Recording Industry vs The People: Elektra v. Barker is settled

Monday, August 18, 2008

Elektra v. Barker is settled

Elektra v. Barker, one of the leading cases repudiating the RIAA's 'making available' theory, has been settled.

Accordingly, Ms. Barker's affirmative defenses will not be adjudicated.

A copy of the stipulation and order of settlement is on file with the Court.

Ms. Barker's answer admitted Ms. Barker's having used Kazaa, but interposed the following defenses:

1. Plaintiffs' damages theory, which argues for statutory damages of from 2,142 to 428,571 times the actual damages, would lead to an unconstitutional result (Parker v. Time Warner Entertainment Co.,331 F.3d 13 (2d Cir. 2003); UMG Recordings, Inc. v. Lindor, 2006 WL 3335048 (E.D.N.Y. 2006); In re Napster Inc., 2005 WL 1287611 (N.D. California 2005)), so that the complaint should be construed as alleging that the use of an "online media distribution system" to infringe plaintiffs' copyrights constituted a single act of infringement, warranting a total recovery of $750 if defendant is liable.

2. In the alternative, the statute should be considered unconstitutional to the extent it could be construed as authorizing more than ten times the actual damages, and recovery should be limited to $3.50 per recording as against a single noncommercial user for a single upload or download of an MP3 file for personal use.

3. Unclean hands based upon plaintiffs' procurement of an unlicensed investigator, and commission of a Class B Misdemeanor under N.Y. General Business Law § 70, as well as unlawful pretexting and invasion of defendant's privacy.

4. Since the amended complaint makes no mention of any enumerated acts of infringement, but instead seeks recovery for a series of acts (the operation of an “online media distribution system” to infringe plaintiffs' copyrights), plaintiffs cannot recover statutory damages, costs, or attorneys fees for any sound recording copyrights registered with the U.S. Copyright Office subsequent to the date on which defendant first began using Kazaa, under 17 U.S.C. § 412. (See, e.g., Homkow v. Musika Records, Inc., 2008 U.S. Dist. LEXIS 14079 (S.D.N.Y. February 26, 2008); Irwin v. ZDF Enters. GmbH, 2006 U.S. Dist. LEXIS 6156 (S.D.N.Y. 2006); Shady Records, Inc. v. Source Enters., 2004 U.S. Dist. LEXIS 26143 (S.D.N.Y. 2004)).

5. Innocent infringement : defendant was not aware of any copyright infringement, and upon information and belief some or all of the copies which she downloaded did not bear copyright notice.

Stipulation and order of settlement

Commentary & discussion:

p2pnet.net
ZDNet
Slyck
Slashdot
Ars Technica
Daily Tech
Digital Music News
Heise Online (German)
Law Vibe: International Law News

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

11 comments:

usagemayvary said...: Ray, how do you feel about this? 6 grand seems a bit excessive, plus a waived appeal? How would waiving the appeal go if the whole amount of the fees is found to be unconstitutional?; August 18, 2008 at 12:00:00 PM EDT
raybeckerman said...: I rejected a comment because it made unwarranted assumptions, and asserted incorrect statements of law. Sorry. Please review the comment policies for Recording Industry vs. The People.

Unfortunately, blogger.com does not provide any tools for editing comments; my only choices are to publish or reject.

Your comment that this would not have been an ideal case in which to test the issues raised by the affirmative defenses is, in my view, incorrect; indeed this would have been an ideal case in which to litigate them.; August 18, 2008 at 12:01:00 PM EDT
raybeckerman said...: Obviously I would have loved to litigate those affirmative defenses.; August 18, 2008 at 12:07:00 PM EDT
Scott said...: Ray, whenever I see a case end like this, I'm always confused as to who won or lost. But considering what Jammie Thomas is going through now, I think the outcome for Tenise Barker is far better than it could have been. The RIAA was in litigation for over two years but got next to no damages for it, and they got bloodied in the process. So congratulations are in order.; August 18, 2008 at 12:27:00 PM EDT
Unknown said...: Well, I guess that the RIAA at least spent more on paying their lawyers than they will receive in this settlement. Does that count as a win in the greater good sense?; August 18, 2008 at 12:50:00 PM EDT
Anonymous said...: It is hard to call this a victory for either side. The Plaintiffs litigated for approximately 2 years to achieve only double their likely settlement offer.

The Defendant is paying double the likely original settlement offer and has lawyer bills to consider, along with 2 years lost to stress.

I failed to see any stipulation to who is paying who's legal bills, including the common statement on RIAA dismissals of each side to bear their own costs.

While it clearly could have gone worse for the Defendant, it could have also clearly gone much better. Everyone seems beaten and bruised here, but the RIAA prevails because it was never their money at stake here and they avoid an embarassing loss with much wider implications for their entire legal strategy, while clearly extracting monetary penalties from the Defendant.

Win to the RIAA by a contentious split decision, and they got off lucky with a case they could never actually take to trial.

{The Common Man Speaking}; August 18, 2008 at 2:47:00 PM EDT
Lior said...: While most of us (especially Ray's other clients) have loved to have the court validate Ms. Barker's affirmative defences (with her footing the bill), we should not surprised be she chose to pay $6K today rather than pay additional legal fees when that would risk a large adverse verdict. She should take of herself first.

To me (an outsider) this is the hard part of legal practice. Anyone can do legal research and write legal documents. On the other hand, not anyone can give good advice in complicated situations. Here the interests of one client might be different than those of other clients, or of the law firm (I'm sure Ray recognizes that he is prominent enough to have a personal stake in the outcome of the whole RIAA litigation campaign), but I'm sure each of Ray's clients gets advice according to what is best for that client.; August 18, 2008 at 3:08:00 PM EDT
Adam S. said...: I'm wondering if the defendant is liable for any attorney's fees in addition to the settlement amount?; August 18, 2008 at 6:00:00 PM EDT
Igor said...: "any" fees? Including to pay for her defense?; August 18, 2008 at 7:02:00 PM EDT
Anonymous said...: The fact that the RIAA settled after spending so much in legal fees should not be overlooked. They thought they had a case (presumably), and now they're walking away with mostly nothing.

Either they made a mistake somewhere in their amended complaint or they are afraid to see these cases unfold.

Other defendants surely will (or have) read about this, so I have no doubt we'll see the same issues defendant raised coming up in other cases, and that will tell us which it was.

XYZZY; August 19, 2008 at 9:02:00 AM EDT
Scott said...: Maybe I'm reading too much into this, but it seemed that the litigation stopped shortly after Ray again raised the issue of the constitutionality of the statutory damages.

If higher courts uphold the principle that damages greater than 10x actual damages are unconstitional, it would mean that the RIAA's "settlement support center" operation would be in actual fact an extortion operation in instances where they demanded more than they could have ever recovered in court. Victims of this extortion racket would be a natural class for a class-action lawsuit against the RIAA cartel members.

That would be so sweet. I hope it happens.; August 19, 2008 at 12:57:00 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