Bringing big IP plaintiffs down a peg — or two

Originally posted 2007-06-01 01:13:36. Republished by Blog Post Promoter

Mike Atkins is paying attention to Microsoft’s IP docket, as a Seattle Trademark Lawyer will do. He’s reporting about a default judgment and award the software maker achieved in California, with a rather surprising anticlimax in the dollars-and-cents category:

Microsoft sought more than $3 million in statutory damages. However, the court only awarded $12,500 in damages and $2,000 in fees and costs. The court explained its decision by stating: “Plaintiff asks for the maximum enhanced statutory damages for the infringement of each of seven copyrights and two trademarks. At $150,000 per copyright and $1,000,000 per counterfeit trademark, the tab comes to $2,050,000. Plaintiff has identified a grand total of three units of counterfeit software that defendant sold. It is true that Microsoft could not conduct discovery to determine its damages, but that in itself does not support levying a statutory damages award in excess of three million dollars. … Statutory damages are intended to serve as a deterrent, but that does not justify such a windfall.

Well. True enough, when we got the judgment for seven (theoretical) figures in Louis Vuitton v. Veit, which was a counterfeiting case (and thus also implicated statutory damages), we could point to a major online counterfeiting operation, from which the court could deduce not only massive sales but the sort of massive wrongdoing that those huge swinging statutory damage options are meant to punish. Even then the court wanted as much proof as we could get our hands on of what was going on there.

But only $2,000 in fees and costs? That doesn’t sound right. The attorneys’ fees provisions of the Copyright Act are supposed to make a successful plaintiff at least whole in terms of the cost of enforcement — regardless of the number of units sold. Two thousand dollars doesn’t even cover scribes and sealing wax.

Sounds like something else was going on here. Any suggestions?

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Author:Ron Coleman

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