Zero Damages: A Complete Fight Over Causal Nexus in Copyright Damages

An analysis of a copyright damages decision in cross-border e-commerce

• Case No. 1:25-cv-25129-PCH
• Court: United States District Court for the Southern District of Florida
• Decision issued: April 28, 2026

I. Introduction

In copyright infringement cases, establishing liability does not automatically produce damages.

Here, having found infringement, the court nonetheless rejected the plaintiff's entire damages claim under 17 U.S.C. § 504(b). The ruling illustrates both the threshold position of causal nexus in the damages analysis and the strict application of the non-speculative evidence standard.

II. Background and Procedural History

The case concerned copyright in product listing images on e-commerce platforms. The plaintiff alleged that a number of Amazon and TikTok Shop sellers had used its product images in their listings and sued for infringement.

The court bifurcated liability and damages.

At the liability stage, the court found infringement and entered a permanent injunction.

At the damages stage, the plaintiff sought actual damages under § 504(b) — including claimed lost profits — and disgorgement of the defendants' profits it contended were attributable to the infringement.

On April 28, 2026, the court ruled on damages and rejected the plaintiff's claims in their entirety.

The defendants were represented by Hongchang Deng, Yi Yi, and Xiangru Chen of LawMay P.C., who conducted the defense at the damages trial.

III. The Two-Step Framework of § 504(b)

Under 17 U.S.C. § 504(b), a claim for disgorgement of profits proceeds in two steps:

Step one: the plaintiff bears the burden of establishing a causal nexus between the infringement and the defendants' profits or the plaintiff's losses.

Step two: only if that nexus is established does the burden shift to the defendants to apportion profits not attributable to the infringement.

Citing Mackie v. Rieser and Polar Bear Productions, Inc. v. Timex Corp., the court noted that where the link between profits and infringement is merely speculative, the claim must fail — and that indirect profits awards are comparatively rare in practice.

IV. The Causation Defense and the Court's Findings

The central question at the damages stage was whether a legally cognizable causal nexus existed between the images at issue and the defendants' profits or the plaintiff's losses.

The defense advanced a systematic set of positions on that question, which the court adopted.

(1) A multi-factor purchasing framework, and the rejection of "the first image drives the sale"

The defense showed that consumer purchasing decisions are influenced by multiple factors, including:

• price
• product function and construction
• customer reviews
• keyword ranking
• promotional mechanics
• platform fulfillment

The court adopted that framework and found the plaintiff's reliance on a single witness's opinion that the listing image was the primary driver lacked credibility.

(2) Dilution of the images' role by the listing as a whole

The defense showed that a consumer reaching a product detail page encounters:

• numerous images not at issue
• the product description

each bearing more directly on the purchasing decision. The court found that the volume of non-accused content in the listing diluted whatever effect the accused images might have had.

(3) Platform differences further reducing the images' role

For products sold through TikTok Shop, the defense noted that the platform is driven by short-form video and that static images play an even more limited role in purchasing decisions. The court accepted that distinction and found the images' influence correspondingly lower.

(4) Product differences and the rejection of one-to-one substitution

The defense established through evidence that the parties' products differed materially in:

• construction
• function
• price range

The court accordingly found that, where the products were differently positioned, the plaintiff's theory that each of the defendants' sales corresponded to one of its own lost sales lacked a factual basis.

(5) Year-over-year sales data undercutting the causal inference

Against the plaintiff's causation argument based on changes in sales volume, the defense compared sales across years and showed that fluctuations tracked a stable seasonal pattern consistent with holidays and promotional cycles. The court adopted that analysis and found the variation insufficient to support a causal link between the infringement and sales results.

(6) Evidentiary gaps and the failure to establish causation

The court also found that the plaintiff had offered no:

• consumer survey
• expert opinion
• specific transaction examples

and had identified no particular purchase attributable to the accused images. Those gaps left the causation finding without an evidentiary basis.

V. The Court's Conclusion

Weighing these factors, the court found the plaintiff had failed to offer evidence sufficient to establish a non-speculative causal nexus, observing that there was "no credible, non-speculative evidence linking infringement to profits."

The plaintiff therefore failed to carry its burden at step one of § 504(b), and the court rejected the entire damages claim without reaching apportionment.

The plaintiff has since filed further procedural motions. Liability remains on appeal.

VI. Practical Significance

The decision reflects not an idiosyncratic outcome but how the § 504(b) framework applies in the e-commerce context. Its significance lies principally in the following.

1. The structural separation of liability and damages

Liability and damages are structurally independent. Where liability is established, damages must still be proven through an independent evidentiary showing. In practice, without targeted preparation for the damages phase, a liability finding does not automatically convert into an economic result.

2. Causation as the substantive threshold for indirect profits

Causation is the substantive threshold for an indirect profits award. The decision confirms again that, in a commercial environment shaped by many factors, attributing sales results to any single element must satisfy a strict standard of proof. Temporal correlation or general experience is usually insufficient to meet the non-speculative evidence requirement.

3. The effect of a multi-factor decision environment

The presence of multiple factors is itself an important basis on which courts reject causation. The complexity of platform mechanics, product attributes, and market behavior makes consumer decisions difficult to attribute to a single variable. Organizing evidence around that complexity is often the core of a causation defense.

4. Sales data must be read against comparable context

Interpreting sales data requires comparable context. Historical data, seasonality, and promotional strategy may all constrain a causal inference. Absent controlled variables, a change at a single point in time rarely supports a stable causal conclusion.

5. The independent legal significance of evidentiary gaps

Evidentiary gaps carry independent legal significance. Without a consumer survey, expert opinion, or specific transaction evidence, a causation finding generally lacks an empirical basis. Such gaps are not merely insufficient proof; they may render the damages claim structurally unsustainable.

This article addresses general legal questions only and does not constitute legal advice on any specific matter. Outcomes depend on the specific facts, evidence, applicable law, and the court's discretion. Past results do not guarantee or predict similar outcomes in future matters.