Originally posted 2010-07-23 10:58:24. Republished by Blog Post Promoter
Glenn Reynolds links to a an article in Wired about a newspaper “chain”‘s — actually, lawyer Steve Gibson’s — “new business model”: Suing bloggers who post newspaper articles, evidently more or less intact ones, on their sites. Glenn says suing bloggers “seems like a poor business plan” — mainly, of course, because most bloggers are broke, or pretty close to it.
The article also explains why these one-off claims by outfits such as the Las Vegas Review-Journal are unlikely, in the long run, to pay off. One reason is that at least the music industry, through the Recording Industry Association of America, is theoretically going for some degree of bulk in its litigation trawling against unlawful file sharing. And we did say “theoretically”: Remember, in 2008 the RIAA managed to spend about $16 million on legal fees to reel in a whopping $391,000. As the article says, “You’d have to go after a lot of people for a relatively small amount of money,” says Jonathan Band, a Washington, D.C. copyright lawyer. “That is a riskier proposition.”
So, yes, it is hard to comprehend the return on investment here.
There are other reasons this doesn’t seem to make sense. ”Defendants might be less willing to settle a lawsuit stemming from their posting of a single news article, despite the Copyright Act’s whopping damages,” says the article. But no, not quite on the “whopping damages” stuff. Contrary to myth — and to the threats routinely uttered by copyright plaintiff attorneys — statutory damages are not meant to be a windfall, as I explain at some length here. Now it is true that some juries think intellectual property infringement damages are a jackpot unrelated to actual harm — usually because judges don’t instruct them properly. But other judges in high profile cases are refusing to be part of the copyright shakedown. Thus in the recent Tannenbaum copyright case, the District Judge reduced the jury’s damages award of $675,000 for infringement of 30 songs to $67,500, ruling that the amount awarded was unconstitutional under the Due Process clause.
Still, $67,500 is a lot of money, a lot, and still pretty darned distant from any plausible quantum of loss to the copyright owner. And that’s even before statutory attorneys’ fees — mandatory for infringement of a properly registered copyright. (Don’t get me started on that.) That doesn’t mean, however, that the plaintiffs are happy with that amount; unsurprisingly, they’re appealing that ruling. A precedent like that would just, if you’ll let me be old school, keep skipping like a broken record if they didn’t do something about it.
On the other other hand, the damage to the market value of a copyright-protected work is a criterion courts are supposed to consider when awarding statutory damages for infringement. And while the ratio to damage caused by the infringement and statutory damages in the Tannenbaum case is out of whack at either of these orders of magnitude, at least there is still some market for big-label music. In contrast, there’s barely any market for fresh news at all — i.e., people really don’t expect or want to pay for it, and they don’t.
That’s not because they can steal it, but because there are so many free or very low cost substitutes for mainstream media available today. And that’s going to be even more true for the mainly warmed over or in some cases really old newspaper stories that seem to be the subject of this copyright “enforcement” sweep.
Yet some meaningful percentage of these cases will settle because it’s cheaper to do so than to engage defense counsel, and because, well, a lot of these cases involve something we call copyright infringement. As I’ve said before, bloggers are wrong to infringe copyright even if they’re just cute little bloggers, and reprinting an entire newspaper article, or a good portion of one, is just about never fair use and thus exempt from an infringement claim.
It is unsurprising that most bloggers are callous about copyright. It has little to do with their work product, for reasons I explain very succinctly here. But they’re wrong to be. And, really, exactly whatever Gibson’s ROI turns out to be — and you can be sure that, unlike Jenner & Block and Cravath, the tip-top law firms charged with the RIAA’s brilliant litigation campaign, he’s not getting paid via Brinks trucks — it’s not our problem. When an infringing blogger gets served with a summons and complaint, he’s going to have to pay to make it go away, and the only thing Gibson’s going to want to know is how much-a-you-got.
What kind of business plan is that?
UPDATE: Lots of interesting stuff on this out there now. This one by Maxwell S. Kennerly, Esquire, is interesting enough to make me overcome my reluctance to link to a LexBlog “blog”. Kennedy wisely asks why are essentially de minimis claims in front of Article III judges at all. Why, indeed? (Hat tip to Walter Olson.)
UPDATE, VEGAS STYLE: Much, much more here from Ryan Gile.