On January 15, the U.S. Court of Appeals for the Fifth Circuit issued an important decision on statutory damages for civil copyright infringement claims in Energy Intelligence Group, Inc. v. Kayne Anderson Capital Advisors, L.P. The Fifth Circuit decided that failure to mitigate damages is not a complete defense to liability for statutory damages under the Copyright Act and the Digital Millennium Copyright Act, but only a factor for a court to consider in setting the amount of damages awarded within the range provided in the statute. The court intelligently grounded its decision in the underlying deterrence and punitive purposes of the statutory damages provisions contained in federal copyright law. In its brief historical overview of statutory damage provisions, the Fifth Circuit called attention to the Copyright Act of 1976 and wrote: In light of these revisions modern statutory damages are even more clearly "designed to discourage wrongful conduct" and may be imposed to “sanction and vindicate” the statutory policy against copyright infringement… Modern appellate decisions continue to emphasize this deterrence purpose, particularly where the defendant’s infringement was willful.
Also:
Statutory damages under the Copyright Act…are not solely intended to approximate actual damages. They serve purposes that include deterrence. Statutory damages under the Copyright Act are therefore distinct from the type of damages that are typically calculated according to rules of mitigation.
Free State Foundation President Randolph May and I discuss history of civil copyright enforcement in our 2018 Perspectives from FSF Scholars paper, "Modernizing Civil Copyright Enforcement for the Digital Age Economy." Also, on January 10 we published our Perspectives paper, "The Constitutional Foundations of Strict Liability for Copyright Infringement."
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