Should people who illegally download music be subject to more severe punishment for their sins than, say, tobacco companies that lied about the dangers of their products? Or how about companies that colluded to fix prices or engaged in civil racketeering? Or patent thieves who deliberately infringed competitors’ intellectual property?
All of those corporate miscreants can be hit with enhanced damages for their wrongdoing, but for all of them those enhancements are limited. Congress has said that when defendants are found to have violated federal antitrust, racketeering or patent laws, they can be on the hook only for as much as three times the actual damage they caused. Punitive damages, which come into play in product liability, fraud and other state-law cases, have been restricted by the U.S. Supreme Court, which held in 2003′s State Farm v. Campbell that the Due Process Clause means punitives cannot vastly exceed actual damages.
So surely when a single mom in Minnesota is found liable for illegally downloading 24 songs via a file-sharing site, due process should limit her punishment, right? If corporate defendants only have to cough up treble damages when they’re found to have engaged in a pattern of racketeering acts, doesn’t it only makes sense that someone without a commercial motive shouldn’t face a penalty out of all proportion to the harm she caused?
Not according to the 8th Circuit. On Tuesday, a three-judge panel reinstated a jury verdict of $222,000 – a penalty of $9,250 per illegal download — against Jammie Thomas-Rasset, the aforementioned Minnesota mom.
Despite arguments by Thomas-Rasset’s lawyers at Camara & Sibley and by the Electronic Frontier Foundationand other amici that the penalty violates her due process rights, the 8th Circuit said that the music companies that sued Thomas-Rasset are entitled to statutory damages against her. In the Copyright Act, wrote Judge Steven Colloton for a panel that also included judges Diana Murphy and Michael Melloy, Congress determined that copyright violators face liability of $750 to $30,000 for each act of infringement, and up to $150,000 if the violation is willful. The opinion explained that when the U.S. Supreme Court set the rules for deciding whether statutory damages accord with the Due Process Clause way back in 1919′s St. Louis, Iron Mountain & Southern Railway Company v. Williams, the court said that Congress has wide latitude to set statutory damages as long as they’re not “so severe and oppressive as to be wholly disproportioned to the offense and obviously unreasonable.” Thomas-Rasset’s penalty of $9,250, the 8th Circuit said, is near the low end of the range for willful infringers like her. So, given the public interest in deterring illegal downloading, the appeals court found, that penalty complies with the Williams standard.