Statutory Damages for Infringement of your Copyrights and Trademarks
Statutory damages for copyright and trademark infringement are damages provided for under federal law, which is an advantage to the claimant because other types of damages (lost profits, compensatory damages) can be difficult to prove.
Under copyright law, statutory damages are only available for copyright infringements that occur after a work is registered with the Copyright Office. To maximize the ability to claim these damages, copyright registration should be made within three months of a work’s publication or before the infringement occurs. Therefore, it is often a good idea to file a copyright application prior to a work becoming published.
Under trademark law, in cases involving use of a counterfeit trademark or cyber piracy, statutory damages can be available if a trademark is registered. It is often a good idea to apply for a trademark registration prior to or shortly after that mark is in use so that a federal trademark registration may be obtained as promptly as possible.
- The Threat Of Statutory Damages For Copyright Infringement Can Be A Useful Enforcement Tool
The amount of statutory damages awarded in a copyright case depends on the seriousness of the infringing act. The range set forth in § 504(c) of the Copyright Act is currently $750 to $30,000 per work infringed.[1] If the copyright owner can prove that the infringement was “willful,” the court may increase the award to $150,000.[2] Alternatively, if the defendant proves that he was not aware and had no reason to believe that his or her actions constituted infringement, the court may reduce the statutory award to $200.[3] Statutory damages are often at the discretion of the fact-finder.[4] Factors that can be considered include “the expenses saved, and profits earned, by the infringer,” and “the revenue lost by the copyright holder.”[5]
- Statutory Damages Can Be A Deterrent For Counterfeiting And Cybersquatting
Under trademark law, the amount of statutory damages can range from a low of $1,000 for innocent infringement to a high of $2,000,000 for willful infringement.[6] Similar to the Copyright Act, the Lanham Act does not provide a definition for “willfulness” in regard to counterfeiting.[7] However, under § 15 U.S.C. 1117(e), the Lanham Act provides that, in regard to cybersquatting:
[I]t shall be a rebuttable presumption that the violation is willful . . . if the violator . . . knowingly provided or knowingly caused to be provided materially false contact information to a domain name registrar, domain name registry, or other domain name registration authority in registering, maintaining, or renewing a domain name used in connection with the violation.[8]
The determination of what constitutes a reasonable amount of statutory damages is a fact intensive inquiry. In contrast to copyright law, if a trademark owner elects to recover statutory damages, they may be precluded from recovering attorney’s fees.[9]
- Statutory Damages Can Provide Leverage to Stop Infringing Activity
Statutory damages can have important practical significance in resolving a dispute with an accused infringer of intellectual property. In many situations, the ability to claim statutory damages can provide a powerful incentive for both copyright and trademark holders to pursue infringement litigation they might not otherwise bring because of how difficult it is to obtain information to support the claims or the high costs of obtaining information (e.g. significant costs related to financial expert witness testimony, etc.). The threat of statutory damages can often help encourage an accused infringer to stop the at-issue infringing activity.
[1] 17 U.S.C. § 504(c)(1).
[2] Id. § 504(c)(2).
[3] Id.; see, e.g., Bly v. Banbury Books, Inc., 638 F. Supp. 983, 986 (E.D. Pa. 1986) (awarding statutory damages in the amount of $250 where plaintiff failed to establish that defendant’s infringement was willful).
[4] 17 U.S.C. § 504(c).
[5] Bryant v. Media Right Prod. Inc., 603 F.3d 135, 144 (2d Cir. 2010).
[6] 15 U.S.C. § 1117(c).
[7] 15 U.S.C. § 1117(c).
[8] See e.g. Verizon Cal., Inc. v. Onlinenic, Inc., 2009 WL 2706393, at *6-9 (N.D. Cal. Aug. 25, 2009).
[9] See K and N Engineering, Inc. v. Bulat, 510 F.3d 1079 (9th Cir. 2007) (holding that, where a successful trademark plaintiff elects statutory damages as opposed to electing to recover actual damages, the plaintiff is barred from recovering attorney’s fees).