Here’s a quick perusal of what’s new in the First Circuit.
First, Judge Boudin took senior status as of June 1. If the time taken to get Judge Lipez’s successor, William Kayatta, is any indication, it will be the next millennium before Judge Boudin’s replacement is chosen and on the bench. Hopefully Judge Boudin will continue to sit in the meantime and thereafter, because he is not only a bright and thoughtful judge (he usually thinks of the tough questions, often more than the other side), but he is genuinely nice, and pleasant to appear before. He, like Judge Selya, has that very helpful trait of telling you what is on his mind at oral argument – what is troubling him, or how he is generally viewing the case. I personally find this the best thing that can happen at argument, because it facilitates having a dialogue with the Court, which is the point of being up there. The fact that Judge Boudin does this in a friendly manner just makes the experience that much more enjoyable, win or lose.
In the world of recent decisions, if you are planning to swipe songs illegally off the internet, don’t do it around here. The Court upheld a jury award of $675,000 for downloading songs, $22,500 each. Sony BMG Entertainment v. Tenenbaum, 12-2146 . The issue the appellant raised was due process – the punishment was so large, he said, it violated the Constitution. Paul Clement, among a cast of many, was on the side of the music business. Judge Howard wrote the decision.
Don’t panic just yet that that your kid is going to wipe out your life savings by downloading the latest Bruno Mars song without permission. Mr. Tenenbaum was apparently downloading and sharing for 8 years, involving up to 5000 songs. He also apparently lied during discovery, blaming the appearance of songs on his computers at home to burglars and a foster child living at his parents’ home. Nice.
Since these were willful acts, the jury could award between $750 and $150,000 for each violation under the Copyright Act, 17 USC s. 504(c), looking at a list of relevant factors. After the jury awarded the $675,000, the trial judge (Rya Zobel) found that the amount was unconstitutionally too whopping, and chopped it back to $67,500. I’ll skip over the previous two appeals involving whether you address remittitur first (yes you do, and Judge Zobel didn’t grant it) and the proper test for the constitutionality of a statutory award. Here, in Tenenbaum III, the First Circuit put the award back into place.
The applicable test is whether "the penalty prescribed is so severe and oppressive as to be wholly disproportioned to the offense and obviously unreasonable.” Nope, said the Court of Appeals. “Tenenbaum carried on his activities for years in spite of numerous warnings, he made thousands of songs available illegally, and he denied responsibility during discovery. Much of this behavior was exactly what Congress was trying to deter when it amended the Copyright Act. Therefore, we do not hesitate to conclude that an award of $22,500 per song, an amount representing 15% of the maximum award for willful violations and less than the maximum award for non-willful violations, comports with due process.”
While Tenenbaum argued that the actual injury was much smaller than $22,500 a piece, the Court noted the importance of deterrence, citing a challenge to a Supreme Court decision that involved an Arkansas statute subjecting railroads to penalties of $50-300 dollars, plus costs, for each offense of charging passengers fares that exceeded legal limits, where a $75 each violation award was upheld. There, the Supreme Court said:
Nor does giving the penalty to the aggrieved [party] require that it be confined or proportioned to his loss or damages; for, as it is imposed as a punishment for the violation of a public law, the Legislature may adjust its amount to the public wrong rather than the private injury, just as if it were going to the state.
(Citing St. Louis, I.M. & S. Ry. Co. v. Williams, 251 U.S. 63, 66 (1919).)
In short, the takeway is that if the award falls within the range allowed by statute, good luck arguing unconstitutionality. So if Junior does start downloading, get him to stop it pronto, and he’d better be contrite. Better yet, get him a subscription to Napster, Rhapsody or some other music service. Living in the cloud is a lot better than the poor house.