Statutory Damages in Intellectual Property Law
What are Statutory Damages?
Before we get to the definition, let's take the term "statutory damages" apart for its meaning.
Damages are sums of money awarded to someone by a court as a result of dispute between two parties (civil law). The party that the court has determined has been "damaged" in some way receives this money as compensation.
Statutory means "by statute or law." In the case of statutory damages, the damages are specifically referenced in a law.
For example, in tax evasion cases, the tax code (law) has specific amounts of fines that are required to be paid by those convicted of this crime.
Statutory Damages Examples
Statutory damages are used in different types of civil law cases, particularly in cases involving violations of consumer rights, credit or collections laws, or civil rights. For example,
- The Fair Debt Collection Practices Act designated damages of up to $1000 a day for violations.
- The Truth in Lending Act ties statutory damages to the lender's financing charges.
- The Cable Piracy Act includes statutory damages between $1,000 and $100,000 for someone who is convicted of pirating a domain name.
Amounts of Statutory Damages in Copyright and Trademark Cases
In copyright cases, the copyright law designates a range of damages between $75 and $30,000 for each work that has been infringed on. As you can see, there is still quite a bit of discretion for imposing damages in these cases.
The higher levels of statutory damages are reserved for the most "willful" cases.
In trademark cases, the statutory damages can be from $1,000 to $250,000 per counterfeit trademark.
Statutory Damages in Copyright and Trademark Law
Intellectual property law (specifically, laws relating to copyright and trademark cases) often have statutory damage provisions because it's difficult to determine the exact amount of the damages in these cases.
Statutory damages are determined by U.S. copyright law and can vary from $750 to $150,000 per instance of infringement, depending on what is considered "just," with higher awards for "willful" infringement. Court costs and attorney fees are often considered in awarding statutory damages.
Although statutory damages are not technically related to actual costs, there has been some discussion in the media and some recent court cases (Sony v. Tenenbaum, for example) which argue that the statutory damages should not be so high.
A copyright holder may receive statutory damages if the copyright has been registeredwith the U.S. Copyright Office. If the copyright is not registered, the copyright holder may only receive compensatory damages for actual damage suffered.
Other Damages in Copyright Cases
In copyright infringement cases, other damages may also be awarded:
- Actual or compensatory damages for financial losses that are definite and provable.
- Effect on profits can be awarded if the damaged party can prove how profits were damaged by the infringement. This is a tough case to prove, which is why there are statutory damages.