File Sharing Damages Only Worth $5 per Month.

By Richard Menta 5/15/05

Very interesting post by Mark Cuban. In this world where the laws say the record industry can sue individual file traders for $150,000 per song, Cuban says that Yahoo's new all-you-can-eat monthly download service has set a new market value for these songs - $5.00 per month.

His argument is a strong one, because in the courts market value plays a key component when assessing actual damages. If kids can buy all that they want for $5.00 a month it makes it hard for the record labels to claim damages in the hundreds-of-thousands per song.

Richard Menta

Recently a judge awarded the RIAA $22,500 against Cecilia Gonzalez for downloading 30 songs. Cecilia, one of the few people to actually try to fight the RIAA was smacked down by the record lobby's cadre of lawyers. Her lawyer says he'll appeal and now he may have something to appeal with. Rather than claim innocence he might try instead to say "Yes your honor we are guilty, but damages should be limited to $5.00 per month of activity as this is market value". If the judge buys the logic the RIAA wins the case, but loses the war.

As Cuban points out, the RIAA would fight this tooth and nail. Litigation is what they do and with a severly depreciated potential for monitary return this becomes a small claims court issue. As Cuban figures it no litigation, no work, fewer RIAA layers are needed. Sure the record labels could continue to subsidize the court costs, but Wall Street may not appreciate the money bleed, especially since it fails to curtail file sharing.

The $22,500 ruling against Cecilia Gonzalez is ridiculous and wrong. It has been said that the RIAA has earned $30 million so far in settlements, blackmail really. It's a protection racket that they have managed to get away with so far because they are not thugs wielding a bat against a local shop owner, but "professionals" wielding subpoenas.

$5.00, hmmm. I would love to see a judge agree with Cuban. It would end this madness.


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