• December 28, 2012

On December 10, Jammie Thomas-Rasset filed a petition for a writ certiorari with the U.S. Supreme Court (meaning that she seeks review of an intermediate appellate court’s ruling against her) asking to have a jury verdict reduced on the grounds that the award is excessive and violates her due process rights. Thomas-Rasset shared 24 songs on Internet, committing copyright infringement. That much is not in dispute. But do statutory damages become punitive if they no longer plausibly reflect actual injury?  How much is too much, way too much, of a penalty for copyright infringement?

 

Record companies filed their lawsuit against Ms. Thomas-Rasset in U.S. District Court for the District of Minnesota back in 2006 (Ms. T-R lives in Minnesota) and the case has gone to trial before three different juries, all of which have returned verdicts in three different amounts against Ms. T-R. See previous Minnesota Litigator posts here and here.

The Copyright Act allows a plaintiff to choose between recovering actual damages or statutory damages which can range between $750 and $30,000 and if the infringement was willful, the upper limit can be as high as $150,000. See 17 U.S.C. § 504. Therefore, the juries in the Thomas-Rasset case could choose any number between $750 per song to $150,000 per song.

The first the jury came back with an award of $9,250 per song for a total of $222,000.  This verdict was set aside because of erroneous jury instructions. The second jury awarded $1.9 million, which was reduced through remittitur by U.S. District Court Chief Judge Michael J. Davis (D. Minn.) to a total of $54,000. The third jury awarded $1.5 million which was again reduced by Judge Davis to $54,000.

The Plaintiff record companies appealed the reduction in the damages and in September, the 8th Circuit held that the jury award of $222,000 was constitutional. Relying on St. Louis, I.M. & S. Ry. Co. v. Williams, 251 U.S. 63 (1919), the 8th Circuit held that the jury award of $222,000 was not unreasonable, that Congress is given wide latitude in setting statutory awards which give fair notice to any would be defendants.

Thomas-Rasset’s petition for certiorari asks the Court to answer only one question:

Is there any Constitutional limit to the statutory damages that can be imposed for downloading music online?

That question may be broad enough in application to be worth the Court’s time because statutory damage award schemes are not limited to copyright infringement. The Supreme Court has held that punitive damages are limited by the due process protections of the Constitution.  See e.g. BMW of North America v. Gore, 517 U.S. 559 (1994). But, Thomas-Rasset argues that statutory damages that are not proportional to any harms suffered are in effect punitive, and therefore there are due process limits that must be imposed.

This case frames the damages issue well because there seems to have been little doubt that Thomas-Rasset willfully infringed. Three juries heard her case and all three returned sizable awards to the record companies. Thomas-Rasset couldn’t have believed that her file sharing was legit. But, how much is too much when it comes to statutory damages?

UPDATE: The Supreme Court denied certiorari on March 18, 2013

Paul Godfread practices trademark, copyright, and business law.  You can visit his website at www.godfreadlaw.com.   You can follow him on twitter @paulgodfread.

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