1
00:00:00,136 --> 00:00:04,292
Today's exciting episode is
something hot off the presses.

2
00:00:04,581 --> 00:00:06,688
If you can consider a U.

3
00:00:06,688 --> 00:00:06,808
S.

4
00:00:06,818 --> 00:00:10,974
Supreme Court decision about copyright
infringement hot, but we're going with it.

5
00:00:11,254 --> 00:00:15,981
So recently, as I'm recording
this in May, 2024, the U.

6
00:00:15,981 --> 00:00:16,101
S.

7
00:00:16,101 --> 00:00:21,626
Supreme Court settled a conflict
among federal courts of appeal, that

8
00:00:21,666 --> 00:00:25,946
whether or not a copyright owner can
recover damages for infringements

9
00:00:26,191 --> 00:00:30,809
that occurred more than three years
before commencement of the lawsuit.

10
00:00:30,978 --> 00:00:35,334
So the second circuit, uh, said that
the copyright plaintiff would be limited

11
00:00:35,493 --> 00:00:39,548
to damages that are only three years.

12
00:00:39,676 --> 00:00:41,801
look back from the
filing of the complaint.

13
00:00:41,801 --> 00:00:45,611
So they can't look at damages for
infringements that occurred before

14
00:00:45,736 --> 00:00:51,436
three years back from the filing of
the complaint, whereas the 9th and 11th

15
00:00:51,576 --> 00:00:55,386
circuits disagreed and said it wasn't
limited to that three year look back.

16
00:00:55,594 --> 00:01:01,299
And so in a 6 3 decision, Authored
by Justin Kagan, the Supreme Court

17
00:01:01,349 --> 00:01:07,149
affirmed the 11th circuit's ruling and
held that the Copyright Act entitles a

18
00:01:07,159 --> 00:01:12,261
copyright owner to recover money damages
flowing from a timely infringement

19
00:01:12,261 --> 00:01:17,158
claim even if the infringement at
issue occurred more than three years

20
00:01:17,158 --> 00:01:19,028
before the initiation of the suit.

21
00:01:19,199 --> 00:01:20,891
There are of course some nuances to that.

22
00:01:21,029 --> 00:01:25,204
But generally, we want to look,
it is a win because we don't want

23
00:01:25,214 --> 00:01:29,491
to have different results just
because, you know, it is federal law.

24
00:01:29,491 --> 00:01:32,321
So it should apply equally
all over the country.

25
00:01:32,474 --> 00:01:35,801
They don't want to have different results
about what damages are available to us.

26
00:01:35,801 --> 00:01:39,888
If you file on the 9th circuit or the 11th
circuit versus filing the 2nd circuit.

27
00:01:40,081 --> 00:01:40,808
So that's great.

28
00:01:40,974 --> 00:01:45,664
So all that to say that, let's
take this moment to review.

29
00:01:45,814 --> 00:01:48,238
Damages for copyright infringement.

30
00:01:48,258 --> 00:01:50,228
And so we're going to have
a little refresher here.

31
00:01:50,401 --> 00:01:53,744
It may even be the deepest dive
into damages that I've done.

32
00:01:53,744 --> 00:01:58,121
I know I've done some light every view of
the damages for copyright infringement.

33
00:01:58,311 --> 00:01:59,851
So let's go a little bit deeper today.

34
00:02:00,044 --> 00:02:03,674
So first, you know, what
damages are available?

35
00:02:03,858 --> 00:02:09,764
Under the US copyright law, so it
provides that the infringer of a

36
00:02:09,804 --> 00:02:15,531
copyright is liable for either the
copyright owners actual damages, plus

37
00:02:15,611 --> 00:02:21,798
additional profits of the infringer,
or they can get statutory damages.

38
00:02:22,058 --> 00:02:24,704
It's actual damages or statutory damage.

39
00:02:24,714 --> 00:02:26,124
You cannot do both.

40
00:02:26,374 --> 00:02:29,804
So let's talk about actual
damages and profits first.

41
00:02:29,948 --> 00:02:34,548
So as the name suggests, actual
damages refers to the compensation

42
00:02:34,578 --> 00:02:39,724
awarded to a copyright owner based
on the actual harm that the owner

43
00:02:39,944 --> 00:02:41,904
suffers from the infringement.

44
00:02:42,068 --> 00:02:45,254
So they can be calculated
as the real financial loss.

45
00:02:45,781 --> 00:02:51,781
So maybe lost profits from sales that
didn't occur because of the infringement.

46
00:02:51,948 --> 00:02:56,784
Also, they have access to the
profits made by the infringer.

47
00:02:56,971 --> 00:03:00,241
one might be more like maybe the
infringer sold it for more than

48
00:03:00,241 --> 00:03:03,511
you could have sold it for, meaning
you should have raised your prices.

49
00:03:03,736 --> 00:03:06,396
if your loss profits are
higher, then go after that.

50
00:03:06,396 --> 00:03:09,356
If their profits are higher
than you go after that.

51
00:03:09,539 --> 00:03:14,699
and then, so maybe it's a combination of
the two, maybe, they, create a derivative

52
00:03:14,709 --> 00:03:16,716
that cause created, more profits.

53
00:03:16,913 --> 00:03:20,393
So you can get your loss sales
and, profits from the derivative.

54
00:03:20,566 --> 00:03:25,783
And so it's, you know, you can't double
dip, but you can, aggregate your losses

55
00:03:25,943 --> 00:03:28,783
and the profits of the infringer.

56
00:03:28,993 --> 00:03:34,439
So the complication here is, on proving
actual damages is that you do need to

57
00:03:34,439 --> 00:03:37,169
have to prove evidence of an actual loss.

58
00:03:37,483 --> 00:03:41,669
So you need to have be keeping, you know,
sales records, financial statements,

59
00:03:41,739 --> 00:03:46,509
anything that would show that decrease
in revenue that is attributable.

60
00:03:46,599 --> 00:03:47,931
to the infringement.

61
00:03:48,088 --> 00:03:52,058
So, if your sale is just having to
go down because, nobody wants it

62
00:03:52,108 --> 00:03:56,234
anymore, it's not attributable to the
infringement, that would not be, an

63
00:03:56,334 --> 00:03:59,134
actual damage due to the infringement.

64
00:03:59,328 --> 00:04:02,594
So you do need to have, some
records that So you can make that

65
00:04:02,594 --> 00:04:07,161
connection, which makes it a little
more complex than statutory damages,

66
00:04:07,161 --> 00:04:08,361
which we'll talk about in a minute.

67
00:04:08,491 --> 00:04:13,118
for when we're looking at the infringer's
profits, that's a little easier to prove.

68
00:04:13,138 --> 00:04:16,961
All you have to do is show
the infringer's gross revenue.

69
00:04:17,123 --> 00:04:18,829
That's considered their profits.

70
00:04:18,869 --> 00:04:22,059
They can, say, well, I also
have these expenses too.

71
00:04:22,059 --> 00:04:26,346
So this is my profit, but obviously
that's a little bit easier to prove,

72
00:04:26,519 --> 00:04:29,843
they have clearly been selling it
and have them and had some gross

73
00:04:29,863 --> 00:04:32,096
revenue based on the infringement.

74
00:04:32,293 --> 00:04:32,553
All right.

75
00:04:32,553 --> 00:04:37,466
So that's your actual profits,
and, actual damages and infringers

76
00:04:37,556 --> 00:04:40,026
profits that you can get as damages.

77
00:04:40,149 --> 00:04:40,459
Okay.

78
00:04:40,489 --> 00:04:44,706
The next category are statutory
damages, and there are some

79
00:04:44,736 --> 00:04:47,216
eligibility requirements, which
we'll talk about in a second.

80
00:04:47,366 --> 00:04:53,947
But if eligible, you can elect the
copyright owner can elect to recover

81
00:04:53,967 --> 00:04:58,983
instead of actual damages and profits
an award of statutory damages.

82
00:04:59,132 --> 00:05:03,900
So these are the damages that the court
can award for copyright infringement,

83
00:05:04,029 --> 00:05:09,640
which do not require the copyright
owner to prove actual financial

84
00:05:09,737 --> 00:05:14,057
Loss, and this is really helpful
if it is hard to prove your losses.

85
00:05:14,057 --> 00:05:18,980
Maybe you can't prove that direct
relationship between the infringement

86
00:05:19,113 --> 00:05:23,683
and a decrease in sales, or maybe
you haven't really had any sales yet.

87
00:05:23,817 --> 00:05:28,010
or there's, not enough, of,
profits to, or damage to really

88
00:05:28,050 --> 00:05:30,963
make sense to pursue legal action.

89
00:05:31,132 --> 00:05:35,264
But, if you have access to statutory
damages, that can make a big difference.

90
00:05:35,507 --> 00:05:38,427
So what are the eligibility
requirements for statutory damages?

91
00:05:38,635 --> 00:05:38,781
It.

92
00:05:38,985 --> 00:05:43,544
requires timely registration
of the work with the U.

93
00:05:43,544 --> 00:05:43,654
S.

94
00:05:43,694 --> 00:05:44,644
Copyright Office.

95
00:05:44,917 --> 00:05:50,944
So to qualify for statutory damages, you
must have registered the copyright either

96
00:05:50,974 --> 00:05:57,811
before the infringement began or within
three months of first publishing the work.

97
00:05:58,007 --> 00:06:01,497
So publishing means when you
made it available to the public.

98
00:06:01,731 --> 00:06:05,676
So when it's still like hanging out in
your computer, that's not publishing.

99
00:06:05,819 --> 00:06:07,976
That's creation, which
is a different measure.

100
00:06:08,082 --> 00:06:12,312
for statutory damages, it's within three
months of first publishing the work.

101
00:06:12,562 --> 00:06:18,886
So statutory damages can
range, from 750 to 30, 000.

102
00:06:18,886 --> 00:06:22,609
1, 000 per work as
determined by the court.

103
00:06:22,609 --> 00:06:24,779
We'll talk about what those variables are.

104
00:06:24,937 --> 00:06:30,639
And if there is a willful infringement,
the statutories can be increased up

105
00:06:30,639 --> 00:06:38,652
to 150, 000 Per work, so obviously,
talking about the cost of litigation

106
00:06:38,652 --> 00:06:42,099
and whether or not it's worth it
to pursue an infringement claim.

107
00:06:42,239 --> 00:06:45,762
This can make a big difference,
especially if you haven't really

108
00:06:45,762 --> 00:06:47,692
made any profits from your work yet.

109
00:06:47,842 --> 00:06:49,982
Or the profits have been relatively low.

110
00:06:50,169 --> 00:06:53,706
If you have access to statutory
damages, one, you don't have

111
00:06:53,706 --> 00:06:55,356
to prove your actual loss.

112
00:06:55,416 --> 00:06:58,566
And two, it makes it a
much simpler case to prove.

113
00:06:58,712 --> 00:07:03,329
Therefore, keeping, attorneys fees,
lower than if you have to prove

114
00:07:03,329 --> 00:07:04,469
all these, all the other stuff.

115
00:07:04,632 --> 00:07:07,319
So Will the court find that
the infringement is willful?

116
00:07:07,489 --> 00:07:14,172
So it can, if it, can show that the
infringer knew what they were doing

117
00:07:14,172 --> 00:07:18,989
was wrong, this could be the case
where, you sent a cease and desist

118
00:07:19,029 --> 00:07:23,496
letter and instead of, stopping the
infringement, they just changed their

119
00:07:23,496 --> 00:07:26,086
URL or did something to try to hide.

120
00:07:26,086 --> 00:07:28,242
And so they, okay, I'll
shut down that website and.

121
00:07:28,569 --> 00:07:29,419
Open up another one.

122
00:07:29,439 --> 00:07:33,886
Obviously, that is a very willful
infringement versus someone who, as

123
00:07:33,886 --> 00:07:37,066
soon as they get caught, they take
it down, as you know, because I

124
00:07:37,214 --> 00:07:40,556
definitely preach this all the time
and infringement is an infringement.

125
00:07:40,576 --> 00:07:44,316
It doesn't matter if you didn't
realize you couldn't use it or, oh,

126
00:07:44,316 --> 00:07:46,002
I thought it was on the Internet.

127
00:07:46,012 --> 00:07:51,072
So it was free or, oh, Innocent or
not, that will depend where in the

128
00:07:51,072 --> 00:07:55,936
spectrum of damages falls, but not
whether or not it is an infringement.

129
00:07:56,099 --> 00:08:00,429
If you take somebody else's copyrighted
work without permission and use

130
00:08:00,429 --> 00:08:03,929
it without their permission, it is
infringement and the only issue is

131
00:08:03,999 --> 00:08:07,549
where in the scale of damages it falls.

132
00:08:07,859 --> 00:08:11,156
So let's talk about calculating
the damages, you know,

133
00:08:11,196 --> 00:08:13,379
how much in that spectrum.

134
00:08:13,379 --> 00:08:16,109
It's a pretty big spectrum
where the damages fall.

135
00:08:16,241 --> 00:08:20,331
So it varies and it will depend on
the seriousness of the infringing

136
00:08:20,401 --> 00:08:24,777
act and also depend on the
financial worth of the infringer.

137
00:08:24,974 --> 00:08:26,704
So the court is going to determine this.

138
00:08:27,241 --> 00:08:27,791
So, um.

139
00:08:27,839 --> 00:08:31,811
Innocent infringements again, still
infringement, but if it really, if

140
00:08:31,811 --> 00:08:35,757
the court binds and the infringer can
prove that it really was innocent,

141
00:08:36,007 --> 00:08:39,047
I don't even know what this would
be, honestly, they can reduce

142
00:08:39,047 --> 00:08:42,001
it to as little as 200 per work.

143
00:08:42,231 --> 00:08:47,694
so maybe an innocent infringement
might be, I had a license.

144
00:08:48,012 --> 00:08:48,812
let's use this one.

145
00:08:48,936 --> 00:08:52,406
like the stock photo place and
you get a license for it and your

146
00:08:52,406 --> 00:08:54,976
license is to use it on your website.

147
00:08:55,186 --> 00:08:58,739
so you have someone who does
your email list or something.

148
00:08:58,739 --> 00:09:00,674
And, And they're like,
oh, I like this image.

149
00:09:00,684 --> 00:09:04,844
And so, yeah, you have a license for all
the images on your website and they put

150
00:09:04,844 --> 00:09:09,191
it in your newsletter and your license
doesn't include use in the newsletter.

151
00:09:09,289 --> 00:09:11,799
maybe that might be considered
an innocent infringement.

152
00:09:11,799 --> 00:09:13,629
Again, I don't, know
how it becomes innocent.

153
00:09:13,639 --> 00:09:14,029
I mean.

154
00:09:14,129 --> 00:09:18,186
we should know we should all know better
that we can't use a works that we don't

155
00:09:18,256 --> 00:09:19,926
own without a license or permission.

156
00:09:20,099 --> 00:09:22,159
So, let's just use that 1 as a sample.

157
00:09:22,366 --> 00:09:24,762
So, you thought you had a license for it.

158
00:09:24,952 --> 00:09:27,546
It was reasonable to believe
that if you can put it on your

159
00:09:27,546 --> 00:09:30,616
website, you can put it in your
newsletter, but you actually can't.

160
00:09:30,809 --> 00:09:32,726
So, let's, call that
innocent infringement.

161
00:09:33,082 --> 00:09:36,992
And on the other hand, if, it was
something that was willful, like

162
00:09:36,992 --> 00:09:40,162
our example, you got that cease and
desist, but instead you tried to,

163
00:09:40,319 --> 00:09:44,409
hide your use instead of, stopping the
use, and the court can find as much

164
00:09:44,409 --> 00:09:47,761
as 000, penalty, damages per work.

165
00:09:47,931 --> 00:09:49,691
that really isn't a penalty, right?

166
00:09:49,691 --> 00:09:53,654
I mean, that is intended to punish
the infringer, in that circumstance.

167
00:09:54,027 --> 00:09:58,751
and so again, that spectrum
will depend on the circumstances

168
00:09:58,892 --> 00:10:01,212
now for an actual calculation.

169
00:10:01,222 --> 00:10:07,776
I'm going to use the example of a website
that has used 3 copyrighted photos.

170
00:10:07,977 --> 00:10:12,727
All from the same photographer,
maybe all from the same, source.

171
00:10:12,897 --> 00:10:19,594
And so 3 photographs from the same source
used on 1 website without permission.

172
00:10:19,767 --> 00:10:27,869
And so, if my range of, statutory
damages is 750 to 30, 000.

173
00:10:27,909 --> 00:10:30,776
Let's just use 10, 000 per photo.

174
00:10:30,946 --> 00:10:32,616
It's a lot, but let's just use it anyway.

175
00:10:32,869 --> 00:10:34,969
so what would the damages be?

176
00:10:35,009 --> 00:10:37,639
I've got one website from one source.

177
00:10:38,067 --> 00:10:39,117
three photographs.

178
00:10:39,537 --> 00:10:46,004
So damages are calculated per
work, not per active infringement.

179
00:10:46,184 --> 00:10:48,101
There was only one active infringement.

180
00:10:48,101 --> 00:10:52,197
I took these photographs, I put them
on my website, but it was three works,

181
00:10:52,207 --> 00:10:54,947
three separate copyrighted photographs.

182
00:10:55,371 --> 00:10:57,721
So the damages are per work.

183
00:10:57,721 --> 00:11:06,806
So at 10, 000 per Work that would be a
30, 000, statutory damages claim for that.

184
00:11:07,002 --> 00:11:12,766
so every song, every book, every
photograph, that would be a

185
00:11:13,226 --> 00:11:16,056
separate work, anything that's a
separate work is registered under

186
00:11:16,056 --> 00:11:19,929
the copyright office is eligible
for the separate statutory damage.

187
00:11:20,099 --> 00:11:22,669
I don't know, it should be a good thing.

188
00:11:22,892 --> 00:11:24,022
will look into this.

189
00:11:24,022 --> 00:11:25,906
Like, let's say, I take.

190
00:11:25,994 --> 00:11:26,687
One.

191
00:11:26,697 --> 00:11:27,887
No, I know the answer to this.

192
00:11:28,091 --> 00:11:32,374
So if I take, one paragraph from
a book, if I take three paragraphs

193
00:11:32,374 --> 00:11:34,397
from a book, that is still one work.

194
00:11:34,457 --> 00:11:35,607
That is not three works.

195
00:11:35,762 --> 00:11:39,876
All right, so as you can see,
that's a pretty heavy club to

196
00:11:39,876 --> 00:11:44,572
wield as a copyright owner if you
have access to statutory damages.

197
00:11:44,774 --> 00:11:47,036
Now, it doesn't mean you're
going to get 10, 000 for photo,

198
00:11:47,206 --> 00:11:48,912
again, that's pretty high.

199
00:11:49,089 --> 00:11:53,409
let's say though, somebody uses
that photograph in advertising that

200
00:11:53,419 --> 00:11:55,352
they know, you don't get to use.

201
00:11:55,736 --> 00:11:57,561
Photographs for free and advertising.

202
00:11:57,712 --> 00:12:01,926
that's going to be a bigger number than
if you use it on your website that,

203
00:12:02,006 --> 00:12:03,922
, frankly, you know, nobody fits in.

204
00:12:04,279 --> 00:12:09,792
so it'll be in there, but that's the
continuum of damages that are available,

205
00:12:10,072 --> 00:12:15,409
for, minor infringements, I'll call it
versus major or willful infringements.

206
00:12:15,750 --> 00:12:18,596
So, obviously, when you have
statutory damages, it's in everybody's

207
00:12:18,596 --> 00:12:20,446
interest to just settle out of court.

208
00:12:20,647 --> 00:12:22,559
I mean, nobody wants to
you're going to lose.

209
00:12:22,559 --> 00:12:26,345
I mean, you infringed and it's
eligible for statutory damages,

210
00:12:26,563 --> 00:12:27,430
why would you go to court?

211
00:12:27,596 --> 00:12:30,679
but you do want to have that
leverage to keep it out of court.

212
00:12:30,882 --> 00:12:34,916
as I was writing this script, and
it's hard to imagine I use a script

213
00:12:34,966 --> 00:12:38,546
because I always deviate from
it, but I do start with a script.

214
00:12:38,586 --> 00:12:41,619
And I was thinking about the fact
that this is what I hear a lot.

215
00:12:41,629 --> 00:12:45,997
Like, how do I, get as much as
possible On to one copyright

216
00:12:45,997 --> 00:12:49,863
registration because there are fees
involved with registering copyrights.

217
00:12:49,863 --> 00:12:53,538
They're not very high, frankly,
but there is some work involved and

218
00:12:53,538 --> 00:12:56,303
some resources involved register
something in the copyright office.

219
00:12:56,487 --> 00:13:02,690
And the idea is to get, compilation
or entire course or a series on

220
00:13:02,780 --> 00:13:05,020
to one copyright registration.

221
00:13:05,145 --> 00:13:10,793
But what I was thinking is, if your
statutory damages are calculated

222
00:13:10,863 --> 00:13:17,950
per work, does it make sense just
as a kind of prophylactic against

223
00:13:18,000 --> 00:13:22,883
copyright infringement to have each,
like, let's say, module of a course

224
00:13:23,040 --> 00:13:25,830
registered as a separate work.

225
00:13:25,930 --> 00:13:30,052
you don't lose Protection
that way, you have more works.

226
00:13:30,602 --> 00:13:35,768
So if I have, let's say I have a 10 module
course and it is sold together, like

227
00:13:35,788 --> 00:13:38,708
you cannot buy the courses individually.

228
00:13:38,708 --> 00:13:40,672
You can only buy them together.

229
00:13:40,835 --> 00:13:45,498
So it would qualify as a single
work for registration purposes.

230
00:13:45,828 --> 00:13:49,148
You don't have to register each
of let's say there's 10 modules.

231
00:13:49,488 --> 00:13:52,905
You can register them together because
they're only available as one work.

232
00:13:53,060 --> 00:13:53,890
so that would be one work.

233
00:13:53,890 --> 00:13:57,417
Somebody steals one or
more portions of my course.

234
00:13:57,637 --> 00:14:00,013
It's one work that's been infringed.

235
00:14:00,013 --> 00:14:04,517
And so that would be your statutory
damages for one work versus if I have

236
00:14:04,547 --> 00:14:09,667
registered each module separately, even
though you can only buy them together,

237
00:14:09,810 --> 00:14:11,860
but I've registered them separately.

238
00:14:12,017 --> 00:14:15,509
And therefore each module
is a separate work.

239
00:14:15,640 --> 00:14:21,620
That same infringement of
my module course is now an

240
00:14:21,620 --> 00:14:25,030
infringement of 10 separate works.

241
00:14:25,464 --> 00:14:32,177
So this is just to remind you, statutory
damages can be very high, and even for

242
00:14:32,177 --> 00:14:34,784
innocent uses, as a copyright owner.

243
00:14:35,087 --> 00:14:35,872
Hey, great.

244
00:14:35,872 --> 00:14:37,962
You have access to
these statutory damages.

245
00:14:38,177 --> 00:14:43,552
However, on the other side of that, if
you are the infringer, even if you are

246
00:14:43,552 --> 00:14:49,162
an innocent infringer or an accidental
infringer or an ignorant infringer,

247
00:14:49,329 --> 00:14:52,469
because you don't know better, although
you should, if you're listening to this

248
00:14:52,489 --> 00:14:57,174
podcast, want to make sure we're always
getting permission to use Anything that

249
00:14:57,174 --> 00:15:03,721
you don't own, anything that falls within,
copyright protection, if you don't own it,

250
00:15:03,761 --> 00:15:05,591
make sure you have permission to use it.

251
00:15:05,772 --> 00:15:10,951
I have created a number of resources
to make sure that you understand what

252
00:15:10,991 --> 00:15:13,411
needs to be done to get permission.

253
00:15:13,471 --> 00:15:16,991
and so the information
is available to you.

254
00:15:17,161 --> 00:15:19,511
So, don't forget IP is fuel.