Sony BMG Music Entm't v. Tenenbaum

A damage award of $22,500 per illegally downloaded or distributed song is not so large as to unconstitutionally violate infringer's rights to due process.

Opinion (Howard: Joel Tenenbaum ("Tenenbaum") willfully downloaded and distributed music files over the Internet via peer-to-peer online file sharing. In 2007, Sony BMG Music Entertainment ("Sony") sued Tenenbaum for copyright infringement. The Copyright Act allows for statutory damages between $750 and $150,000 per infringement. A jury found in favor of Sony and awarded damages of $675,000. The damage award was calculated by assessing damages in the amount of $22,500 per song for the 30 songs whose copyrights Tenenbaum was found to have infringed. Tenenbaum appealed, claiming that the damage award was so large that it was unconstitutional. The Court reviewed de novo and first determined that, because the jury awarded statutory damages and not punitive damages, St. Louis, I.M. & S. Ry. Co. v. Williams, 251 U.S. 63, 40 S. Ct. 71 (1919) applied instead of BMW of North America, Inc. v. Gore, 517 U.S. 559, 116 S. Ct. 1589 (1996). The Court therefore applied the Williams test to Tenenbaum's case. The Williams test states that: "a statutory damage award violates due process only 'where the penalty prescribed is so severe and oppressive as to be wholly disproportion to the offense and obviously unreasonable.'" Tenenbaum argued that, because the actual damage he caused to the plaintiff record companies was only the amount of their profits lost (an amount he estimated at $450), the $675,000 damages award was obviously unreasonable. The Court, however, ruled that the reasonability of a statutory damages structure did not rest on the value of actual damage alone. After weighing Congress's intent to implement a statutory damages scheme that acted as a deterrent, and comparing the types of behavior Congress was attempting to deter with Tenenbaum's willful infringement, the Court found the award constitutional and AFFIRMED the award.