Record Industry Down, P2P Up in Piracy Mistrial

Sam Gustin writes: In a blow for the recording industry, a federal judge has declared a mistrial in the nation's only successfully prosecuted peer-to-peer piracy case, Capitol Records v. Jammie Thomas.

In October 2007, a Minnesota jury found Jammie Thomas, a single mother of two, liable for copyright infringement. She was sentenced to $222,000 in penalties, or $9,250 for each of 24 songs she was accused of pirating.

U.S. District Judge Michael Davis vacated the sentence and granted Thomas's motion for a new trial. In addition, the judge called on Congress to relax its penalties for peer-to-peer music piracy.

Last month, Judge Davies said he was leaning toward declaring a mistrial, after earlier saying he had committed a "manifest error" in his jury instructions. Late Wednesday, Judge Davies did just that.

The issue on trial is whether simply making a copy of a copyrighted song constitutes infringement, even if no one downloads it -- the RIAA's so called "making available" argument.

Davis's about face came shortly after a key setback from the recording industry in a separate case. In that decision, District Court Judge Neil Wake in Phoenix rejected the industry's "making available" argument.

In his ruling Wednesday, Davies wrote "the plain meaning of the term 'distribution' does not including making available and, instead, requires actual dissemination."

Additionally, the judge called on Congress to lower the statutory penalties for peer-to-peer copyright infringement, calling the damages in the Thomas case "wholly disproportionate to the damages suffered by Plaintiffs."

"Thomas allegedly infringed on the copyrights of 24 songs -- the equivalent of approximately three CDs, costing less than $54," Davies wrote, "and yet the total damages awarded is $222,000 -- more than five hundred times the cost of buying 24 separate CDs and more than four thousand times the cost of three CDs."

He called the damages "unprecedented and oppressive."

Thomas said she was "very happy" to hear the judge's ruling.

"Now they're going to have to prove their claims," she told the Associated Press. "They never had to prove anything before. Now they do. It kind of levels the playing field a little bit."