Though copyright vests upon completion of the work, registration with the U.S. Copyright Office is required to bring suit to enforce the copyright. Although usually perfunctory, the registration process may take many months from the date of application. Expedited registration is available, but at significant cost and only with a showing of compelling circumstances. Until just recently, some courts held that a pending application provided sufficient standing for a copyright holder to sue for infringement. Other courts disagreed and required a granted registration. To avoid the cost of securing an expedited registration, copyright holders preferred to sue in the more permissive jurisdictions, which encouraged forum shopping. The debate over whether the pendency of an application suffices is now over, however.
The United States Supreme Court's recent ruling in Fourth Estate Public Benefit Corp. v. WallStreet.Com, LLC, 586 U.S. __ 2019, confirmed that with limited exceptions, a copyright registration, not a mere application, is required throughout the land in order to commence copyright infringement proceedings. This ruling gives copyright holders clear direction and greater incentive to seek early registration. Although there may be delays awaiting issuance of the registration, a successful claimant can recover actual damages or the infringer's profits for infringements that occurred within the limitations period and before registration. Statutory damages are also available in certain instances prior to registration when the works are recently published.
In another recent decision, the Supreme Court also addressed the issue of what constitutes recoverable "costs" for the prevailing party. Rimini Street, Inc. v. Oracle USA, Inc., 586 U.S. __ 2019. The Court clarified that "full costs" to prevailing parties in infringement cases do not include expert witness fees, e-discovery fees or other costs that do not fall under the defined categories of "taxable costs" recognized in the Judicial Code. This ruling confirms that, although the prevailing party may recover attorney fees and certain litigation costs, the winning litigant will need to bear certain types of expenses, some of which may be substantial. Thus, expense management remains an essential component of copyright disputes, as it does for other forms of modern litigation.
Without the option of pursuing litigation based only on a pending application, those seeking to enforce their copyrights would be wise to make an early assessment of possible copyright infringements to determine the need for registration, as well as the timing of demand letters and lawsuits. Creators of copyright-protected works should strongly consider developing a proactive copyright protection plan for new works, especially in industries where infringement is rampant or where speed in pursuing infringement is essential. Moreover, in evaluating the costs and benefits of litigation over settlement, as well as setting reserves, parties must consider that some expenses cannot be recovered, regardless of outcome.
Members of Day Pitney's Trademark Copyright and Advertising group are well-versed in copyright assessment, registration, enforcement and licensing. We would be happy to discuss any questions you may have or to develop a strategic assessment of your copyrighted works in advance of possible infringement, litigation or licensing opportunities.
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