When the Supreme Court capped punitive damages, the business community cheered vociferously. But when two recent court rulings capped statutory damages, the reaction was quite different. Many copyrights owners cried foul.
In Sony BMG Music Entertainment v. Tenenbaum and Capitol Records, Inc. v. Thomas-Rasset, juries imposed large statutory damages against file-sharers who had downloaded music without authorization. Joel Tenenbaum, a graduate student, was found to have infringed the copyrights in 30 songs and was slapped with damages of $675,000. Jammie Thomas-Rasset, a single mother of four, was found to have infringed the copyrights in 24 songs and was hit with damages of $1.92 million. These awards were well within the range of statutory damages set by Congress, but the federal district courts struck them down, ruling that the damage awards were, respectively, "grossly excessive" and "simply shocking."
He reduced the damages to $2,250 per song, three times the minimum amount of statutory damages. This "significant and harsh" award, he stated, was "the maximum amount a jury could reasonably award" in order to both compensate the plaintiffs and deter individuals from future file-sharing.