Saturday, June 20, 2009

Bankruptcy could protect Jammie Thomas; CNet News, 6/19/09

Greg Sandoval via CNet News; Bankruptcy could protect Jammie Thomas:

"[I]n the past, when someone was found liable of willful copyright infringement, the law prevented the defendant from discharging, or wiping out the debt in bankruptcy court. Last year, however, the Ninth Circuit Court of Appeals found in the case of Barboza vs. New Form, that "willful" meant one thing in civil court and something else in bankruptcy court.

In trademark or copyright cases, "willful" means that a defendant knew what they were doing. According to the Ninth Circuit, bankruptcy laws mandate that for a debt to be non-dischargeable, a plaintiff must prove a defendant was "willful and malicious," meaning the person's intent was to cause harm.

Even entertainment lawyers agree that the Ninth Circuit's decision in Barboza makes it tougher for copyright owners to collect damages. Kathryn Bartow, an attorney with Manatt, Phelps & Phillips, a Los Angeles-based law firm that does extensive work for the major movie studios, wrote in a February issue of her firm's newsletter:

(Barboza) serves as a warning to trademark and copyright owners as well as the counsel who represent them in willful infringement cases. When presenting evidence and crafting jury instructions, beware. In willful infringement cases, to prevent an individual defendant from having its debt discharged in bankruptcy, the plaintiff should consider introducing sufficient evidence and including additional jury instructions to satisfy the Bankruptcy Code's definitions of 'willful and malicious.'

If the jury had only found Thomas-Rasset guilty of copyright infringement instead of willful infringement, it would have been easier for her to get rid of the debt...

For the RIAA, the size of the damages stamps it with the bully label and backfires when it comes to public relations. That's the opinion of Ben Sheffner, a former entertainment lawyer and copyright proponent. He says the jury award also potentially hurts the RIAA if someone decides to challenge the damages on constitutional grounds.

"On the plus side, the decision sent a strong message," Sheffner said. Twenty-four "average Minnesotans with no ties to the entertainment industry have now said what she did was wrong and she deserves a strong punishment. On the other side, the size of the monetary damages could be used as serious ammo against the music industry.""

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