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Copyright Infringement Damages Not Dischargeable in Bankruptcy
The U.S. Bankruptcy Court for the Eastern District of Missouri decided that the managing member of a restaurant-bar who was found liable for failing to obtain a public performance license for the music played at the venue, couldn't discharge the copyright-infringement judgment through bankruptcy. In re: Walker, 11-52059-659. Doug Walker operated Twister's Iron Horse Saloon in Imperial, MO. After repeated unsuccessful attempts by ASCAP to get him to enter into a public performance license, the district court issued a default judgment against Walker for $41,231.90. Walker then filed for Chapter 7 bankruptcy and moved to discharge the judgment under 11 U.S.C. '523(a)(6). The music publishing plaintiffs argued the judgment couldn't be discharged because the infringement was “willful and malicious.” ASCAP had tried to contact Walker 28 times by phone, 14 times by letters and twice by sending a representative to the saloon. Chief U.S. Bankruptcy Judge Kathy A. Surratt-States noted: “The Eighth Circuit Court of Appeals [within which the Missouri bankruptcy court resides] has set a high bar for certainty of harm regarding willful and maliciousness for the purposes of Section 523(a)(6).” Chief Judge Surratt-States then found in part: “Debtor's failure to proactively obtain an ASCAP license, and then intentionally ignore ASCAP's several attempts to communicate with Debtor regarding the same, was willful. Debtor knew the consequences of his failure to obtain a license and failure to heed the several contacts by ASCAP ' that royalties due to authors of songs would not be paid ' would cause financial harm to both ASCAP and ASCAP's constituents generally, but Plaintiffs particularly. Debtor's actions were willful.”
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