Judge Gives Record Industry a Win in Ongoing War with Lime Wire

New York federal judge Kimba Wood granted partial summary judgment in favor of record labels on Tuesday, holding that Lime Wire is liable for inducing the copyright infringement of more than 10,000 sound recordings on the file-sharing network before it was shut down last year.

The ruling is hardly surprising, but the record labels are still seeking more.

Lime WIre has somewhat successfully pushed to narrow the scope of its liability by knocking out statutory damages claimed on more than a thousand sound recordings for the labels' failure to secure copyright registration in time. The company also got the judge to accept that labels can't collect more than one statutory award per work. And finally, Lime Wire wants to preclude the plaintiffs from "un-electing" statutory damages and instead going for actual damages on some of its works (probably the non-registered ones).

Still, even if Lime Wire gets what it wants, it still is facing a massive payday.

Statutory damages run as high as $150,000 per infringement, so 150K x 10K = $15 billion.

That's not quite as large as the aggregate damages that might have been put on Lime Wire's shoulders if the judge had allowed plaintiffs to seek damages on more than one statutory award per work, or if the judge allowed plaintiffs to seek actual damages in places where no statutory damages are available.

But let's be honest: $15 billion isn't very different than $75 trillion, a figure the record labels previously requested, which is five times the national debt and an award that even the judge called "absurd." It's still a lot of money and equates to roughly the same thing, at least insofar as the recording industry's intention to send "a message" and/or its real hopes of collection.

So why are the parties fighting over this? For the labels, it could be a matter of maintaining legal precedent. For the defendant, it could be a matter of manifesting paperwork havoc in hopes of extracting a much more reasonable pre-trial settlement.  An alternative theory is that both parties are getting carried away here, exhausting the judge's patience and losing sight of how this plays out in public. Ultimately, a jury will take a judge's instructions and get out its calculator and determine what's reasonable. Neither side seems too concerned just yet about this aspect of the case. We're sure, though, that the case is generating plenty of legal fees.

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