News

We've written frequently about the lawsuits brought by the recording industry against alleged downloaders, but here's an interesting fact: None of the cases has actually gone to trial yet. Many have been dropped by the labels when it appeared they had targeted the wrong defendants; even more have been settled by defendants intimidated by the $750-per-song damages claimed by the labels. Now an attorney is vigorously seeking a trial—and one of his big arguments is that the labels' math doesn't add up.

Ray Beckerman, the attorney who represents Marie Lindor in UMG v Lindor, alleges that the fines sought by the record labels are excessive and "unconstitutionally severe." Judge David Trager allowed Beckerman to argue that "case law and law review articles suggest that, in a proper case, a court may extend its current due process jurisprudence prohibiting grossly excessive punitive jury awards to prohibit the award of statutory damages mandated under the Copyright Act if they are grossly in excess of the actual damages suffered."

So what are the actual damages suffered? According to Beckerman, the labels' actual loss of revenue per download is the 70¢/song they receive from music downloads, not $750. He believes the damages should be capped somewhere between $2.80 and $7.20. The record labels say that wholesale pricing information is a trade secret—one they don't want to discuss publicly.

Hogwash, Beckerman argued in a letter to Judge Trager. He asserts that the reason the information is being kept confidential is to "serve [the labels'] strategic objectives for other cases"—a standard that doesn't "rise to the legal threshold necessary for a protective order." Beckerman wants the court to force the labels to turn over contracts with their 12 largest customers.

According to Universal Music Group (UMG) attorney Richard Gabriel, the pricing information is "highly proprietary" because each constituent label within the UMG v Lindor case independently negotiated with download services. Therefore, "each of the record companies is aware only of its own pricing and does not know what the others charge." However, according to the website Ars Technica, Gabriel did concede that 70¢ was "within the range."

Keep your eyes on UMG v Lindor. It is definitely a case that will prove full of surprises.