FELTNER v. COLUMBIA PICTURES TELEVISION, INC.
In 1991, Columbia Pictures Television, Inc., terminated agreements licensing several television series, including "Who's the Boss," "Silver Spoons," "Hart to Hart," and "T. J. Hooker," to three television stations owned by C. Elvin Feltner after the stations' royalty payments became delinquent. Columbia sued Feltner after his stations continued to broadcast the programs for copyright infringement. After winning partial summary judgment as to liability on its copyright infringement claims, Columbia attempted to recover statutory damages under section 504(c) of the Copyright Act. The District Court denied Feltner's request for a jury trial and awarded Columbia statutory damages following a bench trial. In affirming, the Court of Appeals held that neither section 504(c) nor the Seventh Amendment provides a right to a jury trial on statutory damages.
Does section 504(c) of the Copyright Act or the Seventh Amendment grant a right to a jury trial when a copyright owner elects to recover statutory damages?
Legal provision: 17 U.S.C. 504
Yes. In an opinion delivered by Justice Clarence Thomas, the Court held that, despite section 504(c) of the Copyright Act's silence, the Seventh Amendment provides the right to a jury trial, which includes a right to a jury determination of the amount of statutory damages. Applying a historical Seventh Amendment analysis, Justice Thomas concluded that "there is clear and direct historical evidence that juries, both as a general matter and in copyright cases, set the amount of damages awarded to a successful plaintiff." "As a result, if a party so demands, a jury must determine the actual amount of statutory damages under [section 504(c)] in order 'to preserve the substance of the common-law right of trial by jury,'" wrote Justice Thomas.
Argument of Henry J. Tashman
Chief Justice Rehnquist: We'll hear argument now in Number 96-1768, C. Elvin Feltner v. Columbia Pictures Television.
Justice Roberts: Thank you, Mr. Chief Justice, and may it please the Court--
In this case, a district judge determined that Mr. Feltner should pay Columbia Pictures 8.8 million in statutory damages for a copyright infringement.
Before arriving at that figure, the judge held a bench trial, after which he made the factual finding that Mr. Feltner's conduct was willful, which increased the amount of damages which could be awarded under the statute.
In light of clear historical practice on both sides of the Atlantic prior to 1971, Feltner had a right under the Seventh Amendment to have a jury make that finding and others on which the award was based and determine the amount of damages to be imposed within the statutory limits.
Before reaching that constitutional question, however, we need to consider whether the statute may be construed to afford a jury trial right.
It may be.
First, the first Federal statute providing statutory damages in an amount
"as to the court shall appear to be just. "
the 1856 act, also provided that those damages should be recovered in an action on the case, a prototypical legal action for which a jury would be available.
Statutory damages as to the court shall appear to be just, the samel terminology as employed in the 1856 act, were carried forward in successive acts up to the 1909 act, when the statutory damages provision took its modern form, with no indication that Congress wanted to delete the jury trial right that was so clearly present in 1856.
Unknown Speaker: The concept of statutory damages has changed some, has it not, from 1856 to 1909?
Justice Roberts: Certainly--
Unknown Speaker: The guidelines, or whatever you want to call it.
Justice Roberts: --Yes.
It has been... it was expanded significantly in 1909.
The range was expanded and the 1856 act applied to dramatic compositions.
The 1909 act applied more generally.
But that same language, as to the court shall appear to be just, carried through all the different statutory provisions.
Unknown Speaker: I take it in the '56 act there was no opportunity to elect a different damage scheme after verdict but before a judgment as there is in the current act.
Justice Roberts: That's right.
That's one of the distinctions added in 1909 from the 1856 act.
Unknown Speaker: So if we followed your reasoning in this case, as I think your opponents have pointed out, we would have to accept as a consequence that a jury could render its verdict on actual damages, be discharged, go home, and at that point the election could be made to go for statutory damages, and I don't know what happens then.
I guess the jury would have to be called back on your theory.
Justice Roberts: That's a false problem.
It's never been a problem in the courts that have recognized the jury trial right so far.
All the judge needs to do--
Unknown Speaker: But it could happen, couldn't it?
Justice Roberts: --I don't think so.
All the judge needs--
Unknown Speaker: Why?
Justice Roberts: --to do is to say to the plaintiff, when the jury comes back, I'm going to enter judgment promptly upon their verdict and therefore they'll be there.
If the plaintiff says I want to elect statutory damages--
Unknown Speaker: Well, if--
Justice Roberts: --the jury would not have been sent home by that point.
Unknown Speaker: --And at that point do you tell the jury... and this is a problem that I have that runs through the whole case as to what the judge tells the jury.
Would it suffice if the jury is told, render such damages as you consider to be just?
Justice Roberts: Well, I think the jury would be instructed according to the factors it's supposed to consider, as juries are, for example, in awarding punitive damages.
Unknown Speaker: I looked in Devitt and Blackmere to see if there were any instructions on statutory damages.
There are not.
The common law measure is there.
I'm just not sure what the judge tells the jury.
I'm not sure also which way that cuts.
Justice Roberts: Well, the courts have developed guidelines of what is appropriate to consider, whether it's a jury or a judge, in awarding statutory damages, the amount of loss, the value of the copyright, profits--
Unknown Speaker: Those are all set forth in Nimmer and in the brief, amicus brief filed by the Composer's Association and again, I'm not sure which way that works.
It... on the one hand it seems to me that this is an area where we should develop uniformity and consistency and judges would be helpful.
I suppose your answer to that is that a set of jury instructions developed over the years could do the same thing.
Justice Roberts: --Well, just as with the case of punitive damages, which is an amount of damages left largely to the discretion of the jury, there have developed instructions as to the factors they should consider, and likewise--
Unknown Speaker: None of which have been effective.
It's been a serious problem.
But this copyright law is so odd, because under your version, then, a jury would go out and could determine actual damages and come back with a verdict and a figure and then the plaintiff can say, well, I've looked at that, I think I'd do better under statutory damages and can reject that and ask for statutory damages.
Justice Roberts: --That's true whether a jury or a judge is making that initial determination, so that concern I think doesn't really cut one way or the other on the question of whether--
Unknown Speaker: Mmhmm.
Justice Roberts: --the jury or the judge reaches that conclusion.
They are unusual in that respect.
Unknown Speaker: Now, in the Tull case from this Court we upheld a scheme under similar Seventh Amendment type concerns and said the judge could nonetheless determine statutory damages.
Justice Roberts: Well, the holding in Tull is first of all that that is a legal action, the civil penalty action.
The court analogized to civil penalty actions in the Eighteenth Century, said they were legal, noted that the nature of the remedy, punishment was legal, and then at the very end said, but the actual amount is for the judge.
Unknown Speaker: Well, maybe that would be true here.
Justice Roberts: --If it is true here, then the judgment needs to be reversed because, of course, this judge didn't just determine the amount of damages.
He made a factual finding of willfulness under the statute.
That's something that if this is a legal action--
Unknown Speaker: Well, I assume the willfulness aspect could certainly go to a jury if that were the Court's decision, but what would your position be on the balance?
Justice Roberts: --Well--
Unknown Speaker: Because there still is a discretionary element there, a range of sentences.
Justice Roberts: --There is a discretionary element and Tull, I think, should be limited to the civil penalty context in which it arose for a number of reasons, first of all because that aspect of the holding was dicta in Tull as a technical matter.
The question of who should determine damages wasn't before the Court, because the Court had reversed on liability.
It may not have been necessary to reach that question at all.
That's a technical point.
But the more substantive one is that if you go back and look at the briefing in Tull, it was devoted almost exclusively to the question of liability, very little discussion of the question of damages at all and, whatever may be the case with respect to civil penalties prior to 1791, when damages were not fixed, juries decided damages.
Unknown Speaker: And the distinction is that in Tull the Government received the money and that makes it a governmental type of penalty and here the private individual--
Justice Roberts: Well, the distinction--
Unknown Speaker: --The owner of the copyright receives the money and therefore it's not a penalty.
Justice Roberts: --The distinction goes back to the 18th Century practice in England.
When damages were not fixed, juries set the amount of damages, so if Congress has not fixed the amount of damages in a copyright action, they should be set by juries under this Court's precedent.
Unknown Speaker: Well, but they didn't fix them in this Clean Water Act, either, under Tull.
Justice Roberts: I don't think there was any evidence of juries--
Unknown Speaker: I know we have a problem with Tull for your case and you want to limit it and you indicated it's a penalty, but can't you look at the statutory damages also as a penalty, and so I ask, does the--
Justice Roberts: --Well, they--
Unknown Speaker: --identity of the recipient determine... is that what your distinction's based on?
Justice Roberts: --Well, that's part of it, and also in the civil penalty action you have an analogy to criminal sentencing where a judge determines the sentencing.
That analogy doesn't apply in this case because this is a private right... it's not a public right... a private action between two parties and the core of the analysis, though, although I think Tull can be limited in that way and its statement is dicta, the core of the analysis shouldn't be extended because it can't be defended.
The idea that although Congress fixed the... when Congress fixes the amount of the penalty it can therefore delegate that task to judges ignores the whole purpose of the Seventh Amendment.
The Seventh Amendment is to protect against judicial bias and corruption and overreaching and, while that's not implicated when Congress fixes the amount because Congress is doing that, the judge is just applying it, when you give that task to the judge the whole reason for having the Seventh Amendment comes into play, so that logic in Tull, I think, should at the very least not be extended any further.
Unknown Speaker: Is there any evidence who set the... in... under the Statute of Anne in the 18th Century it was a penny a sheet or something, I think, in damages.
Justice Roberts: Yes.
Unknown Speaker: If there was an argument about how many sheets there were, did the jury decide it or the judge, do we know?
Justice Roberts: The jury, cert jury.
We've cited cases to that effect I believe on page 43 of our brief.
Unknown Speaker: But Mr. Roberts, in this case on that very point that was the one piece of it that I noticed... and you said willful or not goes to the jury and how much goes to the jury, but in this case, it may not be the case generally, it seems to me that how many infringements was ruled on as a matter of law.
Didn't the judge rule on it even before his bench trial?
Justice Roberts: It's very confusing.
He did not.
At the start of the bench trial he said that the issues remaining for trial were how many infringements were involved and were they willful, and what should the damages be, so at the very outset at least, he thought that was an issue for trial.
Later on, he also said he wanted to hear about how many infringements were involved.
Later on, he said he was ruling on it as a matter of law.
Unknown Speaker: But aren't those questions... whether each series is a... each one episode in a series is a separate work, it sounds to me like that's a legal question.
Justice Roberts: Oh, it's a mixed question of law and fact.
It depends... and the legal standard was correctly stated.
It depends upon whether each episode has what's called an independent copyright life, an independent economic value, and that's a question of fact.
You take evidence on that.
How was it copyrighted?
How was it produced?
How was it marketed?
Would the television station show just one episode of a series or not?
There are factual issues involved in that and then a legal standard to be applied, and we think what should have happened is that the jury should have been able to determine those facts based on proper instructions of the... what the legal test was.
Unknown Speaker: --Do you say the same thing about the two stations, whether they were--
Justice Roberts: Yes.
Unknown Speaker: --separate entities?
Justice Roberts: It's not just a question of whether they were separate entities, but whether they were jointly and severally responsible for the infringement, because the statute allows only one award of statutory damage for all individual or joint and several infringements of each work.
Unknown Speaker: So you say if this judge ruled on those two questions as a matter of law that he was wrong.
Justice Roberts: Yes.
That... those should have been submitted to the jury and, as I say, there's some confusion as to what he did.
It's hard to tell.
Unknown Speaker: You're not saying that in principle they could never be ruled on as a matter of law.
Justice Roberts: Oh, no.
Unknown Speaker: I mean, the facts could be so clear that no reasonable jury could find the factual element except one way.
Justice Roberts: The normal rules--
Unknown Speaker: You assert that's not the case here.
Justice Roberts: --The normal rules about directing verdicts and taking issues away from juries I think apply.
Unknown Speaker: That happened on the infringement question.
Justice Roberts: Yes.
Infringement was settled on--
Unknown Speaker: That was summary judgment.
Justice Roberts: --On summary judgment.
Unknown Speaker: But you don't think that this question, how many, could be summary judgment, too, but you say it wasn't in this case.
Justice Roberts: I think it was not in this case.
I do think it's difficult to tell when you have the judge acting both as factfinder and as ruler of law when he's saying based on these facts I'm making this decision, or I'm making this decision as a matter of law and it's also difficult, when that same judge has made a ruling on summary judgment, to tell, is he saying based on the evidence at trial, or I saw this evidence before on summary judgment.
So there is some ambiguity in the record, but I think the jury should have been instructed on the number of infringements, as the judge indicated was an issue available for trial at the outset.
And the court of appeals seemed to think that that was decided at least as a mixed question.
It referred to the judge's findings and whether or not they were erroneous, rather than treating it as a legal ruling.
Now, the first step in this Court's constitutional approach is to find an analogue to this action in 18th Century practice and ask whether that's legal or equitable.
The analogue to modern actions for statutory damages for copyright infringement is the 18th Century action for statutory damages for copyright infringement under the Statute of Anne, under the first Federal copyright statute passed 1 year before the Seventh Amendment by the same Congress that passed the Seventh Amendment, and those statutes provided for recovery of amounts and specified that they should be recovered in an action at law.
Unknown Speaker: As I understand it, after the Statute of Anne, the... if a copyright owner thought the damages were a little too small, so he preferred often to go into equity to get an injunction.
Justice Roberts: Yes.
Unknown Speaker: When he did that, could he also get damages?
Justice Roberts: He had to go in a separate proceeding at law to get damages.
Unknown Speaker: Could not get damages on the equity side.
Justice Roberts: Not in equity, no.
Unknown Speaker: Do you... is there a citation for that in your... I--
Justice Roberts: Well--
Unknown Speaker: --It sounds to me right, but--
Justice Roberts: --Millar v. Taylor I think is the best that I can come up with, which is--
Unknown Speaker: --The Millar case.
Justice Roberts: --After the Seventh Amendment was adopted.
It discusses the history.
Unknown Speaker: But that was overruled, basically, by the statute... well, all right, thank you.
Justice Roberts: Overruled by the House of Lords in Donaldson but not on that question.
It was the question of whether common law copyright survived the Statute of Anne.
Another thing that--
Unknown Speaker: But in the fullness of time didn't equity clean up?
I mean, the cleanup doctrine that if there were damages... the main thing was injunctive relief, but you could incidentally collect damages.
Justice Roberts: --Up until Beacon Theatres and Dairy Queen.
Unknown Speaker: Yes, but there was... you didn't have to bring a separate action at law under the cleanup doctrine.
Justice Roberts: Under the cleanup doctrine, but in Beacon Theatres the Court noted that that could not be used to deprive a party of the right to a jury trial.
Unknown Speaker: But the judge could no longer set the order of trial.
Justice Roberts: --That's right, that ruling on the injunctive aspects couldn't deprive a litigant of his right to a jury trial on the legal aspects, and the legal aspects plainly included the right to statutory damages.
Now, the statutory damages have changed since then, as was pointed out.
The main difference is the modern version gives you a range, and these 18th Century precedents we've been talking about are primarily fixed amounts.
That is not a distinction that makes a difference.
The Government made that same argument in the Tull case in footnote 7.
It said those 18th Century civil penalty actions were for fixed amounts and this, the Clean Water Act is for a discretionary range.
The exact words of this Court are, we do not find that distinction to be significant.
In addition, there were statutory damages--
Unknown Speaker: Isn't that inconsistent with the argument you made earlier that Congress sets the amounts?
Justice Roberts: --Sets the--
Unknown Speaker: I thought you... we were talking earlier about how to distinguish or confine Tull and you said, well, the Congress sets the amounts.
Justice Roberts: --In--
Unknown Speaker: But the Congress there set a vast range, and it's... which is very much like the statute we're involved with here.
Justice Roberts: --But the argument in--
Unknown Speaker: And--
Justice Roberts: --In Tull was, because Congress had fixed the amounts earlier they could delegate that to a judge.
Here you had in the 18th Century fixed amounts under the Statute of Anne, under the first Federal copyright statute, but also a situation where you could get damages for copyright infringement that weren't fixed by Congress and whenever they were not fixed by Congress, those were for a jury.
I don't know that that situation was replicated with respect to the civil penalty actions of the sort at issue in Tull.
And it's also the case here we had 18th Century preSeventh Amendment statutes providing for a range of statutory damages.
Statutes in Massachusetts, New Hampshire, and Rhode Island provided for the recovery of statutory damages within a broad range, so therefore that basic distinction, the difference between fixed and range, doesn't make a difference with respect to characterizing the action.
The second step in this Court's constitutional analysis is to look to the nature of the remedy.
Here, the remedy is money damages, the hallmark of legal relief, and this Court has said that monetary damages are legal and require a jury except in two very specific, defined circumstances, when they constitute restitution or disgorgement, and when they're incidental to or intertwined with equitable relief.
The first certainly doesn't apply here.
Restitution is one of the factors that the jury can consider in setting the amount of damages, but it's not the only one.
They also can look at punishment and compensation, traditional legal remedies, and those legal remedies give the right to a jury.
Again, this is another argument that was made in Tull.
The Government argued there the purpose of the Clean Water Act penalties is restitution.
Therefore, this is equitable.
The Court said no, the purpose is also punishment.
Punishment was one of the purposes.
That's a legal remedy and therefore this is a legal action.
The modern statutory damages serve the legal purposes of punishment and compensation.
You can see the punishment aspect in the fact that you get a broader... a higher range for willful, a lower range for innocent.
You can see the compensatory aspect in the fact that these damages are instead of actual damages.
You don't get both because they serve the same purpose, provide some recompense for the copyright holder.
Unknown Speaker: --What about the argument that actual damages may be hard to prove and so because the legal remedy is inadequate, actual damages, so you have this alternate of the statutory damages, so doesn't equity come in when the legal remedy is inadequate.
Isn't that the basic reason for equitable--
Justice Roberts: That is the basic prerequisite for equitable relief and it's not specified here.
Here, statutory damages are available at the election of the plaintiff for whatever reason or no reason.
He does not have to show that legal... actual damages or legal remedies are inadequate.
Second of all, the fact that that's one of the reasons you have this relief doesn't make it equitable.
Parties frequently provide liquidated damages in contracts because they think it will be difficult to prove actual damages.
If you sue for liquidated damages in a contract it's still a legal action for which a jury is required.
That's the reason you had the fixed penalties in the Statute of Anne, because actual damages were difficult to calculate and yet the respondent agrees that that was a legal action to recover those damages.
Unknown Speaker: --Perhaps you've said this, but it would be helpful if you could just summarize in a sentence, possibly.
If you take Tull, you know, and look at part 3... you know what I'm thinking of.
Justice Roberts: Yes.
Unknown Speaker: All right, and then suppose someone were to say, well, that seems to describe this case, you would say, no it doesn't, and the main distinction that you would make between part 3 of Tull and this case is?
Justice Roberts: Well, the main distinction is that Tull--
Unknown Speaker: Or two if you'd like, or three, but I mean, I'm just trying to get the heart of what you--
Justice Roberts: --Tull is a... Tull first of all is an action by the Government for civil penalties.
This is an action between private parties for damages.
At common law, when damages were not fixed, as they're not here, juries determined the amount of damages, whatever may have been the case with respect to civil penalties.
In Tull, I think--
Unknown Speaker: --I don't want to interrupt Justice Breyer's colloquy with you, but you're talking about two things.
You're talking about the identity of the recipient and the... whether or not the amount is fixed and it seems to me that the latter doesn't help you here, because Justice Breyer I think implied that the range of penalties that Congress sets under the Clean Water Act in Tull look very much like the range that it is setting here.
Justice Roberts: --The difference is that under Tull and the Clean Water Act the Court couldn't... wasn't provided with and didn't find any analogies in the 18th Century where there was a similar range and you got a jury.
Here we have that.
The three State statutes I mentioned provided a range prior to the adoption of the Seventh Amendment and they said, you recover this range in an action of debt, an action at law.
So whatever may be the case, and under the Seventh Amendment you need to look at the particular actions and the historical analogues, whatever may be the case with respect to civil penalties, the analogue here is there prior to the adoption of the Seventh Amendment and it was an action at law.
But with those distinctions of Tull in mind, again, the basic core of the reasoning should not be extended.
When damages were uncertain, that was when the juries were needed most.
This Court said so in Barry v. Edmunds.
Where no precise rule of law fixes the reasonable damages, it is the peculiar function of the jury to determine the amount.
That was the rule at common law, Lord Townshend's Case, the jury are judges of the damages, and that is what this Court held with respect to the Seventh Amendment consistently, at least prior to Tull.
That's why we don't have additur or unconditional remittitur, because it's for the jury to determine the amount of damages.
That's the rationale in Chief Justice Marshall's opinion in Bank of Hamilton.
The statute there said you could be evicted, but you were entitled to compensation for improvements, improvements will be set by commissioners, unconstitutional under the Seventh Amendment.
Juries set the amount of damages.
Now, that body of precedent with respect to damages is wellestablished.
The body of precedent with respect to civil penalties may well be different, but the Court noted in Tull, for example, that it had been presented with no evidence that the Framers were concerned that the jury trial right extend to the question of remedy, and that's right.
If you go back and read the briefs, the evidence isn't there, but the evidence is there in the real world.
The amount of damages was a critical component of the jury trial right.
The episode in New York in 1764 that figured in the ratification debates involved solely a redetermination of the amount of damages set by the jury.
Unknown Speaker: Is the history of it that in England the amount of damages wouldn't have been an issue in terms of amount in respect to the... because the Statute of Anne says a penny a page, but in the United States your point is that some States did make it a jury issue?
Justice Roberts: Well, that point--
Unknown Speaker: A lot of States, perhaps.
Justice Roberts: --That point, but also another one, Your Honor.
Unknown Speaker: What?
Justice Roberts: And that is that there are other situations where damages for copyright infringement were not set.
For example, if you're seeking damages with respect to an unpublished work, then a jury would determine those amounts.
Unknown Speaker: But that's a different--
Justice Roberts: --Under section 504(b) if you're seeking actual damages a jury would determine that amount.
There are situations where the damages are not fixed and in those cases there's no question that it would be for a jury to determine, so whatever the force of Tull with respect to civil penalties, they don't apply to the copyright infringement area.
Unknown Speaker: --What about if... suppose a person brought in the 18th Century an action for an injunction and coupled it with a request for damages?
Justice Roberts: I believe that the action for damages had to be filed separately in a court of law.
It couldn't be joined with the equitable action for an injunction.
Unknown Speaker: But we've already agreed that, as equity emerged, you could combine the two.
You could clean up, you could get damages if you... the main thing that you want is... in the--
Justice Roberts: Well--
Unknown Speaker: --Until Beacon and Dairy Queen--
Justice Roberts: --Yes.
Unknown Speaker: --that was routine.
You could go into equity and say, by the way, equity cleans up, clears up, so incidentally, award me damages.
Justice Roberts: Yes, and Beacon Theatres and Dairy Queen pointed out the flaw with that line of reasoning, which is it was depriving the parties of their right to a jury trial through the conduct of the litigation and you could not go and get both in a single action in equity in England.
Now, with... the State precedent here I don't think should be dismissed as simply the American practice as opposed to the English practice.
The Court is concerned about looking to practice here because they don't want to rely on idiosyncratic practice, but there's no evidence here that the statutes in New Hampshire and Massachusetts were in any way inconsistent with English common law.
There were three of them, which suggests that they were not aberrational at all and the language was perfectly consistent with all the other statutes that were provided at that time, all of which providing relief at law, with the difference that they provided it within a range.
Unknown Speaker: Mr. Roberts, correct me if I'm wrong, but I thought that the cleanup doctrine originated in England and we... our law developed in the same way.
Justice Roberts: I think it did originate in England.
I don't know when.
But again, my reading of Millar v. Taylor is that you couldn't get damages for copyright infringement in an action brought at equity.
You could get your injunction, then if you wanted damages you went in a separate action at law.
Unknown Speaker: Well, at any rate the test is what was the practice at the time of the adoption of our Constitution, isn't it?
Justice Roberts: Yes.
Unknown Speaker: Not what became the practice later.
Justice Roberts: Yes.
If I could reserve the remainder--
Unknown Speaker: Very well.
We'll hear from you, Mr. Tashman.
Mr. Tashman: Mr. Chief Justice, may it please the Court--
Congress enacted statutory damages in 1909 as an alternative to actual damages to provide some recompense to copyright holders.
Congress did this because it recognized that actual, legal damages were frequently difficult, if not impossible to prove and therefore did not provide an adequate remedy.
Statutory damages were later amended and expanded in 1975 and in 1988.
The formulation of an alternate form of relief where legal damages are inadequate is quintessentially an equitable remedy.
Moreover, statutory damages require and involve the exercise of nearly unbridled discretion by the court and an appeal to the court's sense of justice based upon the particular facts in an individual case to fashion a remedy that is both just and consistent with the goals of the Copyright Act.
Unknown Speaker: Did the Tull footnote 7 in effect say that's not a consideration that should influence--
Mr. Tashman: No, it didn't.
I think the Tull footnote 7 said that the Government's argument regarding discretion was in a sense trumped by the fact that what we were dealing with in Tull were punitive damages, or a punitive statute and that was the more important consideration in Tull and the Court correctly stated in Tull that punitive damages and penalties were the exclusive province of the courts of law and not the courts of equity.
However, statutory damages, and by that I mean the damages in the 1909 and 1976 act, are not punitive damages and this Court has so ruled in the L. A. Westermann case.
The primary purpose of statutory damages is to find some method of recompense to the copyright holder, given the inadequacy of the legal remedy of actual damages.
Unknown Speaker: --Mr. Tashman, if I follow your argument correctly, then if a copyright holder comes in at the outset and says, I want the court to find that there has been an infringement and I want statutory damages, I don't want any other kind of damages, could such a plaintiff then avoid having a jury trial on the question of infringement?
On your theory, I take it yes.
Mr. Tashman: Absolutely.
I would characterize statutory damages as an equitable action and an equitable proceeding, just like an action for an injunction and, as in an action in an injunction, all the issues, including the issue of infringement, would be for the court and in a similar fashion, if only statutory damages were sought, which is quite possible under the current act, in the 1976 act, then all of the issues, including infringement, would go to the court.
Now, in this case statutory damages were not elected until after the court granted summary judgment both on copyright liability and also the number of infringements which were involved.
The court held--
Unknown Speaker: There seems to be a debate about what... the number of infringements, whether that was, in fact, a summary judgment--
Mr. Tashman: --Oh, there's no question about it.
The only question that I think is subject to some debate, and even that is really not subject to serious debate, is not the number of broadcasts, because that was either found by the court or stipulated to, but the number of... or the number of series that were broad... the number of episodes which were broadcast because, again, that was stipulated.
Unknown Speaker: --But whether each episode counts as a work.
Mr. Tashman: Correct.
Unknown Speaker: Mr. Roberts said that is a mixed question of law and fact.
Mr. Tashman: It is, except in this case there was no dispute as to the facts, and we don't dispute the facts.
There was no dispute at trial that the series are sold in a single contract.
There was no dispute at the trial that the stations are free to broadcast any number of the... of these episodes, but in this case it was stipulated to that each and every one of the episodes was broadcast between two and three times on a separate date.
Unknown Speaker: Well, I don't want to distract you with a question that would be peculiar just to this case, but I think you have made an important clarification that in your argument statutory damages are just like injunctive relief, so if you come into the court and say, all I want is an injunction, then the infringement will be determined by the court as well.
Similarly here, if the copyright holder says, I want to have those statutory damages and so, please, no jury to say whether the defendant infringed or not.
Mr. Tashman: Yes, I think that would flow once the court, or if the court characterized the statutory damages as an equitable remedy and an equitable--
Unknown Speaker: Why didn't the--
--That's difficult to do, isn't it?
I mean, in an injunction the question for the court is whether certain conduct should be prohibited or not and here, in the statutory damages, there is a range of options for the imposition of the damages and there's a certain amount of discretion involved in fixing the amount within the possible range, is there not?
Mr. Tashman: --Well, there's a huge amount of discretion involved.
Unknown Speaker: Yes.
Mr. Tashman: And that--
Unknown Speaker: And that is a typical question that a jury would address and certainly, if you look to the common law antecedents, that's the kind of thing that in the copyright area would have been determined by a jury.
Mr. Tashman: --Well, I have to agree with... I have to disagree with Your Honor on two counts.
First, as to the practice at common law, under the colonial statutes and under the 1790 act as well, the... well, let me focus on the 1790 act first.
The jury played no role whatsoever in determining the amount of damages.
The only thing the jury determined was whether or not there was an infringement and the number of copies in the possession of the infringer and, once those two facts had been determined, damages were calculated arithmetically by multiplying the number of works in possession by the 10 cents a page, or whatever.
So if we look at the state of the world just prior to the passage of the Seventh Amendment, the jury really had no role in calculating the amount of damages.
Unknown Speaker: Well, it surely would have had a role in determining what later emerged to be an element of willfulness and the extent of the violation and how many pages, or how many events occurred.
Mr. Tashman: Well, I'm afraid I have to disagree with Your Honor again.
Willfulness is a concept that is completely alien to copyright infringement at common law and, indeed, it's completely alien to copyright infringement until 1978.
Unknown Speaker: Oh, but it's a concept that is very familiar at common law in all kinds of criminal and tort law situations.
That's a typical determination by a jury, is something intentionally done, or willfully done.
Mr. Tashman: That is certainly true.
Unknown Speaker: That lends itself to jury determination very readily.
Mr. Tashman: Unlike the assessment of statutory damages within a range, which involves a huge amount of discretion and this discretion is really entirely different from the discretion that a jury uses in trying to ascertain the appropriate amount of actual damages.
Unknown Speaker: How about punitive damages?
A jury has extraordinary discretion there.
Mr. Tashman: Well, it certainly has more discretion than it does in determining actual damages, but for example, the jury cannot, and it would be error for the jury to take into account the conduct of the attorneys and the conduct of the litigants in bringing the litigation and how they conducted the litigation and yet these are factors that courts have taken into account in determining the amount of statutory damages.
Also, I think juries--
Unknown Speaker: You think that that would be impossible under punitive damages, if the jury thought that the defendant in the case knew that it was guilty and had conducted a rear guard action of obstructionist litigation and so forth?
I'm not sure a jury--
Mr. Tashman: --Well, I--
Unknown Speaker: --couldn't consider that for punitive damages.
Mr. Tashman: --I believe there are cases which have held that it would be reversible error for the jury to consider the conduct of counsel at trial and that that conduct has been considered--
Unknown Speaker: Oh, I'm sure just an isolated, you know, piece of rudeness or something like that, I'm sure that would be the case.
You think that could be taken into account here?
Mr. Tashman: --If statutory damages... absolutely.
Unknown Speaker: Really?
Mr. Tashman: --The courts--
Unknown Speaker: The jury thinks counsel were rude to the judge--
Mr. Tashman: --No, no, in statutory damages courts have used the cooperation or lack of cooperation and the manner in which counsel have conducted themselves at trial as a factor in determining the appropriate amount of statutory damages.
Unknown Speaker: --Is... I just wonder, can I go back for a second to your answer to Justice Ginsburg.
Could you explain to me very briefly, as... perhaps I haven't a clear view of Tull, but Tull was a case that I thought gave you support and, as I understood the case, it would have said that the action for damages, a penalty in that case, is, in fact, legal and therefore the plaintiff or a defendant, there would be a right to a jury trial, but then it talked about the assessment of the amount of the penalty and, as far as the assessment of the amount of the penalty was concerned there was no Seventh Amendment right.
Now, if that's... if I'm reading it correctly, then in this case it would suggest that even if... I take it you'd have to say and even if.
Even if the claim is legal and therefore there is a right to a jury trial to determine whether or not statutory damages is due, there is under Tull nonetheless no jury trial right as to the amount of the damages.
Now, is that a correct reading of Tull?
Is Tull applicable in that way?
Are you going to disown Tull, or what is it you want to do about that?
Mr. Tashman: Well, I'm very happy about Tull and I certainly don't want to disown that case.
Tull I think is controlling.
In the event that the Court finds that statutory damages are a legal remedy, our initial threshold argument is that statutory damages are not legal but are equitable.
Tull is not consistent with that.
Tull found that the civil penalties in that case were legal.
Unknown Speaker: That's right.
Now, I want to know what happens if I think, hypothetically, that this is a legal remedy, statutory damages.
Mr. Tashman: Right.
Unknown Speaker: At that point, is that the end of the matter, or are you saying that indeed, even if that's so, given part 3 of Tull, the judge may or Congress may give the judge the power to assess the amount of the penalty?
Mr. Tashman: Well, we are arguing that this is equitable, but in the event that the court rejects that and finds that it is legal, we are clearly arguing that, based upon Tull and based upon the second prong of the test in the Court's recent decision in Markman, that it would be entirely appropriate for the Court to assess the amount of statutory damages.
Unknown Speaker: But then you would lose under--
--But if it were legal, then you'd have the right to a jury trial on infringement, I take it.
Mr. Tashman: Correct.
So... I'm sorry.
Unknown Speaker: And also on... if all you have in your corner is Tull, then you lose on infringement, you lose on willful, or innocent.
That would also be for the jury under--
Mr. Tashman: Well, certainly we don't lose on infringement because in this particular case infringement--
Unknown Speaker: --Yes, but I mean as a question of whether you would be entitled to a jury trial if there is a fact to be tried.
Mr. Tashman: --I know--
Unknown Speaker: If Tull is all you have, then if there is a fact to be tried, the only thing you would get from a judge is the amount of damages, not the willfulness determination, not the number of infringing acts, and not the basic infringement question.
What more could you get from Tull except the very last piece of it?
Mr. Tashman: --I would think that Tull would give us more than the last piece, and that would be any issues that relate solely to the question of liability, such as willfulness, would be the province of the court, and I think that's especially significant in this case.
There is no requirement under the Copyright Act... and the petitioners make this argument and I think it's clearly incorrect, that there is no mandatory requirement for a finding of willfulness or a finding of innocence.
The statute gives the court the absolute discretion to award damages between 500 dollars and 20,000 dollars without any finding whatsoever as to willfulness or innocence and in this case the court found that 20,000 dollars was the appropriate award, and that is an award which does not require any finding of willfulness or innocence.
Only if the court wants to go above the 20,000 dollars is there a requirement that the court find willfulness.
Unknown Speaker: But didn't the court find willfulness here as kind of a part of his explanation of why he picked 20 rather than 500 dollars?
Mr. Tashman: Well, we certainly know that the court did find willfulness.
As to why the court decided to award 20,000 dollars, which would be the maximum amount without a finding of willfulness, we really don't know.
Unknown Speaker: You really want to slice this statute very, very fine, so that not only does the amount of damages somehow get lopped off from the rest of it, but even within the damage provision, up to 20,000 dollars can be decided by the judge alone and when you get above that, if there's willfulness, it... the jury has to be called in.
How does that work?
What... I mean, how does the judge know there's no willfulness, so that he should only give up to 20,000 dollars?
I assume he has to send it to the jury first for the jury to find whether there's willfulness and, if the jury finds no, then he can do between 5 and 20, but that didn't happen here, did it?
Mr. Tashman: Well, I think we could avoid that problem by... in a case where the plaintiff requests damages no greater than 20,000 dollars.
Unknown Speaker: Well, let me ask even... even in that case, I'm... I want to ask a question that goes to the point of whether Tull helps you even on damages alone.
One reason Mr. Roberts suggested that Tull might not help you on that is that in Tull there was no... there was no 18th Century analogue and here he says there is and, going to that point, my question is this.
Granted that in the early actions which were, I guess, brought in this country either for debt or in an action on the case for damages which were, as you point out, just mathematically calculated... you find the number of sheets, you multiply it times a penny or whatnot, and that's your verdict... nonetheless, despite the rather mechanistic way that damages would be calculated in those cases, is there authority that indicates that in those early cases the juries were returning verdicts simply of so many sheets plus infringement, as distinct from a verdict for money damages?
In other words, were the juries coming back with general verdicts, or were they simply coming back with the basis for calculating a verdict which the judge then did?
Do we know?
In other words, I want to know what the 18th Century analogue is here in practice.
Mr. Tashman: I... that's not a question that I have an answer to, although I would argue that, regardless of whether or not the juries specified an amount in the award or whether they just specified the number of copies in the possession of the defendant, that this statute and the colonial statute are entirely inadequate analogues to statutory damages, because the key and the essence of statutory damages is finding an alternate way to recompense the plaintiff outside of the standard rules of proof and outside of the standard measure of damages and outside of the standard rules of evidence.
And what we have in the 18th Century are classic, rigid, legal causes of action either in debt, which is a sum certain, which is the antithesis of statutory damages--
Unknown Speaker: Or case, which is not.
Mr. Tashman: --Or case, but again, while there's more flexibility in case, what we're talking about is actual damages.
What we're talking... there's no question that case is the analogue of actual damages under 504(b) and there's no question that, under 504(b) for actual damages, there's a constitutional right to a jury trial.
Unknown Speaker: All right.
Let's assume that.
Let's assume that the analogue is not point for point.
How do you answer this objection one of the questions that we have to ask, if we get to the point in the argument, is whether the jury... according the jury trial under the present circumstances is necessary to preserve the substance of whatever the 18th Century right was.
If we start with the conclusion that the 18th Century juries were at least awarding something in the nature of actual damages, as distinct from statutory damages today, you nonetheless I think have to face this, that if, today, a plaintiff asks for actual damages, the plaintiff would, on the reasoning of the 18th Century analogue, get the jury trial right and the defendant would get the benefit of the jury trial right.
Whereas if today's plaintiff says, I want to go for big money, I want to go for the kind of statutory damages which in this case could have resulted, I think... what was it, 44 million dollars, the upper limit +/?
a great deal of money, anyway, the jury right disappears and, given your answer to Justice Ginsburg, it disappears even on the question of liability.
Don't you face the problem of how we preserve the substance of the 18th Century right if we accept your argument and, in particular, if we accept your answer to Justice Ginsburg?
Mr. Tashman: No, I don't think so.
I don't think the substance of the 18th Century right goes to the amount or the size of the award.
Unknown Speaker: Well, let's assume that it at least goes to liability and the... on your answer to Justice Ginsburg, the right to a jury determination on liability is likewise gone if the election is made to accept the statutory damages.
Mr. Tashman: And that is no different from the fact today, or during the 18th Century, that if a copyright holder brought an action for an injunction plus an equitable accounting, that all issues in that case, including the question of infringement, would be for the court.
Now, the size and the impact--
Unknown Speaker: Well, they would be, but at least the accounting is... is at least for money that should not have been in the pocket in the first place.
We're talking about a statutory damage remedy here with an outer limit in a willfulness case that exceeds anything that was known to 18th Century equity, I would suppose.
Mr. Tashman: --Well, I'm not sure that's true if you factor in inflation, but regardless of that, if you're talking about an injunction to enjoin another copyrighted work... for example, today one motion picture believes another motion picture is infringing and if you want to talk about leverage, the leverage and the risk is not so much the damages as enjoining the infringing work, which may have cost hundreds of millions of dollars, before that work is distributed based upon copyright infringement.
So it's quite possible that when you're dealing with injunctions the potential for injury to the defendant is just as great, if not greater, than when you're dealing with actual damages or statutory damages.
Indeed, I think--
Unknown Speaker: Do we... is that the... I mean, I think that's a very good argument.
It raises a question in my mind as to whether we should accept that analogy, because isn't the analogy that we look at in asking about the preservation of the substance of the jury trial right the analogy between the action at law then, or an action at law then and an action at law now?
In other words, should I accept your analogy to what equity could do?
Mr. Tashman: --Well, certainly equity did not do that in the 18th Century, but if there were statutory damages it would be an equitable... it would be an equitable... you would get them in equity, because they involve extraordinary discretion--
Unknown Speaker: If you were doing what you just described today it would still be... if all you want is the injunction, no money relief at all, you want to stop the other picture from being shown, you don't have... the other side and you don't have a jury trial right if all you're seeking is an injunction.
Mr. Tashman: --I think that's not subject to dispute and that could result in damages of hundreds of millions of dollars, injury of hundreds of millions of dollars--
Unknown Speaker: But you wouldn't get the damages, because your claim would be precluded.
Mr. Tashman: --No, when I say... I'm sorry, when I say damages, the consequence of an injunction, given those facts, would result in a huge amount of injury to the party being enjoined.
Unknown Speaker: There's a practical question related to this that I have that you may not have a judgment on, but as... in your experience, copyright holders who by and large are plaintiffs in these suits, if I compare them to other plaintiffs, say in tort suits, we don't... I haven't normally heard complaints from plaintiffs in tort suits about the jury.
To the contrary.
They feel that punitive damages, et cetera, normally... I'd say not everybody, but the jury's more than adequate, or adequate in awarding... taking care of the interests of the tort plaintiffs through punitive damages, et cetera.
Why is it, in your experience, that in this case the copyright holders who tend to be plaintiffs in these cases fear... at least, I read that into what they're saying, that the jury won't be able properly to compensate them or to work with a statutory punitivetype situation?
Mr. Tashman: Well, I know the amici have raised those issues and I can only speak to my experience in this case and in this case we do not believe that a jury would be incapable of awarding statutory damages.
I suspect a jury would have awarded more statutory damages, because once they found willfulness, they would have felt compelled to go into the willfulness range, which is something the district court did not do.
I can see... so we don't think that this gets into the third prong articulated in Ross, at least not given the facts here.
I can see hypothetically two situations where it would.
First, where statutory damages were elected after a jury came down with a verdict for actual damages and then you'd have to send back that jury and the jury, having deliberated and figured out that X dollars was the appropriate award of damages, kind of send them back and tell them, no, no, no, unring the bell, come up with another award, and I think that's conceptually a difficult thing to ask a jury to do, kind of to unring the bell, especially when you don't give them any guidelines to tell the jury... other than the possibility of willfulness or innocence, which is not a mandatory factor but a discretionary factor.
So I would think under those facts it would be something that would be--
Unknown Speaker: Would you comment on Mr. Roberts' response to that, that the same problem applies when the judge tries the case?
Mr. Tashman: --I'm sorry, can you repeat the question?
Unknown Speaker: The... Mr. Roberts suggested in response to this argument that you can unring the bell even if you don't have a jury.
I mean, you can ask the judge to take a second look, too.
Mr. Tashman: Well, the judge hasn't taken a first look, because the judge has not, while the case was going to the jury, spent days trying to figure out the appropriate amount of actual damages and lost profits, so the judge is really coming to that issue completely afresh, while the jury is already committed to this concept that X dollars were lost profits and X dollars were actual damages.
Unknown Speaker: You're saying that if the judge has already determined actual damages it would be too late to unring the bell.
Mr. Tashman: Well, the judge doesn't determine actual damages.
Unknown Speaker: Oh, but if there's no jury trial at all, if there's no jury right at all, he's going to.
Mr. Tashman: Well, if there's no jury right, then the judge won't determine actual damages because the only question is statutory damages, so in that case--
Unknown Speaker: No, I thought--
Mr. Tashman: --I'm sorry.
Unknown Speaker: --was asking the question, suppose neither side wants the jury, you have a judge trial, plaintiff gets an amount calculated by the judge--
Mr. Tashman: Ah.
Unknown Speaker: --and says, judge, I don't like that calculation.
Do it under statutory damages.
Mr. Tashman: Thank you.
Is that your hypothetical?
Unknown Speaker: Yes.
Mr. Tashman: Thank you for the clarification.
I would think it would be difficult for a judge, but I think a judge would be in a better position to go back and to recalculate or rethink than a jury would be, although--
Unknown Speaker: Although I suppose a judge could protect himself and say, if you're going to submit the matter to me, are you asking for actual damages or statutory damages and you can say we... make a prayer in the alternative.
Mr. Tashman: --Correct.
Unknown Speaker: I suppose a judge could protect himself by demanding to know from the client in advance what he wants.
Mr. Tashman: I think that's quite true.
Unknown Speaker: Can you require the determination to be made in advance like that?
Mr. Tashman: No.
Unknown Speaker: I thought it... so the answer's no.
Mr. Tashman: No.
Unknown Speaker: Would you... I had the same problem Justice Breyer asked you about.
I understand you just represent one client in this case and the irony of it is, maybe... you may be better off if you lose, because a jury may come in with a bigger award.
Mr. Tashman: Well, I hope you wouldn't rule based upon that.
Unknown Speaker: Well, I certainly won't.
I certainly won't, but it's ironic... or the other way around.
They... there may be a crossverdict.
Mr. Tashman: I think my client would not feel better off if he lost.
Unknown Speaker: If they have to try the case over.
No, I understand that.
But it is puzzling to me as to why, because of the position filed by the amici, why this class of plaintiffs is afraid of... seems to disapprove of juries whereas the plaintiff generally would seem to prefer juries.
Is there anything about copyright law that suggests why that should develop?
Mr. Tashman: Well, I think we're dealing with intangible rights.
We're dealing with rights that are inherently difficult to value.
We're dealing with rights which are not consumed.
We're dealing with cases where you have large companies suing local establishments, where--
Unknown Speaker: Not much human interest in it at all, is there?
Mr. Tashman: --Where it's... you know, it's very difficult to try to figure out how a huge music company has been injured by Joe's Bar and Grill performing.
Unknown Speaker: Thank you, Mr. Tashman.
Mr. Tashman: Thank you very much.
Unknown Speaker: Mr. Roberts, you have 4 minutes remaining.
Justice Roberts: Thank you, Mr. Chief Justice.
Justice Souter, the answer to your question is juries at common law returned general verdicts for an amount.
They didn't say 50 sheets, go do the math.
The citations are collected at page 43 of our brief.
Unknown Speaker: They returned general verdicts where there was a statutory specified amount for each sheet?
Justice Roberts: Sure.
Now, it's a calculation, but they did the calculation.
Unknown Speaker: But I mean, it wasn't a great mystery what the calculation ought to be.
Justice Roberts: No.
No, at least not under those where the amount was fixed.
It was under the statutes in New Hampshire and Massachusetts and Rhode Island.
Justice Kennedy, a better citation than the one I gave you is on page 35 of our brief, the Colburn case, saying the court in equity doesn't award anything beyond the accounting, so damages beyond restitution would not be allowed.
It's important to recognize that the willfulness determination here was critical to the judgment.
The district court noted the range for willful infringements before imposing his award.
Columbia argued that the court should award a higher award.
They said, just 40,000 per infringement and that's less than half the amount you can award, what they said and, of course, the court of appeals in upholding the amount emphasized that the infringements were willful and the 20,000 figure was well within the statutory range.
Now, to focus for a moment on the third point in Tull, the damages question.
If this is a legal action, issues of infringement, number of works, willfulness have to be tried to the jury and Tull is the only impediment to the conclusion that damages also are for the jury.
Tull proceeds along the assumption that, although the Framers were willing to take up arms over the issue of whether a judge or a jury decides liability, they didn't care one way or another whether the judge or the jury said 200 dollars or 100,000 dollars.
The proposition simply makes no sense.
The amount of--
Unknown Speaker: So we'd have to overrule Tull, in your view.
Justice Roberts: --No.
I think Tull can be confined to the civil penalty context in which it arose and the particular history in which it arose.
In other words, the historical fact about civil penalties as opposed to damages.
But we know that damages were set by the jury when they were not fixed, regardless of the case with respect to civil penalties.
Thank you, Your Honor.
Chief Justice Rehnquist: Thank you, Mr. Roberts.
The case is submitted.