On October 17, 2007, a jury in a federal district court in Minnesota found Jammie Thomas liable for willful copyright infringement and reached a verdict of $222,000.00 in damages. Sony BMG Music Entertainment was among the seven record labels who brought this lawsuit against Thomas for sharing music online and infringing on their copyrights. The plaintiffs in that case were able to show Thomas had twenty-four songs on her computer that she made available in the Kazaa file-sharing network. This verdict is a first of its kind and should have a chilling effect on those who share music files with others.
Under the Copyright Act, one who distributes copies of copyrighted work without proper authorization from its owner may be liable for copyright infringement. The Thomas case helps clarify the ambiguity in what constitutes “distributes” with respect to file-sharing cases. The judge in the Thomas case instructed the jury that they could find infringement regardless of whether or not anyone copied the twenty-four music files in her computer. The court interpreted the term “distribution” in the Copyright Act to simply mean making the file accessible to others and not a question of whether someone actually copied it.
It is important to note that the Copyright Act allows for statutory damages of up to $150,000.00 for each willful infringement. Thomas had thousands of music files on her computer, however, the record labels sought to hold her accountable for only twenty-four. As a result, Thomas could have been liable for up to $3,600,000.00 in damages. Luckily, the jury found Thomas liable for only $9,250.00 in statutory damages per infringement.
Although there were thousands of cases like the Thomas case filed by the record companies, this is the first of its kind to actually go to trial. In an effort to stop file sharing and copyright infringement, the record labels and the Recording Industry Association of America (“RIAA”) may choose to make examples out of further un-suspecting individuals who share files. As a result, the threat of more similar trials is on the horizon.
With CD sales on a tremendous decline over the years and online music piracy taking over, the music industry is using other tactics to try to re-capture some of its market share. On October 19, 2007, the RIAA reported that it sent out 411 pre-litigation settlement letters to 19 universities nationwide in an attempt to thwart music theft on the internet. These letters are subsequently forwarded to the individual student users, who are given an opportunity to settle the copyright infringement claim with the RIAA at a discounted rate. Otherwise, the record companies have threatened to sue. The RIAA is determined to take a proactive stance with music piracy as, according to the RIAA website, its record label members are losing over $300,000,000.00 per year to street piracy alone (this figure does not take into account the difficult task of calculating online piracy). Record companies, musicians, record stores, and others in the music industry have lost jobs and millions of dollars and have been forced to shut down. It seems as if filing lawsuits against unsuspecting online copyright infringers is the RIAA’s strongest ammunition in the war against music piracy.
Now that threshold of proof has been lowered with respect to what constitutes “distributes”, the record labels and RIAA are more likely to prevail in these types of lawsuits. Now, anyone who copies or distributes files, uploads files, or who makes files available for sharing without authorization, may be a target in a civil suit by record companies. This means that a person may expose themselves to liability simply by joining a peer-to-peer filing sharing network (such as Kazaa) and making files available for download. Although the record labels and the RIAA are targeting unauthorized use of music files, the same rules apply to copyrighted movies, pictures, text, and software. In addition, a judgment of willful copyright infringement against an individual may be non-dischargeable if they were forced to file for bankruptcy protection.