Statutory damages: A rarity in copyright laws internationally, but for how long?

Journal of the Copyright Society of the U.S.A.

Volumn 60, Issue 4, 2013, Pages 529-580

  Samuelson, Pamela ^a   Hill, Phil ^b   Wheatland, Tara ^c  

^a UNIVERSITY OF CALIFORNIA   (United States)

^b HARVARD UNIVERSITY   (United States)

^c Berkeley Center for Law Business and the Economy   (United States)

Author keywords

[No Author keywords available]

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EID: 84892703651     PISSN: 08863520     EISSN: None     Source Type: Journal    
DOI: None     Document Type: Review

References (140)

1. See, e.g., Pamela Samuelson & Tara Wheatland, Copyright Statutory Damages: A Remedy In Need of Reform, 51 WM. & MARY L. REV. 439, 441 (2009);
2. See also 4 MELVILLE B. NIMMER & DAVID NIMMER, NIMMER ON COPYRIGHT § 14.04[E][l][a] (2012) ("[T]he truth is that statutory damages fluctuate wildly.,").
3. See, e.g., Stephanie Berg, Remedying the Statutory Damages Remedy for Secondary Copyright Infringement Liability: Balancing Copyright and Innovation in the Digital Age, 56 J. COPYRIGHT SOC'Y 265 (2009);
4. Sheila B. Scheuerman, Due Process Forgotten: The Problem of Statutory Damages and Class Actions, 74 Mo. L. REV. 103 (2009);
5. J. Cam Barker, Note, Grossly Excessive Penalties in the Battle Against Illegal File-Sharing: The Troubling Effects of Aggregating Statutory Damages for Copyright Infringement, 83 TEX. L. REV. 525 (2004).
6. Our research suggests that the first countries to adopt copyright statutory damages provisions similar to the U.S. provision were Canada and Liberia in 1997. See Proceedings of the Standing Senate Committee on Transport and Communications (Apr. 14, 1997) (statement of Jeffrey Richstone), available at http://www.parl.gc.ca/35/2/parlbus/cornmbus/senate/Com-e/tran-e/13ev-e.htm? Language=E&Parl=35&Ses=2&comm-id=19 ("There is a new provision that we borrowed from the United States legislation called statutory damages.");
7. JOHN C. MCKEOWN, FOX ON CANADIAN LAW OF COPYRIGHT AND INDUSTRIAL DESIGNS § 24:16(a) (4th ed. 2003) ("The section is similar in a number of respects to pre-existing U.S. provisions and reference will no doubt be made to U.S. case law by Canadian courts in the future.,");
8. An Act Adopting a New Copyright Law of Liberia, 25 Liberia Code of Laws of 1956, ch. 2, § 2.42(IV) (1997), available at http://www.wipo.int/ wipolex/en/details.jsp?id=5194.
9. WIPO Lex, WIPO, http://www.wipo.int/clea/en (last visited Feb. 19, 2013).
10. Other valuable resources included: INTERNATIONAL COPYRIGHT LAW AND PRACTICE (Paul Edward Geller ed., 2012);
11. Copyright Watch, ELECTRONIC FRONTIER FOUNDATION, http://copyright-watch. org/ (last visited Feb. 19, 2013);
12. Collection of National Copyright Laws, UNESCO, http://portal.unesco.org/ culture/en/ev.php-URLJD=14076&URL-DO=DO-TOPIC&URL-SECTION=201.html (last visited Feb. 19, 2013).
13. This remedy is sometimes referred to as "pre-established damages.," E.g., Agreement on Trade Related Aspects of Intellectual Property Rights art. 45(2), Apr. 15, 1994, Marrakesh Agreement Establishing the World Trade Organization, Annex 1C, 108 Stat. 4809, 869 U.N.T.S. 299 [hereinafter "TRIPs,"], available at http://www.wto.org/english/docs- e/legal-e/27-trips.pdf; Morocco, art. 62;
14. Which Kind of Damages Are Available in IP disputes?, WORLD INTELLECTUAL PROPERTY ORGANIZATION, http://www.wipo.int/enforcement/en/faq/judiciary/faq08. html#pre (last visited Feb. 17, 2013).
15. Criminal fines are usually limited to a narrower class of infringers - willful and/or for-profit defendants - and are also subject to the stricter procedural limits of the criminal justice system. See, e.g., Law No. 24/82 of July 7, 1982 on Copyright and Neighbouring Rights, art. 101 (Congo), available at http://www.wipo.int/wipolex/en/details.jsp7id-642 ("knowing," infringers may be liable for a fine not more than 60, 000 CFA francs for the first offense and 100, 000 CFA francs or imprisonment of not more than three months, or both, for each subsequent offense);
16. Law No. 17.616 of January 10, 2003 amending Law on Copyright art. 18 (Uru.), available at http://www.wipo.int/wipolex/en/details.jsp?id=3978 (allowing, in addition to compensation, a fine of up to ten times the value of the infringed product).
17. E.g., Copyright and Neighboring Rights Protection Proclamation (No. 410/2004) § 43(5) (Eth.), available at http://www.wipo.int/wipolex/en/ details.jsp?id=5306 [hereinafter "Ethiopia Copyright Law,"]. Statutory damages make sense in moral rights cases because infringements of moral rights are in fact hard to assign a particular dollar amount.
18. A multiplier-based exemplary damages provision, separate from an award of actual damages, is a preferable alternative to an award of statutory damages because it accomplishes the goals of punishment and deterrence without the drawback of being unmoored from the copyright owner's actual harm suffered and/or the unjust enrichment of the infringer. Copyright and Related Rights Law art. 156 (2010) (Bosn. & Herz.), available at http://www.wipo.int/wipolex/ en/details.jsp?id=5932 (for intentional or grossly negligent infringement, allowing up to three times "stipulated remuneration or adequate customary remuneration,");
19. Intellectual Property Code of the Philippines (Republic Act No. 8293/1998) § 76(4), available at http://www.wipo.int/wipolex/en/details. jsp?id=3432 (allowing up to three times actual damages);
20. Law No. 83 of February 4, 1994 on Copyright and Neighboring Rights art. 79.1 (Pol.), available at http://www.wipo.int/wipolex/en/details.jsp?id=3500 (in lieu of restitution of profits, allowing two to three times equitable compensation). Indeed, this type of award meshes well with Due Process jurisprudence in the United States, which tests constitutionality, in part, by examining the ratio of punishment to compensation. See Samuelson & Wheatland, supra note 4, at 474-80, 503.
21. INT'L MONETARY FUND, WORLD ECONOMIC OUTLOOK 182-83, (2012), available at http://www.imf.org/external/pubs/ftyweo/2012/01/pdf/text.pdf.
22. The twenty-eight WIPO member states with advanced economies that do not provide statutory damages are: Australia, Austria, Belgium, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Iceland, Ireland, Italy, Japan, Luxembourg, Malta, Netherlands, New Zealand, Norway, Portugal, San Marino, Slovakia, Slovenia, Spain, Sweden, Switzerland, and the United Kingdom. Two of the advanced economies on the IMF's list are not WIPO member states: Hong Kong and Taiwan. INT'L MONETARY FUND, supra note 19, at 180. Hong Kong does not have statutory damages, while Taiwan does. Copyright Act art. 88 (last amended 2010) (Taiwan), available at http://www.tipo.gov.tw/en/AllInOne-Show. aspx?path=2557&guid=26944d88-del9-4d63-b89f-864d2bdb2dac&lang=en-us [hereinafter "Taiwan Copyright Act,"]. This Article includes a few details on Taiwan's statutory damage provision, infra Part IV, even though Taiwan is not a WIPO member state.
23. WIKIPEDIA, List of World Countries by Population, http://enwikipedia.org/ wiki/List-of-countries-by-population (last visited Feb. 19, 2013). In ascending order of total population, those countries are: Bahamas, Bahrain, Lithuania, Republic of Moldova, Liberia, Costa Rica, Singapore, Kyrgyz-stan, Bulgaria, Israel, Azerbaijan, Dominican Republic, and Belarus.
24. WIKIPEDIA, Post-Soviet States, http://en.wikipedia.org/wiki/Post-Soviet- states (last visited Feb. 19, 2013). These countries are: Azerbaijan, Belarus, Kazakhstan, Kyrgyzstan, Lithuania, Republic of Moldova, Russian Federation, and Ukraine.
25. STEPHEN F. SIWEK, COPYRIGHT INDUSTRIES IN THE U.S. ECONOMY 15 (2011), available at http://www.iipa.com/copyright-us-economy.html.
26. ANDREW GOWERS, GOWERS REVIEW OF INTELLECTUAL PROPERTY 3 (Nov. 2006), available at http://www.hm-treasury.gov.Uk/d/pbr06-gowers-report-755.pdf.
27. PRICE WATERHOUSE COOPERS, MAKING THE INTANGIBLE TANGIBLE: THE ECONOMIC CONTRIBUTION OF AUSTRALIA'S COPYRIGHT INDUSTRIES 3 (2008), available at http://www.copyright.com.au/get-information/assets/doc-uments/ Making%20the%20intangible%20tangible.pdf.
28. See Jane C Ginsburg, A Tale of Two Copyrights: Literary Property in Revolutionary France and America, 64 TUL. L. REV. 991, 991-93 (1990);
29. Jean-Luc Piotraut, An Authors' Rights-Based Copyright Law: The Fairness and Morality of French and American Law Compared, 24 CARDOZO ARTS & ENT. L.J. 549, 551-52 (2006).
30. Even in countries where no trade agreement with the United States mandates statutory damages, there is little doubt that direct or indirect influence from the United States was a factor in their adoption. The United States-pioneered range-based statutory damages for copyright infringement and statutory damages provisions in other countries frequently mirror much of the language and structure of the U.S. provision. For an exposition of the myriad ways in which one country's laws can be directly and indirectly influenced by another country, see Katerina Linos, Diffusion Through Democracy, 55 AM. J. POLL SCI. 678, 681-89 (2011), and sources cited therein.
31. Trade Agreements, U.S. TRADE REPRESENTATIVE, http://www.ustr.gov/trade- agreements (last visited Feb. 11, 2013);
32. Trade Compliance Center, U.S. DEP'T OF COMMERCE, http://tcc.export.gov/ (last visited Feb. 11, 2013).
33. U.S.-Australia, art. 17.11(7)(b); Brad Sherman & James Lahore, Australia, in INTERNATIONAL COPYRIGHT LAW AND PRACTICE, AUS § 8[4][a][ii] (Paul Edward Geller ed., 2012) (discussing additional damages).
34. See infra Part IV. Our information on Costa Rica comes from an IIPA report, which confirms statutory damages but provides little detail on the provision itself. INT'L INTELLECTUAL PROP. ALLIANCE, 2013 SPECIAL 301 REPORT ON COPYRIGHT PROTECTION AND ENFORCEMENT 53 (2013) [hereinafter "2013 IIPA REPORT,"], available at http://www.iipa.com/2013-SPEC301-TOC.htm.
35. See INT'L INTELLECTUAL PROP. ALLIANCE, 2012 SPECIAL 301 REPORT ON COPYRIGHT PROTECTION AND ENFORCEMENT 60 (2012) [hereinafter "2012 IIPA REPORT"] (Costa Rica "also responded to a number of matters needed for CAFTA implementation, including⋯ pre-established (or statutory) damages in civil judicial proceedings,");
36. Dominican Republic, infra Appendix A (enacting amendments providing, inter alia, statutory damages in Law No. 424-06, Implementation of the Dominican Republic-Central America-United States Free Trade Agreement); Jay (Young-June) Yang & Chang-Hwan Shin, Korea, in INTERNATIONAL COPYRIGHT LAW AND PRACTICE, KOR § 1[3] (Paul Edward Geller ed., 2012) (noting that statutory damages, inter alia, will become effective when the U.S.-Korea Free Trade Agreement becomes effective).
37. The Industry Trade Advisory Committees are bodies organized under the Secretary of Commerce and the U.S. Trade Representative (USTR), which "provide⋯ detailed policy and technical advice, information, and recommendations to the Secretary and the USTR regarding trade barriers, negotiation of trade agreements, and implementation of existing trade agreements affecting its subject area.," U.S. DEP'T OF COMMERCE & U.S. TRADE REPRESENTATIVE, CHARTER OF THE INDUSTRY TRADE ADVISORY COMMITTEE ON INTELLECTUAL PROPERTY RIGHTS 1 (2010), available at http://www.trade.gov/itac/committees/ Charters/Intellectual-Property-Rights-ITAC.pdf. ITAC-15 is responsible for the subject area of intellectual property rights.
38. INDUS. TRADE ADVISORY COMM. ON INTELLECTUAL PROP. RIGHTS (ITAC-15), THE U.S.-COLOMBIA TRADE PROMOTION AGREEMENT (TPA): THE INTELLECTUAL PROPERTY PROVISIONS 21 (2006), available at http://www.ustr.gov/archive/assets/Trade- Agreements/Bilateral/Colombia-FTA/Reports/as-set-upload-file605-9835.pdf.
39. See, e.g., INT'L INTELLECTUAL PROP. ALLIANCE, POSITION PAPER OF THE INTERNATIONAL INTELLECTUAL PROPERTY ALLIANCE, FOR THE AMERICAS BUSINESS FORUM (ABF) VIII, - WORKSHOP ON INTELLECTUAL PROPERTY RIGHTS, MIAMI, FL, U.S.A. 2 (2003), available at http://www.iipa.com/rbi/2003-Aug29-FTAA-ABF-Miami-Position- Paper.pdf (recommending that such provisions be incorporated into national law).
40. Ruth L. Okedeji, Back to Bilateralism? Pendulum Swings in International Intellectual Property Protection, 1 U. OTTAWA L. & TECH. J. 125, 134 (2003).
41. Michael D. Birnhack, Trading Copyright: Global Pressure on Local Culture 9, in THE DEVELOPMENT AGENDA: GLOBAL INTELLECTUAL PROPERTY AND DEVELOPING COUNTRIES 371 (Neil Weinstock Netanel ed., 2007), available at http://papers.ssrn.com/sol3/papers.cfm?abstract-id=1020774; Okedeji, supra note 55 at 134-35. Surprisingly, a 1994 amendment to the Trade Act allows the USTR to find a country's IP protections inadequate even where that country is compliant with TRIPs. Birnhack, supra, at 9 n.43.
42. The USTR primarily bases its Special 301 Reports on submissions by the IIPA and PhRMA, an organization representing biotech and pharmaceutical companies, whose comments focus on issues relating to medicines. James Love, USTR's New Hearings on 301 List, KNOWLEDGE ECOLOGY INT'L (Jan. 12, 2010, 9:10 PM), http://keionline.org/node/745.
43. See Country Reports, INT'L INTELLECTUAL PROP. ALLIANCE, http://www.iipa.com/countryreports.html (last visited Feb. 17, 2013); Love, supra note 58; Birnhack, supra note 56, at 391.
44. Birnhack, supra note 56, at 391; DUNCAN MATTHEWS, GLOBALISING INTELLECTUAL PROPERTY: THE TRIPS AGREEMENT 25-27 (2002);
45. MICHAEL P. RYAN, KNOWLEDGE DIPLOMACY: GLOBAL COMPETITION AND THE POLITICS OF INTELLECTUAL PROPERTY 80 (1998). Although the USTR's Special 301 Reports do not explicitly cite the IIPA's submissions, "they do address issues raised in the IIPA reports, echoing its complaints and occasionally its language.," Birnhack, supra note 56, at 391.
46. Although the IIPA offers many complaints about statutory damages, only Israel has been criticized specifically about statutory damages in the official USTR Special 301 Reports. See RONALD KIRK, 2012 SPECIAL 301 REPORT 37 (2012), available at http://www.ustr.gov/sites/default/files/2012%20Spe- cial%20301%20Report-0.pdf (encouraging Israel to "amend its copyright law to provide for statutory damages," even though Israel has had statutory damages at least since 2001);
47. RONALD KIRK, 2011 SPECIAL 301 REPORT 30 (2011), available at http://www.ustr.gov/webfm-send/2849 (same).
48. The USTR has criticized China's civil damages regime generally as "inadequate.," RONALD KIRK, 2010 SPECIAL 301 REPORT 21 (2010), available at http://www.ustr.gov/webfm-send/1906.
49. The 2005 report on Singapore also criticized the absence of a minimum recovery and questioned whether the maximum award amounts are high enough. The IIPA's full comments were as follows: Although the USSFTA Article 16.9.9 requires that Singapore provide right holders with an option for "pre-established," damages, amended section 119 of the Act creates a system in which the court may, in all cases in which statutory damages are elected, award merely nominal, or even zero, damages. This frustrates the goals of predictability and deterrence which statutory damages aim to achieve. The $200, 000 (US $122, 000) ceiling on statutory damages in a single lawsuit should also be increased in order to achieve deterrence. INT'L INTELLECTUAL PROP. ALLIANCE, 2005 SPECIAL 301 REPORT DISPUTE SETTLEMENT 2, available at http://www.iipa.com/pdf/ IIPA%20301%20FTA%20DISPUTE%20SETTLEMENT%20SINGAPORE.pdf.
50. INT'L INTELLECTUAL PROP. ALLIANCE, 2010 SPECIAL 301 REPORT ON COPYRIGHT PROTECTION AND ENFORCEMENT 207-08 (2010), available at http://www.iipa.com/rbc/ 2010/2010SPEC301ISRAEL.pdf. The IIPA does regard the increase in the statutory maximum as favorable. Id. at 207.
51. INT'L INTELLECTUAL PROP. ALLIANCE, 2009 SPECIAL 301 REPORT ON COPYRIGHT PROTECTION AND ENFORCEMENT 298 (2009), available at http://www.iipa.com/rbc/ 2009/2009SPEC301SOUTHKOREA.pdf.
52. INT'L INTELLECTUAL PROP. ALLIANCE, 2001 SPECIAL 301 REPORT ON COPYRIGHT PROTECTION AND ENFORCEMENT 121 (2001), available at http://www.iipa.com/rbc/ 2001/2001SPEC301ISRAEL.pdf.
53. See, e.g., PEDRO ROFFE, BILATERAL AGREEMENTS AND A TRIPS-PLUS WORLD: THE CHILE-USA FREE TRADE AGREEMENT 44 (2004), available at http://www.quno.org/ geneva/pdf/economic/Issues/Bilateral-Agreements-and-TRIPS-plus-English.pdf ("In the Chilean system, damages are only supposed to compensate for the losses caused by the injury. So, theoretically, damages may never exceed the actual prejudice suffered by the right holder. The obligation of statutory damages alters drastically the Chilean general system of compensatory damages upon which IPRs had traditionally relied.,"); see also infra Part IV.A (purposive limitations).
54. For example, the Canadian government created a website to announce the Copyright Modernization Act; in that site's FAQ, the government asks and answers: "Will the Bill allow record labels to sue individuals and groups for large amounts, like in the U.S.? This Bill ensures that Canadians will not face disproportionate penalties for minor infringements of copyright by distinguishing between commercial and non-commercial infringement.," Questions and Answers, GOV'T OF CANADA (Nov. 29, 2011), available at http://balancedcopyright.gc.ca/eic/site/crp-prda.nsf/eng/h-rp01153.html#record. For a more detailed analysis of some of the problems that have arisen in the application of the statutory damages provision in the United States, See Samuelson & Wheatland, supra note 4, at 480-91.
55. See, e.g., On Davis v. Gap, Inc., 246 F.3d 152, 172 (2d Cir. 2001) ("The purpose of punitive damages - to punish and prevent malicious conduct - is generally achieved under the Copyright Act through the provisions of 17 U.S.C. § 504(c)(2), which allow increases to an award of statutory damages in cases of willful infringement."); Nat'l Football League v. PrimeTime 24 Joint Venture, 131 F. Supp. 2d 458, 478 n.17 (S.D.N.Y. 2001) (noting that statutory damages are "partly punitive,"). For more cases demonstrating the punitive nature of some awards of statutory damages, See Samuelson & Wheatland, supra note 4, at 460 n.89 and accompanying text.
56. Compare H.R. REP. NO. 94-1476, at 161 (1976) ("[T]he plaintiff in an infringement suit is not obligated to submit proof of damages and profits and may rely on the provision for minimum statutory damages." (emphasis added)), Video Views, Inc. v. Studio 21, Ltd., 925 F.2d 1010, 1016-17 (7th Cir. 1991) ("If a copyright owner seeks only 'minimum' statutory damages, the record on damages need not be developed at all. If a greater amount of statutory damages is sought, the district court may make the appropriate award when the evidentiary record adequately supports that determination.,"), and Peer Int'l Corp. v. Luna Records, Inc., 887 F. Supp. 560, 568 (S.D.N.Y. 1995) (Sotomayor, J.) ("Statutory damages should bear some relationship to the actual damages suffered by copyright infringement.,"), with New Form, Inc. v. Tekila Films, Inc., 357 Fed. App'x 10, 11-12 (9th Cir. 2009) ("There is no required nexus between actual and statutory damages under 17 U.S.C. § 504(c).,"), and Superior Form Builders, Inc. v. Dan Chase Taxidermy Supply Co., 74 F.3d 488, 496-97 (4th Cir. 1996). Cf. L.A. Westermann Co. v. Dispatch Printing Co., 249 U.S. 100, 108-09 (1919) (discussing statutory damages under the 1909 Copyright Act: "[T]he minimum amount appears to us to have been fixed because of the inherent difficulty of always proving by satisfactory evidence what the amount is which has been actually sustained." (emphasis added));
57. Brady v. Daly, 175 U.S. 154, 157 (1899) (discussing statutory damages under the 1831 Copyright Act: "In the face of the difficulty of determining the amount of such damages in all cases, the statute provides a minimum sum for a recovery in any case, leaving it open for a larger recovery upon proof of greater damage in those cases where such proof can be made." (emphasis added)).
58. *2 (D. Conn. Apr. 13, 2009) (awarding $50, 000 to approximate Plaintiff's lost profits);
59. Pret-A-Printee, Ltd. v. Allton Knitting Mills, Inc., No. 81 Civ. 3770, 1982 WL 1788 (S.D.N.Y. 1982 Sept. 16, 1982).
60. See, e.g., Broad. Music, Inc. v. Spring Mount Area Bavarian Resort, Ltd., 555 F. Supp. 2d 537, 545 (E.D. Penn. 2008) (justifying statutory damages above plaintiffs request because, during the relevant time, "Defendants were on repeated notice of their infringement, were continually offered a simple and straightforward opportunity to terminate their infringement, and opted instead to flatly ignore Plaintiffs' attempts to resolve this dispute.,");
61. cf. United States v. Halper, 490 U.S. 435, 448 (1989) ("[A] civil sanction that cannot fairly be said solely to serve a remedial purpose, but rather can only be explained as also serving either retributive or deterrent purposes, is punishment, as we have come to understand the term.,").
62. See, e.g., Pedrosillo Music, Inc. v. Radio Musical, Inc., 815 F. Supp. 511, 517 (D.P.R. 1993) (awarding less than $10, 000 "would not deter [this] defendant from continuing to violate the copyright laws.");
63. Int'l Korwin Corp. v. Kowalczyk, 855 F.2d 375, 383 (7th Cir. 1988) (increased statutory damages may be necessary in a particular case to prove to a defendant that it "costs less to obey the copyright laws than to violate them[.],");
64. cf. Melvin Halpern, The Sound Recording Act of 1971: An End to Piracy on the High ©'s?, 40 GEO. WASH. L. REV. 964, 992 (1972) (noting inadequacy of statutory damages under 1909 Act to deter the same defendant from continuing the same infringing acts after being held liable).
65. This purpose is sometimes called "specific deterrence.," See Yurman Design, Inc. v. PAJ, Inc., 93 F. Supp. 2d 449 (S.D.N.Y. 2000)
66. (sustaining jury award "as both a specific and general deterrent to future infringement,"), so The distinction appears slight, but is important. All remedies have some general deterrent value because, so the argument goes, a decision against one defendant sends a message to other similarly situated potential defendants that they are equally at risk. See Mitchell Polinsky & Steven Shavell, Punitive Damages: An Economic Analysis, 111 HARV. L. REV. 869, 877 (1998) (defining general deterrence as "the effect that the prospect of having to pay damages will have on the behavior of similarly situated parties in the future (and not just on the party at hand).,").
67. Thus, an award that embodies compensation, retribution, and/or specific deterrence provides general deterrent value without augmenting further the remedy imposed on the defendant at bar. Cf. Sure-Tan, Inc. v. NLRB, 467 U.S. 883, 904 n.13 (1984) (recognizing that compensatory remedies for discriminatory discharges under the National Labor Relations Act, such as reinstatement and backpay, provide "deterrence against unfair labor practices" in addition to "meaningful relief for illegally discharged employees,").
68. When the desire for general deterrence is a separate and additional component of the award against the defendant at bar, the situation is starkly different. The award ceases to be a reflection of the controversy between the two parties - severing the connection between the conduct at issue and the award imposed - and instead becomes about the conduct of non-parties, i.e., strangers to the litigation. See, e.g., Sony BMG Music Entm't v. Tenenbaum, 660 F.3d 487, 504 (1st Cir. 2011) (approving a jury instruction providing a non-exclusive list of factors to consider including "the need to deter this defendant and other potential infringers" (emphasis added)); Fitzgerald Publ'g Co., Inc. v. Baylor Publ'g Co., Inc., 807 F.2d 1110, 1117 (2d Cir. 1986) (noting that courts may consider the deterrent effect on others besides the defendant);
69. *5 (S.D.N.Y. Aug. 16, 2001) (concluding that "a substantial award is necessary to deter" the defendant specifically and justifying it as an award that "will serve to deter other potential infringers");
70. *2 (N.D. Cal. Oct. 1, 2010) (reducing statutory damages down to an amount the court found "sufficient to deter other potential infringers.,");
71. cf. Phillip Morris USA v. Williams, 549 U.S. 346, 353 (2007) ("[T]he Constitution's Due Process Clause forbids a State to use a punitive damages award to punish a defendant for injury that it inflicts upon nonparties or those whom they directly represent, i.e., injury that it inflicts upon those who are, essentially, strangers to the litigation.,").
72. Apart from unmooring the civil remedy from the conduct at bar, there is also worry about double counting. See State Farm Mut. Auto. Ins. Co. v. Campbell, 538 U.S. 408, 423 (2003) (Breyer, J., concurring) ("Larger damages might also 'double count' by including in the punitive damages award some of the compensatory, or punitive damages that subsequent plaintiffs would also recover⋯. "). The same "double counting," concern is undoubtedly present where statutory damages serve the same purpose.
73. See, e.g., Alberto Bercovitz & German Bercovitz Milagros del Corral, Spain, in INTERNATIONAL COPYRIGHT LAW AND PRACTICE, SPA § 8[4][a][iii] (Paul Edward Geller ed., 2012) ("Spanish civil law in principle does not allow punitive damages.,");
74. Adam Liptak, Foreign Courts Wary of U.S. Punitive Damages, N.Y. TIMES, Mar. 26, 2008),
75. at Al (citing Italian court which explains, "[P]rivate lawsuits brought by injured people should have only one goal - compensation for a loss.,"). Many countries do not have punitive damages at all in the civil system. Liptak supra ("Most of the rest of the world views the idea of punitive damages with alarm.,"). Some countries have refused to enforce punitive damage awards from the U.S. courts. Id. (citing Italy and Germany). In contrast, many countries provide criminal penalties, including fines, which explicitly serve punitive goals. This view is reflected in their copyright laws. Although some countries have "exemplary damages," most rely on actual damages and profits for monetary remedies. See Lionel Bently & William R. Cornish, United Kingdom, in INTERNATIONAL COPYRIGHT LAW AND PRACTICE, UK § 8[4][a][iii] (Paul Edward Geller ed., 2012) (noting that even in the United Kingdom, where additional damages are available, "their award seems to be the exception rather than the rule,").
76. See St. Louis I.M. & S.R. Co. v. Williams, 251 U.S. 63, 64 (1919) (characterizing statutory damages as "essentially penal" and "primarily intended to punish,");
77. See also BMW of N. Am v. Gore, 517 U.S. 559, 575 (1996) (describing Williams, a case involving statutory damages, as holding that a "punitive award may not be wholly disproportioned to the offense" (emphasis added));
78. see generally Scheuerman, supra note 6; Samuelson & Wheatland, supra note 4;
79. cf. Webloyalty.com, Inc. v. Consumer Innovations, LLC, 388 F. Supp. 2d 435, 443 (D. Del. 2005) (finding that a $25, 000 award balanced the need, on the one hand, to punish "unsupportable" conduct and deter infringement, and, on the other hand, to ensure that a statutory award "do[es] not amount to a windfall for Webloyalty in a case where no actual damages have been shown.,").
80. See, e.g., Copyright Act (Act No. 8/2011) § 72(5) (Sierra Leone), available at http://www.sierralii.Org/sl/legislation/act/2011/8 ("Where there is a danger that an act of infringement may be continued, the court shall (a) expressly order that the act shall not be committed; and (b) fix a fine which is twice the original fine, which shall be paid if the order is not respected.,");
81. Copyright Act (Act No. 12 of 2002) §28(4) (Tonga), available at http://www.wipo.int/wipolex/en/details.jsp?id=5270 ("Where there is a danger that acts of infringement may continue, the Court shall order that no further acts be committed and fix a fine not exceeding $20, 000 which shall be due if the order is not respected.,");
82. Copyright (Amendment) (Act No. 5/2008) § 38(6) (Trin. & Tobago), available at http://www.wipo.int/wipolex/en/details.jsp?id=6642 ("Where there is a danger that acts of infringement may be continued, the Court shall have the authority to order that such acts not be committed and the Court shall fix a fine of five thousand dollars for each day on which the infringement is continued, which fine shall be paid if the order is not respected.,").
83. See, e.g., Masters v. UHS of Delaware, Inc., 631 F.3d 464, 473 (8th Cir. 2011) (in trademark action under the Lanham Act, noting "[disgorgement exists to deter would-be infringers⋯");
84. Official Comm. of Unsecured Creditors of WorldCom, Inc. v. Sec. & Exch. Comm'n, 467 F.3d 73, 81 (2d Cir. 2006) ("[T]he primary purpose of disgorgement orders is to deter violations of the securities laws by depriving violators of their ill-gotten gains."
85. (quoting Sec. & Exch. Comm'n v. Fischbach Corp., 133 F.3d 170, 175 (2d Cir. 1997));
86. BASF Corp. v. Old World Trading Co., Inc., 41 F.3d 1081, 1096 (7th Cir. 1994) (noting that a disgorgement remedy in Lanham Act case "may overcompensate for a plaintiff's actual injury and create a windfall judgment"; however, a court "may consider the need to deter further violations to protect the public at large."
87. (quoting George Basche Co. v. Blue Coral, Inc., 968 F.2d 1532, 1540 (2d Cir. 1992));
88. Sec. & Exch. Comm'n v. First City Fin. Corp., 890 F.2d 1215, 1230 (D.C. Cir. 1989) (noting for SEC violation that "[disgorgement is an equitable remedy designed to deprive a wrongdoer of his unjust enrichment and to deter others from violating the securities laws.");
89. JAMES T. O'REILLY, 1 FOOD AND DRUG ADMINISTRATION, § 7:32 (2012) ("Disgorgement⋯ deters violations of the law by making illegal activity unprofitable").
90. 6 WILLIAM F. PATRY, PATRY ON COPYRIGHT § 22.181 (2013) (emphasis added). Patry proceeds to describe a court adopting a general deterrence theory as an outlier.
91. Nintendo of Am., Inc. v. Dragon Pac. Int'l, 40 F.3d 1007, 1010 (9th Cir. 1994) ("The district court has wide discretion in setting the amount of statutory damages under the Copyright Act.");
92. Harris v. Emus Records Corp., 734 F.2d 1329, 1335 (9th Cir. 1984) ("The court has wide discretion in determining the amount of statutory damages to be awarded, constrained only by the specified maxima and minima.").
93. Los Angeles News Serv. v. Reuters Television Int'l, 149 F.3d 987, 996 (9th Cir. 1998) ("[A] plaintiff may recover statutory damages 'whether or not there is adequate evidence of the actual damages suffered by plaintiff or of the profits reaped by defendant.'")
94. (quoting Harris v. Emus Records Corp., 734 F.2d 1329, 1335 (9th Cir. 1984)). The legislative history of the 1976 Act is no more illuminating than the statute itself, stating only that "there is nothing in section 504 to prevent a court from taking account of evidence concerning actual damages and profits in making an award of statutory damages within the range set out in subsection (c)." H.R. REP. NO. 94-1476, at 161 (1976); S. REP. NO. 94-473, 143-44 (1975).
95. Peer Int'l Corp. v. Luna Records, Inc., 887 F. Supp. 560 (S.D.N.Y. 1995).
96. After the Supreme Court decided that the Seventh Amendment requires the right to a jury trial on statutory damages, David Nimmer wrote, "It is daunting, to say the least, to imagine how a judge could craft jury instructions that replace the type of analysis the court itself would undertake" because the setting of statutory damages "often involves extensive analysis of precedent so as to create a statutory-damages regime consistent across a spectrum of cases[;]⋯ [i]t is not clear how a jury ever can perform this type of analysis." David Nimmer & Jason Sheesby, After Feltner, How Will Juries Decide Damages?, NAT'L L.J., Feb. 8, 1999, at C19.
97. Three examples will illustrate the point. In one series of cases, the same plaintiff recording company sued several different entities for continuing to make and sell records after their statutory license was terminated, and in three different suits, obtained three different statutory damages awards. Peer Int'l Corp. v. Luna Records, Inc., 887 F. Supp. 560, 569 (S.D.N.Y. 1995) ($10, 000 per work); Peer Int'l Corp. v. Max Music & Entm't, Inc., No. 03 Civ. 0996KMWDF, 2004 WL 1542253 (S.D.N.Y. July 9, 2004) ($30, 000 per work);
98. Peer Int'l Corp. v. Pausa Records, Inc., 909 F.2d 1332 (9th Cir. 1990) ($50, 000 per work). In another case, several recording companies brought suit against an individual file-sharer and the first jury awarded statutory damages of $9, 250 per song for a total award of $220, 000; after a mistrial on unrelated grounds (although the court noted concerns about the large damage award), a second jury, on the same facts, awarded $80, 000 per song for a total award of $1.92 million; the judge remitted the award down to $2, 250 per song for a total of $54, 000; when the plaintiffs opted for a third trial, it resulted in a $1.5 million judgment. Capitol Records, Inc. v. Thomas-Rasset, 692 F.3d 899, 901-02 (8th Cir. 2012). A similar fate befell Elvin Feltner who, after a judge set a statutory award, sought and obtained a ruling from the United States Supreme Court that he was entitled to a jury trial on the issue of statutory damages; on remand, a jury awarded more than three times the original judge-made award, producing an award over $31 million.
99. Columbia Pictures Television, Inc. v. Krypton Broad., Inc., 259 F.3d 1186 (9th Cir. 2001) (recounting facts and procedural history, and affirming jury award).
100. Interestingly, although the IIPA has lodged many complaints about Israel's copyright statute, including complaints about statutory damages provision, it has not complained that these factors limit courts' ability to invoke a broad general deterrence rationale in individual cases. The IIPA has repeatedly complained that the statutory maximum and minimum - not the awards set within those limits - are insufficient to "have a deterrent impact on piracy." See, e.g., INT'L INTELLECTUAL PROP. ALLIANCE, 2008 SPECIAL 301 REPORT ON COPYRIGHT PROTECTION AND ENFORCEMENT 223 (2008), available at http://www.iipa.com/rbc/2008/2008SPEC301ISRAEL.pdf.
101. In this regard, the deterrent sought may be only the threat embodied in the statute, similar to criminal charges. cf. Richard A Oppel Jr., Sentencing Shift Gives New Leverage to Prosecutors, NEW YORK TIMES (Sept. 25, 2011), at Al.
102. Compare Azerbaijan, art. 45(2), with Law of the Republic of Azerbaijan on Legal Protection of Topographies of Integrated Circuits, art. 13.4.2 (2008) (authorizing payment between 220 and 5, 500 Manats), available at http://www.wipo.int/wipolex/en/details.jsp?id=9166.
103. Ethiopia Copyright Law, supra note 16, § 33(4); Copyright (Amendment) Act No. IX of 2009, §§ 44(1), 44(4) (Malta), available at http://www.wipo.int/wipolex/en/details.jsp?id=8168. In some ways, the case for applying statutory damages to violations of moral rights is stronger than the case for applying them to violations of economic rights: Moral rights are less susceptible to a monetary valuation, and thus a substitute remedy to avoid denying recovery altogether seems appropriate.
104. *2 (D. Mass. Aug. 23, 2012) (rejecting remittitur, citing evidence that Tenenbaum downloaded and distributed "thousands of copyrighted works" even though the suit concerned only 30 of those works).
105. 17 U.S.C. § 504(c)(1) (2006). Prompt registration of the copyright in the work at issue is the only barrier to the recovery of statutory damages. 17 U.S.C. § 412 (2006). However, this requirement is intended not as a limit on the availability of statutory damages, but as an inducement to prompt registration of one's copyright interest. Blanch v. Koons, 329 F. Supp. 2d 568, 570 nl (S.D.N.Y. 2004) ("If punitive damages [were] available to a plaintiff who did not timely register [his] work, the statutory purpose of encouraging copyright registration [would be] frustrated."). As far as we can tell, no other country yet uses registration as a condition to the awarding of statutory damages, perhaps recognizing that doing so would unfairly deny a remedy (which is itself designed to combat unfairness) to parties who lack the sophistication and familiarity with copyright law to register their works at an early stage. See Samuelson & Wheatland, supra note 4, at 454-55; see generally John Tehranian, The Emperor Has No Copyright: Registration, Cultural Hierarchy and the Myth of American Copyright Militancy, 24 BERKELEY TECH. L.J. 1397 (2009).
106. See, e.g., F.W. Woolworth Co. v. Contemporary Arts, Inc., 344 U.S. 228, 231 (1952) (noting that statutory damages "give the owner of a copyright some recompense for injury done him, in a case where the rules of law render difficult or impossible proof of damages or discovery of profits")
107. (quoting Douglas v. Cunningham, 294 U.S. 207, 209 (1935));
108. Lowry's Reports, Inc. v. Legg Mason, Inc., 302 F.Supp.2d at 460 ("Statutory damages exist in part because of the difficulties in proving - and providing compensation for - actual harm in copyright infringement actions.");
109. See also STAFF OF U.S. COPYRIGHT OFFICE, 87TH CONG., REPORT OF THE REGISTER OF COPYRIGHTS ON THE GENERAL REVISION OF THE U.S. COPYRIGHT LAW 102 (Comm. Print 1961) ("The value of a copyright is, by its nature, difficult to establish, and the loss caused by an infringement is equally hard to determine. As a result, actual damages are often conjectural, and may be impossible or prohibitively expensive to prove.").
110. Motion for Preliminary Injunction, at 2-3, Arista v. Lime Wire, June 4, 2010.
111. Plaintiffs in the LimeWire lawsuit allegedly requested up to $75 trillion in statutory damages, which is more money than the GDP of the entire world combined as of 2011. See Sarah Jacobsson Purewal, RIAA Thinks LimeWire Owes $75 Trillion in Damages, PCWORLD (Mar. 26, 2011). http://www.pcworld.com/article/223431/riaa-thinks-limewire-owes-75-trillion-in- damages.html.
112. Canada, § 38.1(2). Although the term "single medium" is the subject of some controversy, in 2006 a court used the "special case" exception, a component of which is the "single medium" requirement, to impose a statutory award below the minimum on a defendant that operated a website that allowed subscribers to watch various programs owned and produced by the plaintiffs. Telewizja Polsat Canada, Inc. v. Radiopol, Inc., 2006 FC 584 (Lemieux, J., May 10, 2006). The reduction applied to all 2, 009 works at issue, at least some of which were unrelated, indicating that "single medium" is broader in scope than the U.S. "one work rule" in § 504(c)(1) which treats only parts of a compilation or derivative work as one work. See also Ysolde Gendreau & David Vaver, Canada, in INTERNATIONAL COPYRIGHT LAW AND PRACTICE CAN § 8[4][a][ii][b] (Paul Edward Geller ed., 2012) (offering a multimedia CD-ROM as an example of a "single medium").
113. Bryan Mercurio, TRIPS-Plus Provisions in FTAs: Recent Trends, in REGIONAL TRADE AGREEMENTS AND THE WTO LEGAL SYSTEM, 215-37 (Lorand Bar-tels, Federico Ortino eds., 2006); Okedeji, supra note 55, at 128-29.
114. See ARNAND GROVER, REPORT OF THE SPECIAL RAPPORTEUR ON THE RIGHT OF EVERYONE TO THE ENJOYMENT OF THE HIGHEST ATTAINABLE STANDARD OF PHYSICAL AND MENTAL HEALTH 96 (2009) (U.N. Doc. A/HRC/11/12) ("Flexibilities were included in TRIPS to allow States to take into consideration their economic and development needs. States need to take steps to facilitate the use of TRIPS flexibilities.");
115. see generally Henning Grosse Ruse-Khan, The International Law Relation Between TRIPS and Subsequent TRIPS-plus Free Trade Agreements: Towards Safeguarding TRIPS Flexibilities?, 18 J. INTELL. PROP. L. 325 (2011).
116. As some have noted, this agreement is properly termed "plurilateral" because it included numerous parties but is still closed to voluntary additions to the negotiating table. See, e.g., Catherine Saez, ACTA A Sign Of Weakness In Multilateral System, Intellectual Property Watch, WIPO Head Says, IP-WATCH (June 30, 2010), http://www.ip-watch.org/weblog/ 2010/06/30/acta-a-sign-of-weakness-in-multilateral-system-wipo-head-says.
117. Some have speculated that countries that wish to change the international landscape of intellectual property law are frustrated with WIPO and have turned to a solution somewhere between the multilateralism of WIPO and the bilateralism/regionalism of numerous individual agreements. Michael Geist, The ACTA Threat to the Future of WIPO, INTELLECTUAL PROPERTY WATCH (Apr. 14, 2009), http://www.ip-watch.org/weblog/2009/04/14/the-acta-threat-to-the-future-of-wipo.
118. Eric Pfanner, In Secret, Nations Work Toward Crackdown on Piracy, N.Y. TIMES (Feb. 8, 2010), http://www.nytimes.com/2010/02/08/technology/08piracy. html;
119. Nate Anderson, Secret ACTA Treaty Can't Be Shown to Public, Just 42 Lawyers, ARS TECHNICA (Oct. 15, 2009), http://arstechnica.com/tech-policy/news/ 2009/10/these-42-people-are-shaping-us-internet-enforcement-policy.ars.
120. Michael Geist, The ACTA Internet Chapter: Putting the Pieces Together, MICHAEL GEIST (NOV. 3, 2009), http://www.michaelgeist.ca/content/view/4510/125. According to Geist, parts of the treaty appear to have been based on a trade agreement signed with South Korea, which included a provision mandating statutory damages.
121. A leaked draft dated January 18, 2010, indicated that the United States and Japan wished the treaty language to read that countries "shall" impose either pre-established damages or an alternative presumption for determining damages, while the EC, Canada, and New Zealand would provide that countries "may" impose such remedies. Michael Geist, Putting Together the ACTA Puzzle: Privacy, PIP Major Targets, MICHAEL GEIST (Feb. 3, 2009), http://www.michaelgeist.ca/content/view/3660/125/ (noting that some countries other than the United States would like the imposition of statutory damages to be optional).
122. Anti-Counterfeiting Trade Agreement (ACTA), UNITED STATES TRADE REPRESENTATIVE, http://www.ustr.gov/acta (last visited Feb. 17, 2013).
123. Signing by Mexico on the Anti-Counterfeiting Trade Agreement (ACTA), MINISTRY OF FOREIGN AFFAIRS OF JAPAN (July 12, 2012), http://www.mofa.go.jp/ policy/economy/i-property/actal207.html;
124. ACTA Controversial Anti-Piracy Agreement Rejected by EU, BBC NEWS, July 4, 2012, http://www.bbcxo.uk/news/technology-18704192.
125. press Release, International Trademark Association, Japan Ratifies ACTA (Sept. 6, 2012), available at http://www.inta.org/Press/Pages/JapanRatifiesACTA. aspx.
126. See, e.g., Trans Pacific Partnership Agreement, ELECTRONIC FRONTIER FOUNDATION, https://www.eff.org/issues/tpp (last visited Feb. 17, 2013).
127. Zach Carter, Darrell Issa Questions Obama On Trans-Pacific Partnership, Leaks Key Text of Trade Deal, HUFFINGTON POST (May 16, 2012), http://www.huffingtonpost.com/2012/05/16/darrell-issa-trans-pacific-partnership- trade-deal-n-1521035.html (quoting Issa: "While the Obama administration speaks publicly about protecting open Internet and delivering open government, they continue pushing secretive agreements like ACTA and TPP that exclude the public and could undermine individual privacy rights and stifle innovation⋯. They need to explain this apparent inconsistency.").
128. Trans-Pac. P'ship, Intellectual Property Rights Chapter art. 12(4) (Feb. 10, 2011) (draft), available at http://keionline.org/sites/default/files/tpp- 10feb2011-us-text-ipr-chapter.pdf.
129. See The Register's Call for Updates to U.S. Copyright Law, U.S. COPYRIGHT OFFICE (Mar. 20, 2013) (statement of Maria A. Pallante), available at http://www.copyright.gov/regstat/2013/regstat03202013.html;
130. Maria A. Pallante, The Next Great Copyright Act, 37 COLUM. J.L. & ARTS 315 (2013).
131. See, e.g., State Farm Mut. Auto. Ins. Co. v. Campbell, 538 U.S. 408 (2003);
132. BMW of N. Am. v. Gore, 517 U.S. 559 (1996).
133. INT'L INTELLECTUAL PROP. ALLIANCE, 2009 SPECIAL 301 REPORT ON COPYRIGHT PROTECTION AND ENFORCEMENT 298 (2009), available at http://www.iipa.com/rbc/ 2009/2009SPEC301SOUTHKOREA.pdf.
134. RONALD KIRK, 2009 SPECIAL 301 REPORT 1, 10 (2009), available at http://www.ustr.gov/sites/default/files/ Full%20Version%20of%20the%202009%20SPECIAL%20301%20REPORT.pdf.
135. F.W. Woolworth Co. v. Contemporary Arts, Inc., 344 U.S. 228, 231 (1952).
136. See supra note 76 and accompanying text; Morley Music Co. v. Dick Stacey's Plaza Motel, Inc., 725 F.2d 1, 3 (1st Cir. 1983) ("Although there need not be the kind of hearing required if factual damages were the issue⋯ there must, we think, be either some hearing or sufficient affidavits to give the trial judge an adequate reference base for his judgment." (emphasis added));
137. Cohen v. United States, 105 Fed. CI. 733, 758 (2012) (endorsing, in an alternative holding, the Video Views rule, "[E]ven if a plaintiff were permitted to elect a range of statutory damages, in order to receive more than the minimum award, the plaintiff must support that request with sufficient evidence.");
138. New Line Cinema Corp. v. Russ Berrie & Co., 161 F. Supp. 2d 293, 303 (S.D.N.Y. 2001) (rejecting New Line's argument that "because [the] infringement was 'willful,' [the court] should use the discretion conferred on [it] by § 504(c)(1) to increase any award up to $100, 000; instead, holding that "statutory damages should be commensurate with actual damages incurred" and that "the proper departure point" was the evidence of actual damages);
139. See also Brady v. Daly, 175 U.S. 154, 157 (1899) (construing the 1856 Copyright Act, "In the face of the difficulty of determining the amount of [actual] damages in all cases, the statute provides a minimum sum for a recovery in any case, leaving it open for a larger recovery upon proof of greater damage in those cases where such proof can be made." (emphasis added));
140. L.A. Westermann Co. v. Dispatch Printing Co., 249 U.S. 100, 108-09 (1919) (quoting favorably Brady when construing the 1909 Copyright Act, adding "[t]he minimum amount appears to us to have been fixed because of the inherent difficulty of always proving by satisfactory evidence what the amount is which has been actually sustained." (emphasis added)).