Recording Industry vs The People: In UMG v. Lindor Parties Stipulate to Procedure for Determining Wholesale Download Prices for Purposes of Unconstitutionality Issue

Thursday, May 17, 2007

In UMG v. Lindor Parties Stipulate to Procedure for Determining Wholesale Download Prices for Purposes of Unconstitutionality Issue

In UMG v. Lindor, some six (6) months after the plaintiffs were ordered to provide defendant with "all relevant documents" concerning the wholesale prices of single song downloads, the parties were able to reach agreement on a stipulated procedure, which dispenses with the need for the RIAA to produce documents, for the determination of the wholesale download prices for purposes of determining the issue of the constitutionality of plaintiffs' $750-per-file statutory damages theory.

Under the procedure agreed upon, the RIAA will provide Ms. Lindor's counsel with declarations describing the price range of wholesale downloads; the declarations will be confidential pending further court order; and it will be assumed, for purposes of the litigation only, that the low end of the price range is the wholesale per-song price:

Stipulations for Determination of Wholesale Download Prices*
Order approving stipulations*

* Document published online at Internet Law & Regulation

Keywords: digital copyright online download upload peer to peer p2p file sharing filesharing music movies indie label freeculture creative commons pop/rock artists riaa independent mp3 cd favorite songs

4 comments:

Unknown said...: Certainly looks like this has the potential of being the hole in the dike that can no longer be plugged with an available digit (confidentiality notwithstanding). Once settled, the $3500 to $7000 'beneficient' settlements will have no basis in reality (or legality) and should quickly go by the wayside. Unfortunately, does little for those already 'snared' and 'settled'.; May 17, 2007 at 12:23:00 PM EDT
AMD FanBoi said...: When you've got so much to hide (I'm talking about you, Mr. RIAA), you should really be leery of going into court at all -- especially when you could have avoided all this. Actual profits per digital download. Media Sentry contracts. Illegal, anti-trust, extortionate, RICO, unconstitutional, misuse actions on your part, can all come to haunt the arrogant.

Jaded: Not completely in agreement with your analysis. If the RIAA "proved" illegal infringement and collected constitutional damages of 3X to 10X per a thousand songs detected (1000 shared songs was their initial threshold -- it's now obviously lower), that would fall into the range of payments you quote. It's only when they sue for hundreds of millions of alleged damages that they are so far over the line vis-a-vi the Constitution and previous SCOTUS rulings on the matter.; May 17, 2007 at 1:56:00 PM EDT
recordjackethistorian said...: The issue this raises is the same one which was raised when Ray came to the tech community to ask for advice and input on what the RIAA called "evidence". As we all know, Beckerman & co are accomplished lawyers but not accomplished computer techs. Without the tech communities input, they would not have known what was a smoke screen and what was real.

The same thing is true here, if someone gives you a list and documents saying this is the wholesale price of this and that is what it cost us to do whatever, how do you know its the truth? The real cost or recordings has always been shrouded in mystery (intentionally, I think). I know what it costs a band to produce a CD, I know what pressing costs. But I really have no idea what a major company like Sony/BMG or EMI true costs are. The RIAA demand for confidentiality is not without reason. They fear the expertise of the masses.

Cheers,
David
a.k.a. The Record Jacket Historian.; May 17, 2007 at 5:21:00 PM EDT
raybeckerman said...: dear recordjack....

1. we already know the price is ~70 cents

2. this is about the revenues, not costs... we haven't gotten into the costs yet...

3. what do you know about my expertise in this area? i've been working in music law for 32 1/2 years....

4. you can't possibly believe that i was relying on the slashdot and groklaw communities for my technical information.... i put the question out there to the community, and got a lot of valuable thinking and a lot of valuable input... but i didn't take anyone's word for it and didn't rely on anything i was told by any anonymous poster.... everything serious was run through my technical advisor, Mr. Zi Mei... i feel insulted that you think i wouldn't have known how to depose dr. jacobson had i not had that extra assistance... i first worked on an expert witness deposition about 30 years ago.....; May 17, 2007 at 9:35:00 PM EDT

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JUDICIAL QUOTATIONS

"[T]he Court is concerned about the lack of facts establishing that Defendant was using that IP address at that particular time. Indeed, the [complaint] does not explain what link, if any, there is between Defendant and the IP address. It is possible that Plaintiff sued Defendant because he is the subscriber to IP address .... As recognized by many courts, just because an IP address is registered to an individual does not mean that he or she is guilty of infringement when that IP address is used to commit infringing activity." -Hon. Barry Ted Moskowitz, Chief Judge, S.D. California. January 29, 2013, AF Holdings v. Rogers
"The complaints assert that the defendants – identified only by IP address – were the individuals who downloaded the subject “work” and participated in the BitTorrent swarm. However, the assumption that the person who pays for Internet access at a given location is the same individual who allegedly downloaded a single sexually explicit film is tenuous, and one that has grown more so over time." - Hon. Gary R. Brown, Magistrate Judge, E.D.N.Y. May 1, 2012, K-Beech v. Does 1-37
"The concern of this Court is that in these lawsuits, potentially meritorious legal and factual defenses are not being litigated, and instead, the federal judiciary is being used as a hammer by a small group of plaintiffs to pound settlements out of unrepresented defendants."
-Hon. S. James Otero, Dist. Judge, Central Dist. California, March 2, 2007, Elektra v. O'Brien, 2007 ILRWeb (P&F) 1555
"The University has adequately demonstrated that it is not able to identify the alleged infringers with a reasonable degree of technical certainty...[C]ompliance with the subpoena as to the IP addresses represented by these Defendants would expose innocent parties to intrusive discovery....[T]he Court declines to authorize discovery and quashes the subpoena as to Does # 8, 9, and 14" -Hon. Nancy Gertner, Dist. Judge, Dist. Massachusetts, November 24, 2008, London-Sire Records v. Does 1-4
"[C]ounsel representing the record companies have an ethical obligation to fully understand that they are fighting people without lawyers... that the formalities of this are basically bankrupting people, and it's terribly critical that you stop it...." -Hon. Nancy Gertner, Dist. Judge, Dist. Massachusetts, June 17, 2008, London-Sire v. Does 1-4
"Rule 11(b)(3) requires that a representation in a pleading have evidentiary support and one wonders if the Plaintiffs are intentionally flouting that requirement in order to make their discovery efforts more convenient or to avoid paying the proper filing fees. In my view, the Court would be well within its power to direct the Plaintiffs to show cause why they have not violated Rule 11(b) with their allegations respecting joinder. [I]t is difficult to ignore the kind of gamesmanship that is going on here.....These plaintiffs have devised a clever scheme... to obtain court-authorized discovery prior to the service of complaints, but it troubles me that they do so with impunity and at the expense of the requirements of Rule 11(b)(3) because they have no good faith evidentiary basis to believe the cases should be joined." -Hon. Margaret J. Kravchuk, Magistrate Judge, District of Maine, January 25, 2008, Arista v. Does 1-27, 2008 WL 222283, modified Oct. 29, 2008
"[N]either the parties' submissions nor the Court's own research has revealed any case holding the mere owner of an internet account contributorily or vicariously liable for the infringing activities of third persons.....In addition to the weakness of the secondary copyright infringement claims against Ms. Foster, there is a question of the plaintiffs' motivations in pursuing them..... [T]here is an appearance that the plaintiffs initiated the secondary infringement claims to press Ms. Foster into settlement after they had ceased to believe she was a direct or "primary" infringer." -Hon. Lee R. West, District Judge, Western District of Oklahoma, February 6, 2007, Capitol v. Foster, 2007 WL 1028532
"[A]n overwhelming majority of cases brought by recording companies against individuals are resolved without so much as an appearance by the defendant, usually through default judgment or stipulated dismissal.....The Defendant Does cannot question the propriety of joinder if they do not set foot in the courthouse." -Hon. S. James Otero, Central District of California, August 29, 2007, SONY BMG v. Does 1-5, 2007 ILRWeb (P&F) 2535
"Plaintiffs are ordered to file any future cases of this nature against one defendant at a time, and may not join defendants for their convenience."
-Hon. Sam Sparks and Hon. Lee Yeakel, District Judges, Western District of Texas, November 17, 2004, Fonovisa v. Does 1-41, 2004 ILRWeb (P&F) 3053
"The Court is unaware of any other authority that authorizes the ex parte subpoena requested by plaintiffs."
-Hon. Walter D. Kelley, Jr., District Judge, Eastern District of Virginia, July 12, 2007, Interscope v. Does 1-7, 494 F. Supp. 2d 388, vacated on reconsideration 6/20/08
"Plaintiffs contend that unless the Court allows ex parte immediate discovery, they will be irreparably harmed. While the Court does not dispute that infringement of a copyright results in harm, it requires a Coleridgian "suspension of disbelief" to accept that the harm is irreparable, especially when monetary damages can cure any alleged violation. On the other hand, the harm related to disclosure of confidential information in a student or faculty member's Internet files can be equally harmful.....Moreover, ex parte proceedings should be the exception, not the rule."
-Hon. Lorenzo F. Garcia, Magistrate Judge, District of New Mexico, May 24, 2007, Capitol v. Does 1-16, 2007 WL 1893603
"'Statutory damages must still bear some relation to actual damages." Hon. Michael J. Davis, Dist. Judge, U.S.District Court, Dist. Minnesota, January 22, 2010, Capitol Records v. Thomas-Rasset
"[T]his court finds that defendants' use of the same ISP and P2P networks to allegedly commit copyright infringement is, without more, insufficient for permissive joinder under Rule 20. This court will sever not only the moving defendants from this action, but all other Doe defendants except Doe 2."
-Hon. W. Earl Britt, District Judge, Eastern District of North Carolina, February 27, 2008, LaFace v. Does 1-38, 2008 WL 544992
"[L]arge awards of statutory damages can raise due process concerns. Extending the reasoning of Gore and its progeny, a number of courts have recognized that an award of statutory damages may violate due process if the amount of the award is "out of all reasonable proportion" to the actual harm caused by a defendant's conduct.[T]hese cases are doubtlessly correct to note that a punitive and grossly excessive statutory damages award violates the Due Process Clause....."Hon. Marilyn Hall Patel, Dist. Judge, N.D. California, June 1, 2005, In re Napster, 2005 US DIST Lexis 11498, 2005 WL 1287611
"[P]laintiffs can cite to no case foreclosing the applicability of the due process clause to the aggregation of minimum statutory damages proscribed under the Copyright Act. On the other hand, Lindor cites to case law and to law review articles suggesting that, in a proper case, a court may extend its current due process jurisprudence prohibiting grossly excessive punitive jury awards to prohibit the award of statutory damages mandated under the Copyright Act if they are grossly in excess of the actual damages suffered....."-Hon. David G. Trager, Senior District Judge, Eastern Dist. New York, November 9, 2006, UMG v. Lindor, 2006 U.S. Dist. LEXIS 83486, 2006 WL 3335048
"'[S]tatutory damages should bear some relation to actual damages suffered'....(citations omitted) and 'cannot be divorced entirely from economic reality'". -Hon. Shira A. Scheindlin, Dist. Judge, Southern Dist. New York, August 19, 2008, Yurman v. Castaneda
"The Court would be remiss if it did not take this opportunity to implore Congress to amend the Copyright Act to address liability and damages in peer to peer network cases.... The defendant is an individual, a consumer. She is not a business. She sought no profit from her acts..... [T]he damages awarded in this case are wholly disproportionate to the damages suffered by Plaintiffs." -Hon. Michael J. Davis, District Judge, Dist. Minnesota, September 24, 2008, Capitol v. Thomas
"If there is an asymmetry in copyright, it is one that actually favors defendants. The successful assertion of a copyright confirms the plaintiff's possession of an exclusive, and sometimes very valuable, right, and thus gives it an incentive to spend heavily on litigation. In contrast, a successful defense against a copyright claim, when it throws the copyrighted work into the public domain, benefits all users of the public domain, not just the defendant; he obtains no exclusive right and so his incentive to spend on defense is reduced and he may be forced into an unfavorable settlement." US Court of Appeals, 7th Cir., July 9, 2008, Eagle Services Corp. v. H20 Industrial Services, Inc., 532 F.3d 620
"Customers who download music and movies for free would not necessarily spend money to acquire the same product.....RIAA’s request problematically assumes that every illegal download resulted in a lost sale."
-Hon. James P. Jones, Dist. Judge, Western Dist. Virginia, November 7, 2008, USA v. Dove