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The Key To Fixing Copyright Is Ending Massive, Unpredictable Damages Awards

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The Key To Fixing Copyright Is Ending Massive, Unpredictable Damages Awards

Postby MrFredPFL » Fri Jan 24, 2020 3:57 pm

Story :

What if a single parking ticket carried a fine of up to a year's salary? What if there were no way to know consistently how much the fine would be before you got it? And what if any one of thousands of private citizens could decide to write you a ticket? What would happen? People would start avoiding public parking and stay home more often. Business would decline. The number of false or unfair tickets would rise. Everyone would lose confidence in the system—and in the law—as parking became a huge gamble.

Something very close to this scenario is a reality in copyright law. Copyright holders who sue for infringement can ask for "statutory damages." That means letting a jury decide how big of a penalty the defendant will have to pay—anywhere from $200 to $150,000 per copyrighted work, without requiring any evidence of actual financial losses or illicit profits. That's a big problem for anyone who uses works in lawful but non-traditional ways. Musicians, bloggers, video creators, software developers, and others gamble with these massive damages whenever their art or technology touches another’s work. They risk unpredictable, potentially devastating penalties if a copyright holder objects and a court disagrees with their well-intentioned efforts.

On Copyright Week, we like to talk about ways to improve copyright law. One of the biggest improvements available is to fix U.S. copyright’s broken statutory damages regime. In other areas of civil law, the courts have limited jury-awarded punitive damages so that they can’t be far higher than the amount of harm caused. Shockingly, it’s been determined that large jury awards for fraud, for example, offend the Constitution’s Due Process Clause. But somehow, that’s not the case in copyright—some courts have ruled that Congress can set damages that are potentially hundreds of times greater than actual harm, if it chooses to do so.

Massive, unpredictable damages awards for copyright infringement, such as a $222,000 penalty for sharing 24 music tracks online, are the fuel that powers exploitative litigation business models: law firms and companies that bring dubious claims of infringement against thousands of Internet users, demanding cash settlements to avoid being served with a lawsuit. These businesses, often called copyright trolls, use the threat of statutory damages to coerce settlements, often without doing the work to make sure their accusations are correct.

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