasset, rather than accept the reduced award of $2,250 per song, as set by the judge. Not surprisingly, the labels are doing this because they disagree with the precedent of a judge changing the jury award, and the new trial is limited solely to the damages question. But, honestly, the whole thing is a bit weird. If the judge can reduce the older jury award, and a new jury sets a higher rate, can the judge just reduce it again, and we go through this entire process for the fourth time? The Slashdot post, written by Ray Beckermann claims that the labels "could only win a verdict that is equal to, or less than, $54,000," in the new trial, but I'm not sure why he says that. Is it because the judge would reduce it again? This is not at all clear.

Still, the actual filing from the RIAA's lawyers has some interesting claims (pdf):

While Plaintiffs do not believe that either verdict was improper under the law, or that the second verdict should be remitted, they would have considered accepting a remittitur simply so that this case could finally come to an end. However, any remittitur must otherwise be consistent with the law and be guided by what actual juries have awarded under similar circumstances. Unfortunately, Plaintiffs find it impossible to accept a remittitur that could be read to set a new standard for statutory damages -- essentially capping those damages at three times the minimum statutory amount of $750 (or $2,250) for any "noncommercial individuals who illegally download and upload music." (Id. at 2, 25.) This far-reaching determination is contrary to the law and creates a statutory scheme that Congress did not intend or enact.

It's a bit of a stretch to claim that this would be a cap on "any" unauthorized noncommercial file distribution. I would imagine that any court still has the right to take into account the specific circumstances to make sure the award is proportionate to the rights being violated. The labels' lawyers are stretching what the judge said here.

Indeed, Congress has spoken on this very topic. Congress deliberately and purposefully established a range of statutory damages that applies without regard to the commercial motivation of the defendant.

I find this statement funny, because they then cite what Congress said way back in 1999. Fair enough, Congress (which basically just took RIAA talking points and put them into the Congressional record) did make those comments -- but these are the same entertainment industry lawyers who supported a "secondary liability" or inducement standard in the Grokster case, even though Congress had specifically rejected an attempt to put an inducement standard into the law. And when confronted, how does the RIAA explain that? Well, they say "the situation changed." Ah, so it's okay to have the courts change copyright law when the situation changes in one direction, but not the other?

What the judge was doing here was recognizing that the amount the jury awarded was clearly out of proportion to the actual infringement -- just as the courts in Grokster supposedly recognized that an inducement standard made sense in shutting down third parties (something I disagree with, but it's how the court felt). It seems that the RIAA and its lawyers have a massive double standard here.

A rule that the maximum permissible award in cases involving so-called "noncommercial" infringers is three times minimum statutory damages also ignores the harm caused by such infringers. From an economic perspective, individuals who give away copyrighted works illegally can cause as much harm as those who sell those works illegally, particularly when the so-called "non-commercial" infringer uses a P2P service. The notion that an infringer who does not make a profit should automatically be entitled to better treatment than an infringer who does make a profit is found nowhere in the law. The "not for profit" infringer is hardly entitled to special protection, which is why Congress conferred no such protection.

Again, Congress also conferred no such thing as an inducement liability, but the courts -- at the urging of the RIAA -- conferred exactly that via the courts. Why such a double standard?

The Court's cap would set a new ceiling such that no copyright owner could effectively enforce their rights unless they could and did sue on numerous works. No copyright owner would be motivated to enforce its rights where it could only sue on a handful of works because the potential recovery would be too limited. Congress set a wide range of statutory damages for copyright cases precisely because plaintiffs need to be incentivized to bring appropriate cases to enforce their rights -- even those who own a small number of copyrights or those who only have a limited number of works infringed. Conversely, the Court's artificially depressed cap compels parties with a large number of copyrights at stake to sue on all of them, rather than a more modest number. This serves only to increase the discovery and trial burdens on parties and courts. Yet the Court's inflexible "three times" cap would invariably penalize plaintiffs with a small number of works at issue, and would force those with a lot of works to add to their complaints unnecessarily.

Woe is the RIAA. If the awards for unauthorized sharing of a $1 song that might help promote their artists and help them make more money (if only the RIAA were to adapt to a changing market place) might "only" be 2,250 times the market price of the song? Cry me a river. And, even more ridiculous is the claim that this is some undue burden on the RIAA that it might have to actually sue over all of the songs someone distributed in an unauthorized manner, rather than just selecting a handful as it does now. This is a major issue. Technically, the RIAA has been able to just pick a couple dozen songs and sue over those, knowing that the totally disproportionate statutory damages will "cover" the rest. But does that seem right to anyone? The idea that rather than proving the actual harm done by the actual distribution, the RIAA is allowed to just pick a "sampling" and without proof get back many times the price without even presenting any actual evidence of the wider damage or the wider distribution of more files?

It seems perfectly reasonable to expect the RIAA should have to actually include what they claim was infringed, rather than being able to just pick a handful, knowing that the totally out of proportion statutory damages will "cover" the rest.

In fact, the paragraph above is effectively the RIAA admitting that it knows the statutory damages are out of proportion, but it believes it's fair because the RIAA is too cheap and too lazy to actually sue people for what it claims they infringed on.

Talk about a sense of entitlement.

Still, as we've said for a while now, this is a really bad case all around. It's pretty clear that Thomas-Rassett was involved in widespread infringement, and then lied about it. If people are going to challenge ridiculous statutory rates and other aspects of copyright law, this is really bad case to do that (ditto for the Tenenbaum case). This is one where it seems like she really might have been better off settling early and moving on. And the oddity of the judge reducing the jury award just makes this whole case into something of a circus...

Filed Under: appeal, constitution, copyright, jammie thomas, jammie thomas-rasset, settlement, statutory damages
Companies: riaa

Jammie Thomas Rejects Offer From RIAA To Settle For $25k Plus Request For Judge To Vacate Last Week's Decision

from the and-so-it-goes dept

After the judge in the Jammie Thomas-Rasset case decided to reduce the amount awarded to the record labels by the jury, we had hoped that both sides would figure out a way to just end this lawsuit. However, it looks like that's not happening. As we noted, the RIAA was extremely reluctant to accept the new, greatly reduced, award, not because of the amount, but because they're afraid to set precedent that a judge can lower the award in chosen by a jury using statutory damages in a copyright case. So, instead, the RIAA tried to offer Jammie a deal: pay $25,000 (donated to a musician's charity) and ask the judge to vacate the reduction in the award, and the case would be settled. This isn't surprising. The RIAA would just like the case to be over, but doesn't want to set the precedent, so they ask Thomass-Rasset to pay less, but the "trade" is to get the decision deleted. Thomas-Rasset quickly rejected the offer, and now it seems likely that the RIAA will reject the reduced amount and everyone will go back to trial over just the damage amount. In an interesting bit of spin, Thomas-Rasset's lawyers are claiming that this shows that the RIAA just wants to use this case as a "bogeyman" in order "to scare people into doing what they want," rather than as an attempt to actually recover any real damages.

Filed Under: appeal, constitution, copyright, jammie thomas, jammie thomas-rasset, settlement, statutory damages
Companies: riaa

Court Reduces Award In Jammie Thomas-Rasset Case From $80,000 Per Song To $2,250

from the and-so-it-goes dept

It looks like the judge who oversaw the Jammie Thomas-Rasset case realized that the original $1.92 million award was just ridiculous -- even if the Justice Department supported it. Instead, the court has reduced the award to $2,250 per song, saying that seems much more reasonable:

The need for deterrence cannot justify a $2 million verdict for stealing and illegally distributing 24 songs for the sole purpose of obtaining free music. Moreover, although Plaintiffs were not required to prove their actual damages, statutory damages must still bear some relation to actual damages

While I question the use of "stealing" here, and still think that $2,250 seems pretty high (even the judge admits that if he weren't reducing the amount from the jury and had been able to set the amount originally, he probably would have gone even lower), this case had all sorts of problems from the start -- with tremendous evidence (well beyond just an IP address) that Jammie was, in fact, doing a fair amount of file sharing. Her defense and attempted reasoning were weak and not at all helpful. This seems like a case where she would be better off paying this off (somehow) and moving on.

It's now in the hands of the record labels if they'll accept this or if they want to have a new trial concerning damages. Again, for them, this might be a situation where they're best off accepting it and moving on. The original $80,000 damages got the labels a ton of bad press, with even the musicians whose music was shared speaking out against the case and other musicians arguing it was a reason to disband the RIAA.

Update: News.com suggests both sides might appeal. The interesting part is from the labels who, like I suggested above, do want to just bury this story and have the case be over with -- but might be worried about setting a precedent allowing a judge to lower a jury award.

Filed Under: appeal, constitution, copyright, jammie thomas, statutory damages

DOJ Doesn't Believe $80,000 Per Song Unconstitutional Or Oppressive

from the tell-that-to-Jammie dept

While this probably isn't a huge surprise, given the fact that the Justice Department is stocked with former lawyers for the entertainment industry (and because it's filed similar briefs before), but it's still worth noting that the Justice Department has filed a brief in the Jammie Thomas lawsuit, in support of the constitutionality of the $1.92 million fine (and, no, none of the former RIAA lawyers are signatories to the brief, though you have to imagine their "expertise" was consulted). The reasoning is quite troubling and appears to include some serious revisionist history.

First, what's stunning is that the brief claims the awards are perfectly constitutional because it is not "so severe and oppressive as to be wholly disproportioned to the offense [or] obviously unreasonable." Really? It seems that an awful lot of people find the idea of being forced to hand over $80,000 per song without any evidence that it was ever actually shared by anyone is severe and oppressive to the point that it's disproportionate to the offense and quite obviously unreasonable. I mean, this is a woman who wanted to listen to her favorite bands, and she now has to pay nearly $2 million. How can anyone claim that's not "severe and oppressive" in relation to the actual "harm" done?

Second, the brief claims that the damages should be much more than the $1.29 price per song found on iTunes, because it "ignores the potential multiplying effect of peer-to-peer file-sharing." Except, if that were the case, shouldn't the plaintiffs been required to show that these songs were actually shared? And should Thomas also be liable for the actions of anyone else she shared the songs with? That seems to go quite beyond what the law states.

Third, and perhaps most troubling, is the Justice Department's sneaky little claim that the statutory rates are obviously fair for file sharing, because they were put in place in 1999, with the explicit statement from Congress that these numbers were there because of internet file sharing. That sounds good, but ignores the fact that this little change in the law was pushed almost entirely by entertainment industry lobbyists (the same folks who now run the Justice Department!) to protect their dying business model, rather than through any empirical evidence. The real original purpose of statutory rates had nothing to do with punishing personal, non-commercial use, but were very much about dealing with commercial harm.

It's a neat, but immensely troubling, trick by the entertainment industry. Sneak through bizarre and totally unsupported legislation through a Congress that's never met a stronger copyright law it didn't love, using your high paid lobbyists. Then, get those same lobbyists appointed to the Justice Department to defend it against Constitutional challenges. Regulatory capture at its finest.

Filed Under: constitutional, copyright, file sharing, fine, jammie thomas, lawsuit, music, settlement
Companies: doj

As Jammie Thomas Seeks New Trial, RIAA Claims (Incorrectly) That She Distributed 1,700 Songs To Millions

from the can't-stop-the-lying dept

This will come as a surprise to just about no one, but Jammie Thomas' lawyers have pointed out that the $1.92 million verdict against her is excessive, and is asking the judge to either throw out the award, lower it to the statutory minimum or grant a new trial. That was pretty much expected. What's odd, however, is the note at the very bottom of that article, concerning the filing that the RIAA made to the court. The RIAA keeps insisting that it just wants to settle the case, but if that's true, it seems weird to then attack Thomas in court again, but that's what the filing seems to do. It suggests that Thomas (despite this whole process) must still be sharing songs and that the court needs to issue an injunction barring her from doing so. While we've said that there appears to be ample evidence that Thomas used file sharing programs (and that she shouldn't have let this case go to trial), it would be quite surprising if anyone had any evidence that she was still doing this. As far as I know, the RIAA has not presented any such evidence at all. Demanding an injunction, then, seems quite strange.

On top of that, the RIAA appears to falsely claim (or the AP reporter misquoted the RIAA) that Thomas "distributed more than 1,700 songs to millions of others through the file-sharing system Kazaa." That may be true, but it certainly was not shown in court at all. The RIAA only named 24 songs she was charged with sharing, and then did not present any evidence that she actually shared any of them with anyone other than the RIAA's own investigators. The claim that she "distributed more than 1,700 songs to millions of others" was not proven at all, and in fact this entire new trial was because the judge originally made the mistake of assuming "making available" meant distribution. It does not. For the RIAA to misstate this point is really quite odd.

Filed Under: constitutional, copyright, file sharing, fine, jammie thomas, lawsuit, music, settlement
Companies: riaa

Jammie Thomas Decides To Appeal Constitutionality Of $1.92 Million Damages Award

from the and-away-we-go... dept

As we speculated earlier this week, given the silence from the Jammie Thomas camp since the $1.92 million verdict against her, we assumed she was gearing up for an appeal -- and that's now been confirmed. Thomas' lawyer has announced that Thomas has decided to appeal, questioning the constitutionality of the statutory damages awarded, which was the obvious attack point. It will be interesting to see who gets involved in actually managing the appeal.

Filed Under: appeal, constitution, copyright, jammie thomas, statutory damages
Companies: riaa

Jammie Thomas Not Willing To Settle Yet... Acccording To The RIAA

from the bizarre dept

How badly do you think the RIAA wants Jammie Thomas to settle? Since the verdict came down, the organization has done everything it possibly can to distance itself from the $1.92 million verdict against her for file sharing. While willing to play up the ruling itself the organization seems to recognize that the insanity of the $1.92 million doesn't do it any favors. Even the musicians whose music was part of the case are embarrassed by the amount. In an ideal world, the RIAA would love to settle the lawsuit for some lower amount so it can run around touting the "risks" of file sharing without having people laugh outloud when hearing that someone had to pay $1.92 million for potentially sharing 24 songs that could be bought for $1 each.

So, you get a slightly bizarre situation, where it's the RIAA proactively reaching out to Thomas to try to settle the lawsuit -- but so far Thomas apparently isn't interested. I've been saying that I thought she would settle, but the longer this goes on, the more I wonder if she's actually planning to fight on. If so, this could certainly represent a case to examine the statutory rates associated with copyright violations. The verdict seems so out of proportion with the supposed "crime" that it's difficult to see it pass the laugh test. However, there's a halfway decent chance that a court punts on the issue, saying (as the Supreme Court did in the Eldred case) that such questions are up to Congress, rather than the courts. Of course, if the case is to move forward, it would help to have lawyers who have had more than a few weeks to study up on the issues, and who didn't make public pronouncements that were distractions rather than anything related to the actual case.

Filed Under: copyright, file sharing, jammie thomas, lawsuit, music, settlement
Companies: riaa

RIAA Claims Jammie Thomas Jury Is A Representative Sample Of Views On File Sharing

from the wow,-that's-chutzpah dept

After the Jammie Thomas verdict came down, I predicted that the RIAA would "gloat about and misrepresent to its own advantages." Within hours, I was attacked by a former entertainment industry lawyer with a long screed claiming that no one from the RIAA misinterpreted or gloated about it at the trial. Except, of course, I wasn't talking about what they said as they walked out of the courtroom. I was talking about what would happen afterwards... like a few days later on the RIAA blog. That's when the RIAA tried to claim that the Jammie Thomas jury provides a representative sample of "music industry outsiders" whose verdict disproves the theories of certain "pundits" who believe the digital economy should be a "new wild west" where "the rule of law" is not obeyed.

Talk about misrepresenting.

First of all, I don't know of many "pundits" who think that the digital economy should be a new wild west at all. I think that many of them are actually just focused on preserving individual rights against a constant landgrab by an industry whose history has shown it to not be above removing right after right after right from people. The RIAA and its supporters have taken content out of the public domain, making a government go back on a bargain it struck with content creators, much to the detriment of society, but very much to the benefit of a few record label execs and their lobbyists and lawyers. That's stealing from the public. It's taking a bargain and changing the terms. People don't want a wild west. They want the culture we were promised, and they want their individual freedoms.

Furthermore, calling the very specific nature of the Jammie Thomas trial a referendum on file sharing is ridiculous. Her case had a very specific set of circumstances unlike many others -- and even we (a "reliable critic" according to the RIAA) felt that she never should have gone to trial, as the evidence against her seemed strong. On top of that, this "sample" involved RIAA lawyers who had years to prepare the case against some rookie lawyers who were brought on the case just weeks earlier with little preparation at all, and who, frankly, did a terrible job, seemingly more focused on other issues than the key points in the case.

The Jammie Thomas trial was not a referendum on "the rule of law" or on "file sharing" or on the future of music business models. It was a referendum on Jammie Thomas, who presented herself as an incredibly questionable witness with a fair amount of circumstantial evidence that she broke the law and then tried to avoid taking responsibility for her actions. If the RIAA wants to believe that the people are behind its self-destructive campaign of suing people, more power to it, but putting its head in the sand hasn't worked for the last decade, and I doubt it'll start working now.

Filed Under: file sharing, jammie thomas, jury, sample
Companies: riaa

Richard Marx, One Of The Artists Jammie Thomas Supposedly Shared, Blasts Verdict, Apologizes

from the want-no-part-of-this dept

And the backlash from the Jammie Thomas verdict continues... First there was Moby blasting the RIAA, but he's been a long term RIAA critic. Now, however, singer Richard Marx has come out against the ruling. This is interesting for a variety of reasons. Marx isn't exactly known as a "counter culture" type who would fight back against the RIAA (and, in fact, says he's against unauthorized file sharing). But, more importantly, one of his songs is included in the 24 songs that Thomas was on trial for sharing. For that, he now feels really bad:

As a longtime professional songwriter, I have always objected to the practice of illegal downloading of music. I have also always, however, been sympathetic to the average music fan, who has been consistently financially abused by the greedy actions of major labels. These labels, until recently, were responsible for the distribution of the majority of recorded music, and instead of nurturing the industry and doing their best to provide the highest quality of music to the fans, they predominantly chose to ream the consumer and fill their pockets.

So now we have a "judgment" in a case of illegal downloading, and it seems to me, especially in these extremely volatile economic times, that holding Ms. Thomas-Rasset accountable for the continuing daily actions of hundreds of thousands of people is, at best, misguided and at worst, farcical. Her accountability itself is not in question, but this show of force posing as judicial come-uppance is clearly abusive. Ms. Thomas-Rasset, I think you got a raw deal, and I'm ashamed to have my name associated with this issue.

Once again, even the artists that the RIAA is supposedly "supporting" are angry about the RIAA's own actions.

Filed Under: jammie thomas, richard marx
Companies: riaa

Moby Says 'Disband The RIAA' For Winning $1.92 Million From Jammie Thomas

from the representing-the-artists?!? dept

As a whole bunch of you have sent in, the musician Moby has put up a blog post where he suggests the RIAA should be disbanded for its $1.92 million win over Jammie Thomas. While (unfortunately) he gets a few of the facts wrong (they didn't sue her for $2 million, but it's what the jury chose -- though it is accurate that the RIAA has clearly suggested it has no problem with the statutory rates for infringement in the past), his overall point is sound. It's ridiculous that the RIAA thinks this is the proper strategy:

argh. what utter nonsense. this is how the record companies want to protect themselves? suing suburban moms for listening to music? charging $80,000 per song?

punishing people for listening to music is exactly the wrong way to protect the music business. maybe the record companies have adopted the 'it's better to be feared than respected' approach to dealing with music fans. i don't know, but 'it's better to be feared than respected' doesn't seem like such a sustainable business model when it comes to consumer choice. how about a new model of 'it's better to be loved for helping artists make good records and giving consumers great records at reasonable prices'?

i'm so sorry that any music fan anywhere is ever made to feel bad for making the effort to listen to music.

the riaa needs to be disbanded.

This isn't new territory for Moby. Way back in 2003, he got angry after finding out that some of his songs were being used by the RIAA to sue people, and stated: "I'm tempted to go onto Kazaa and download some of my own music, just to see if the RIAA would sue me for having mp3's of my own songs on my hard-drive."

Still, we're seeing more and more artists react poorly to the RIAA, who still claims to represent them. Why is it that our politicians still buy that clearly incorrect story?

Filed Under: jammie thomas, moby, music, recording industry, riaa
Companies: riaa