The opinion of the court was delivered by: Hellerstein, District Judge.
OPINION AND ORDER MODIFYING REPORT AND RECOMMENDATION
The Honorable Ronald L. Ellis, U.S.M.J., after conducting an
inquest on damages, issued a Report and Recommendation ("R & R")
dated December 12, 2001 and filed December 13, 2001. After de
novo review of the record and consideration of objections,
see 28 U.S.C. § 636(b)(1), I hold that the R & R is modified
in the respects discussed below, and instruct the Clerk of Court
to grant judgment for the plaintiff in the modified amount.
According to the allegations of the complaint and the record
of inquest, plaintiff Getaped.com, Inc. ("Getaped") created a
website at www.getaped.com to sell Go-Ped ® brand motorized
scooters (the "Getaped site"). Plaintiff spent 400 hours or more
over an eight-week period
designing and creating the source code for the Getaped site,
which went "live"*fn1 on the Internet in December 1999. As
with most websites, the Getaped site has undergone several
modifications. Plaintiff registered one of the modified versions
of the Getaped site — a version which first went live on July
15, 2000 — with the United States Copyright Office on August 14,
From at least early summer 2000, defendants copied the Getaped
website by posting identical source code at their own sites,
www.buyaped.com and www.23water.com. Getaped claims that the
replication of the Getaped site at defendants' sites infringed
its copyright and diverted traffic and sales from its site.
Default judgment on liability was entered against defendants
John Shields and Ski & Cycle Hut on January 23, 2001. Defendant
Shelly Cangemi was never served and was dismissed without
prejudice on March 6, 2001. The issue before Judge Ellis, and
reviewed here, is the extent of damages to which Getaped is
entitled for the defendants' infringement. Judge Ellis took
proofs from the plaintiff on the issue of damages, and heard
objections from the defendants, who finally appeared in the
damages portion of the suit. After consideration of the evidence
and the arguments, Judge Ellis concluded that plaintiff was
entitled to $1,050.00 in damages. I hold that Judge Ellis erred
in his interpretations of material propositions of law, and that
plaintiffs correct recovery should be $30,000 in statutory
damages, plus attorney's fees and costs.
Under the Copyright Act, plaintiff is entitled, at its own
election, to either (1) actual damages and the infringer's
profit, or (2) statutory damages, for defendants' infringement.
17 U.S.C. § 504. The Court may also award attorney's fees and
costs. 17 U.S.C. § 505. Both statutory damages and attorney's
fees and costs are unavailable if "(1) any infringement of
copyright in an unpublished work commenced before the effective
date of its registration; or (2) any infringement of copyright
commenced after first publication of the work and before the
effective date of its registration, unless such registration is
made within three months after the first publication of the
work." 17 U.S.C. § 412.
Judge Ellis concluded that plaintiff was entitled neither to
statutory damages nor attorney's fees. He reasoned that
plaintiffs source code was an "unpublished work" for purposes of
the Copyright Act, see 17 U.S.C. § 101, and, because
defendants' copyright infringement commenced before the August
14 registration, plaintiff therefore was not entitled to
statutory damages by virtue of Section 412. On the issue of
actual damages, Judge Ellis found that plaintiff had failed to
prove that its decline in sales was caused by defendants'
infringement, and awarded instead a license fee of $1,050 as
damages. I disagree with Judge Ellis' holdings.
"Publication" is a technical term under the Copyright Act and
is defined as "the distribution of copies . . . of a work to the
public by sale or other transfer of ownership, or by rental,
lease, or lending," or the "offering to distribute copies . . .
to a group of persons for purposes of further distribution . . .
or public display."*fn2 17 U.S.C. § 101. The definition also
points out that "[a] public performance or display of a work
does not of itself constitute publication." Id. "To `display'
a work means to show a copy of it, either directly or by means
of a film, slide, television image, or any other device or
Judge Ellis determined that Getaped had not "published" its
website, but, rather, merely "displayed" it. In coming to this
conclusion, Judge Ellis implicitly distinguished between posting
a website or webpage (what Getaped did) and posting music files,
software or photographs on a webpage. The latter has been held
in numerous instances to constitute publication. See, e.g., A &
M Records, Inc. v. Napster, Inc., 239 F.3d 1004, 1014 (9th Cir.
2001) (uploading music files to the internet for others to copy
violates copyright holder's exclusive publication right); State
v. Perry, 83 Ohio St.3d 41, 697 N.E.2d 624, 628 (1998) (in
finding a state statute preempted by the Copyright Act, noting
that "[p]osting software on a bulletin board where others can
access and download it is distribution," i.e., publication);
Playboy Enterprises, Inc. v. Chuckleberry Pub., Inc.,
939 F. Supp. 1032, 1039 (S.D.N.Y. 1996) (uploading content on
internet and inviting users to download it violates exclusive
publication right); Playboy Enterprises, Inc. v. Russ
Hardenburgh, Inc., 982 F. Supp. 503, 513 (N.D.Ohio 1997)
(defendants violated plaintiffs exclusive publication right by
moving subscriber-uploaded photographs to common bulletin ...