Manhattan Federal Judge Kimba Wood Calls Record Companies' Request for $75 Trillion in Damages 'Absurd' in Lime Wire Copyright Case
Willkie Farr, counsel to Lime Wire, urged the judge to reject the record companies' argument that they should be awarded damages for each instance of infringement. With thousands of users and millions of downloads, Lime Wire's liability could have been staggering. Instead, she held, damages should be limited to one award per work.
By Victor Li|March 15, 2011 at 12:00 AM
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Does $75 trillion even exist? The thirteen record companies that are suing file-sharing company Lime Wire for copyright infringement certainly thought so. When they won a summary judgment ruling last May they demanded damages that could reach this mind-boggling amount, which is more than five times the national debt. Manhattan federal district court judge Kimba Wood, however, saw things differently. She labeled the record companies’ damages request “absurd” and contrary to copyright laws in a 14-page opinion. The record companies, which had demanded damages ranging from $400 billion to $75 trillion, had argued that Section 504(c)(1) of the Copyright Act provided for damages for each instance of infringement where two or more parties were liable. For a popular site like Lime Wire, which had thousands of users and millions of downloads, Wood held that the damage award would be staggering under this interpretation. “If plaintiffs were able to pursue a statutory damage theory predicated on the number of direct infringers per work, defendants’ damages could reach into the trillions,” she wrote. “As defendants note, plaintiffs are suggesting an award that is ‘more money than the entire music recording industry has made since Edison’s invention of the phonograph in 1877.’” While Wood conceded that the question of statutory interpretation was “an especially close question,” she concluded that damages should be limited to one damage award per work. “We were pleased that the judge followed both the law and the logic in reaching the conclusion that she did,” said Lime Wire’s attorney, Joseph Baio of Willkie Farr & Gallagher. “As the judge said in her opinion, when the copyright law was initiated, legislatures couldn’t possibly conceive of what the world would become with the internet. As such, you couldn’t use legislative history. Instead, the overarching issue is reasonableness in order to avoid absurd and possibly unconstitutional outcome.” Baio, who is scheduled to represent Lime Wire when the damages trial begins on May 2, joked that the money that the record companies sought from his client would be better spent on paying for health care or wiping out the national debt. Glenn Pomerantz of Munger, Tolles & Olson, who represented 13 record company plaintiffs, did not return requests for comment.
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