In the first BitTorrent copyright infringement case over pornographic videos to go to trial in the country, a federal judge has ruled in favor of the producers, finding damages of $112,500 related to one defendant.
The judge ruled from the bench on damages after a one-day nonjury trial in Philadelphia on Monday.
Two of the three defendants — only a trio remained after the original 52 were winnowed down — sued by Malibu Media settled about a month before the bellwether trial, admitting liability and maintaining their anonymity with confidentiality agreements regarding their agreed-upon damages. The remaining defendant, who had perjured himself and concealed evidence, admitted liability on the eve of trial, but his damages were left to be determined by the court.
Bryan White was handed a $112,500 verdict, plus attorney fees, for five infringements. That’s $22,500 per infringement, which U.S. District Judge Michael Baylson of the Eastern District of Pennsylvania arrived at by trebling the minimum statutory award of $750, standard practice among federal judges, and increasing it tenfold.
The attorney fees could easily double that figure — Keith Lipscomb estimated that the hours from last month alone would total $100,000. Lipscomb, of Lipscomb, Eisenberg & Baker in Miami, represented Malibu Media.
"A judge must act strongly," Baylson said before issuing the verdict, explaining, "There does have to be a penalty aspect to this."
The confidential settlements with the two other defendants were substantial, Lipscomb said. Although they are confidential, for one person who violated four infringements and another who violated 35 infringements, he said that the average settlement he gets in these cases is $7,500 and "this is by orders of magnitude bigger." Before those two settlements, the largest he said he had gotten was $20,000.
Before issuing his verdict on damages for White, Baylson explained that he’s given a great deal of attention to the case since the former chief judge of the Eastern District, J. Curtis Joyner, asked him to shepherd the dozens of similar cases through the court. Copyright laws are essential to maintain a free society, he said, emphasizing that Malibu Media is not a patent troll, but a bona fide business and copyright holder.
Lawyers had been expecting, and preparing for, a weeklong jury trial, until the third and final defendant admitted liability late last week.
During the daylong bench trial, the plaintiffs called half-a-dozen witnesses, none of whom were questioned by the defense.
Most of the testimony centered on the technical functioning of BitTorrent software, which distributes digital files, like those that hold movies or music, that have been uploaded between swarms of users, each of whom have their computers simultaneously downloading and uploading different parts of the large files.
Colette Field, who owns Malibu Media with her husband, was among the witnesses. She told the court that BitTorrent websites are the single biggest threat to her business and they cost her millions of dollars a year, with more than 300,000 people worldwide downloading her videos for free on pirating websites.
In a departure from ordinary procedure, Baylson agreed to hear testimony from Doe 13, who remained anonymous. Doe 13, who had by far the highest number of infringements, was praised by plaintiffs’ counsel for his forthrightness in admitting liability. From the stand, he apologized to Field.
Lawyers on both sides agreed that the bellwether case will have an impact around the country, largely by encouraging deterrence by Internet users.
Ronald Smith, who represented White and has a practice in Philadelphia, summed up the lesson this way: "Don’t be penny-wise and pound-foolish," pay for the videos or music that you download on the Internet.
"That’s gotta be the lesson," Lipscomb said.
Lipscomb estimated that he files about 200 suits around the country each week against, now, largely individual plaintiffs and said that the record in this trial will "distinguish us against bad actors," using the recent decision in California against Prenda, involving copyright trolls.
He summed up this case, saying of the bellwether trial, "The whole point is to sound the bell to other defendants."