Issue link: https://read.dmtmag.com/i/303813
MAY 2014 21 THE JOURNAL No. 12 on Get It Quick Page with a DMCA takedown notice. The recipient is prompted to access a "case number" using a "password' (all of it having been provided in the demand letter), to "settle" the copyright infringement at a Website ded- icated for this sole purpose and which is owned and operated by the copy- right enforcement company. Presumably, if they are paid, then the copyright enforcement company forwards the "settlement" moneys (or at least a portion thereof) to the rightful copyright owner. At this point, there is nothing overtly illegal about these "copyright enforcement" ac- tivities however distasteful they may be. Potential Monetary Damages. With all of this in mind, it is im- portant to understand that if someone used the client's Wi-Fi system to unlawfully download illicit content, this work first would have to be reg- istered with the U.S. Copyright Office in order for the entertainment company to initiate a lawsuit against the client. However, if it was reg- istered and a lawsuit was filed and the entertainment company (or its as- signee) successfully proved a case for copyright infringement against the client, then the entertainment company would be entitled to either ac- tual damages (i.e., monies lost to the entertainment company or ac- crued to the client by virtue of the infringement) OR statutory damages of between $750 and $30,000 per copyrighted work. In addition, if the entertainment company were able to prove the infringement was inten- tional, then statutory damages could be increased by the court to $150,000 per occurrence. [17 U.S.C. ยง 504] Likely Repercussions. DMCA takedown notices and threats of copyright infringement litigation are serious and should be given the at- tention they deserve. However, it is important to understand that the instances of potential copyright infringement over the Internet number in the millions every single day and not every such instance is of equal im- portance to copyright holders. If a movie studio or television network chased down every person who illegally downloaded a movie or other- wise violated the DMCA, they would put themselves out of business be- cause the return would not warrant the expense of the pursuit. Indeed, absent proof that a business providing free Wi-Fi acted intentionally to infringe a copyright, there is very little incentive for the copyright owner to register the copyright and then file and prosecute a copyright infringe- ment lawsuit. If nothing else, the likely recovery of monetary damages is so small that it argues strongly against copyright owners taking any fur- ther action (unless the offending activity continues and/or substantially increases). General Recommendations. Consequently, unless there is more to the infringement than a one-time mistake or lapse in judgment, busi- nesses would be well served to take the following actions to preempt prob- lems and to protect themselves should they ever arise: 1. Create and implement a fairly stringent "Wi-Fi Guest User Policy" that includes a properly-worded "terms of use" disclosure statement; 2. Using an experienced outside company, implement a technologi- cal filter that prevents unauthorized access to the Wi-Fi; 3. Require customers, visitors, and anyone else using the Wi-Fi to sign an acknowledgment of the "terms of use" (on hard copy in pen or via a "click through" on the company Website); 4. If Wi-Fi users do not agree to the terms of use, then do not grant them access to the Internet; 5. Maintain copies of the new Policy (plus any amendments) as well as all signed disclosure statements; 6. If a DMCA takedown notice or a demand letter is received, do not ignore it; 7. Keep a copy of the DMCA takedown notice and forward it to legal counsel for a quick review; and 8. If legal counsel recommends further action, follow the attorney's recommendations. Usually, they can help develop a useful strategy for how best to proceed. And, finally, there may be some value in confirming that the com- pany's insurance policy (or policies) provides defense and indemnity for these types of situations. If there is ever any actual litigation to enforce third party copyrights, you will be very glad that you planned for it. David Baker is a partner with Hart King, one of California's most respected boutique law firms. He has over 25 years of wide-ranging experience in intel- lectual property protection and enhancement, commercial transactions and lit- igation and real property litigation. David can be reached at (714) 432-8700 or at dbaker@hartkinglaw.com. Tri-State Distributors, Inc. We are a full line distributor for after market products. 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