A recent motion for default judgment shows a willingness on the part of the Federal Court to strike out against the worst infringers.

The Facts

Microsoft Corporation brought an action against a number of defendants relating to the sale of infringing copies of MICROSOFT branded software and the unauthorized use of MICROSOFT trade marks by businesses operated under the name PC Village. The defendants included two numbered companies and employees of each company.

When the plaintiffs’ investigators attended at the business premises of PC Village, evidence was obtained of conscious repeated infringement of the plaintiff’s copyrights and trade marks. The defendants’ initially retained counsel to defend the proceedings but eventually failed to deliver a statement of defence.

Default Judgment

The plaintiff brought a motion for default judgement seeking statutory damages under the Copyright Act, punitive damages, an injunction and costs on a solicitor and client basis.

In determining the amount of statutory damages to award, reference was made to previous decisions involving similar types of infringement in which substantial amounts of damages had been awarded. The Judge said that the amount of statutory damages must reflect not only the bad faith of the defendants but their disregard for the rights of the plailntiff. The amount of statutory copyright damages must be sufficiently high to serve as a salutary message in deterring future infringements on the part of the named defendants and other parties. As a result, $10,000 was awarded for each copyright violation against the numbered companies. This resulted in judgement of $70,000. The employees were also found jointly and severally liable.

The Court also awarded punitive and exemplary damages in the amount of $50,000 to reflect the fact that the conduct of the defendants constituted a callous disregard for the rights of the plaintiff.

A permanent injunction was granted as well as costs of the motion on a solicitor and client basis in the sum of $50,000.

Comment

The decision is indicative of the willingness of the Federal Court to make substantial damage awards against infringers who callously and repeatedly disregard the rights of a plaintiff.