Is a copyright registration required before filing an infringement lawsuit?

It depends on what court you are in. In the Western District of Wisconsin, you have to have the registration certificate in hand.

Plaintiff photographer sued defendant sports memorabilia dealers for infringement of the copyright in a photo of Green Bay Packers quarterback Aaron Rodgers. Certain defendants moved to dismiss for failure to state a claim, arguing that since he had not obtained a copyright registration certificate before filing suit, plaintiff had not satisfied this required precondition for making a copyright infringement claim.

The court granted the motion, holding that under 17 USC 411(a)‘s plain meaning, it is not sufficient for a plaintiff to simply allege it has filed an application to register the infringed copyright before filing suit. Instead, the statute’s language requires that a registration “has been made”.

Copyright litigants should note that there currently exists a circuit split on this issue — whether an application or actual registration –- is sufficient to meet the precondition for bringing an infringement action. And even district courts within the same circuit have differed on the reading of Section 411(a) (this is the case in the Seventh Circuit). The issue even splits well known copyright commentators William Patry and (the late) Melville Nimmer. Patry reads the statute to require registration certificate in hand, while Nimmer would read it to require only that an application has been filed.

The safer route, absent guidance from an authoritative appellate court, a Supreme Court decision, or a clarifying amendment to the Copyright Act, a plaintiff should make sure it has a registration certificate in hand before filing suit. The Copyright Office, for a fee, will process applications on an expedited basis. That extra fee is certainly more affordable than having the litigation matter hung up and possibly dismissed.

Robbins v. Svehla, 2016 WL 6900719 (W.D. Wis. November 22, 2016)

Evan_BrownAbout the Author: Evan Brown is a Chicago technology and intellectual property attorney. Call Evan at (630) 362-7237, send email to ebrown [at] internetcases.com, or follow him on Twitter @internetcases. Read Evan’s other blog, UDRP Tracker, for information about domain name disputes.

Website operator faces copyright liability over use of allegedly infringing third party add-on

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The recent case of Live Face on Web, LLC v. Biblio Holdings LLC illustrates some important risks of which any purchaser of third-party technology services or deliverables should be aware. The defendant in this case faces potential copyright liability (and the expenses associated with defending such claims) arising from technology that a third party vendor provided for defendant to enhance defendants’ website.

Plaintiff’s software

Plaintiff developed software that allows website operators to display video of a personal “host” to welcome online visitors to the website. A website operator implements plaintiff’s software by embedding an HTML script tag in the code of its website. The added code links the website to a copy of plaintiff’s software stored on the same server as the customer’s website or on a different server. When a user points his or her browser to the web page, the embedded HTML script tag causes the distribution of plaintiff’s software, which in turn causes the personal host video to be displayed. The browser saves plaintiff’s software into cache or hard drive or both, and automatically loads the software into RAM.

Defendants’ alleged infringement

Defendants allegedly used an infringing version of plaintiff’s software to display a spokesperson video on its website. Specifically, defendants claim that they contracted with a third party vendor that processed video that defendants provided, then sent defendants HTML code which defendants implemented into their site. When a user visited defendants’ website, his or her browser would call on the allegedly infringing code, which was stored on the third party vendor’s server. This caused a copy of the allegedly infringing software to be stored on the visitor’s computer in cache, memory, or its hard drive.

The proceedings

Plaintiff filed suit for copyright infringement in the U.S. District Court for the Southern District of New York. Defendants moved to dismiss for failure to state a claim upon which relief may be granted. The court denied most of the motion to dismiss, leaving the majority of copyright-related claims remaining in the case. It granted the motion to dismiss on the question of contributory liability.

Direct copyright infringement

Defendants raised several arguments as to why they should not be liable for direct copyright infringement . Although the court rejected each of these arguments, it observed that defendants’ most promising argument was that any infringement was actually done by the third party vendor that provided the technology to defendants. In this part of its opinion, the court considered the holdings of Perfect 10 v. Amazon, 508 F.3d 1146 (9th Cir. 2007) and other cases that involved in-line linking. The court observed that the reasoning of these cases appeared to limit plaintiff’s ability to hold defendants liable for direct infringement of plaintiffs distribution right. Nonetheless, the record did not have enough information for the court to definitively make a determination at this early stage. Accordingly, the court decided to permit discovery on the relationship between the third-party technology vendor and he allegedly infringing software.

The court also rejected defendants’ other arguments against liability for direct infringement. It found unpersuasive defendants’ arguments that the software was never downloaded. On this point, the court found that the complaint had sufficiently alleged that the infringing software was automatically saved into the cache or hard drives and automatically loaded into computer memory or RAM of visitors to defendants’ website. The court also rejected defendants’ arguments that the DMCA Safe Harbors protected them from liability, that any copying was only de minimis, and that previous lawsuits against the third-party technology provider should relieve defendants from liability.

Contributory infringement

On the question of contributory liability, the court granted defendants’ motion to dismiss. To bring a claim for contributory infringement, a plaintiff must allege both that its copyrighted work was directly infringed and that the defendant, with knowledge of the infringing activity, induced, caused, or materially contributed to the infringing conduct of another. The court found that plaintiffs had alleged only a bare legal conclusion that defendants knew or had reason to know they were using an infringing version of the software. Without strong enough allegations on the knowledge element of contributory infringement, this claim failed.

Vicarious infringement

Vicarious liability for copyright infringement may be imposed where a defendant profits directly from the infringement and has a right and ability to supervise the direct infringer, even if the defendant initially lacks knowledge of the infringement. The court denied the motion to dismiss on this point, as plaintiff plausibly alleged that defendants controlled the allegedly unlawful distribution of copies of plaintiff’s software to its website visitors. The court drew inferences in plaintiff’s favor, noting the allegation that defendants did modify their website to include code linking to the allegedly infringing software. Plaintiffs also successfully alleged that defendants profited from the use of the infringing software in that having the video host captured, held and prolonged the attention of the average online user, and did in fact generate revenues and profits for defendants. On this point, the court look to Arista Records v. MP3Board, 2002 WL 1997918 (S.D.N.Y. August 28,2002), which stands for the proposition that “infringement which increases a defendant’s user base or otherwise acts as a draw for customers constitutes a direct financial interest.”

Implications

In the course of negotiating technology development and service agreements, a customer should seek to get assurances from its vendor that any technology being provided will not infringe third party intellectual property rights. It is critically important to, were possible, have the vendor warrant and represent that the deliverables are non-infringing. It is equally important, still from the customer’s perspective, to have the vendor obligate itself to indemnify the customer in the event there are third party claims of intellectual property infringement. Although from this opinion we do not see all the facts, it appears this could be a situation where the defendant/customer is being taken to task and having to incur needless expense for the use of infringing software provided by its vendor. If that is the case, it is an unfortunate situation, one which a prudent customer of technology services would be well advised to seek to avoid.

Live Face on Web, LLC v. Biblio Holdings LLC, 2016 WL 4766344 (S.D.N.Y., September 13, 2016)

Photo courtesy of Flickr user J E Theriot  under this Creative Commons license.

Evan_BrownAbout the Author: Evan Brown is a Chicago technology and intellectual property attorney. Call Evan at (630) 362-7237, send email to ebrown [at] internetcases.com, or follow him on Twitter @internetcases. Read Evan’s other blog, UDRP Tracker, for information about domain name disputes.

Cruz campaign still facing copyright and breach of contract liability over songs used in political ads

Court denies motion to dismiss copyright and breach of contract claims over songs used in YouTube and TV political ads.

Months after Ted Cruz ended his presidential bid, his campaign, and the advertising company hired to create ads for the campaign, still face liability over two songs used in YouTube and television ads. A federal court in Washington state has denied the defendants’ motion to dismiss copyright infringement and breach of contract claims brought against them.

An employee of the Cruz campaign’s advertising company allegedly downloaded two songs from Audiosocket, and then used those songs in two separate campaign ads. Audiosocket and the copyright holders sued for infringement and breach of the licensing agreements under which the songs were provided.

The court rejected the defendants’ arguments. It held that the plaintiffs had adequately pled the existence of their copyright registrations, and that the claims for breach of the licensing agreement were not preempted by the Copyright Act. Because the licensing agreement expressly prohibited the songs to be used for political purposes, the breach of contract claims were not “equivalent” to a copyright infringement claim, and therefore not subject to preemption under 17 USC 301.

The case is a reminder of the risks that companies and organizations face when hiring outside vendors to procure and create content. The hiring party should seek, at minimum, to ensure that the vendor has obtained the appropriate rights in the content it will integrate into the deliverables provided under the arrangement. And the vendor should utilize appropriate internal protocols and form documents to help ensure that the content it provides to its customer does not infringe. That kind of diligence will help avoid unpleasant situations between vendor and customer that arise when third parties claim against both of them that intellectual property rights have been infringed.

Leopona, Inc. v. Cruz For President, 2016 WL 3670596 (W.D. Washington, July 11, 2016)

No statutory damages in online copyright case where infringement continued after copyright registration

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If a copyright infringement begins before the plaintiff registers its copyright, and continues after the date of registration, can the plaintiff recover its attorney’s fees and statutory damages for the infringement that occurs after registration? The U.S. District Court for the Southern District of Indiana recently considered that question in the case of Bell v. Turner, 2016 WL 1270221 (S.D. Ind. March 31, 2016).

The prospect of recovering statutory damages and attorney’s fees is a big motivator for copyright plaintiffs. The Copyright Act (at 17 U.S.C. § 504(c)(1)) provides that a plaintiff can receive an award of statutory damages — in lieu of actual damages and profits — in a sum not less than $750 or more than $30,000 for each infringement. If the copyright infringement is willful, “the court in its discretion may increase the award of statutory damages to an award of not more than $150,000.” And 17 U.S.C. § 505 provides that a successful party in a copyright action can recover its costs and attorney’s fees in the court’s discretion.

But statutory damages and attorney’s fees are only available if certain conditions are met. The Copyright Act precludes a plaintiff from obtaining statutory damages and attorney’s fees if the infringement of the work commenced after publication but before registration. The Copyright Act provides, at 17 U.S.C. § 412(2), that “no award of statutory damages or attorney’s fees…shall be made for…any infringement of copyright commenced after first publication of the work and before the effective date of its registration, unless such registration is made within three months after the first publication of the work”.

In Bell v. Turner, the court granted summary judgment to the defendant on the issue of whether plaintiff was entitled to recover statutory damages and attorney’s fees. Plaintiff first published his photo of the Indianapolis skyline online in 2000. In 2009, defendant copied the photo and placed it on his website. In 2011, plaintiff registered the copyright in the work, but defendant left his copy of the photo online, even after the work was registered.

In granting summary judgment to defendant, the court cited to Derek Andrew, Inc. v. Poof Apparel Corp., 528 F.3d 696 (9th Cir. 2009) and observed that “the first act of infringement in a series of ongoing infringements of the same kind marks the commencement of one continuing infringement under § 412.” Because the defendant posted the photo online more than three months before the date plaintiff registered the work, plaintiff was not entitled to recover statutory damages or attorney’s fees, even though the infringement continued after the date of registration.

Bell v. Turner, 2016 WL 1270221 (S.D. Ind. March 31, 2016)


Evan_BrownAbout the Author: Evan Brown is a Chicago technology and intellectual property attorney. Call Evan at (630) 362-7237, send email to ebrown [at] internetcases.com, or follow him on Twitter @internetcases. Read Evan’s other blog, UDRP Tracker, for information about domain name disputes.

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