Copyrights – Supreme Court to Weigh-in on when a Copyright Owner Can Sue for Infringement

Two years ago, the U.S. Supreme Court clarified the test for determining when a three dimensional design for a “useful article” is copyrightable, resolving an issue that had divided the federal circuit courts for years. Although the practical implications of that decision are still being sorted out, the high court has moved on to another important copyright issue. Last month, the Court agreed to resolve the question of what the Copyright Act means when it states that “registration” is necessary before any lawsuit alleging copyright infringement can be filed.

Although copyright is inherently granted to all original works that are “fixed in any tangible medium of expression,” the Copyright Act is clear that registration by the U.S. Copyright Office is a prerequisite to filing any copyright lawsuit, making it one of the best-known benefits of a federal copyright registration. But that is not all; registration also creates a public notice of ownership that anyone can search, one that can be relied on in case of any future enforcement action. It also establishes prima facie evidence of the validity of a work and the recorded ownership if it is registered within five years of publication. Timely registration even makes it possible for a copyright owner to recover attorneys’ fees, costs, and statutory damages in the case of infringement – meaning that, instead of just actual damages, up to $150,000 can be recovered for every single instance of infringement.

In a 2009 case involving Sony (Sony BMG Music Entertainment, et al. v. Tenenbaum), the rights to thirty different registered songs were found to have been infringed. Though actual damages would not likely have been very high, the jury awarded statutory damages to the tune of $22,500 per song, for a total award of $675,000 – a sum that would not have been possible without the initial registrations. A federal registration even allows right-holders to put the U.S. Customs on notice to prevent importation of infringing copies of the work in question. So while copyright is inherent in every eligible work, registration can bring a great deal more to the table.

However, courts have long disagreed on whether denial or approval of a copyright application constitutes “registration,” or whether merely filing a complete application constitutes “registration.” Some circuits have adopted the application approach and hold that the Act’s requirement is met once a complete application has been filed. Others have adopted the registration approach, finding that the requirement is met when the final certificate is in hand (or registration is refused). Still others have declined to adopt either approach.

In the current case, Fourth Estate Public Benefit Corp. v. Wall-Street.com LLC, the district court followed the registration approach, and dismissed Fourth Estate’s copyright infringement claim on the basis that the Copyright Office had not yet approved or denied Fourth Estate’s application for copyright registration. The Eleventh Circuit affirmed the district court and held that “[f]iling an application does not amount to registration.” Interestingly, the U.S. solicitor general has already taken sides, asking the justices to affirm the Eleventh Circuit’s ruling. It would appear, then, that the government is of the opinion that the Copyright Office’s disposition (either approval or refusal) of an application is required by the language of the statute.

Whatever the high court decides, it will hopefully bring clarity to an issue to which the circuits have long been asking for guidance. Until then, copyright owners who intend to enforce their copyrights would be wise to seek formal registration with the Copyright Office before bringing suit and avoid the issue entirely.

This article appeared in the July 2018 issue of MarkIt to Market. To view our past issues, as well as other firm newsletters, please click here.