Dr. Eugene Scott

A declaratory judgment action for copyright abandonment can give rise to fee shifting under the Copyright Act, the U.S. Court of Appeals for the Ninth Circuit ruled in a case of first impression Wednesday.

Doc's Dream v. Dolores Press means that a Georgia minister's company that rebroadcasts the sermons of TV preacher Eugene Scott could be on the hook for up to $307,000 in attorney fees.

"We hold that, even when asserted as a claim for declaratory relief, any action that turns on the existence of a valid copyright and whether that copyright has been infringed invokes the Copyright Act, and thus attorney's fees may be available pursuant to Section 505," Judge Consuelo Callahan wrote for a unanimous panel.

The case is part of a "litany of claims, counterclaims, and motions" over the rights to the televised sermons of Eugene Scott, which started in the Los Angeles area in the 1970s and eventually were broadcast throughout North America as part of a 24-hour-a-day religious network.

Scott licensed Dolores Press Inc. to distribute his works in 1995, with profits going to his Wescott Christian Center and Faith Center. During that time he made his works available for online viewing and, according to plaintiffs in the case, "encouraged his followers and the public at large to freely download, reproduce, and distribute an archive of his works."

On his death in 2005 Scott bequeathed his copyrights to his widow, Melissa Scott, who continued the licensing arrangement with Dolores Press.

Georgia minister Patrick Robinson asked Melissa Scott for permission to share the works with his students online. Though Scott refused, Robinson moved ahead anyway with a website to share the works. According to the Ninth Circuit, Robinson said his goals were "to stick it to the devil" and "get the ball rolling in this legal matter."

Ninth Circuit Judge Consuelo Callahan

"Robinson succeeded in the latter," Callahan wrote. Dolores Press sued for copyright infringement and Robinson's company, Doc's Dream, sued for a declaration that Scott had abandoned his copyrights before his death. U.S. District Judge Manuel Real of the Central District of California granted summary judgment for Dolores Press that there had been no abandonment, and Dolores and Melissa Scott moved for $307,000 in fees.

Real denied the motion. With no case law on the subject, Real looked to the Nimmer on Copyright treatise and concluded that because Robinson's suit for a declaration of copyright abandonment didn't require construction of the Copyright Act, a fee award was outside its scope.

Callahan, who was joined by Ninth Circuit Judges John Owens and U.S. District Judge Edward Korman, visiting from New York, ruled that even under the logic of the Nimmer treatise, fees would be available. Nimmer states that the Copyright Act would have to be construed in "a case in which E sues F for a declaration that the work in question falls outside the scope of copyright protection."

That hypothetical is "nearly identical to this case," Callahan wrote.

"We read Section 505, as does Nimmer, to allow the discretionary award of attorney's fees in any action where the scope of the copyright is at issue," Callahan wrote. And it would be "difficult—if not impossible—to properly evaluate an intellectual property creator's alleged abandonment without invoking the Copyright Act."

U.S. District Judge Percy Anderson has now taken over the copyright litigation from Real, who died last June. The Ninth Circuit instructed him to consider whether an award of fees to Dolores Press and Scott would be appropriate under the Fogerty factors.

In a separate order Thursday, the Ninth Circuit awarded fees on appeal to Dolores Press and to Scott. The court referred the case to Appellate Commissioner Peter Shaw to determine an amount, reviewable by the court.

The appellate win goes to Manatt Phelps & Phillips partner Benjamin Shatz; Kevin Leichter and Andrew Hewitt of The Leichter Firm; and Mark Lee of Rimon, all of whom represented Dolores Press and Melissa Scott.

Doc's Dream was represented by the Digital Business Law Group of Palm Harbor, Florida.