Court Denies Waiver of Plaintiffs' Right to Seek Actual Copyright Damages

In a February 6, 2017 ruling, Judge Richard J. Sullivan rejected the defendant's claim that the plaintiffs waived their right to actual copyright infringement damages by failing to request them in their initial disclosures.  The Court wrote:

Although Plaintiffs “corrected” this disclosure a mere five days later . . . , Defendant argues that this purported correction was “void because Plaintiffs cannot reverse their prior election for statutory damages.” . . . None of the authority cited by Defendant supports a rule so strict that it would bar a plaintiff from recovering actual damages due to an election made in initial disclosures and corrected days later, particularly where Defendant has not articulated any prejudice. Rather, the closest examples cited by Defendant involve elections made much later in litigation. See Marano v. Aaboe, No. 05-cv-9375 (BSJ) (RLE), 2010 WL 6350785, at *4 (S.D.N.Y. Oct. 20, 2010) (plaintiff “elected to seek statutory damages instead of actual damages in his initial brief” in connection with an inquest on damages, which “came more than one year after a default judgment had been entered and more than six weeks after the conclusion of fact discovery on the issue of damages”), adopted by 2011 WL 1157553 (S.D.N.Y. Mar. 28, 2011); Homkow v. Musika Records, Inc., No. 04-cv-3587 (KMW), 2008 WL 508597, at *4 (S.D.N.Y. Feb. 26, 2008) (plaintiff “clearly elected to pursue statutory damages” by requesting such damages in his amended complaint and repeating that request in a submission made in connection with an inquest on damages after entry of default judgment). The Court sees no legal or logical basis for applying the “gotcha” rule envisioned by Defendant, and thus declines to find that Plaintiffs have “irreversibly” elected statutory damages by referencing such damages in their initial disclosures and quickly correcting that reference.

Judge Sullivan nevertheless ruled that "Plaintiffs’ failure to introduce any evidence of actual damages is a de facto election of statutory damages," and limited the Plaintiffs to recovering statutory damages only if Plaintiffs are able to prove infringement.

Court Rules Question of Copyright Infringement Statutory Damages Is for the Jury

In a September 28, 2015 ruling, Judge Gregory H. Woods held, after granting summary judgment of copyright infringement, that the amount of statutory damages was a question for the jury. Given the particular facts of this case, Judge Woods noted the open legal question of whether statutory damages are recoverable for infringement of both a musical composition and of a sound recording of that composition. The Court discussed a split in the District on that question, but suggested that it would adopt the view that a sound recording is a derivative work of a musical composition, precluding the separate recovery of statutory damages. Judge Woods also noted the legal uncertainty about whether a copyright holder can recover actual damages of a copyrighted “work,” and then recover statutory damages for the same “work” (albeit of a derivative work). Because of factual issues as to both of these legal questions, Judge Woods did not need to reach a definitive conclusion about them.

Court Awards Statutory Copyright Infringement Damages of $750 Per Infringement

In a May 22, 2014 ruling, Judge Paul A. Engelmayer granted the plaintiffs’ unopposed motion to award statutory copyright damages of $750 for each of three copyrights that the defendant had previously been found to infringe. Although the Court did not reach the issue of whether the infringement was innocent, Judge Engelmayer wrote that the $750 award was justified irrespective of the innocence of the infringement. The Court also dismissed the plaintiffs’ motion to voluntarily dismiss with prejudice their remaining claims, finding that a dismissal with prejudice will benefit, not harm, the defendant.

Court Awards Statutory Copyright Infringement Damages of $3,000 Per Infringement

In a May 16, 2014 ruling, Magistrate Judge James C. Francis IV issued a Report and Recommendation after an inquest awarding statutory damages of $3,000 per photograph for six infringing pictures of Lindsay Lohan that the defendant published on its website.  Judge Francis found that this amount of damages "represents three time the amount of the licensing fee for each image," making the award "clearly within the lawful range, and, indeed, near the lower end."  The Court also awarded attorneys' fees of $6,732.50, approving hourly rates for two partners of $525 and $450, but reducing a third year associate's rate from $400 to $200.

Court Awards Statutory Copyright Infringement Damages after a Default

In an April 11, 2014 ruling, Magistrate Judge James L. Cott recommended an award of $9,000 in statutory damages after an inquest in the plaintiff’s copyright infringement action for the unauthorized use of a celebrity photograph. The plaintiff sought the $9,000 as three times its lost licensing fee of $3,000. Judge Cott found that “trebling the licensing fee . . . is in line with the general approach taken by courts.”

The Court also awarded attorneys’ fees and costs. While approving the hourly rate of a partner with 20 years copyright experience of $525, Judge Cott reduced the requested associate’s rate from $400 to $300, writing that there was “no detail” about the lawyer’s specialization or experience in copyright litigation.

Court Rules That Only a Single Award of Statutory Damages Is Allowed to Separate Owners of Musical Composition and Sound Recording

In an April 7, 2014 ruling, Judge William H. Pauley III explained his trial ruling “that where two different owners hold respective copyrights in the musical composition and sound recording of the infringed work, they must share a single award of statutory damages.” The Court reasoned that when the defendants “infringed the copyright covering a sound recording and musical composition for the same song, they infringed only one work because the infringement was directed at the sound recording and the musical composition was not exploited.” The Court noted that had the separate owners sued separately, “they may of course collect separately ‘as long as the infringer’s liability on these statutory damages does not exceed the amount provided in Section 504(c)’” of the Copyright Act.

Court Enters Default Judgment and Awards Maximum Statutory Damages in Copyright Infringement Action

In an April 3, 2014 ruling, Judge J. Paul Oetken granted the plaintiff’s motion for a default judgment in a copyright infringement action over the “Frankie and Johnnie” chair, awarded $150,000 in statutory damages, and directed the plaintiff to submit a fee application. The Court “reviewed the filings in this case and conclude[d] that Plaintiff has satisfied the prerequisites to entry of default judgment on its copyright infringement claim.” Judge Oetken further found that the defendant “acted willfully because it is reasonable to assume that as a furniture company, [the defendant] ‘should have known’ that its conduct was infringing based upon its experience with copyright matters.” The Court awarded the maximum $150,000 statutory amount in “light of the compensatory and deterrent purposes of the Copyright Act, the burden of bringing an action, and [the defendant’s] failure to appear.”

Court Adopts Magistrate’s Report and Recommendation of Statutory Damages and Attorneys’ Fees after Default in Trademark Infringement Action

In an April 3, 2014 ruling, Judge George B. Daniels adopted Magistrate Judge Peck’s Report and Recommendation after an inquest awarding $1 million in statutory damages and approximately $10,000 in attorneys’ fees against the defendants who defaulted in the plaintiff’s trademark infringement action. Judge Daniels approved Judge Peck’s conclusion deeming the infringement willful in light of the default. Since the maximum statutory damages award under the Lanham Act is $2 million, the Court adopted Judge Peck’s conclusion that “an award of $1 million – half of the statutory maximum – is sufficient and appropriate in this case.” With regard to attorneys’ fees, Judge Daniels adopted Judge Peck’s conclusion that “the allegations in the complaint, along with Defendants’ default, are sufficient to justify the award of attorneys’ fees to Plaintiff,” and approved the reduction of 15% that Judge Peck made to the amount of fees the plaintiff sought.

Court Recommended Preliminary Injunction and Declaratory Judgment Be Granted, In Part, And Denied Monetary Damages and Attorneys’ Fees Be Denied, For Copyright Infringement Of Documentary Film.

In a March 3, 2014 Report and Recommendation to the Honorable Ronnie Abrams, Magistrate Judge Ronald L. Ellis recommended that declaratory judgment for the plaintiff be granted in part; that the plaintiff’s request for a permanent injunction be granted; and that the plaintiff’s requests for monetary damages and attorneys’ and costs be denied.

Plaintiff Tanya Steele commenced this action against defendants Richard Bell and Josh Milani Gallery, Pty. Ltd. for declaratory judgment, copyright infringement, fraud on the U.S. Copyright Office, breach of contract, and other claims concerning the ownership of the film, Blackfella’s Guide to New York City. Plaintiff sought declaratory and injunctive relief, damages, and attorney's fees and costs, pursuant to the Copyright Act. On May 16, 2013, the Honorable Ronnie Abrams entered default judgment against defendants and referred the case for an inquest on damages.

Plaintiff sought a declaration that she is the "sole author of the Film because she singlehandedly generated the concept for the Film and supervised the Film's creation from start to finish." The Supreme Court has stated that "[t]he sine qua non of copyright is originality." "Original, as the term is used in copyright, means only that the work was independently created by the author (as opposed to copied from other works), and that it possesses at least some minimal degree of creativity." As the plaintiff developed the concept, content, and overall aesthetic for the film, created the title to the film, executed the film, prepared production schedules, shot and reviewed footage, and wrote the script, the court recommended that plaintiff's request for a declaration that she is the sole author of the film be granted.

Court Awards $15,000 in Statutory Damages for Trademark Infringement

In a January 29, 2014 ruling, Judge Robert W. Sweet entered judgment in favor of plaintiffs Debra Schatzki and BPP Wealth, Inc. in their trademark infringement action against defendant Weiser Capital Management, LLC and others after a bench trial. BPP owns the registered service mark “Building, Protecting and Preserving Wealth for Generations,” as well as other marks. The Court found that the “evidence establishes that [Weiser Capital] incorporated BPP’s service marks into its website and promotional materials during Schatzki’s tenure at [Weiser Capital] and continued to incorporate BPP’s service marks into its website and promotional materials for six weeks after Schatzki’s termination.” Judge Sweet wrote that given “the totality of the evidence, [Weiser Capital] did infringe on Plaintiff’s service marks.” Noting that the plaintiffs elected statutory damages, the Court ruled that “given the totality of the circumstances surrounding the use of the service marks by Defendants, including the circumstances of Schatzki’s termination by [Weiser Capital] and role at [Weiser Capital] prior to her termination and that the service marks were ultimately removed from the website and promotional materials” a $15,000 award is appropriate.

In a follow up February 18, 2014 ruling, Judge Sweet declined to award prejudgment interest on the statutory trademark damages award.  Judge Sweet acknowledged that prejudgment interest would be permissible, but is typically awarded for "willful conduct or bad faith and 'exceptional' circumstances."  The Court found that the plaintiffs had not show willful misconduct or bad faith at trial, and so were not entitled to an award of prejudgment interest.

Magistrate Recommends Statutory Trademark Damages and Permanent Injunction Against Counterfeiters

In an August 9, 2013 ruling, Magistrate Judge Frank Maas recommended a $9 million award of statutory trademark damages to Tiffany (NJ) LLC against a series of related defendants (all but one of whom is located in China) and their credit card processor and entered a permanent injunction, but declined to enter a turnover order of funds held in Chinese banks pending an appeal to the Second Circuit of a similar order in another action.  Tiffany filed its complaint against the defendants alleging that they, "through a series of companies and websites, unlawfully manufactured, marketed and sold counterfeit versions of trademarked Tiffany products over the internet, in violation of the Lanham Act."  Tiffany also sued the defendants' credit processor, 95epay, alleging contributory infringement.  All defendants defaulted, and an inquest was ordered.  None of the defendants appeared at the inquest, although three Chinese banks holding defendants' assets and that had previously been restrained appeared to contest a turnover order on, among other grounds, China's bank secrecy laws.

Statutory Damages Awareded and Attorneys' Fees Denied in Copyright Action

In a July 30, 2013 ruling, Judge Paul G. Gardephe adopted in full the Report and Recommendation of Magistrate Judge Freeman awarding plaintiff Rami Shamir $5,000 in statutory copyright damages and denying plaintiff's attorneys' fees.  Shamir had sued a number of related defendants alleging that they had infringed the copyright in his novel "Train to Pokipse" by selling "advanced reading copies" of the book.  The defendants defaulted and largely refused to participate in the proceedings in any meaningful way.  Judge Freeman held an inquest, and in response to Shamir's request for $150,000 in statutory damages, awarded $5,000, noting that the case "'presents a situation of willful infringement, with modes profits to the infringers, at best, and no demonstrable, actual loss to Plaintiff.'"  Judge Freeman declined to award attorneys' fees because ""Plaintiff's unsworn, unauthenticated submission, and non-contemporaneous records, do not substantiate Plaintiff's requested award."  Judge Gardephe, applying a "clear error" standard, ruled that the $5,000 statutory damages award was proper, particularly in light of the defendants' profit of at most $1,200 for the infringing copies.  The Court likewise found the request for attorneys' fees to be insufficiently substantiated.