I draw three lessons:

1. When someone accuses you of infringement and asks why you did not obtain legally required licenses, do not reply, as Ellen’s producers allegedly did, that you don’t “roll that way.” Otherwise, your adversary will reply:

“As sophisticated consumers of music, Defendants knew full well that, regardless of the way they rolled, under the Copyright Act, and under state law for the pre-1972 recordings, they needed a license to use the sound recordings lawfully”

2. Despite the usual tendency of major TV and film studios to be much more cautious than necessary about IP clearance and licensing, sometimes they screw up too. Even when they are, as the plaintiffs point out, “sophisticated consumers of music.”

3. I always wondered if there were some legal remedy for those dances. Once again, IP comes to the rescue.

1. Judge Gertner will reduce the damages somewhat.
2. She will find that the statutory damages provisions of the Copyright Act do not contravene constitutional protections under the Gore line of cases.
3. The First Circuit will affirm.
4. The Supreme Court will deny cert.

I think the damages provision might be vulnerable in a specific defendant’s case (though Ms. Thomas-Rasset would be a better test than Mr. Tenenbaum here), but is safe on its face. In lawyerspeak, it’ll survive a facial challenge, but might fail as-applied.

The Gore limits depend in part on the concept of notice: defendants should know ahead of time how much they’d be liable for if they violate the law. No one expects punitive damages of 500:1 (Gore) or 145:1 (State Farm). But predicting liability – at least at its minimum / maximum amounts – is easy for copyright law. That’s a key difference between a statutory damages scheme, with a range specified by the legislature, and a common-law one where juries pick a number from a hat.

Second, the range of damages in the Copyright Act looks reasonable on its face. $30,000 per work (and up to $150,000 for willful infringement) is a lot, especially if it’s just to deter (or compensate for harm by) a single defendant. (General deterrence is out under Philip Morris v. Williams, which is sad for law & econ thinkers.) Imagine a business that runs off copies of “Harry Potter and the Deathly Hallows” in its basement and sells them. Copyright infringement of this one work is clear, but the business carefully shreds all evidence of sales. So, it’s impossible to prove actual damages; businesses are often risk-averse, meaning that higher awards of damages are needed to deter; and there’s only 1 copyrighted work at issue. Statutory damages are important to provide any deterrence – since proof of harm is under the infringer’s control – and since the infringement might be quite profitable, an award might need to be high (even $150K). Hence, the damages scheme is clearly rational in at least some cases.

The harder question is whether the unconstrained jury discretion for statutory damages could run afoul of due process protections. Individual downloaders tend to be pretty similar if you think about it: there’s not much difference between Thomas and Tenenbaum. So why is her penalty almost 4 times more per work than his, for the same type of infringement? Neither has much in the way of monetary resources, so they’re either undeterrable, or able to be deterred at a fairly low amount (marginal value of a dollar and all that). Here is where the damages scheme seems like it might be vulnerable: it does get hard to predict liability in some individual cases, and the wide range of damages looks a bit too much like absolute discretion. (Thought exercise: what if a jury could award any amount of damages per infringement? Would that improve deterrence against Tenenbaum and Thomas? Would it be significantly less accurate than the actual damages, which everyone agrees are pretty low in real terms? But such a framework would likely run afoul of constitutional limits.)

If this is right, it means that both sides should worry – as should Congress. Getting damages right is important, but preserving both procedural and substantive protections for defendants is just as much so. Comments and disagreement welcomed…

I wasn’t at the courtroom, so I’m relying on reporting / blogs, but I think they’re wrong. Here’s why.

First, Tenenbaum’s attorneys failed to object to the liability question. So, it’s not preserved for appeal. That’s bad, unless the First Circuit decides to tackle it sua sponte, which they won’t.

Second, look at Joel’s actual testimony (quotes from Ray Beckerman’s helpful site, emphasis mine):

“He also testified that he had used the sublimeguy14 username, admitted that he had used KaZaA, and that the KaZaA shared folder in the screenshots from MediaSentry were his. He also testified that it was not uncommon for him to see other people uploading files from him on the KaZaA traffic tab.”

“He testified that he had burned CDs of the music in his shared, and testified that he had ripped CDs to his computer.”

“He testified that he had listened to, talked about, made mixes of, and made available for distribution all of the music in his shared folder.” [ignore the distribution part]

“The redirect was very short… He was asked if he was now admitting liability, to which he said yes. ”

Even throwing out the redirect, if Beckerman is reporting this accurately (I trust him), Tenenbaum has admitted to facts that constitute violations of 17 USC 106(1), 106(2), and 106(3). The liability bit came on redirect and can be ignored without affecting the outcome. The plaintiffs thus clearly made out their case on chief on infringement, and since Tenenbaum’s fair use defense was shot down ahead of time, it was all over but the shouting (and the damages calculation)…

The judge in the copyright infringement lawsuit against Joel Tenenbaum has issued a directed verdict on the issue of infringement liability. The only remaining issue for the trial is that of damages. I predict Joel is going to get whacked: he admitted to lying in a deposition, and suggested that “burglars” might have downloaded the songs to his computer. (Increasingly tech-literate, those burglars!) The jury in the Thomas-Rasset case seemed to think that her somewhat incredible story counted against her in terms of damages, and it may be the same here.

On the other hand, Tenenbaum’s defense team has substantial ammunition on its side regarding damages. Pam Samuelson’s paper makes a compelling case that the Copyright Act’s damages scheme should not only be interpreted differently by courts, but may in fact be constitutional. This could well be the most important aspect of this case.

Stay tuned – via Ben Sheffner and Brent Whelan. Predictions on the size of damages welcomed in the comments.

So it’s interesting to speculate what the judge might make of the damages a jury just awarded to the record label plaintiffs in the Jammie Thomas retrial: $1.92 million — more than 8 times the amount awarded in the first trial, or $80,000 (based on the jury’s finding of willfulness) for each of the 24 works Thomas infringed.  Remittitur motion, anyone?

With a seemingly impecunious litigant like Thomas, it probably makes little difference whether the jury awarded $1,920,000, or $222,000, or “a bazillion kajillion dollars”; I know of nobody who seriously expects the record labels to see more than a tiny fraction of the recompense from Thomas they claim they are owed.  And, as I’ve noted before, if you want to campaign for reducing the maximum statutory damage awards for copyright infringement, Thomas is probably not the most sympathetic candidate to make that argument.

It’s certainly an extraordinary number, however, and it just shows how quickly individual acts of file-sharing can pile up into multi-million-dollar liability under current law.

UPDATE: EFF’s Fred von Lohmann ably tees up the constitutional excessiveness issue also raised by Derek following my earlier post. Not a topic upon which I feel qualified to opine, but see Fred’s post and judge for yourself.

In some ways this is better, and in some ways worse. Fingerprinting can catch a lot of infringement, but it’s a rule rather than a standard: there’s no way for a content ID system to figure out fair use. (Heck, lawyers are bad at it.) The dispute resolution form improves things, but I wish the system notified the poster first (with, say, a deadline for response) before taking down the allegedly infringing content.

This is a nice reminder that the Internet is a world of private power. There’s no right to post to YouTube, and posters get whatever process Google decides to afford them when content appears to be infringing. In many ways, this recapitulates the standard public choice problems of copyright law: copyright-owning interests are concentrated and powerful, and copyright-using interests tend to be dispersed and weaker. In that sense, we’re probably fortunate that the content ID take-down system is as thoughtful as it apparently is. /Update

Warner Music has issued a take-down notice under the Digital Millennium Copyright Act for the video slideshow of Larry Lessig’s keynote talk at the OFC Conference in San Diego in March 2009. This can only be viewed as 1) a sad commentary on automated detection of copyrighted material, 2) a serious error in judgment, or 2) a deliberate provocation. Naturally, Lessig is going to fight, which I assume begins with a counter-notification under Section 512(g)(3) of the DMCA. I’ve been going over the myriad of clips in Lessig’s talk, trying to figure out which might be the source of Warner’s notice. It’s an interesting question whether Warner might be liable under 512(f) of the DMCA, along the lines of Lenz v. Universal’s claims, for failure to issue this notice in good faith. (Is it sufficient to believe in good faith that all uses require permission, or to hold a completely unreasonable yet devoutly believed view on the topic? I’m dubious – most subjective standards have some objective grip at bottom.) It’s hard to see Lessig’s utilization of the clips as anything but fair use: they’re quite abbreviated, the use is in a non-traditional educational setting, and there’s no market displacement of the originals. Not sure, in other words, how this fight started, but I have a sense of how it’ll end…

One of those still-pending cases settled today for $7,000 (which seems generally in line with prior settlements, in view of the fact that there were two accused downloaders).  I found this comment from the story particularly striking (emphasis mine):

“We are pleased to have reached an agreement with the Santangelos,” Cara Duckworth, a spokeswoman for the R.I.A.A., said in an e-mailed statement. …

She said the lawsuit had succeeded in showing that breaking the law has consequences and in steering music fans toward legal online services “that fairly compensate musicians and labels.”

The really interesting phenomenon, however, is just how resistant P2P users’ norms proved to be to the RIAA’s litigation campaign. Indeed, if the campaign was actually “steering fans toward legal online services,” it would doubtless still be underway.  If P2P users now understood “that breaking the law has consequences,” the entertainment industry would not be complaining so loudly about piracy.  What actually happened was, the RIAA sued a bunch of people, and users apparently reacted with a shrug, so they stopped suing.  Why did the RIAA’s years-long (and expensive) litigation campaign fail to sway hearts and minds?  More generally, has suing people ever been an effective way to alter their opinions?  Those are the questions that the content industries ought to be trying to answer.

Through the good work of advocacy groups like Public Knowledge, efforts to add legal approval of copyright filtering to the economic stimulus bill now before Congress have been thwarted — so far. Although neither the House nor the Senate version of the legislation contained the provision, it can of course be added by the conference committee. If that happened, it would be almost impossible to stop it from becoming law, given the high stakes for the overall legislation and special rules that make it essentially impossible to remove a provision by amendment.

I would oppose copyright filtering in any event, on two independent grounds dear to my heart: it is harmful to both data privacy and fair use. But adding such a complicated and far-reaching bill to the stimulus package (to which it is superfluous) — without any real debate — would be unconscionable.

PK has a web page up that allows you to fax a letter to the conference committee members; do it today before it’s too late. The letter I wrote is after the jump:

I am a law professor studying privacy and intellectual property law and new technology. I understand that efforts continue to insert a “copyright filtering” proposal into broadband development provisions of the conference report on the stimulus bill.

Any such amendment should be rejected. This issue is being portrayed as noncontroversial, but I assure you that is not so. This extremely complex issue implicates personal privacy of web users and the balance of intellectual property rights.

First, filtering opens the door for monitoring of our online reading and writing habits, seriously threatening personal intellectual privacy. Second, mechanized filtering cannot reliably detect “fair use” under copyright law, which requires human judgment. Such automatic filtering will chill free expression by shutting down perfectly legal web content.

This proposal requires greater scrutiny. I support rapid passage of the stimulus bill to help spur our economic recovery, but filtering is not necessary to allow that to happen. Please resist efforts to add it to the package.

Many thanks for your attention.

1. Public choice problem – IP profs know they just aren’t that influential with Congress, compared to industries (such as movies and music) with a significant economic stake. Tilting at windmills isn’t a good use of time.
2. No big deal – the Act doesn’t make enough substantive changes to IP law (focusing mostly on counterfeit trademarks and setting up a new IP bureaucracy in the federal government) to rally profs to the barricades. It’s not much of a windmill, anyway.
3. Advancing the ball – the Act is actually a good idea. Windmills can be useful things.

I’d be interested to know what you think.

Update (Oct. 15, 1:30PM): Susan Scafidi has an insightful post at Concurring Opinions. My only quibble: do we want an IP czar generally? Larry Lessig would be terrific, but administrations come and go; the structure remains. (Particularly given the bipartisan consensus on this bill.)