Appeals Court Upholds College Student's $675,000 Piracy Penalty

In the long-running case of Joel Tenenbaum, who was ordered in 2009 by a jury to pay $675,000 for illegally downloading and sharing 30 songs online, the First Circuit Court of Appeals decided on Tuesday that the penalty should stand.

The penalty came to $22,500 for each song infringed, which Tenenbaum argued was unconstitutionally excessive under the due process clause.

But in a case that was first brought in 2007 as part of the RIAA's aborted legal campaign against individual file-sharers, the appeals court doesn't see anything wrong with that.

"Tenenbaum carried on his activities for years in spite of numerous warnings, he made thousands of songs available illegally, and he denied responsibility during discovery," says the appellate court. "Much of this behavior was exactly what Congress was trying to deter when it amended the Copyright Act. Therefore, we do not hesitate to conclude that an award of $22,500 per song, an amount representing 15% of the maximum award for willful violations and less than the maximum award for non-willful violations, comports with due process."

Tenenbaum argued that the actual injury to the record labels was $450, the cost of the 30 albums.

The appeals court retorts, "But this argument asks us to disregard the deterrent effect of statutory damages, the inherent difficulty in proving damages in a copyright suit, and Sony's evidence of the harm that it suffered from conduct such as Tenenbaum's."

In making the ruling, the First Circuit had to analyze different precedents for how to apply damages and settled on one brought in a Supreme Court case that held that a statutory damage award violates due process only "where the penalty prescribed is so severe and oppressive as to be wholly disproportioned to the offense and obviously unreasonable."

Punishing piracy with a large award doesn't meet that test because Congress designed statutory damages to be a deterrent, the judges conclude.

The ruling was authored by Circuit Judge Jeffrey Howard. Read here in full.