Fourth Estate Pub. Benefit Corp. v. Wall-Street.com, LLC

Resolving circuit split, U.S. Supreme Court holds that copyright owner cannot file infringement lawsuit until Copyright Office has registered work at issue, and that merely applying for registration is not sufficient.

Fourth Estate Public Benefit Corp., a news organization that licenses online content while retaining the copyright in its articles, licensed several articles to the news website Wall-Street.com. After Wall-Street.com canceled its account with Fourth Estate, it continued to display Fourth Estate’s articles on its website. Fourth Estate sued Wall-Street.com for copyright infringement, alleging that it had “filed applications to register [the] articles with the Register of Copyrights.” Fourth Estate did not allege, however, that the Register of Copyrights had approved or otherwise rendered a decision on its applications.

Wall-Street.com moved to dismiss, arguing that Fourth Estate was not permitted to bring an infringement claim under Section 411(a) of the Copyright Act because the Register of Copyrights had not yet approved Fourth Estate’s applications to register its copyrights. The district court agreed and dismissed the complaint. The U.S. Court of Appeals for the Eleventh Circuit affirmed, holding that registration of a copyright under 17 U.S.C. § 411(a) occurs when the Copyright Office has approved or denied registration (the “registration approach”), and not merely when a copyright claimant has filed an application for registration (the “application approach”). In so holding, the Eleventh Circuit joined the Tenth Circuit in adopting the registration approach, and deepened a split within the courts of appeals — the Ninth and Fifth Circuits having adopted the application approach, the Eight Circuit having endorsed the application approach in dicta, the Seventh Circuit having taken different positions in dicta, and the First and Second Circuits having declined to adopt an approach as of that time. (Read our summary of the Eleventh Circuit’s decision here.)

Resolving this circuit split, the U.S. Supreme Court unanimously affirmed the Eleventh Circuit’s decision. Relying primarily on statutory interpretation, the Court explained that adopting the application approach would lead to inconsistencies within the Copyright Act and render certain provisions superfluous.

Section 411(a) states that “no civil action for infringement of the copyright in any United States work shall be instituted until . . . registration of the copyright claim has been made in accordance with this title,” and that if “registration has been refused, the applicant is entitled to institute a civil action for infringement if notice thereof . . . is served on the Register of Copyrights.” The Court interpreted § 411(a) as focusing on action by the Copyright Office — namely, its registration or refusal to register a copyright. According to the Court, if application alone sufficed to “ma[ke]” registration, then § 411(a)’s provision allowing a copyright claimant to file suit when the Register has refused her application would be superfluous. Such an interpretation, the Court held, would also accord the word “registration” inconsistent meanings within § 411(a) — in the first sentence, meaning the act of filing an application, and in the second sentence, meaning the Register’s review of an application. Furthermore, because § 411(a) allows the Register to become a party to a civil action with respect to the issue of registrability, such allowance, the Court held, would be negated if an infringement suit could be filed and resolved before the Register acted on an application.

Fourth Estate argued that because registration is not a condition to copyright protection, § 411(a) should not be interpreted to bar copyright claimants from enforcing that protection in court once they have applied for registration. But, as the Court noted, the Copyright Act vests copyright owners with exclusive rights upon creation of their works and prohibits infringement from that point forward; thus, a copyright owner can recover for infringement that occurred both before and after registration. Furthermore, the Court noted, the Copyright Act expressly permits preregistration infringement suits with respect to works especially vulnerable to predistribution infringement, such as movies and musical compositions, as well as for live broadcasts.

Finally, although Fourth Estate raised the specter that copyright owners may lose the ability to enforce their rights if the Copyright Act’s three-year statute of limitations expires prior to registration, the Court labeled such fear “overstated.” The current seven-month average processing time for registration applications still leaves “ample time” to sue after the Register’s decision, the Court said. While it acknowledged that processing times have crept upward over the past several decades, the Court attributed such delays to staffing and budgetary shortages that Congress is capable of alleviating. “Unfortunate as the current administrative lag may be,” the Court said, “that factor does not allow us to revise § 411(a)’s congressionally composed text.”

Summary prepared by Frank D’Angelo and Lisa Rubin