Cengage Advantage Books: Fundamentals of Business Law 9th Edition by Roger LeRoy Miller

Exercise 10

Maverick Recording Co. v. Harper
United States Court of Appeals, Fifth Circuit, 598 F.3d 193 (2010). www.ca5.uscourts.gov/Opinions/aspx
FACTS Maverick Recording Company and several other musicrecording firms (the plaintiffs) hired MediaSentry to investigate the infringement of their copyrights over the Internet. During its investigation, MediaSentry discovered that Whitney Harper was using a computer program to share digital audio files with other users of a peer-to-peer network. The shared files included a number of the plaintiffs' copyrighted works. The plaintiffs sued Harper for copyright infringement and sought $750 per infringed work (the minimum amount of damages set forth in the Copyright Act). Harper had downloaded thirty-seven copyrighted audio files. Harper asserted that she was an "innocent" infringer, citing Section 504(c)(2) of the Copyright Act, which provides that when an infringer was not aware that his or her acts constituted copyright infringement, "the court in its discretion may reduce the award of statutory damages to a sum of not less than $200." The trial court granted summary judgment for the plaintiffs on the issue of copyright infringement and prevented Harper from further downloading and sharing of the copyrighted works. The court, however, awarded the plaintiffs only $200 per infringed work. Both parties appealed. Harper claimed that there was insufficient evidence of copyright infringement. The plaintiffs argued that the district court had erred by failing to rule out the innocent infringer defense as a matter of law.
ISSUE Can a person who downloaded thirty-seven copyrighted audio files and then shared them with other users via a peer-to-peer network assert the innocent infringer defense?
DECISION No. The U.S. Court of Appeals for the Fifth Circuit affirmed the trial court's finding of copyright liability and reversed its finding that the innocent infringer defense presented an issue for trial. The court concluded that Harper was not an innocent infringer and that the district court had therefore erred in awarding damages of only $200 per infringement.
REASON The court looked at the language of the statute and determined that the innocent infringer defense is limited by Section 402(d) of the Copyright Act. "The plain language of the statute shows that the infringer's knowledge or intent does not affect its application." Harper contended that she was too young and naïve to understand that copyrights applied to downloaded music, but the court dismissed this argument. The court reasoned that the defendant's reliance on her own understanding of copyright law-or lack thereof-was irrelevant in the context of the Copyright Act. "Lack of legal sophistication cannot overcome a properly asserted limitation to the innocent infringer defense." The federal appellate court ruled that the plaintiffs must be awarded statutory damages of $750 per infringed work on remand.
FOR CRITICAL ANALYSIS-Ethical Consideration In this and other cases involving similar rulings, the courts have held that when the published phonorecordings from which audio files were taken contained copyright notices, the innocent infringer defense does not apply. It is irrelevant that the notice is not provided in the online file. Is this fair?