Charles Nesson, William F. Weld Professor of Law at Harvard Law School, who defends Joel Tenenbaum in his dispute with record labels, said that Joel has only caused $21 worth of damages from his activities. Tenenbaum was told to pay $675,000 in damages to record companies for downloading and sharing 30 songs using the Kazaa software. Nesson has described the damages as "monstrous and shocking."
"Had he purchased the 30 songs on iTunes, he would have paid 99 cents apiece, of which Apple would have passed on 70 cents to the record companies," Nesson argues. "Assuming, contrary to fact, that the record companies have zero costs so that every cent returned to them is profit, the total return would have been $21.00."
Record companies say that statutory damages are a fair way to deal with P2P file sharing, since nobody really knows how many times a user downloaded any of the 30 tracks from Tenenbaum, or from most P2P users. Nesson believes that the actual loss of revenue caused by Tenenbaum's actions should instead be the amount of money he would have paid for the songs had be opted to purchase them legally.
"Not a single person who downloaded these songs using Kazaa would have been impeded from obtaining them had Tenenbaum blocked access to his share folder. Tenenbaum was not a seeder of any of these songs... Once the initial seeds had proliferated, the addition of one more copy to the unlimited, easily-accessible supply could have had no economic consequence whatsoever. Plaintiffs would not have realized a single additional sale had Tenenbaum blocked access to his share folder," Nesson wrote in his final arguments on the issue of damages.
According to Nesson, statutory damages ought to bare some relation to actual damages, and cites the reduction of damages by a Judge in the Jammie Thomas-Rasset case (which is set to go to its third trial). "In 2008, one study reported that the average British teenager had 800 illegal tracks on his iPod. If $22,500 per infringement were constitutional, this would mean the average teenager is exposed to an $18 million dollar verdict against him, clearly an absurd, arbitrary, and unconstitutional result," Nesson argues.
"For additional absurdity, imagine further that the industry actually got judgments of $18 million in damages from roughly 30,000 teenagers, which is approximately the number of lawsuits they filed against consumers until the end of 2008. That would mean they had outstanding judgments for $540 billion dollars—or more than the total revenue the recording industry can expect to earn in about 50 years at its current size of $11 billion per year."
Record companies say that statutory damages are a fair way to deal with P2P file sharing, since nobody really knows how many times a user downloaded any of the 30 tracks from Tenenbaum, or from most P2P users. Nesson believes that the actual loss of revenue caused by Tenenbaum's actions should instead be the amount of money he would have paid for the songs had be opted to purchase them legally.
"Not a single person who downloaded these songs using Kazaa would have been impeded from obtaining them had Tenenbaum blocked access to his share folder. Tenenbaum was not a seeder of any of these songs... Once the initial seeds had proliferated, the addition of one more copy to the unlimited, easily-accessible supply could have had no economic consequence whatsoever. Plaintiffs would not have realized a single additional sale had Tenenbaum blocked access to his share folder," Nesson wrote in his final arguments on the issue of damages.
According to Nesson, statutory damages ought to bare some relation to actual damages, and cites the reduction of damages by a Judge in the Jammie Thomas-Rasset case (which is set to go to its third trial). "In 2008, one study reported that the average British teenager had 800 illegal tracks on his iPod. If $22,500 per infringement were constitutional, this would mean the average teenager is exposed to an $18 million dollar verdict against him, clearly an absurd, arbitrary, and unconstitutional result," Nesson argues.
"For additional absurdity, imagine further that the industry actually got judgments of $18 million in damages from roughly 30,000 teenagers, which is approximately the number of lawsuits they filed against consumers until the end of 2008. That would mean they had outstanding judgments for $540 billion dollars—or more than the total revenue the recording industry can expect to earn in about 50 years at its current size of $11 billion per year."
