Awards of statutory damages and attorney's fees give copyright law its “teeth” to discourage infringers. Sometimes, the mere credible possibility of these two remedies can force an early settlement of copyright infringement cases, and this year they are getting a lot of attention in two different arenas.
In January, the U.S. Commerce Department’s Internet Policy Task Force released its 100-page White Paper on Remixes, First Sale and Statutory Damages, which gave recommendations on remixes and fair use, the first sale doctrine and digital distribution, and statutory damages.
17 U.S.C. § 504 offers successful copyright infringement plaintiffs a choice to recover either the actual monetary damages sustained and the profits of the infringer, or statutory damages determined by courts ranging between $750 and $30,000 per infringed work and up to $150,000 per willful infringement.
Regarding statutory damages, the white paper's main recommendations were to (1) amend the statute to include nine mandatory factors for determining the amount of damages, (2) increase the potential for reduced damages for innocent infringement, and (3) allow alternative damages assessment frameworks to online users of streaming services for copyrighted works.
The proposed nine factors for determining the amount of statutory damages to award are balanced to take into account plaintiffs' perspectives (such as lost revenues and the value of the infringed work), defendants' circumstances (their financial situations, and the duration and scope of the infringement), and public policy considerations (the need for deterrence and the appropriateness of the punishment).
The Supreme Court will revisit Kirtsaeng v. John Wiley & Sons in 2016, this time with an eye towards deciding the appropriate standard for determining whether to award attorney's fees to prevailing parties. Authority for awarding attorney's fees comes from 17 U.S.C. § 505, which says in part that a “court may...award a reasonable attorney’s fee to the prevailing party.” In its first iteration, Kirtsaeng turned on an application of the First Sale Doctrine, with the Court concluding that resale in the U.S. of textbooks purchased legally overseas did not amount to copyright infringement.
After denial of his claim for attorney's fees at the district and appellate levels, Kirtsaeng, a grad student, successfully petitioned the SCOTUS to hear the case again, this time for the purpose of reconciling what he characterizes as clear splits among the various circuits over application of Supreme Court precedent in Fogerty v. Fantasy, Inc., 510 U.S. 517 (1994). In contrast, Wiley & Sons charges that the petitioner has invented the circuit split and that the Second Circuit correctly applied the law.