2007 Archive

Now Hear This: Boalt Expert Says Music Sharing Verdict Rings True

By winning the first online music downloading case that went to trial, record companies seemed to hit all the right notes. While it is unlikely that the verdict will resonate as a powerful deterrent, Boalt Hall Professor Robert P. Merges thinks it may signal a change in how our culture views the widespread practice of online file sharing, which allows users to obtain music free instead of paying for it in stores.

On October 4th, a federal jury in Minnesota found Jammie Thomas liable of copyright infringement and ordered her to pay $222,000 in damages to six record labels for sharing copyrighted music on the Internet. The jury ordered Thomas to pay $9,250 for each of 24 songs she was accused of downloading without permission and offering them online through Kazaa, a file-sharing service. Merges, a prominent authority on copyright law and Director of the Berkeley Center for Law & Technology, applauds the decision.

"Given the magnitude of what's going on with file sharing, it's a drop in the bucket," Merges says. "On the other hand, it establishes a principle that when people take time to think through the issue, there isn't much justification for it. The deterrent effect of the decision may be minimal, but the principle of it is pretty important. A lot of explanations for file sharing will be subject to more scrutiny. Besides, now I'll have a little more ammo in arguments with my students."

Like many young music fans, Merges' students present several arguments in favor of file sharing: musicians are not harmed because they receive only a tiny fraction of every CD sale; downloading music leads to more exposure for musicians, resulting in CD purchases that would otherwise not occur; record companies grossly inflate the price of CD's; intellectual property should not follow the same rules as physical property; no actual value is lost by "stealing" a song because MP3s are not physical entities; the music industry wrongly seeks to enforce American laws even though the Internet is global; and special interests have caused copyright law to become increasingly and unfairly restrictive.

Since 2003, the Recording Industry Association of America has coordinated more than 25,000 lawsuits over file sharing. Although many defendants settle the suits by paying smaller amounts to record labels, Thomas opted to go to trial. She maintained her innocence, denying that she was the user "tereastarr" on Kazaa—despite using the same handle on e-mail and website logins. Witnesses for the record companies, including an Internet provider and a security firm, testified that the online address used by "tereastarr" did in fact belong to Thomas.

Internet law pundits do not expect the victorious record labels to seek full payment from Thomas, a 30-year-old single mother of two. "Putting this poor individual into bankruptcy would hurt their public image and take the focus off the real victims," says Merges, co-author of the law school textbooks Intellectual Property in the New Technological Age, and Software and Internet Law. "It's not just big, anonymous record companies or millionaire music stars affected by this. For many musicians, a royalty check is the difference between going back to work as a temp and doing what they want to do and what they're good at, which is playing music."

In copyright law, damages range from $750 to $30,000 per infringement (in this case, per sound recording downloaded or distributed without license). Damages can reach $150,000 per infringement if the violation is deemed willful. Jury instructions stated that the record labels did not have to show that Kazaa users downloaded songs from Thomas' computer, only that she left them in a publicly accessible directory where they could be downloaded. Yet despite finding Thomas in willful violation, the jury held damages under $10,000 per infringement.

"I think the jury went where enlightened common sense would leave you," Merges says. "They wanted to show that this behavior was really wrong, but didn't want to sock this person with a huge verdict that would've been crippling for life. People feel ripped off when they pay $14 for a plastic CD, and there's a fundamental resistance there that file sharing tapped into. But you're not buying a piece of plastic; you're buying someone's time, effort, and professional skills embodied in that piece of plastic."