Hefty Fine for Sharing Music Is Constitutional

9/20/2011 5:19:00 PM, Matt Reynolds
     (CN) - The 1st Circuit reinstated a hefty $675,000 damages against a Boston College student who illegally downloaded and shared thousands of music files, saying the award to Sony BMG Music Entertainment was constitutional.

     After a jury entered the award against Joel Tenenbaum, U.S. District Judge Nancy Gertner slashed it as excessive in violation of due-process protections. The 10-fold decrease ordered Tenenbaum to pay $2,250 for each of the 30 infringed recordings.
     Sony presented evidence that Tenenbaum had distributed thousands of copyrighted songs on peer-to-peer networks from the late 1990s to at least 2007. On appeal, Tenenbaum argued that his file-sharing activities amounted to "consumer copying," absolving him of liability.
     The Boston-based federal appeals court disagreed Friday, siding with the government, which intervened to defend the Copyright Act.
     Noting that the case was "difficult and contentious," a three-judge panel upheld the constitutionality of the Copyright Act and made Swiss cheese of Tenenbaum's consumer-copying theory.
     "Tenenbaum is not a 'consumer-copier,' a term he never clearly defines," Chief Justice Sandra Lynch wrote. "He is not a consumer whose infringement was merely that he failed to pay for copies of music recordings which he downloaded for his own personal use. Rather, he widely and repeatedly copied works belonging to Sony and then illegally distributed those works to others, who also did not pay Sony. Further, he received, in turn, other copyrighted works for which he did not pay. Nor can Tenenbaum assert that his was merely as 'noncommercial' use and distribution of copyrighted works as those terms are used elsewhere in the act. His use and distribution was for private gain and involved repeated and exploitative copying."
     The 65-page opinion also rejected Tenenbaum's claim that Sony did not demonstrate "actual harm."
     "Tenenbaum downloaded the thirty copyrighted works at issue and distributed those works to innumerable network users," Lynch wrote. "Sony presented extensive testimony regarding the loss in value of the copyrights at issue that resulted from Tenenbaum's conduct, and the harm of Tenenbaum's actions to itself and the recording industry, including reduced income and profits, and consequent job loss to employees."
     Though Tenenbaum claimed trial-court errors in relation to the Copyright Act and jury instructions about the range of statutory damages, Lynch said she could not order a new trial on that basis.
     Turning to the government's challenge, Lynch agreed that the due-process finding was overreaching. Gertner should have reduced the award by the procedural process known as "remittitur" instead, according to the 65-page decision.
     "The court declined to adhere to the doctrine of constitutional avoidance on the ground that it felt resolution of a constitutional due process question was inevitable in the case before it," Lynch wrote. "A decision on a constitutional due process question was not necessary, was not inevitable, had considerable impermissible consequences, and contravened the rule of constitutional avoidance. That rule had more than its usual import in this case because there were a number of difficult constitutional issues which should have been avoided but were engaged."
     "Facing the constitutional question of whether the award violated due process was not inevitable," she added. "The District Court should first have considered the non-constitutional issue of remittitur, which may have obviated any constitutional due process issue and attendant issues. Had the court ordered remittitur of a particular amount, Sony would have then had a choice. It could have accepted the reduced award. Or, it could have rejected the remittitur, in which case a new trial would have ensued."
     On remand, Gertner must consider the common-law remittitur question. Attachment