Copyright law is found in more than in the copyright code. Courts interpret the code, along with rulings by other courts, and apply it to the circumstances. But courts can disagree with each other, making it difficult to predict the outcome of a copyright infringement case. Fortunately, the 2nd Circuit Court of Appeals recently issued an order clarifying some frequent copyright infringement issues.
Joseph Sohm had entered into agreements with several agencies, including Continuum Productions Corp. (now Corbis Corp.), to issue licenses to third parties on his behalf. In 2004, Corbis entered into a preferred vendor agreement (“PVA”) with Scholastic Inc. that established fees for certain print-run ranges of Sohm’s photos.
In 2016, Sohm sued Scholastic for copyright infringement in the US District Court for the Southern District of New York (Case No. 16-cv-7098), alleging that Scholastic infringed his copyrights by using his photos in various publications in numbers exceeding the print runs contemplated in the invoices. After the District Court ruled on Sohm’s claims, both parties appealed to the Second Circuit Court of Appeals (Sohm v. Scholastic Inc., No. 18-2110 (2d Cir. 2020). The issues presented there are important to photographers.
Issue #1 – who has the burden to prove infringement when the infringement claimed is exceeding the scope of a license? In a copyright infringement case, the plaintiff must show: (i) ownership of a valid copyright; and (ii) unauthorized copying of the copyrighted work. A license to copy the work is “an affirmative defense to a claim of copyright infringement . . . that the alleged infringer must plead and prove.” Yamashita v. Scholastic Inc., 936 F.3d 98, 104 (2d Cir. 2019). Nevertheless, the 2nd Circuit here held that “when the contested issue is the scope of a license, rather than the existence of one, the copyright owner bears the burden of proving that the defendant’s copying was unauthorized under the license and the license need not be pleaded as an affirmative defense.”
Issue #2 – When the infringer exceeds the terms a license, is the copyright owner’s claim for infringement or breach of contract? The issue of whether license terms are “conditions” or “covenants” is discussed more fully at https://www.photoattorney.com/the-importance-of-conditions-in-your-free-license/. In the Sohm case, the 2nd Circuit explained that “generally, ‘if the licensee’s improper conduct constitutes a breach of a covenant undertaken by the licensee and if such covenant constitutes an enforceable contractual obligation, then the licensor will have a cause of action for breach of contract,’ not copyright infringement. . . . [But] ‘if the nature of a licensee’s violation consists of a failure to satisfy a condition to the license, it follows that the rights dependent upon satisfaction of such condition have not been effectively licensed, and therefore, any use by the licensee is without authority from the licensor and may therefore, constitute an infringement of copyright.’” quoting 3 Nimmer on Copyright § 10.15[A]). The court found that Sohm properly plead that Scholastic had violated restrictions in the PVAs upon which the licenses were conditioned. Therefore, a claim for copyright infringement was appropriate.
Issue #3 – Does the “discovery” or “injury” rule apply to start the three year statute of limitations for copyright infringement? Check this blog entry to learn more about this issue: https://www.photoattorney.com/when-does-the-time-start-for-your-copyright-infringment-claim/. The 2nd Circuit applied for Sohm’s claims the “discovery rule for copyright claims under 17 U.S.C. § 507(b). Under that rule, an infringement claim does not 25 ‘accrue’ until the copyright holder discovers, or with due diligence should have discovered, the infringement.” Compare this case: https://www.photoattorney.com/10th-circuit-dismisses-copyright-infringement-claim-filed-late-claim-continuing-infringement/.
Issue #4 – How many years of damages can a copyright owner recover for infringement? The 2nd Circuit limited Sohm’s damages: “[t]he Supreme Court was crystal clear . . . that, independent of whether the injury or discovery rule applies, ‘[u]nder the [Copyright] Act’s three-year provision, an infringement is actionable within three years, and only three years, of its occurrence,’ and that ‘the infringer is insulated from liability for earlier infringements of the same work’” (quoting Petrella v. Metro-Goldwyn-Mayer, Inc., 572 U.S. 673, 671 (2014)).
Issue #5 – Are Corbis’ group copyright registrations valid because they did not include Sohm’s name as author? Important past cases on this issue have been discussed more fully at https://www.photoattorney.com/new-york-court-invalidates-copyright-registrations/ and https://www.photoattorney.com/ninth-circuit-court-finds-copyright-registrations-valid/. The 2nd Circuit found a different way to side with Sohm:
Citing to Muench, Scholastic asserts that Sohm’s name was required to be included in the group registrations for them to be valid under the Copyright Act, 712 F. Supp. 2d at 85, thereby rejecting the district court’s contrary conclusion here and the Ninth Circuit’s contrary conclusion in Alaska Stock. We, however, agree with the district court and the Ninth Circuit. The “author” that must be identified in a group registration under 17 U.S.C. § 409(2) is the author of the compilation, rather than the author of each underlying work, and a valid group registration works to register each individual work included in the compilation.
We agree with the district court below and the Ninth Circuit. The plain language of § 409(2) does not require a group registrant like Corbis to include each individual author of each individual work in the compilation to effectively register those individual works. The key word in § 409(2) is “work” instead of “author.” As the Ninth Circuit explained, “[t]his subsection says that the name of the author or authors of ‘the work’ must be provided, the statute defines a ‘collective work’ as being a type of ‘work,’ and here, the author of the collective work was” Corbis. Alaska Stock, 747 F.3d 681 (footnote omitted). Consequently, to obtain a valid group registration under § 409(2), “[t]he ‘author or authors’ that must be listed . . . are the author or authors of the collective work itself.”3 Id. The Corbis group registrations all satisfied this requirement by listing Corbis as the author of the collective work. Accordingly, the district court properly determined that Corbis validly registered each of the photographs in the relevant group registrations.
In sum, the NY District Court in Sohm found that the operative word in Section 409(2) is “work” rather than “author” and that Muench improperly relied upon 17 U.S.C. § 103 in its interpretation of Section 409(2). Now, the 2nd Circuit confirmed that registration of a compilation of photographs under 17 U.S.C. 409 by an applicant who holds the rights to the component works is valid and effectively registers the underlying individual photos, even if the compilation does not list the individual authors of the individual photos.
Check the court’s full opinion for more information: https://www.photoattorney.com/wp-content/uploads/2020/09/Sohm-v-Scholastic-2nd-Circuit.pdf
All of this is helpful to photographers to understand their rights when fighting against copyright infringement.