Fri, Feb. 23, 2018

Recognition of Judgment with Statutory DMCA Damages

CK - Washington. Statutory damages under the Digital Millennium Copyright Act can have a punitive effect, resulting in a denial of recognition in a foreign court where the legal system finds punitive elements incompatible and grossly violative of civil action principles, a German court decided in response to a petition to freeze assets of a Ger­man company in favor of a U.S. company that had obtained a default judgment for some $8 million in California under the DMCA.

The Leipzig district court explained on February 19, 2018 in docket number 05 O 3052/17 -- presumably, per defendant's counsel, Marian Härtel, Blizzard En­ter­tain­ment Inc. v. Bossland GmbH -- that a recognition matter does not allow the Ger­man court to replace its judgment with that of the foreign court. It would need to re­spect the international principles on recognition which include public order/ordre pub­lic con­si­de­rations. In this case, the default judgment lacked any explanation of the as­sess­ment of statutory damages; the plaintiff had opted under the DMCA to forego ac­tu­al damages; the number of alleged violations was a mere estimate; and the total of ag­gre­ga­ted da­ma­ges reached an extreme with punitive character.

The court considered American analyses of compensatory damages law as well as of pu­ni­tive, exemplary and statutory damages law, concluding that statutory DMCA da­ma­ges can, and in this case do, contain a degree of punitiveness which bars recognition as an incompatible form of damages. Noting that the U.S. default judgment stated that the damages award­ed we­re not punitive, the court analyzed that statement with a result di­stinguishing the elements of a punitive nature in Germany from that in the United Sta­tes.


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