dissenting:
In our previous decision, L.A. News Serv. v. Reuters Television Int’l, Ltd. (Reuters III), 149 F.3d 987 (9th Cir.1998), we decided the very issue the majority now re-decides the other way. At that time, we identified the issue as whether “a plaintiff may recover actual damages accruing from the unauthorized exploitation abroad of copyrighted work infringed in the United States.” Id. at 989. We held that it could. Our mandate said, “We REVERSE the ruling barring the 'claim for extraterritorial damages and REMAND for a trial on actual damages, with directions that if LANS elects to recover actual damages, the award of statutory damages be vacated.” Id. at 997.
The majority now holds that when we said “actual damages,” we didn’t mean actual damages, but only whatever profits the infringer might have realized. This new holding is not only at odds with our previous holding, but it fails to take account of the fact that the Copyright Act itself specifically uses the terms “actual damages” and “profits” separately and distinctly.1 The district court should have allowed LANS to do what we said it could do — prove its actual damages. For that reason, I respectfully dissent.
At this stage of the case, the majority’s reliance on Sheldon v. Metro-Goldwyn Pictures Corp., 106 F.2d 45 (2d Cir.1939), is puzzling. In Sheldon, the question of what constitutes “actual damages” wasn’t an issue or even discussed. Sheldon was an appeal from an accounting. The sole question was whether the plaintiff could recover the profits earned by the defendant from its foreign exploitation of a motion picture that infringed the plaintiffs stage play, profits that were discovered during the accounting. The court held that the plaintiff could, on a constructive trust theory. “Actual damages” had nothing to do with the case.
Subafilms Ltd. v. MGM-Pathe Communications Co., 24 F.3d 1088 (9th Cir.1994) doesn’t shed light on this problem, either. It merely holds that there is no recovery under American copyright law for infringements that do not occur within the United States. True enough, but as we previously held in Reuters III, “actual damages” can be recovered when the infringement occurs wholly within the United States. Reuters III at 992, 997. That’s exactly what happened here, and why we reversed for a trial at which LANS would be allowed to prove its actual damages, if any. This is not a novel concept. See Update Art, Inc. v. Modiin Publ’g, Ltd., 843 F.2d 67, 70 n. 4 (2d Cir.1988); Famous Music *933Corp. v. Seeco Records, Inc., 201 F.Supp. 560 (S.D.N.Y.1961).
There are any number of ways to compute actual damages. Neither the Copyright Act, nor our prior decision in this case, nor any other case, limits the calculation of actual damages to only the infringer’s ill-gotten profits. LANS should have been allowed to put on its proof of its actual damages, as we previously held it could. I would remand for a trial on actual damages (just as we did last time) except this time, I would add that we really, really mean it.
. 17 U.S.C. § 504(b):
(b) Actual Damages and Profits. — The copyright owner is entitled to recover the actual damages suffered by him or her as a result of the infringement, and any profits of the infringer that are attributable to the infringement and are not taken into account in computing the actual damages.