Show Me...Damages

Clearly, damages are a form of monetary compensation. The question is how to assess damages. It is more than difficult to assess. Two recent damages cases prove this point: Oracle v. SAP and RIAA v. Thomas. In both instances, liability was established and now damages have become the major issue.

In Oracle v. SAP, the jury awarded $1.3 billion when SAP copied Oracle’s software and customer manuals. Oracle claimed that a license for such software to SAP would have been around $2 billion dollars. SAP countered that because it was only able to get sway a few of Oracle’s customer to buy from SAP that the damages in the $30-40 million dollar range was more appropriate. Following the verdict, a representative from SAP indicated that “[SAP] will pursue all available options, including post-trial motions and appeal if necessary.”


In November, the third trial in RIAA v. Jammie Thomas-Rassett, a case involving illegal music downloads of 24 songs was held. In 2007, the jury initially awarded the RIAA $222,000. However, due to a jury instruction error, the judge declared a mistrial and the verdict was thrown out. Rather than settling outside of court, Thomas-Rassett opted for a second trial, and in 2009 the second jury awarded the RIAA just under $2 million. The judge in the case subsequently lowered the award to over $50,000.

Both parties appealed the decision and a third jury awarded the RIAA $1.5 million or $62,500 per song. A copy of the verdict is available here via Copyrights and Campaigns. Lawyers for Thomas argued that because the downloads themselves were worth $1 a piece that the damages should be $24. The RIAA had sought a maximum amount of $3.6 million.

A Twist of LimeWire - Infringer Pirated

Following the decision that LimeWire’s peer file-sharing network infringed copyrights in a lawsuit filed by the Recording Industry Association of America, Judge Kimba Wood issued a permanent injunction against the company on October 26, 2010. The injunction was granted with LimeWire's consent.

In the 17 page order, the Court did go through the permanent injunction factors from the Salinger case in the Second Circuit. You can see the entire injunction here.

The Court found that LimeWire would be unlikely to be able to pay the statutory damage award. If LimeWire were not permanently enjoined, it would continue to facilitate “generations of infringement.” The RIAA would also be harmed because LimeWire would offer the copyrighted works that plaintiffs sell for free, thereby significantly affecting the market for the copyright owners’ works.

The Court also found the statutory damage award was not an adequate remedy at law especially to prevent future infringements and this factor favored a permanent injunction.

Because the Court found LimeWire’s business model was infringement, the balance of the hardships clearly favored plaintiffs. Finally the Court found that a permanent injunction serves the public interest by upholding copyrights and the harm caused by LimeWire.

In effect, LimeWire’s network has been shut down.

However, according to news reports, there is a software sharing program called LimeWire Pirate available on downloading sites on the Internet.

LimeWire has posted a notice on its website claiming it has recently become aware of third parties using the LimeWire name. The notice also includes a cease and desist to all parties using the LimeWire software, name and trademark.

Weekly Wednesday Wrapup

This week the big copyright news story was the RIAA victory against Limewire, a file sharing website for copyright infringement. See Decision here. In the course of the decision, the Court specifically notes the success of the RIAA against individuals. See Decision at footnote 22.

Is this the zenith for the recording industry in lawsuits for copyright infringement for file sharing?

Quite possibly as the recording industry has claimed that it will stop pursuing file sharing copyright infringement lawsuits. [Wall Street Journal]

The number of copyright infringement lawsuits nearly doubled from 2004 to 2005 (just under 6,000 lawsuits filed) when the RIAA lawsuits for file sharing were ramping up. However, a steady decline in the number of lawsuits has occurred to the point were the number of copyright infringement lawsuits is slightly more than 2,000.
Source: Administrative Office of the Courts

As one set of copyright owners may be ending its lawsuits on file sharing…BitTorrent may be the next target. As technology advances, the spectrum and size of the files to be shared grows. The producers of the Best Picture – “The Hurt Locker” are threatening suit and to learn the identities of BitTorrent users that illegally copied the movie. [ABC News]

Given that the RIAA has paved the way with its successes in copyright infringement actions and learning the identities of downloaders through ISP subpoenas, the MPAA and its members may have an easier time stopping infringements (and possibly fewer lawsuits filed for movie downloads).

Weekly Wednesday Wrapup - May 5, 2010

This week the Second Circuit and rappers bring the headlines in copyright news:

• Remember: Copyright does not cover ideas including pureeing vegetables to “sneak” them into kids' diets. The Second Circuit Court of Appeals, upheld a lower court’s decision that no copyright infringement occurred as Jessica Seinfeld’s cookbook Deceptively Delicious: Simple Secrets to Get Your Kids Eating Good Food was “very different” from Missy Chase Lapine’s cookbook The Sneaky Chef: Simple Strategies for Hiding Healthy Foods in Kids' Favorite Meals. See order here.


• Second Circuit upholds RIAA’s method of obtaining identities of alleged copyright infringers who downloaded music through subpoenas of internet service providers. See order here.


• Second Circuit vacates preliminary injunction and remands to district court to follow the Supreme Court’s decision in Ebay v. MercExchange where court finds likelihood of copyright infringement of The Catcher in the Rye and its main character Holden Caufield by Fredrik Colting and his book 60 Years Later: Coming Through the Rye. See order here.

Now onto the rappers:

• Lil Wayne has been sued for copyright infringement by rapper Dirahn Gilliams who claims Lil Wayne used portions of his song “Grinding Like A Goon” in the multi-platinum hit “Lollipop”.


• Continuing with the hip hop theme, Akon filed a copyright lawsuit in the Southern District of New York against Konvict cosmetics over their Konvict fragrance. According to the rapper, he had been in talks with the company over a fragrance line, however no deal was actually finalized.

And in other news:

• Don Henley has sued the Republican Senate hopeful Chuck DeVore for copyright infringement after Devore retooled Henley’s songs “The Boys of Summer” and “All She Wants to Do is Dance” to “Hope of November” and “All She Wants to Do is Tax” in campaign videos.
  See complaint here.

While fair use is likely to be raised by DeVore, I don’t think that he has the same arguments in the You Tube / Prince lawsuit. Nor do I think that a claim of parody could be successful – it is difficult to comprehend how a political attack ad to drum up political campaign contributions [there goes the whole not for profit angle] can be seen as a parody of the Don Henley songs. DeVore and other Defendants claim that they were making a political point as Henley represents the entertainment industry. [This is not only a weak argument but also leads anyone to believe DeVore could have taken any song by any artist and claim that they represent the entertainment industry.]