Unauthorized Korean DVD Sales Leads to Large Damages Award

Earlier this week, a federal judge sitting in Alexandria, Virginia, ordered the owner of a now-defunct chain of Northern Virginia video stores to pay $555,000 in damages for willful violations of U.S. copyright law after he rented and sold unauthorized copies of copyrighted Korean-language DVDs and videos to customers. The individual in question, Young Min Ro, did not even attend his own trial, though he was represented by a lawyer.

The U.S.-based affiliates of the three largest television broadcasting corporations in South Korea sued Mr. Ro and other defendants for willful copyright infringement in United States District Court for the Eastern District of Virginia. They alleged and proved at a bench trial that Ro made illegal copies of their TV programs and continued to rent and sell copies of the programs to his customers even after his licensing agreement ended and he was no longer paying monthly fees to the broadcast companies. In a July 26, 2011, ruling, Judge Leonie M. Brinkema found that the evidence showed not only that Ro violated copyright law but that he did so willfully. Willful copyright violators are subject to heightened damages under a provision of U.S. copyright law. (See 17 U.S.C. 504(c)(2)).

The plaintiffs had chosen to seek statutory damages – those imposed at the judge’s discretion within certain statutory limits – rather than precise economic damages based on measures such as the defendant’s profits from the violations or the licensing fees that they did not pay. For damages purposes, the plaintiffs chose to focus on 37 specific instances of copyright infringement for which the judge had already found the defendants liable.

In determining the monetary damages for these 37 violations, Judge Brinkema noted that under copyright law, each violation results in a statutory damage award of at least $750, and in the case of a willful violation, as much as $150,000 per violation is possible. The judge used her discretion to award $15,000 per violation, for a total damage award of $555,000.

Judge Brinkema explained that the exact amount of damages is up to her “discretion and sense of justice” under case law and that the damages are intended to serve the purposes both of compensating the plaintiffs and deterring future violations. She DVD.jpgreasoned that the damages should amount to at least $154,895 (the amount of the unpaid licensing fees) and should also include disgorgement of the illegally obtained profits. This figure was difficult to calculate since the video stores’ records were incomplete but could be as high as $225,500. She noted that the actual economic damages should be only a “floor” for the recovery.

Another relevant factor was that in the past, Ro had been ordered to pay $307,500 for copyright violations in a similar case, as well as being sentenced to two years’ probation, 60 days of home confinement, 200 hours of community service, and a $1,000 fine – and that these measures had apparently had no impact on his behavior. Those facts, the judge wrote, justify “a heightened damages award of significantly more than $307,500.00, in the hopes that this time, Ro might finally get the message.” This amount, she said, was “reasonable and appropriate given the willful and repeated nature of the defendants’ violations.”

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