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Wednesday, December 28, 2011

A fair compensation for infringement of copyright

About six years ago, a website owner sued more than a hundred companies and government bodies for the unauthorized use of the digital maps provided in their website. The amount claimed was over $3,000 per map. The amount claimed was clearly exorbitant, as the loss of revenue suffered by the website or the cost of producing the map was nowhere near the amount claimed.

It was likely that nearly all of these parties were not aware that they were infringing the copyright. Some of these used parties had used more than 10 maps, so the total amount claimed was quite substantial.

To my knowledge, most of the infringing parties settled the claims out of court by paying the website owner close to the amount claimed, perhaps after a small discount. It was quite sad that the leaders of these large companies and government bodies were not prepared to fight in court against an excessive and unconscionable claim, and were prepared to pay a hefty sum of money (using the monies of their shareholders and taxpayers) just to avoid the negative publicity about being sued.

The website owner must have collected several million dollars of settlement from these parties. The legal claims were handled by a lawyer that specialized in making these legal claims. The lawyer firm must have collected a large amount of legal fees from these cases.

I personally knew about a company that was sued. The staff had used more than 10 digital maps a few years earlier and was not aware that he was infringing the copyright. That company refused to pay the exorbitant claim but offered an amount representing their estimate of the cost of producing the maps. The website owner took the case to court but finally dropped the case. Details of the out of court settlement was not disclosed. This was perhaps the only case that went to court.

I heard another story (but not verified) that a local university had paid more than one million dollars to settle a copyright claim where a student had uploaded a video, without permission, into the university's website. I was shocked at the purported amount of the settlement over a trivial matter, especially as the payment was probably made out of public funds. I could not image any justification for the video clip owner to receive such a large payment,which is tantamount to an extortion! This could be just a rumour.

Nevertheless, I wish to call on our Ministry of Law to pass a law to clarify the principles to determine the amount of compensation that should be paid for the use of copyright materials. The lack of clarity has led to an unsatisfactory situation where legal firms, which specialize in making these types of claims, could claim exorbitant amounts, and the sued parties were forced to make exorbitant payments due to the lack of clarity.

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