X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.
The 9th U.S. Circuit Court of Appeals has held that an assignee of a claim for copyright infringement who has no legal or beneficial interest in the copyright itself, may not institute action for infringement. [FOOTNOTE 1] In reaching its decision, the court analyzed the 1976 Copyright Act and the “scant, although persuasive, precedent” that is available in analogous situations. SCRIPT CONTROVERSY Nancey Silvers wrote the script of a made-for-television movie called “The Other Woman.” The script was a work-for-hire for Frank & Bob Films II which remains to this day the proprietor of the copyright in the script and the movie. Approximately three years after the movie was broadcast on television, Sony Pictures Entertainment Inc. released a motion picture titled “Stepmom.” After the release of that film, F&B executed an “Assignment of Claims and Causes of Action” in favor of Silvers. F&B retained ownership of the underlying copyright in the script, but assigned to Silvers “all right, title and interest in and to any claims and causes of action against Sony Pictures Entertainment Inc., Columbia TriStar and any other appropriate persons or entities, with respect to the screenplay ‘The Other Woman’. … and the motion picture ‘Stepmom.’” Silvers then sued Sony for copyright infringement, alleging that the movie “Stepmom” was substantially similar to the script for “The Other Woman.” Sony moved to dismiss the complaint on the ground that Silvers lacked standing to bring an action for copyright infringement in the absence of her having some legal or beneficial ownership in the underlying copyright. The district court denied the motion and certified the issue for interlocutory appeal. A panel affirmed the decision of the district court and the court then voted to take the case en banc. The decision cites Article 1, �8, clause 8 of the Constitution which states “The Congress shall have the Power … To promote the Progress of Science and useful Arts by securing for a limited Times to Authors … the exclusive Right to their … Writings. … ” The court indicates that this clause does not grant any substantive protection to authors; rather, Congress is empowered to provide copyright protection. The court indicates that because copyright is a creature of statute, the only rights that exist under copyright law are those granted by statute. Section 501(b) of the act states that “the legal or beneficial owner of an exclusive right under copyright is entitled, subject to the requirements of �411, to institute an action for any infringement of that particular right committed while he or she is the owner of it.” According to the court, the clear meaning of this provision is that the plaintiff must be the legal or beneficial owner of an exclusive right under copyright in order to sue for copyright infringement. The opinion then lists the “exclusive rights” of a copyright proprietor set forth in ��106 of the act. The right to sue for an accrued claim for infringement is not one of those exclusive rights. The court also cites �201(d) of the act which indicates that exclusive rights in a copyright may be transferred and owned separately. It notes that the provision creates no exclusive rights other than those listed in �106, nor does it create an exception to �501(b). When a copyright interest is transferred, it must be recorded to protect the copyright holder’s right to bring an infringement suit. The court indicates that the recording statute does not contemplate a transfer of anything other than an ownership interest in the copyright along with the concomitant exclusive rights. Further, under �501(b), in order for a plaintiff to be “entitled … to institute an action” for infringement, the infringement must be committed while he or she is the owner of the particular exclusive right allegedly infringed. The statute does not say expressly that only a legal or beneficial owner of an exclusive right is entitled to sue but, according to the court, under traditional principles of statutory interpretation, the explicit listing by Congress of who may sue for copyright infringement should be understood as an exclusion of others from suing for infringement. COPYRIGHT IS CREATURE OF STATUTE The court states that there are two particularly important reasons to apply such a presumption here. First, copyright is a creature of statute, so the court will not lightly insert common-law principles that Congress has left out. Second, the durational limitation of �501(b) indicates that Congress restricted even the legal or beneficial owner of a copyright; the owner is not entitled to sue unless the alleged infringement occurred while he or she [was] the owner of it. “In other words, Congress’ grant of the right to sue was carefully circumscribed.” Although the court believes that the meaning of �501(b) is clear, it recognizes that the omission in that provision to explicitly address the present question may create an ambiguity. Therefore, the court consults legislative history. The opinion states that the House Report suggests strongly that Congress intended to limit the class of persons who may sue for infringement. It cites material from the legislative history which indicates that the first sentence of �501(b) empowers the legal or beneficial owner of an exclusive right to bring suit. Non-owners claiming it their right to sue, such as Silvers, are not entitled to notice or joinder, which suggests that Congress did not envision their existence, or that the right to sue was a right severable from ownership from one of the authorized exclusive rights. The court concludes that Congress wanted to ensure that the owner of any exclusive right in the copyright would be entitled to bring a suit for infringement. Congress foresaw a permissible division of exclusive rights; the owner of any one of those exclusive rights may sue, with the other owners being entitled to notice and joinder. In this sense, Congress intended to “unbundle” the exclusive rights. The court also notes that the legislative history indicates that if the right is not specified than it is not one of the exclusive rights granted by Congress. It then states, “For instance, A may own the copyright in a book, while B may own the right to develop the book into a screenplay. A may sue an infringer of the book; B may sue an infringer of the screenplay. But only owners of an exclusive right in a copyright may sue. For instance, neither A nor B in the example above could assign an accrued claim for copyright infringement to C if C had no legal or beneficial interest in the copyright.” After examining the strong connection between copyright and patent law, the court concludes with the statement that “no rights exist with respect to patents unless they are created affirmatively by Congress, and courts may recognize only those rights that appear in the statute.” The court indicates that it should interpret the Copyright Act consistently with the requirements of the Patent Act. OTHER CASES The last section of the opinion is an analysis of cases from other circuits. It finds persuasive two cases from the 2nd Circuit. In ABKCO Music, Inc. v. Harrisongs Music, Ltd.,[FOOTNOTE 2] ABKCO had purchased both the copyright to a song and “any and all rights assertable under copyright against the Infringing Composition in any part of the world which may have heretofore arisen or which may hereafter arise.” Although the infringement in question occurred prior to ABKCO’s buying the copyright, the court held that ABKCO could sue the infringer “not out of its ownership of the copyright, but from its ownership from the claims themselves which were purchased, along with the copyright, in 1978.” The court made it clear that its decision was limited to the situation in which the same entity purchased both the copyright and the accrued claims; the only issue is one of timing, where the ownership of the copyright and occurrence of the infringement had to coincide. That opinion reaffirmed the principle in Eden Toys, Inc. v. Florelee Undergarment Co.[FOOTNOTE 3] also a 2nd Circuit decision, concluding that a party that has no ownership interest has no standing to sue (superseded on other grounds). The court indicates that it is important for it to parallel the 2nd Circuit because: a) its independent analysis leads it to the same conclusion and b) the creation of a circuit split would be particularly troublesome in the realm of copyright. Accordingly, the court concludes that the bare assignment of an accrued cause of action is impermissible under �501(b) of the act. Because that is all that was conveyed to Silvers, she is not entitled to institute, and may not maintain, an action against Sony for alleged infringement of the copyright in “The Other Woman.” Two judges dissented in a lengthy opinion in which they analyzed the history of both the 1909 Copyright Act, the act and the cases relied upon by the majority. Michael I. Rudell is an entertainment attorney practicing with Franklin, Weinrib, Rudell & Vassallo. He is past chairman of the Forum on Entertainment and Sports Industries of the ABA. ::::FOOTNOTES:::: FN1 Silvers v. Sony Pictures Entertainment, Inc., 402 F3d 881 (2d Cir. 2005) FN2 944 F2d 971 (2d Cir. 1991). FN3 697 F2d 27 (2d Cir. 1982).

This content has been archived. It is available exclusively through our partner LexisNexis®.

To view this content, please continue to Lexis Advance®.

Not a Lexis Advance® Subscriber? Subscribe Now

Why am I seeing this?

LexisNexis® is now the exclusive third party online distributor of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® customers will be able to access and use ALM's content by subscribing to the LexisNexis® services via Lexis Advance®. This includes content from the National Law Journal®, The American Lawyer®, Law Technology News®, The New York Law Journal® and Corporate Counsel®, as well as ALM's other newspapers, directories, legal treatises, published and unpublished court opinions, and other sources of legal information.

ALM's content plays a significant role in your work and research, and now through this alliance LexisNexis® will bring you access to an even more comprehensive collection of legal content.

For questions call 1-877-256-2472 or contact us at [email protected]

 
 

ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2020 ALM Media Properties, LLC. All Rights Reserved.