On March 4, 2019, a unanimous U.S. Supreme Court (“SCOTUS”) finally put to rest the split among the Federal Circuits that a copyright owner may file suit once the U.S. Copyright Office registers a copyright. Previously, some Circuits had allowed lawsuits once an application had been filed with the Copyright Office. Writing for the Court, Justice Ginsberg said that the Copyright Act clearly stated that an issued registration was required for owners to enforce their rights.
Background of Copyright Law
Under copyright law, an author gains “exclusive rights” in his work immediately upon the work’s creation, including the right to reproduce it, distribute it, and display it. The Copyright Act also entitles an owner to begin a copyright infringement action in Federal Court to enforce those exclusive rights. Generally speaking (there are limited exceptions), before an owner can act on those rights, he must comply with the requirement that “registration of the copyright claim has been made.” Registration is similar to an administrative exhaustion requirement that the owner must satisfy before suing to enforce his rights. Under the current process at the Copyright Office, registration is issued generally in seven months. The Copyright Office also offers expedited processing for a significantly higher filing fee (currently $800) and those applications currently are processed within two weeks. Therefore, there is usually not a good reason why the registration requirement cannot be met before filing a lawsuit.
Facts of the Case
The parties in this case both are involved in online news journalism and the Petitioner licensed content to the Respondent. When the licensing agreement was cancelled, the terms of the licensing agreement required the Respondent to remove the licensed content from its website; however, the Respondent did do so, and the Petitioner sued for copyright infringement. After filing suit, the Petitioner then filed copyright applications to protect the licensed news stories. Ultimately, its copyright applications were refused, but the issue before SCOTUS was whether the suit was proper based on the filing of the applications or whether the suit needed to wait until the registration issued.
The Supreme Court’s Decision
The Court ruled in Fourth Estate Pub. Benefit Corp. v. Wall Street.com, LLC that a copyright owner cannot file an infringement lawsuit until the Copyright Office has registered the work at issue. While many organizations had encouraged SCOTUS to take the application approach, the Justices were clear that the registration approach was the only approach that fit with the Copyright Act’s statutory language. Justice Ginsburg acknowledged that Congress has had plenty of opportunity to change the current system, but has declined to do so. She also stated that current backlogs at the Copyright Office could be alleviated by allocating additional funding to the Copyright Office. However, Justice Ginsburg was quick to calm any fears that the backlog was so detrimental to the litigation process that any statutes of limitations would be possibly missed by requiring claimants to first seek a registration, noting that copyright owners have the ability to recover damages for “infringement that occurred both before and after registration.”
Impact of the Decision
We agree this was the proper decision and appreciate the Court came to this decision and we now have a consistency among all the the Circuits. In the wake of this decision, many high-profile cases were withdrawn that were filed based solely on filed applications (and not yet issued) copyright registrations, among them the widely publicized Fortnite law suits filed late last year.
As copyright registrations are relatively inexpensive and quick to obtain (compared to patents and trademarks), we encourage copyright owners to file as soon as an important work is created. For any licensed works, copyright applications should always be filed, so that in the case of breach of the terms of the license, as in this case, any proper remedies for infringement may be brought. Expedited filing fees can add up, especially if more than one work is the subject of litigation, so by filing early and updating filings for any changed content, you can be ready to bring an infringement suit if necessary.
Please feel free to contact us if you have any questions about this case of need assistance with a copyright or intellectual property matter.
Stacey C. Kalamaras is the founding partner of Kalamaras Law Office, LLC. She has extensive intellectual property experience with a particular focus on trademark prosecution and enforcement. She has protected some the world’s largest brands in more than 150 countries and specializes in helping small and medium sized businesses grow and protect their brands. Contact her at firstname.lastname@example.org.
Stacey is also the founder and lead instructor of Trademarkabilities®, an online trademark academy for lawyers, whose mission it is to prepare lawyers to be confident and effective practitioners before the USPTO. To learn more, please visit https://www.trademarkabilities.com/.