Cengage Advantage Books: Foundations of the Legal Environment of Business 3rd Edition by Marianne Jennings

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Sony BMG Music Entertainment v. Tenenbaum 660 F.3d 487 (1st. Cir. 2011)
Our Foster Child Downloaded the Music, Not I
Facts
Joel Tenenbaum developed file-sharing software that allowed 30 music recordings copyrighted by Sony (plaintiffs) to be downloaded and distributed without Sony's authorization. Sony brought suit for damages and a permanent injunction. The jury found that Tenenbaum's infringement of the copyrights at issue was willful and awarded Sony statutory damages of $22,500 for each infringed recording. Tenenbaum's request for a reduction in damages (remittitur) from $675,000 was granted by the trial court and the damages were reduced by a factor of 10. Tenenbaum's request for a dismissal on the grounds that his infringement was not willful was denied. Both Sony and Tenenbaum appealed.
Judicial Opinion
LYNCH, Chief Judge
Tenenbaum began downloading and distributing copyrighted works, via Napster, without authorization in 1999.
Because it enabled copyright infringement, the Napster network was shut down in 2001. This did not stop Tenenbaum [who then used] AudioGalaxy, iMesh, Morpheus, Kazaa, and Limewire. Tenenbaum shifted to these other networks after Napster's termination despite his knowledge that Napster was forced to close on account of copyright infringement.
From 1999 until 2002, he primarily downloaded and distributed copyrighted works to and from his desktop computer at his family's home in Providence. He left home to attend Goucher College in Baltimore, Maryland, in 2002, at which point he began using a laptop to download and distribute copyrighted works. Following his graduation from Goucher in 2006, he began using a second laptop for these purposes. At one point in time in 2004 alone, Tenenbaum had 1153 songs on his "shared-directory" on the Kazaa network. Most of the networks Tenenbaum used had a "traffic tab" that informed him of the frequency with which other users were downloading his shared files.
While Tenenbaum was at Goucher College in 2002, his father, Dr. Arthur Tenenbaum, called him to warn him that his use of peer-to-peer networks to obtain and distribute music recordings was unlawful. Dr. Tenenbaum instructed Tenenbaum not to continue to engage in such conduct. Despite his father's request, Tenenbaum continued his illegal activity.
Tenenbaum also received direct warnings from Goucher College. Each year Tenenbaum received a Goucher student handbook warning that using the college's network to download and distribute copyrighted materials was illegal, but he did so anyway.
The handbook also warned that illegally downloading and distributing music files could subject the copyright infringer to up to $150,000 of liability per infringement. By the end of his undergraduate studies at Goucher, the school had implemented so many technological restrictions on its network-which he knew were designed to prevent illegal downloading of music files- that peer-to-peer programs "wouldn't work at all."
The Tenenbaums' Internet service provider, Cox Communications, also warned against using the Internet to illegally infringe copyrighted [and] that Tenenbaum had been detected infringing copyrighted materials. He also received a warning letter from Sony. The letter urged Tenenbaum to consult with an attorney immediately.
After receiving this letter, Tenenbaum nonetheless took his laptop computer for repairs and had its operating system reinstalled and its hard drive reformatted. Despite these warnings, Tenenbaum continued the illegal downloading and distribution of copyrighted materials until a full two years after receiving the letter from Sony. He stopped his activity only after this lawsuit was filed against him.
Before the trial, Tenenbaum attempted to shift responsibility for his conduct to other individuals by claiming they could have used his computer in order to illegally download and distribute the copyrighted works. These individuals included a foster child living in his family's home, burglars who had broken into the home, his family's house guest, and his own sisters. His sisters and others he blamed testified that they had never illegally downloaded music and had no knowledge of who installed the file sharing software on Tenenbaum's computer.
We affirm the finding of liability against Tenenbaum and in favor of plaintiffs. We affirm the injunctive relief. We vacate the district court's due process damages ruling and reverse the reduction of the jury's statutory damages award. We reinstate the jury's award of damages.
If, on remand, the court allows any reduction through remittitur, then plaintiffs must be given the choice of a new trial or acceptance of remittitur.
Case Questions
1. What does the court highlight as proof of Tenenbaum's intent to infringe the copyright?
2. Explain what will be done with the damages issue.
3. What advice would you give to friends who are downloading music on peer-to-peer programs?