Recently, the United States Department of Justice (DoJ) filed an amicus brief addressing the constitutionality of the $80,000/song statutory-damage award that a second jury imposed after enduring the My-Children-Did-It Defense offered by the evidence-destroying Defendant in Capitol Records, Inc. v. Thomas. Predictably, the Department of Justice concluded that the statutory-damage award intended to deter and punish such conduct was constitutional. Just as predictably, Mr. Mike Masnick at TechDirt replied with a foaming rant that spat accusations of unethical and potentially criminal conduct at at least five DoJ attorneys. Ben Sheffner of Copyrights & Campaigns then exposed the vacuity of TechDirt's reckless accusations.
But Mr. Masnick's attack on the Department of Justice was worse than just reckless and vacuous: it also relied upon wholly inaccurate accounts of the law of statutory damages and the facts of Thomas. Indeed, this is why both DoJ and other policymakers who care about preserving the generative potential of both copyrights and the Internet just ignore the ceaseless yip-yap of TechDirt attack poodles: their alternative reality is generally irrelevant to those trying to understand the facts, law, and policy that prevail here on Earth.
TechDirt got the law wrong--again.
Mr. Masnick began by lashing out at "the Justice Department's sneaky little claim that the statutory rates are obviously fair for file sharing, because they were put in place in 1999, with the explicit statement from Congress that these numbers were there because of internet file sharing. That sounds good, but ignores the fact that this little change in the law was pushed almost entirely by entertainment industry lobbyists... rather than through any empirical evidence."
Wrong. First, Mr. Masnick mischaracterized why the statutory-damage ranges were increased in 1999. To quote the Department of Justice (p. 5), quoting Congress:
Congress explained that the increase [in statutory-damage-award ranges] was necessary not just to adjust for inflation, but also because:
"Many computer owners are either ignorant that copyright laws apply to Internet activity, or they simply believe that they will not be caught or prosecuted for their conduct. Also, many infringers do not consider the current copyright infringement penalties a real threat and continue infringing, even after a copyright owner puts them on notice that their actions constitute infringement and that they should stop the activity or face legal action."
H.R. Rep. 106-216, at 3 (1999). [Findings on inflation are quoted id. at 6; see also here].
I have proven here that Congress could have reasonably concluded that a 1999 increase in the statutory-damage ranges was needed to pace inflation. To argue that there is no "empirical evidence" for inflation is absurd. Indeed, empirical evidence about inflation alone validates the Digital Theft Deterrence and Copyright Damages Improvement Act of 1999.
Moreover, legislation is almost inevitably entirely prospective: Congress must thus make predictive, (rather than purely empirical), judgments about the rules that will be needed, in the future, to govern the behavior of classes of individuals. Here, any predictive component in the 1999 judgments of Congress has been wholly vindicated: the facts of cases like Thomas and Tenenbaum only echo the concerns that drove the Digital Theft Deterrence and Copyright Damages Improvement Act of 1999.
Next, Mr. Masnick re-wrote over 200 years of legal history: "The real original purpose of statutory rates had nothing to do with punishing personal, non-commercial use, but were very much about dealing with commercial harm." He was dead wrong--again--for two reasons.
First, Mr. Masnick's argument denied realities that have been obvious since about 1790. Since 1790, every enacted federal copyright law has provided for statutory damages, and none confined statutory damages to "commercial" copying and distribution. George Washington and James Madison did not do so in the Copyright Act of 1790: nor did the Presidents and Congresses that enacted the Copyright Act of 1831, the Act of 1856 (which added a new, not-limited-to-commercial-performances statutory-damages provision), the Act of 1870, or the Copyright Act of 1909.
Worse yet, not only is it error to claim that, historically, statutory damages "had nothing to do with punishing personal, non-commercial use," any such claim is facially wrong under the Copyright Act of 1976. For example, the 1976 Act has always contained special provisions that permit statutory damages to be remitted if certain noncommercial actors commit innocent infringements. See 17 U.S.C. Â§ 504(c)(2). These provisions prove that Congress knew that the 1976 Act--like every preceding federal copyright act since 1790--otherwise permitted statutory damage awards against noncommercial infringement by individuals or non-profit entities. I have discussed more supporting evidence for this conclusion here.
Second, even were Mr. Masnick's argument not wrong as a matter of law, it would still rest upon an obvious non sequitur: it wrongly presumed that "personal, non-commercial use" cannot cause "commercial harm." For example, Parent-Teacher Associations are worthy charitable organizations. Nevertheless, were PTAs permitted to fund their productive activities through door-to-door sales of wrapping paper, candles, AND pirated DVDs of commercial family films, that would create an obvious potential for commercial harm--and an equally obvious disincentive to create family films. But while Mr. Masnick's argument thus fails in any context, it backfires spectacularly when advanced in Thomas, a case involving a consumer who used the file-sharing program KaZaA to share 1,700 audio files.
The distributors of KaZaA were not exactly the local PTA. Indeed, a Federal Court of Australia found that the distributors of KaZaA intended to authorize infringing use of their program. The United States Supreme Court also found "clear," "replete" and "overwhelming" evidence that the distributors of Grokster, (a branded version of KaZaA), intended to induce or authorize the infringing use of their program. Distributors of KaZaA thus intended to--and briefly did--create the largest, global, for-profit copyright-piracy ring ever known.
Moreover, the success of their global, for-profit copyright-piracy schemes depended entirely upon consumers--like Defendant Thomas-Rassat--acting as distributors for their pirate network. Consequently, anyone claiming that a defendant who used KaZaA to "share" 1,700 files with other KaZaA users was engaged in mere "personal, non-commercial use" is either remarkably naive or desperately grasping at straws. Compare Lawrence Lessig, Free Culture 66 (2004) (distinguishing KaZaA from "commercial piracy" by arguing that, "unlike cable TV, no one is selling the content that is shared on p2p services"), with MGM Studios, Inc. v. Grokster Ltd., 545 U.S. 913, 940 (2005) (finding that "the commercial sense of [Grokster's] enterprise turns on high-volume use, which the record shows is infringing").
In conclusion, Mr. Masnick set out to show that DoJ acted in bad faith by relying upon "sneaky little claim[s]" and a re-write of the history of statutory-damages law in order to defend the "bizarre and totally unsupported" Digital Theft Deterrence and Copyright Damages Improvement Act of 1999. But thanks to his own not-so-sneaky absurdities and his own re-write of the history of statutory-damages law, Mr. Masnick succeeded only in showing that he understands neither law, nor technology, nor economic realities as basic as inflation.
TechDirt got the facts of Thomas wrong--again.
Moving from the law of statutory damages to the facts of Thomas, Mr. Masnick's attacks on the Department of Justice again ignored another critical reality: federal courts take jury verdicts quite seriously.
When courts review jury verdicts, they construe all evidence, (and all inferences that could be reasonably derived from it), in the light most favorable to the jury's verdict: "'A jury verdict is entitled to extreme deference, and we will not set it aside unless no reasonable jury could have reached the same verdict based on the evidence submitted.' When reviewing the sufficiency of the evidence, 'we consider the evidence in the light most favorable to the jury's verdict.'" Plamp v. Mitchell School Dist. No. 17-2, 565 F.3d 450, 462 (8th Cir. 2009); see also, e.g., EEOC v. Convergys Customer Management Group, Inc., 491 F.3d 790, 797 (8th Cir. 2007). Consequently, the Department of Justice--or anyone else--must also apply this standard to say anything relevant about how the facts of Thomas should affect judicial review of the amount of the jury's verdict.
To accuse the Department of Justice of wrongdoing, Mr. Masnick had to rewrite these principles of jury-verdict review. First, Mr. Masnick construed the facts of Thomas in a light so favorable to the Defendant that he would actually reward her for destroying evidence. Then, he imagined "facts" about her alleged motives and intentions that contradict her own sworn testimony.
First, Mr. Masnick repeatedly complained that the Thomas Plaintiffs just did not prove that the Defendant actually "shared" files: he claimed that there was no "evidence that [any song] was ever actually shared by anyone" and asked, "shouldn't the plaintiffs have been required to show that these songs were actually shared?"
Again, Mr. Masnick is dead wrong: Plaintiffs did prove that the songs at issue were actually shared and actually downloaded. But perhaps Mr. Masnick meant to complain that because neither the Plaintiffs nor the Defendant in Thomas possess wiretapping authority, neither offered a complete, verified accounting of the full extent of the actual harm caused by the Defendant's "sharing."
But even that complaint would be bizarre: Mr. Masnick has harshly criticized the Tenenbaum defense team for failing to present expert testimony on damages. In Thomas, the Plaintiffs noted, (pp. 8-9), that while they did present some evidence about actual harm, the Defendant did not:
Defendant might have attempted to elicit testimony that Plaintiff's actual damages were merely $1.29 or $15 per track, in an effort to have the jury limit the statutory damages they awarded based on the fact that the actual damages were low. But Defendant apparently had no evidence of this and did not present it to the jury. In fact, Defendant failed at trial to address the actual harm caused by her infringement.
Indeed, in Thomas, Mr. Masnick's complaints about quantifying actual harm become uniquely absurd. For example, an installed version of KaZaA may provide some information about how often its user's "shared" songs were downloaded by other KaZaA users--but only if the disk drive on which KaZaA was installed is not "damaged" and discarded before anyone can examine it. To be sure, when a defendant allegedly destroys critical evidence--and then allegedly conceals its destruction for months--it becomes more difficult for anyone to estimate the actual harm caused by that defendant. But, then, statutory damages exist to deal with precisely such cases.
Next, Mr. Masnick explains Defendant Thomas-Rassat's motive for sharing 1,700 audio files with other KaZaA users: "I mean, this is a woman who wanted to listen to her favorite bands, and now she has to pay nearly $2 million. How can anyone claim that's not 'severe and oppressive' in relation to the actual 'harm' done?"
Note that Mr. Masnick's "explanation" explains nothing: if the Defendant just "wanted to listen to her favorite bands" then why was she "sharing" 1,700 audio files with strangers? Is Mr. Masnick arguing that Defendant Thomas-Rassat was sharing files inadvertently? Professor Charles Nesson and other Berkman-Center law professors have argued that the distributors of KaZaA created "technological barriers" to force or dupe users into sharing files. Does Mr. Masnick now agree with them?
In any case, Mr. Masnick's rhetorical question also ignored the actual facts of Thomas and imagined facts absent from Thomas. But, sadly, the actual facts of Thomas are so bad that even Mr. Masnick's imagination backfired: his attempt to attribute narrow, quasi-sympathetic motives to the Defendant succeeded only in accusing her of being--not just any run-of-the-mill perjurer--but the sort of perjurer who would deliberately blame her own wrongful conduct on her own children.
In other words, Mr. Masnick's claims about the motives, intentions, and rationales of Defendant Thomas-Rassat contradict the Defendant's own sworn testimony: she never testified about her intentions, motivations, or rationale for using KaZaA to copy and distribute copyrighted music: in two separate trials, she testified--though not very credibly--that she never used KaZaA at all.
Granted, the jury in Thomas might have imposed a different award had all evidence in the case suggested that the Defendant was a mere dupe who never intended to act as a high-volume distributor for a global, for-profit copyright-piracy ring. But during judicial review of the second Thomas jury verdict, such speculation is irrelevant. For purposes of review, the facts of Thomas (or Tenenbaum) must be confined those actually presented to the jury, and those facts, (and all reasonable inferences that could be drawn from them), must be construed in the light most favorable to the verdict. When that is done, little merit remains in claims that the verdicts of the juries in these cases were unconstitutionally excessive.
In summary, the fundamental problem with Mr. Masnick's intemperate attack on the Department of Justice is not just that it slings facially baseless accusations of very serious wrongdoing. It is also that those baseless accusations derive from dead-wrong accounts of what the law is, what the facts are, and how the facts must be construed when reviewing a jury verdict.
This said, three important points about the Thomas verdict must be stressed.
First, while I think it highly likely that a very substantial per-song verdict will ultimately be sustained on appeal in Thomas, I do not purport to predict how Judge Davis will rule on the Defendant's Motion for a New Trial, Remittitur, and to Alter or Amend the Judgement. As I noted last fall, Judge Davis' needless, extra-judicial obiter dicta about the amount of the last Thomas verdict has now put him in a very awkward position. I have no idea what he will do next.
Second, I have not argued that reasonable persons cannot question the amount of the verdicts in Thomas and Tenenbaum. To the contrary, I have argued only that persons who do question the amount of those verdicts must, if they are reasonable, concede that those who disagree with them cannot be reasonably presumed--for that reason alone--to be acting in bad faith.
Third, while the standard of review alone will cast the Defendants in Thomas and Tenenbaum in a miserably bad light, those who defend the proven generative power of copyrights must remember: Joel Tenenbaum and Jammie Thomas-Rassat are not the worst villains in these cases.
Indeed, even if the facts in these cases are construed the manner most unfavorable to the Defendants, then what Mr. Tenenbaum and Ms. Thomas-Rassat did was painfully simple: they used the KaZaA program for its intended purpose--to infringe copyrights--the only purpose for which it was well-adapted.
Consequently, the primary villains in these cases are the architects of file-sharing piracy who worked so hard to position college students and single mothers as the human shields who would protect the profits of piracy. For example, when copyright owners tried to avoid suing infringing users of KaZaA by asking its distributors to cancel the registrations of users sharing infringing files, its distributors stopped registering users. When copyright owners tried to avoid suing infringing users of KaZaA by sending instant messages to users sharing infringing files, its distributors disabled instant messaging. In short, KaZaA users like Mr. Tenenbaum and Ms. Thomas-Rassat were ultimately sued because the designers of KaZaA worked hard to ensure that copyright owners seeking to deter infringing uses of their program would have to either pay them off or sue their users.
And the "secondary" villains? Well, my vote goes to the vacuous utopians who actively defended the sort of conduct just described. Juries just found Defendants Tenenbaum and Thomas-Rassat liable for willful copyright infringement--because they used KaZaA for what two courts have now found was its intended purpose.
Consequently, the sad truth is that these Defendants ought to be very grateful: many Internet utopians argued that distributors of file-sharing program ought to be allowed to encourage or dupe students, single mothers, and children into infringing copyrights. But these same utopians had no sympathy whatsoever for the ordinary citizens that were thus induced to infringe.
For example, if the ACLU, the Internet Archive, Project Gutenberg, and the librarians of Boston University had their way, the Department of Justice wouldn't just be defending the constitutionality of the jury verdicts in Tenenbaum and Thomas--it would also be prosecuting and imprisoning American citizens--like student Joel Tenenbaum and single-mother Jammie Thomas-Rassat--who were induced to use KaZaA for its intended purpose (p.26):
Copyright owners also have the very real ability to prevent and discourage copyright infringement by--as they have done for years--suing those who are actually committing the direct infringement. The music industry has in fact utilites this exact tactic, filing thousands of lawsuits against individuals accused of illegally downloading music through peer-to-peer networks. Those efforts have apparently been quite successful. Even further protection is now being provided to copyright owners by the federal government, which recently commenced a major effort to stop peer-to-peer copyright infringement by bringing criminal prosecutions against those directly committing the infringement.
In Grokster, the American Civil Liberties Union--the employer of Judge Geitner's husband--was binge-drinking so much Internet Kool-Aid that it ended up arguing that we should encourage foreign corporations to profit by intentionally encouraging or duping American students and single mothers into infringing the federal civil rights of American artists because those artists could just bankrupt--or the American government could just imprison--every American citizen that these foreign corporations successfully duped or encouraged. And remember: in Grokster, the Defendants, citing "the possibility of a criminal investigation," (p.3, n.1) had refused to let any amici examine the whole record. Consequently, the ACLU was arguing that not even criminal conduct should make a for-profit foreign corporation civilly liable for the intended consequences of own its efforts to dupe or encourage American consumers to violate the federal civil rights of American artists....
And if that argument sounds like vacuous lunacy--it was. Consequently, it was rejected--not only by all nine Justices of the United States Supreme Court--but also by the Grokster Defendants at oral argument, (p. 42), who wisely declined to make themselves look as dogmatically vicious as the ACLU or the Boston-University librarians.
Consequently, the real lesson of Thomas and Tenenbaum may be this: we have no more time for shrill TechDirt yip-yap or airy utopian pontificating. Copyright protection has helped make the United States the world's leading producer and exporter of a vast array of expressive works. But to preserve that competitive advantage--and to reduce the need for copyright enforcement against ordinary students and families--we must think more seriously than we have about how we want copyright owners to enforce their rights on the Internet and how we want them to remediate the effects of some of the most malign commercial piracy schemes ever conceived.
Fortunately, if responsible internet service providers and copyright owners work together, they may find that proven solutions to this challenge already exist. In the context of hosting sites like YouTube, alternative enforcement mechanisms like notice-and-takedown--while they have frustrated both copyright owners and site operators--have also obviated any need to enforce copyrights against the consumers who use these sites.
In the context of "P2P" file-sharing, graduated-response programs offer an intriguing analog to notice-and-takedown. It is time to begin encouraging responsible ISPs and copyright owners to find some better way to deter infringing uses of even irresponsibly designed file-sharing programs. If we do, then cases like Thomas and Tenenbaum will be remembered--not as the beginning of copyright-enforcement against consumers--but as the wake-up calls that led us to think seriously about how we want copyrights to be enforced on the Internet.