On May 19, the U.S. Supreme Court issued a 6-3 opinion in Petrella v. Metro-Goldwyn-Mayer. Although its forthcoming opinion in Aereo v. American Broadcasting Cos. will rightly be expected to be the Supreme Court’s blockbuster copyright opinion of this term, Petrella can be considered more of a sleeper, turning on a narrow, technical issue, but with a surprising set of facts and potentially wide-ranging implications.
The case that launched a thousand boxing puns, Petrella concerns Paula Petrella, whose father, Frank Petrella, wrote a 1963 screenplay based on the life of his friend, boxer Jake LaMotta, who was ultimately the subject of Martin Scorsese’s 1980 film “Raging Bull.” After Frank Petrella died in 1981, the copyright passed to his daughter.
Petrella renewed her copyright in the screenplay in 1991, but then waited another seven years to send her first demand letter to the studios. This prompted a protracted two-year letter writing campaign, and then she waited another nine years to file a lawsuit against MGM and other studios in the U.S. District Court for the Central District of California. Her primary claim was for copyright infringement—she argued that Scorsese’s film unlawfully copies protectable elements of her father’s 1963 screenplay, even though that screenplay was not the shooting script for “Raging Bull.” Because the statute of limitations for copyright claims requires the filing of the suit within three years after the accrual of the claim, Petrella sought copyright damages only for infringement occurring after January 2006.
MGM moved for summary judgment, and the district court ruled in its favor, finding that the equitable doctrine of laches barred the suit in its entirety. In the Ninth Circuit, a defendant is entitled to a laches defense if it can prove that the plaintiff delayed in initiating the lawsuit; the delay was unreasonable; and the delay resulted in prejudice. Danjaq LLC v. Sony Corp., 263 F.3d 942, 951 (9th Cir. 2012). The court concluded that Petrella had unreasonably delayed filing the lawsuit and the delay significantly prejudiced MGM, since it had invested heavily in the promotion, marketing and distribution of the film, the value of which could have been depleted in the face of her copyright claim. The U.S. Court of Appeals for the Ninth Circuit affirmed in 2012. Petrella v. Metro-Goldwyn-Mayer Inc., 695 F.3d 946 (9th Cir. 2012).
The Supreme Court granted certiorari because of a split among the circuit courts regarding whether laches, an equitable, judge-made defense, can apply to copyright infringement claims, which have an express statute of limitations.
The majority opinion, authored by Justice Ruth Bader Ginsberg, holds first that laches may not be invoked to bar Petrella’s entitlement to legal (i.e. monetary) remedies under the Copyright Act. In so doing, the court relied in large part on the fact that the “principal application” of the laches defense should only bar claims “of an equitable cast for which the Legislature has provided no fixed time limitation.” In other words, laches should operate as an “essentially gap-filling, not legislative-overriding” defense where a statute of limitations is in place and the claim has been brought within that statutory time period.
Among the significant concerns argued by MGM and embraced by the district court was that it appeared from the record that Petrella had simply hung back on filing her lawsuit until such time as it appeared that “Raging Bull” was beginning to turn a profit. The Supreme Court rejected this as a legitimate concern, and even argued that a plaintiff was perfectly within her rights to wait and see what effect, if any, “Raging Bull” would have on the value of her father’s 1963 screenplay.
In short, the three-year statute of limitations, and the “continuing infringement theory,” under which, as here, a separate copyright infringement claim accrues each time the work is infringed, “allow a copyright owner to defer suit until she can estimate whether litigation is worth the candle.” The court noted that, in waiting as she did, Petrella gave up the right to damages for any infringement prior to filing suit in 2009.
The court also rejected MGM’s concern, acknowledged by the district court, that key evidence was likely lost during Petrella’s protracted delay. The court noted that the burden of proving copyright infringement is squarely on the plaintiff’s shoulders, and as such, that “[a]ny hindrance caused by the unavailability of evidence” was at least as likely to disadvantage Petrella as much as it would MGM. Moreover, the court noted that the adjudication of the claim would likely turn on the trier of fact’s comparison of the original and allegedly infringing works in order to determine substantial similarity.
Finally, the court noted that although laches cannot apply in situations where Congress has established a statute of limitations, MGM could still assert the doctrine of estoppel to bar remedies. Estoppel is similar to laches, but applies only where the copyright owner intentionally misleads the defendant regarding her abstention from lawsuit, and the defendant detrimentally relies on such deception. Estoppel remains a viable defense in copyright infringement suits.
Although the court held that laches cannot bar monetary damages in a copyright infringement suit, it acknowledged that this equitable defense still could have a part to play in such cases, since it could bar certain equitable remedies otherwise typically available—like an attempt by Petrella to have “Raging Bull” destroyed in its entirety and banished to the trash heap of film history. Of course, Petrella did not seek such a drastic equitable remedy. She sought equitable relief consisting of disgorgement of unjust gains and an injunction against future infringement. In practice, though, it is unclear how an injunction against future infringement would be any less drastic than the other equitable remedies noted by the court.
Thus, the court concluded that while the district court could have considered laches in fashioning equitable remedies assuming Petrella could prove infringement, her case should not have been dismissed on the basis of that defense. And, assuming Petrella prevails, the court instructed the district court that it could consider her delay in filing suit, but that it should also “closely examine” MGM’s reliance on such delay. This suggests MGM could have pursued a declaratory judgment action in its own right to put Petrella’s claims to bed early on.
In a dissenting opinion, Justice Stephen Breyer argued that laches has been regularly applied by lower courts in a variety of settings involving statutes of limitations and that in certain cases it should remain a viable defense. “In those few and unusual cases where a plaintiff unreasonably delays in bringing suit and consequently causes inequitable harm to the defendant, the doctrine permits a court to bring about a fair result.”
As this language suggests, part of what makes the Petrella decision so surprising is the extreme set of facts under which it arose. It appears the court was too willing to minimize the bad facts in favor of a decision that hews closely to time-honored distinctions between remedies at law and at equity, while simultaneously ignoring, or at least minimizing, practical realities, such as the significant risk of investing time and money in the marketing and distribution of properties that could be subject to untimely infringement claims.
Moreover, the court’s suggestion that the passage of time would equally disadvantage both parties is questionable. For example, although not apparently at issue in Petrella, a defendant would be significantly prejudiced in its ability to prove the affirmative defense of independent creation. This defense often turns on testimony from the creators of the allegedly infringing work and contemporaneous documents, all of which can be more difficult to obtain over time; memories fade and documents are often lost.
In other words, as the court notes, although a plaintiff can typically prove a copyright infringement claim without much more than the plaintiff’s work and the defendant’s allegedly infringing work, a defendant may need to gather significant evidence to combat the plaintiff’s claim. Thus, the specter of a copyright infringement claim arising years after the time of creation raises significantly more risks for defendants than for would-be plaintiffs.
Although lawyers and jurists can continue to debate the wisdom of foreclosing the application of a laches defense to legal remedies on a claim which has an express statute of limitations, it will be very important to see how Petrella plays out on remand. Assuming she even has a valid claim for copyright infringement, will the district court be able to limit Petrella’s equitable remedies to take into account her substantial delay in filing suit?
More troublingly for studios and content creators, will Petrella embolden other copyright holders to come out of the woodwork and file new infringement lawsuits of their own? As Justice Breyer points out, a plaintiff could now simply delay in bringing suit in order to wait for the death of a witness who might directly undermine the plaintiff’s claim. As he notes, “[l]ong delays do not automatically prove inequity, but depending on the circumstances, they raise that possibility.”
With its opinion in Petrella, the Supreme Court has drastically reduced the ability of defendants to combat that possibility, and leaves such potential defendants with one less tool for obtaining an early dismissal of meritless, long-delayed claims.
Joshua M. Keesan is an associate in the Los Angeles office of Kelley Drye & Warren LLP, where he represents film, television and other entertainment companies, as well as non-entertainment clients nationwide in the areas of intellectual property and general business litigation.
In Practice articles inform readers on developments in substantive law, practice issues or law firm management. Contact James Cronin with submissions or questions at