Majors Welcome P2P Win, But $1.92M Award Could Make For Bad PR

 Majors Welcome P2P Win, But $1.92M Award Could Make For Bad PR

Majors Welcome P2P Win, But $1.92M Award Could Make For Bad PR
June 18, 2009 - Legal and Management
By Ben Sheffner
The recording industry secured a resounding victory when a Minnesota jury awarded the four major labels $1.92 million in damages after unanimously finding that Jammie Thomas-Rasset had willfully infringed on their copyrights by downloading and sharing 24 songs on the Kazaa peer-to-peer network.
The mammoth size of the verdict, representing $80,000 per track, may help dissuade more P2P users from illegally downloading music, and for that the labels are happy. "We appreciate the jury's service and that they take this as seriously as we do," RIAA spokeswoman Cara Duckworth said in a statement.
"We are pleased that the jury agreed with the evidence and found the defendant liable."
But a question arose after the verdict about whether the sheer size of the damages could lead to a backlash against an industry that is already portrayed in some quarters as overreaching.
No one expects that the four major labels, all plaintiffs in the case, will collect the entire amount from Thomas-Rasset, a 32-year-old Brainerd, Minn., mother of four who testified during the retrial that her ex-boyfriend or sons, then 8 and 10, were most likely responsible for downloading and distributing the songs. Thomas-Rasset lost her previous trial in 2007 and was ordered to pay $222,000, only to achieve a now-pyrrhic victory when the court tossed the verdict because of a faulty jury instruction.
The RIAA's Duckworth indicated after the verdict that the recording industry doesn't intend to collect $1.92 million from Thomas-Rasset. "Since day one, we have been willing to settle this case and we remain willing to do so," she said.
This could help the labels avoid potential political and legal headaches stemming from the large verdict. Even for law-abiding citizens who believe that labels have every right to protect their copyrights, a verdict of almost $2 million could be hard to swallow.
The Copyright Act provides for awards of statutory damages of up to $150,000 per infringed work, in the case of willful infringement. A number of copyright scholars on the "copyleft," led by Harvard Law School's Charles Nesson, have argued that such damages awards for personal use of file-sharing networks are excessive. Though no court has yet adopted that theory, the Thomas-Rasset verdict provides a very human face to the argument, which she will likely pursue on appeal if the case isn't settled.
While the recording industry maintains strong support in Congress, with powerful champions including House Judiciary Committee Chairman John Conyers, D-Mich., and his Senate counterpart Patrick Leahy, D-Vt., the Minneapolis verdict could well lead to a legislative move to reduce the damages awards available against individual infringers like Thomas-Rasset.
Thomas-Rasset's attorney, Kiwi Camara, said he was "very surprised" by the size of the verdict and signaled a willingness to talk about a possible settlement with the labels. But Camara also listed a number of potential issues to appeal should the parties be unable to resolve the case, including a challenge to the labels' ownership of the copyrights at issue based on the argument that they were improperly classified as "works made for hire" in contravention of the Copyright Act of 1976.
Ben Sheffner is a copyright attorney who blogs at copyrightsandcampaigns.blogspot.com. Previously, while employed at 20th Century Fox, he worked on an amicus curiae brief in this case for the Motion Picture Assn. of America.

Majors Welcome P2P Win, But $1.92M Award Could Make For Bad PR