First Circuit Affirms $675,000 Award Against Joel Tenenbaum: Gore Test Does not Apply to Statutory Damages under Copyright Act

by Foley Hoag LLP - Trademark, Copyright & Unfair Competition
Contact

music-clipartMUSIC1-500x500This week, the First Circuit affirmed a $675,0000 statutory damages award against college student Joel Tenenbaum for copyright infringement. The Court held that the damages award, based on Tenenbaum’s illegal downloading and distribution of 30 copyrighted songs, was not excessive or a violation of due process. 

The Original Jury Award

As we have previously discussed, Tenenbaum had been downloading and distributing (via peer-to-peer networks) thousands of copyrighted songs, despite warnings from his parents, his college and copyright owners.  In 2007, a group of recording companies brought a copyright infringement suit and sought statutory damages with respect to a representative sample of about thirty songs.  Tenenbaum initially lied and blamed his sisters, but eventually admitted to illegal file sharing.  A jury found that Tenenbaum’s infringement was willful, and awarded the plaintiffs $675,0000 in statutory damages, or $22,500 per song — about 15% of the maximum statutory damages that could have been awarded under 17 U.S.C. § 504(c).

Judge Gertner Finds the Award Unconstitutional

When Tenenbaum moved for a reduction of the award based on the principles of remittitur and due process, Judge Nancy Gertner reduced the award ten-fold, to $67,500.  Judge Gertner found that the severity of the award was a violation of due process under the Supreme Court’s ruling in BMW of North America, Inc. v. Gore, 517 U.S. 559 (1996).  The Gore case, which addressed punitive damages, held in part that such damages must be somewhat proportionate to the harm suffered by the plaintiff.  

The First Circuit’s First Reversal

In 2011, the record companies appealed the reduction of the award and the First Circuit reversed and remanded. According to the First Circuit, Judge Gertner should have avoided the constitutional due process issue because she could have ruled based on non-constitutional remittitur principles.  Additionally, the First Circuit doubted whether the Gore test applied to statutory damages under the Copyright Act (as opposed to punitive damages), and suggested that the district court reevaluate the award based on a different test set forth in St. Louis, I.M. & S Ry. Co. v. Williams, 251 U.S. 63 (1919).  The Williams test, which is more plaintiff-friendly than Gore, provides that an award of statutory damages violates due process only “where the penalty prescribed is so severe and oppressive as to be wholly disproportionate to the offense and obviously unreasonable.”  On remand, Judge Rya Zobel (Judge Gertner having retired) applied Williams and reinstated the original award of $675,000.

The Second Appeal

Now it was Tenenbaum’s turn to appeal.  In 2012, he argued that the district court should have stuck to the Gore test, and that under either test the award was excessive, in large part because it was disproportionate to the actual injury he caused, which Tenenbaum estimated at a mere $450 (the retail cost of the thirty albums in question).

On June 25, 2013, the First Circuit rejected Tenenbaum’s arguments and affirmed the award. In an opinion by Judge Jeffrey Howard, the Court affirmatively rejected the Gore test as inappropriate for the review of statutory damages under the Copyright Act. According to the Court, Gore counseled proportionality between the wrongful act and the actual harm caused, but such an approach was logically inapplicable to a case involving statutory damages, where actual damages are irrelevant.  The Court went on to hold that the award against Tenenbaum was not excessive because, even if the actual damages were low in proportion to award, the deterrent purpose of statutory damages (as well as Tenenbaum’s willfulness) made up the difference. 

As we have previously discussed, the applicability of the Gore test to statutory damages under the Copyright Act is a controversial issue on which appellate courts may disagree. No word yet on whether Tenenabaum will attempt to appeal the decision to the Supreme Court.

 

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Foley Hoag LLP - Trademark, Copyright & Unfair Competition | Attorney Advertising

Written by:

Foley Hoag LLP - Trademark, Copyright & Unfair Competition
Contact
more
less

Foley Hoag LLP - Trademark, Copyright & Unfair Competition on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Privacy Policy (Updated: October 8, 2015):
hide

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.

Security

JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.