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Just in time for the holidays, the Recording Industry Association of America announced it will cease filing new lawsuits against individuals it suspects of downloading and redistributing music.
While the RIAA says it will continue with lawsuits already filed, new ones have not been filed since August. This move comes after 5 years of suing individuals, a policy that has generated a great deal of controversy. However, whether or not the RIAA has become a reformed Grinch returning Christmas to Whoville, or is just being a Scrooge with a new business plan remains to be seen.
The RIAA is likely abandoning new lawsuits for two major reasons. First, the sheer number of suits the RIAA has filed has led to bad publicity as the it has sued many defendants who do not fit the mold of professional copyright infringers. These include 12 year old girls, multiple sclerosis victims, and even people who do not own a computer. All of these suits tend to indicate that the RIAA took a rather cavalier approach in filing blanket suits against a very large number of John Doe defendants without giving much thought to the the image it would give to customers of the the music labels that comprise the RIAA.
While it might be nice to think that the RIAA cares about how the public perceives its attempts to reign in piracy, the real reason that the RIAA has halted new suits is that it may very well be litigating its way to failure. Initially, it thought that it could threaten young college students, the early targets of its lawsuits, into paying their tuition money to the record labels and turning off their file sharing. However, it has turned out that several defendants have fought back with their own lawyers, and the prospects have become not so rosy for the RIAA. First, some of the “John Doe” suits are being thrown out as judges have refused to grant subpoena power for the RIAA to discover the identities of alleged infringers. Second, even when there is an infringement, some judges have lowered damages far below what the RIAA would like.
However, the most damaging case by far is the suit of RIAA v. Tanya Andersen of Oregon. Ms. Andersen is a disabled single mother raising a young child who not only had an illegitimate RIAA suit dismissed, but then responded by becoming the lead plaintiff in a class-action countersuit. This suit is brought under the RICO statutes – normally reserved for organized crime – accusing the RIAA of conspiring to file mass lawsuits without any basis to believe there was actual piracy, and then to “shake down” the defendants with settlement offers. Ms. Andersen may have a chance because she was one of the first defendants to not only defeat the RIAA in open court, but also to receive attorney’s fees and have the presiding judge rebuke the RIAA’s tactics.
Whatever the final outcome of Ms. Andersen’s suit, the RIAA and its lawyers have already committed a cardinal business sin: They forgot that they are in business to make money. The lawsuits are not being filed against professional counterfeiters and pirates who actually make money from copyright infringement, but instead they target the very people from whom the RIAA ostensibly wants to make money. While all the suing has been going on, the record labels have ignored the basic economics of supply and demand in misunderstanding the new digital music economy. If the members of the RIAA decided to reach out to new customers with music that people actually want to listen to at a price that the market will actually bear, they might need to spend less time and money paying lawyers to file dubious lawsuits. In the spirit of the holidays, the RIAA might want to listen to the ghosts of lawsuits past in planning for the future.
– Chuck Fox
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