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Instead of Billions, LimeWire may only owe $330,000,000
March 10, 2011
Thomas Mennecke
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Since LimeWire lost their copyright case to the music industry last year, the P2P company was potentially looking at over a billion dollars in statutory damages. The big question on the table was an interpretation of the copyright law, and how much the once highly popular P2P software company owed the music industry. Here's the part of the copyright law where the different of between hundreds of millions of dollars and billions of dollars lies:

A copyright holder can demand "...an award of statutory damages for all infringements involved in the action, with respect to any one work, for which any one infringer is liable individually, or for which any two or more infringers are liable jointly and severally, in a sum not less than $750 or more than $30,000 as the Court considers just..."

So what does that mean? Ok...here's the premise: the music industry is demanding statutory damages on 11,000 copies of work. Can the music industry get at most $30,000 x 11,000 copies of work (or $330 million) OR can they nail LimeWire for $30,000 x 11,000 x The Total Number of Infringers per Work. As you can imagine, the latter number is staggering.

The music industry tried to argue that the "or" in the copyright law did not distinguish the two conditions upon which they could collect statutory damages. In essence, they tried to argue the "or" equaled an "and". It was darn good layering, but the argument died in court.

Justice Kimba Wood, presiding in US District Court in New York, ruled on the side of LimeWire, significantly limiting the damages imposed on LimeWire.

"the Court is confident that Congress intended for the Copyright Act to treat jointly and severally liable infringers the same way that the statute treats individually liable infringers. For any individually liable infringer, a plaintiff is entitled to one statutory damage award per work. For any two or more jointly and severally liable infringers, a plaintiff is entitled to one statutory damage award per work."

The language in the copyright law is subtle enough that the music industry's talented legal team can chomp down on a point like this and really give LimeWire a run for their money. But the judge in this case proved wise as well, and delivered a ruling based on reason. With a maximum cap set at $330 million, and possibly much less, depending on how much damage Judge Kimba ultimately awards, Mark Gorten and the LimeWire company may emerge from this disaster financially intact.

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