Lawyers Challenge Lowered Amount of ‘Shocking’ File Sharing Award

Submitted by MacRonin on January 26, 2010 - 11:08pm

Lawyers Challenge Lowered Amount of ‘Shocking’ File Sharing Award: Via Threat Level.

Lawyers for a music file sharer said Monday they would challenge a judge’s order reducing from $1.92 million to $54,000 the amount their client, Jammie Thomas-Rasset, must pay the recording industry for copyright infringement of 24 songs.

The appeal concerns Friday’s head-spinning order by U.S. District Judge Michael Davis. The Minnesota federal judge dramatically lowered the amount a jury in June ordered Thomas-Rasset to pay — after being found liable in what at the time was the nation’s first Recording Industry Association of America file sharing case to reach trial. Most of the RIAA’s 30,000 lawsuits were settled out of court for a few thousand dollars during the record companies’ six-year litigation campaign, which is winding down.

Joe Sibley, Thomas-Rasset’s attorney, said in a telephone interview that even the reduced amount of damages is unconstitutionally excessive. It’s a penalty of 2,250 times an assumed $1 cost of a music download.

“We’re still appealing the underlying constitutionality,” he said. “It’s the difference between Joseph Stalin and the Khmer Rouge,” Sibley said. “It’s still egregious.”

The Copyright Act allows damages of up to $150,000 per track. A Minnesota jury dinged Thomas-Rasset $80,000 a song. Davis, the judge who presided over the trial in Duluth, Minnesota, lowered it Friday to $2,250 per song — three times the $750 minimum. The judge declared the $1.92 million verdict “shocking” and said damage awards “must bear some relation to actual damages.”

Judge Davis declined to rule on Sibley’s position that the Copyright Act in the file sharing context was unconstitutional. Instead, the judge exercised what is called “remittitur.” That’s when a judge reduces a jury’s damages award upon a finding that there was no rational basis for the jury to have reached its decision.

To be sure, the RIAA now finds itself in a legal conundrum as it sorts out a response to the only court decision to reduce a copyright damages award.

The reduced verdict, $54,000, is a big penalty, and the RIAA could walk away a courthouse winner.

But would the RIAA stand idle and refrain from challenging a legal decision that for the first time seemingly created a judicial right to alter a jury’s copyright infringement award? The music industry’s lobbying and litigation arm isn’t disclosing its next move. The group must inform the judge of it response by Friday.

In court briefs, however, the group told the judge earlier that it might accept a reduced award in the interest of “finality.” Copyright attorney Ben Sheffner suggests that the judge’s decision has left the RIAA between a rock and a legal hard place.

Lory Lybeck, the Washington state attorney leading a proposed class action against the RIAA on accusations that its six-year-old litigation campaign has been a “sham,” said Davis’ decision was “a huge win for the RIAA for the judge not to say these civil penalties are unconstitutional.”

For the RIAA to challenge Davis’ decision, Lybeck suggested, “would be a very strange strategy.”

Still, the legal jockeying may not have much application in the real world.

The RIAA is winding down its lawsuit campaign and instead is working with other rights holders and internet service providers to adopt a program to discontinue internet access of online copyright scofflaws.

That change in strategy is not lost on Sibley. But he said the RIAA could once again renew its litigation campaign.

“Somebody needs to decide the application of these ridiculous damages,” he said. “In this digital world, somebody has to say there isn’t any constitutional basis to allow this kind of threat to continue.”

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