Court Interprets Basis for Statutory Copyright Infringement Damages
As you are probably aware, the 1976 Copyright Act authorizes the Court, in its discretion, to award statutory damages of up to $30,000, which may be increased up to $150,000 per infringement, if the infringement is willful. To be eligible for statutory damages, a plaintiff must, of course, have registered the underlying image prior to the infringement or within three months of first publication.
The U.S. Court of Appeals for the First Circuit (comprising Maine, Massachusetts, Rhode Island and New Hampshire), in reversing the District Court, has changed the prevailing interpretation of measuring statutory damages under the Copyright Act for at least those states comprising the First Circuit.
The case, Hernandez, et al v. Sonolux Records, involved the production of 186 recordings of two copyrighted songs by Guillermo Venegas-Lloveras, a noted composer, on sixteen different albums. After the defendant defaulted, a judgment was entered for statutory damages of $1.6 million. This was calculated at $100,000 for each of the sixteen albums.
The defendant moved to set aside the default and the damage award on the grounds that the Court erred in its calculation. A second judge denied the motion to set aside the default, but reduced the award to $200,000, using the defendant's theory of calculation. Both sides appealed.
The issue on appeal involved the Copyright Act provision for recovery of statutory damages, when the party is eligible, which states that a plaintiff may recover such damages "for all infringements involved in the action with respect to any one work, for which any one infringer is liable personally."
The second District Court Judge, and the Circuit panel, interpreted this statutory language as basing damages upon the number of works that are infringed (in this case the two songs), and not on the number of infringing works (the sixteen albums).
The Circuit Court upheld the default, and the theory of calculating damages, but remanded the case to the District Court for a recalculation of damages since the first judge might have awarded up to $150,000 per infringement (and not $100,000) if he had known there were only two infringements.
This decision is limited to statutory damages. If actual damages are greater, a plaintiff may still seek the higher award. Although this decision is only law in the First Circuit, its reasoning may be followed by the other courts. Since the law is still evolving, we may probably hear more on this in the future.
Attorney Joel L. Hecker lectures and writes extensively on issues of concern to the photography industry. His office is located at Russo & Burke, 600 Third Ave, New York NY 10016. Phone: 1 212 557-9600. E-mail:
HeckerEsq@aol.com.
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