Defendants moved for partial summary judgment on all claims for copyright infringement prior to April 30, 2007, contending “[t]he three-year statute of limitations applicable to copyright-infringement claims bars claims for all sales made more than three years prior to [p]laintiff’s filing this lawsuit on April 30, 2010.” Defendants did not argue that plaintiff’s claims concerning infringement, which occurred within three years before plaintiff filed his original complaint, were untimely. Rather, for purposes of the summary judgment motion, the sole issue was whether plaintiff should be limited to recovering only those damages he suffered in the three years prior to filing suit or whether he could reach back beyond the three-year period preceding the lawsuit because he allegedly was unaware of the infringing conduct at that time.
After noting clear Sixth Circuit precedent that the discovery rule applies in copyright cases, the district court explained that the relevant question was one of damages, not the relevant limitations period. In the absence of clear Sixth Circuit precedent concerning the availability of damages for pre-discovery infringement, the court adopted the approach of the Ninth Circuit’s 2004 decision in Polar Bear Productions, Inc. v. Timex Corp. In Polar Bear, the Ninth Circuit held that the Copyright Act “permits damages occurring outside of the three-year window, so long as the copyright owner did not discover—and reasonably could not have discovered—the infringement before the commencing of the three-year limitation period.” The district court agreed with the Ninth Circuit’s interpretation allowing damages occurring outside the three-year period preceding the suit, noting that to the extent that Sixth Circuit decisions had failed to apply the reasoning of Polar Bear in previous cases, those decisions rested on distinguishable facts, including where the plaintiffs had earlier notice of the alleged infringements and their claims were therefore time-barred.
Plaintiff claimed that he did not discover the alleged infringement until almost three years before he filed his lawsuit (just barely in time to meet the statute of limitations requirements). Under the discovery rule, in order to bar plaintiff from collecting any damages, defendants would have to demonstrate, by undisputed facts, that he “knew or is chargeable with knowing” of alleged acts of infringement occurring more than three years before the lawsuit was filed. Because they had conceded for purposes of the motion that plaintiff was not aware of the allegedly infringing song prior to April 2007, the district court denied defendants’ partial motion for summary judgment as to potential damages.
For more information, please contact Jonathan Zavin, W. Allan Edmiston, David Grossman, Tal Dickstein or Meg Charendoff.
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