Cyberlaw Cases

Earlier this week, Judge Gertner entered judgment to the tune of $675,000 in Sony BMG v. Tenenbaum. Nothing particularly surprising there. This was the number arrived at by the jury, based on a statutory damages calculation of $22,500 per infringed work.

The court also issued an injunction barring Joel Tenenbaum from infringing plaintiffs’ work in the future, and requiring him to destroy all infringing copies of plaintiffs’ works. Again, all pretty standard fare.  But a couple issues of note crop up in the court’s memorandum on the issue of injunctive relief. First, the court rightly refused the record labels’ effort to enjoin Tenenbaum from “promot[ing] … using the Internet or any online media distribution system to infringe copyrights,” recognizing the First Amendment implications of such an ambiguous prior restraint.

More troubling is the court’s treatment of the standard for injunctive relief. A permanent injunction requires a showing that the harm at issue is irreparable and that monetary damages are inadequate. If you are not a copyright litigator, you might wonder how plaintiffs who are to receive $675,000 in damages for sharing 30 songs could argue with a straight face that they have suffered irreparable harm for which money alone cannot possibly compensate.

To avoid this somewhat inconvenient question, courts developed a presumption of irreparable harm in cases of infringement. This presumption owes its origins as much to concerns over judicial economy as to any principled stance on the nature of the harm suffered by rights holders. In 2006, the Supreme Court in eBay v. MercExchange rejected this shortcut in the context of permanent injunctions in patent cases. Right-minded courts have subsequently applied eBay’s insistence on some factual showing of irreparable harm in copyright as well as patent cases.¹ Unfortunately, Judge Gertner didn’t follow their lead, allowing plaintiffs to skate by purely on reliance on the presumption.

But the juiciest document the court provided this week was the memorandum detailing its rationale for rejecting Tenenbaum’s proffered fair use defense. The analysis of the four factors is hardly surprising.  Spoiler alert: Tenenbaum loses on all of them. But there are some notable aspects of the court’s opinion.

First, the court goes to great lengths in dicta to clarify the scope of its conclusion.  This is not an opinion that says downloading or sharing copyrighted works over peer to peer networks can never constitute fair use.  There are factual scenarios under which such a defense might be plausible: downloading songs to sample and then promptly deleting them, space shifting music you’ve already acquired legally, and obtaining content not available for legal purchase elsewhere.  None of those facts, of course, were argued by Tenenbaum’s counsel, largely I suspect because they simply were not true.

Second, speaking of Charlie Nesson & Company, the court’s opinion includes an atypical if not entirely shocking admonishment of Tenenbaum’s counsel, describing the defense as “truly chaotic” and offering a skeletal and incomplete account of the bizarre behavior Team Tenebaum, and Nesson in particular, exhibited throughout the litigation.

Third, and most importantly, the court may have tipped its hand regarding the most important outstanding issue in the Tenenbaum litigation: the argument that the statutory damages provisions of the Copyright Act as applied to Tenenbaum’s activity faces serious constitutional challenges. Towards the end of its opinion the court writes:

As this court has previously noted, it is very, very concerned that there is a deep potential for injustice in the Copyright Act as it is currently written. It urges — no implores — Congress to amend the statute to reflect the realities of file-sharing. There is something wrong with a law that routinely threatens teenagers and students with astronomical penalties for an activity whose implications they may not have fully understood. The injury to the copyright holder may be real, and even substantial, but, under the statute, the record companies do not even have to prove actual damage.

The court here displays some sympathy to the claim that copyright statutory damages impose liability, in the court’s words an “astronomical penalt[y],” that is entirely untethered to the actual harm copyright holders suffer. This a hopeful sign for Tenenbaum. On the other hand, the court might be signaling its inclination to leave Congress rather than the courts holding the bag. Here’s hoping for a little judicial activism.

See also:

• Mark Giangrande, Fair Use Argument Falls Flat in File Sharing Case, Law Librarian Blog (Dec. 9, 2009).
• Nate Anderson, How Team Tenenbaum missed a chance to shape P2P fair use law, Ars Technica (Dec. 7, 2009).
• Ben Sheffner, Some additional thoughts on the Tenenbaum fair use opinion: mainly right on fair use, but why all the dicta?, Copyrights & Campaigns (Dec. 7, 2009).

1. For a discussion of the dubious presumption of irreparable harm after eBay, see Pamela Samuelson & Krzysztof Bebenek, Why Plaintiffs Should Have to Prove Irreparable Harm in Copyright Preliminary Injunction Cases, J.L. & Pol’y for the Info. Society (2009). [↩]