So you’re a Entertainment Law litigator and you get a case in which the facts seem on your side and the monetary damages that might follow could sound, well, juicy. As a recent case involving a rap song video game shows, however, litigants should not count their money in a lawsuit before all the ink’s dry on all the papers.
Consider: What seemed like a copyright infringement lawsuit in New York with a potential $8 million payoff, well, honey, a federal magistrate and a U.S. District Court judge shrank that award. (Online decision posted, courtesy of Courthouse News.) And, combined with a no-show defendant, that led counsel, figuratively, to whistle in the air and wonder about, is it leprechauns and their booty at the end of rainbows?
Let’s look at what happened, starting in 2009, when 4MM, a video-game developer and publisher of Def Jam Rapstar, approached Capitol Records to license recordings for a rap song game with an agreement that 4MM never paid.
Capitol, along with other record companies, sued 4MM for infringement, asserting unauthorized reproduction, distribution, use, and exploitation of certain musical compositions and sound recordings. For its part in this litigation, EMI sought $150,000 for each infringement, sending the projected total damages to more than $8 million.
All defendants in this case but 4MM settled. 4MM never responded and the court ordered a default judgment against it on Nov. 15, 2012. Then, on Jan. 13 of this year, a U.S. Magistrate issued a report and recommendation awarding plaintiffs $535,125 for statutory damages under the Copyright Act, plus pre-judgment interest.
Because 4MM also had let lapse on Jan. 27, 2013, its chance to object, that left standing the recommendations of U.S. Magistrate James Cott to U.S. District Judge Denise Cote, who took note of the defendant’s willful infringement and the need for specific and general deterrence regarding its actions. She and her bench colleague also had to consider 4MM’s less than substantial profits and the uncertainty, for damage considerations, of the number of downloads involved in this case.
The judge issued a permanent injunction against 4MM, barring its use of the disputed tunes, noting the firm continued to infringe even after it was warned, and she accepted the Cott’s recommendations for the half-million-dollars or so in damages.
Here’s the last challenge in the case: The company’s website is now defunct and 4MM lawyers have not appeared on the Federal Court docket. So as EMI attorney Richard Roth has asked, “Can we find any gold at the end of the rainbow?”