Copyright Lawsuits Become More Expensive for Some Plaintiffs

The Supreme Court handed down a decision today in Fourth Estate Pub. Benefit Corp. v. Wall-Street.com, resolving a circuit split and holding that most plaintiffs in copyright disputes cannot file suit while their copyright applications are pending before the Copyright Office. The new rule may make copyright lawsuits more costly for some plaintiffs.

The rule in the Ninth Circuit and a few others had been that, because plaintiffs could sue after a rejection or acceptance by the Copyright Office, plaintiffs could also sue while an application was pending. The ability to make a claim was inevitable, and thus “registration” in the preconditions to suit meant “applied for registration.”

With the new rule and registration times at the Copyright Office estimated between six to eight months, plaintiffs who need to bring suit faster will now be forced to pay an extra $800 in government fees to have the Copyright Office expedite registration, where processing typically takes just a week. The Copyright Office grants such special handling only in certain circumstances, and prospective litigation is generally one reason for doing so.

This new requirement could impact plaintiffs seeking a preliminary injunction and plaintiffs whose time to file suit is within a year or so of the three-year statute of limitations for copyright lawsuits.

Plaintiffs seeking preliminary injunctions

Plaintiffs who plan to seek preliminary injunctive relief (or file suit) should talk to their lawyers about expediting registration. The Court’s ruling does not address what impact its decision might have on preliminary injunctive relief, which is granted only when (among other factors) there is a risk of irreparable harm. Courts consider plaintiff’s own delay before granting preliminary injunctions, and plaintiffs who wait too long to seek a preliminary injunction can be denied relief because, merely by waiting, they have demonstrated the potential harm is not so irreparable. “An unreasonable delay suggests that the plaintiff may have acquiesced in the infringing activity, or that any harm suffered by the plaintiff is not so severe as to be ‘irreparable.’” Richard Feiner & Co. v. Turner Entm’t Co., 98 F.3d 33, 34 (2d Cir. 1996). One can easily imagine defendants arguing that a plaintiff who chooses not to seek expedited registration has effectively decided to wait six to eight months to file suit, and they should thus not be allowed to seek preliminary injunctive relief because there is no irreparable harm. Whether delay caused by the Copyright Office is “unreasonable” is another matter, but prudent plaintiffs who can afford the $800 special-handling fee to expedite registration may be able to avoid that question altogether.

Plaintiffs nearing the statute of limitations

Plaintiffs who are within a year or so of expiry of the three-year statute of limitations may also need to seek expedited registration. The appellee in Fourth Estate had argued that the Copyright Office’s processing time, together with the limitations period, counseled against requiring registration before filing suit. The Court’s response was that the limitations period is three years, while registration averages only seventh months—leaving ample time to seek registration and file suit. That response by the Court suggests application processing might not equitably toll the limitations period—and if the Copyright Office causes a plaintiff to miss the filing deadline, tough luck.