January 18 1999

Statutory Damages in Software Copyright Infringement

Roschier, Attorneys Ltd | Intellectual Property - Finland

The Finnish Supreme Court held in a recently rendered software copyright infringement case that the reasonable compensation referred to in Article 47 of the Finnish Copyright Act for copyright infringement is the amount that corresponds to a simple licence fee based on retail prices of the copied software products. According to the Copyright Act, the copyright owner is entitled to recover an award of reasonable compensation regardless of whether or not the infringer was aware or had any reason to believe that his act constituted infringement. If the copying or use of software is wilful or negligent, the infringer shall, in addition to the above mentioned compensation, be liable for any other loss and injury. As the burden of proof regarding damages lies with the copyright owner and the amount of damages is, in practice, difficult to determine, reasonable compensation (plus attorney fees and costs) in many cases constitutes the only monetary remedy for the copyright owner. In cases not related to software but other protected works, the courts have from time to time awarded compensation that exceeds the calculation based upon the licence fee analogy, but in software infringement cases courts have awarded considerably smaller compensation. According to the Supreme Court, in a case of wilful infringement for commercial advantage, the amount of reasonable compensation should equal the ordinary licence fee that the defendant would have had to pay if he had purchased a licence. Thus, the ruling of the Supreme Court is in line with the already established principle that reasonable compensation does not include any element of punitive damage. The ruling can be criticized as it implies that an infringer is in the same position as a law-abiding business that purchases the software for the ordinary licence fee. The decision has also been criticized as the copyright owner (i.e. the manufacturer of the software) can be seen to make a 'profit' from the difference between its own factory price and the retail price of software. (Source: Supreme Court Case 1998:91 rendered on August 21 1998).



For further information on this topic contact Rainer Hilli at Roschier Holmberg, Attorneys Ltd by telephone (+358 9 228 551) or by fax (+358 9 664 300) or by email (a class="normal" href="mailto:[email protected]">[email protected]).