Two More Copyright Myths Bite the Dust: The $150,000 Statutory Damages Award and the DMCA as the Enemy of Free Speech

Stephen Carlisle March 11, 2015

Two more copyright myths bit the dust this week, though it is doubtless that they will continue to be repeated. The first is the persistent myth of the $150,000 statutory damages award. The second is the myth of the DMCA takedown notice as the enemy of free speech.

The Myth of the $150,000 Statutory Damages Award

This is one of the favorite fear-mongering tactics of the Electronic Frontier Foundation, ¹ namely the ability of a Court, in extreme circumstances to award the sum of $150,000 in statutory damages for the infringement of one copyrighted work. ² Yes, the statute does provide for this kind of award, but only in cases where there has been “willful” infringement of copyright. The true story is that no one gets awarded this level of statutory damages. Note that in the EFF post referenced above, it failed to cite even one instance where the maximum $150,000 award was made.

As a part of my duties, a digest of all court decisions mentioning the word “copyright” is sent to my desk every morning. Having been here a little over a year, I have never seen a court award the maximum amount of statutory damages. The truth is, the awards are usually a couple of thousand dollars, and in several cases I saw, the minimum award of $750 was made. For example, in an endnote to this recent blog post, I detailed the awards made in 7 published judgments won by alleged “copyright troll” Malibu Media. The most that was awarded by any Court was $2,250 per work infringed, and twice, the award was the statutory minimum, $750 per work infringed. ³

On March 10, 2015, the Senate Subcommittee on Antitrust, Competition Policy and Consumer Rights held hearings on whether the Department of Justice consent decrees with the music performing rights organizations should be modified or abolished. ⁴ Once again, Chris Harrison, the Vice-President, Business Affairs at Pandora, trotted out the evil specter of the $150,000 damage award. Unfortunately for him, sitting on the subcommittee was Al Franken, who some of you may remember from “Saturday Night Live,” but is now a Senator from Minnesota. Mr. Franken obviously knows a thing or two about show business and copyrights. Franken pressed him on how many times judgments had resulted in the maximum award of $150,000 being awarded. For his part, Harrison tried to dodge the question, but Franken would not let him. After Franken repeated his question several more times, Harrison finally admitted he knew of no such cases in which the maximum award had been made.

The DMCA as the Enemy of Free Speech

Few things about copyright are more often and wrongfully asserted than the notion that copyrights in general, and the DMCA in particular, inhibits “free speech.” This is reflected in Google’s (and Twitter’s) policy of forwarding all takedown notices to the EFF funded “Chilling Effects” organization.

Landing in my inbox this week was this thoroughly researched law review article in the Virginia Journal of Law and Technology, by Daniel Seng. ⁵ In his article, The State of the Discordant Union: An Empirical Analysis of DMCA Takedown Notices, Mr. Seng writes of how he created a program to analyze the database at Chilling Effects for the years 2008 through 2012. He then broke out the data into several fields including what types of entities sent the most takedown requests (not surprisingly, it’s the record industry ⁶), and for the first time, we have reliable data on how many takedown requests are met with counter-notices.

Remember, that under the plain language of the DMCA, if one has been served with an untrue, or even abusive DMCA notice, one can file a counter-notice and have the material re-posted. Also remember, that according to the tech companies and the EFF, “abuse of DMCA takedown notices is a real and serious problem.” ⁷ Previously, this blog looked at the available evidence and found no support for this proposition and that most of the evidence put forward in support was anecdotal. ⁸ So, if the big tech companies and the EFF are correct, we should see a huge number of counter-notices relative to the number of valid takedowns.

The numbers show the opposite. Arguments about huge numbers of bad and abusive take-down notices are pure fantasy. Mr. Seng found that there were 68 counter-notices reported to Chilling Effects in 2011 and 82 counter-notices in 2012. No counter-notices at all were reported between 2008 and 2010. ⁹

Contrast this with the number of notices filed. In 2011, 71,798 takedown notices were sent to the organizations that report to Chilling Effects. The very next year, 2012, that number had increased over six-fold, to 448,138. ¹⁰ Also consider that just two years later, Google alone received 345 million takedown notices. ¹¹

To recap, in 2011, 71,798 takedown notices were reported against 68 counter-notices, making the rate of bad takedown requests 0.001% of all notices filed.

In 2012, 448,138 takedown notices were reported against 82 counter-notices, making the rate of bad takedown requests 0.0002%. So, the number of takedown requests went up six times the previous year’s number and the rate of bad takedowns dropped.

So, as I said at the top of the post, I do not expect that these two persistent myths will go away. I expect that they will continue to be repeated, despite the fact that all available evidence points to them being not true.