An American photojournalist, Ms. Leuthold, was on the scene in New York City on September 11, 2001. She licensed a number of still photographs to the CBC for use in a documentary about the 9/11 attacks. The photos were included in 2 versions of the documentary, and the documentary was aired a number of times betwen 2002 and 2004. We originally wrote about this in an earlier post: Copyright Infringement & Licensing Pitfalls. The court found that the CBC had infringed copyright in the photographs in six broadcasts which were not covered by the licenses. Though Leuthold claimed damages of over $20 million, only $20,000 was awarded as damages by the court.
In Leuthold v. Canadian Broadcasting Corporation, 2014 FCA 174, the Federal Court of Appeal upheld an award of double costs against Leuthold. Early in the litigation process, the CBC had formally offered to settle for $37,500 plus costs. Ms. Leuthold did not accept the CBC’s offer and went to trial where she was awarded $20,000. Ms. Leuthold’s total recovery was substantially less than the amount of the CBC’s offer. When this happens, a plaintiff can be liable under Rule 420 for double costs, which was awarded in this case. Double costs amounted to approximately $80,000 in these circumstances, which means Ms. Leuthold is liable for about 4 times the amount of the damage award. Although Ms. Leuthold objected that such a disproportionate costs award was “punitive”, the court concluded:
“The sad fact of the matter is that litigation produces winners and losers; that is why it is such a blunt tool in the administration of justice. But justice is not served by allowing persons who have imposed costs on others by pursuing or defending a claim which lacks merit to avoid the consequences of their behaviour. Such a policy would be more likely to bring the administration of justice into disrepute than the result in this case.”