Can I Use That? ' Protecting Your Business From Copyright Litigation

• Published date: 03 October 2022
• Subject Matter: Intellectual Property, Litigation, Mediation & Arbitration, Copyright, Trials & Appeals & Compensation
• Law Firm: Barrett McNagny
• Author: William A. Ramsey

The Internet is filled with readily accessible and downloadable images and written content. A common misconception exists that the public nature of this information makes it fair game for reproduction and use. If you or your employees hold this belief, you may wind up being the target of a copyright infringement lawsuit.

In order to prove copyright infringement, a plaintiff must show two things: (1) the plaintiff owns a valid copyright, and (2) the defendant has copied elements of the work that are original. Thus, if Acme Inc. has a valid copyright in content on its website, or that some third party has placed on the Internet and an employee of your company downloads that content and uses it in, for example, advertising materials, your company is at risk for being sued and potentially held liable for damages.

The damages for copyright infringement can greatly exceed what the average person might expect. In general, one who infringes on another's copyright is liable for either 1) the plaintiff's actual damages plus any additional profits of the infringer, or 2) statutory damages. See 17 U.S.C. ' 504(a). A copyright plaintiff seeking to recover the defendant's profits establishes the initial case for damages by showing gross revenue. The defendant can then attempt to reduce this number by proving deductible expenses and showing that some of the profit was attributable to factors other than the plaintiff's copyrighted work. See 17 U.S.C. ' 504(b). If a defendant cannot make either showing, a defendant's gross revenue stands as the damages.

This damages paradigm can result in unexpectedly high damages claims. For example, if a plaintiff claims that a defendant took copyrighted material and used it in a book, the plaintiff would like to begin by claiming all profits from the sale of the book; if a plaintiff claims that a defendant infringed on a home design, the plaintiff would likely begin by claiming all profits from the sale of homes based on that design; if a plaintiff claims that a defendant infringed on a copyright of a song, the plaintiff would likely begin by claiming all profits derived from that song. A defendant could certainly have the opportunity to reduce these claimed expenses, but the initial damages figures claimed by a plaintiff can be staggering.

Even if there are little to no actual damages, a copyright holder may elect to recover an award of statutory damages of $750 to $30,000 per infringed work. 17 U.S.C. 504(c)(1). The amount of the...