Out of their minds

How does this happen?

Insanely large judgment

I understand willful infringement of copyright is a bad thing. Illegally downloading songs knowing you are doing so should be penalized.
But $80,000 per song? How is that in any way justified?
What happened to the principle of proportionality where the punishment matches the crime? There is no way one copy of one song can cause $80,000 in harm to the record label.
Perhaps it's the old Lincoln addage: "the best way to get rid of a bad law is to enforce it."

I love her reaction though. Reminds me of a quote from the Who. Pete Townshend I think.
Remember, this was the early 1960s so money meant a lot more then. The Who had a bit of shtick where they would smash their instruments at the end of the show, along with much stage equipment. One day they were called into their manager's office to be informed they were 100,000 pounds in debt. Their reaction was to roll on the floor laughing. Pete (I think) said something along the lines of "when you're 10,000 pounds in debt you worry because somehow you've got to pay that off. But you know you're never going to pay off 100,000 pounds so it's just laughable."
Of course their story ended better, with them becoming world-wide blockbuster stars and easily paying off everything.

And now they stand on the side of the creditor, demanding payment from mom for her downloads. (though I doubt she downloaded the Who)
That brings up another thing though: I bet dollars to donuts not a penny of that judgment will go to the artists. Do the artists get the nickel on the dollar off the judgment that they would have gotten off a paid-for download? Probably not, though I would be interested to find out.