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IP/Entertainment Case Law Updates

Guzman v. Hacienda Records and Recording Studio, Inc.

District court denies defendant's post-trial application for award of expert witness fees, finding they are excluded from Copyright Act’s provision entitling prevailing party to “full costs.”

Defendant Hacienda Records and Recording Studio, Inc. prevailed on a copyright infringement claim brought by plaintiff Jose O. Guzman following a bench trial in the U.S. District Court for the Southern District of Texas. Hacienda moved for attorneys’ fees, which the district court denied, concluding that the infringement claim was not frivolous, objectively unreasonable or brought in bad faith. Hacienda then moved for an award of $93,847.50 in costs, which included $30,510 in expert witness fees under Section 505, which provides that a court “may allow the recovery of full costs.” Guzman opposed the motion on the grounds that only costs specified as taxable costs in 28 U.S.C. § 1920 should be included in an award under 17 U.S.C. § 505. The district court disagreed that the “full costs” language of Section 505 was limited by the recoverable expenses enumerated in 28 U.S.C. § 1920, but nonetheless held that expert witness fees are not covered by Section 505.

The district court reasoned that the term “full costs” does not include all costs associated with the litigation because attorneys’ fees are expressly carved out and addressed separately in Section 505. It then looked to prior U.S. Supreme Court cases addressing costs statutes outside the copyright context as persuasive on this issue. Those cases, including Crawford Fitting Co. v. J.T. Gibbons, Inc.; West Virginia Hospitals, Inc. v. Casey; and Arlington Central School District Board of Education v. Murphy, hold that the term “costs” should not be construed to encompass witness fees in the absence of a clear indication to the contrary. The district court concluded that when Congress enacted the Copyright Act of 1976, it had explicitly authorized awards of witness fees in various other statutes and would have done so in Section 505 had it intended to. The court declined to follow the unpublished Ninth Circuit decision in Kourtis v. Cameron, which permitted the collection of expert witness fees under Section 505, because the panel in that case did not acknowledge prior U.S. Supreme Court precedent.

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