No. 36
June 2014

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International Association for the Protection of Intellectual Property

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Raging Bull Copyright Infringement Claim is Not Knocked-Out by Laches Defense, U.S. Supreme Court Holds
(Article by Seth I. Appel, Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP, Chicago, Illinois, U.S.A.)
Raging Bull, the critically-acclaimed motion picture telling the story of boxing champion Jake LaMotta, had its origin in Frank Petrella's 1963 screenplay. Metro-Goldwyn-Mayer, Inc. (“MGM”) acquired the rights and released the movie in 1980. MGM continues to market Raging Bull today in formats such as DVD and Blu-ray.

Under the U.S. Copyright Act, works published prior to 1978 are protected for an initial term of 28 years and a renewal term of 67 years. An author's heirs inherit renewal rights, even if the author assigned the copyright during the initial term. In 1991, following Frank Petrella's death, his daughter Paula renewed the copyright in his screenplay, becoming its sole owner. Eighteen years later, on January 6, 2009, she brought a copyright infringement lawsuit against MGM in California federal court.

The Copyright Act provides a three-year statute of limitations: “No civil action shall be maintained under the provisions of this title unless it is commenced within three years after the claim accrued.” 17 U.S.C. § 507(b). Under the widely-recognized separate-accrual rule, each reproduction or distribution of an infringing work is a new wrong that starts a new limitations period. Thus, Paula Petrella sought injunctive relief and damages only for acts of infringement occurring since January 6, 2006.

Notwithstanding the statute of limitation, MGM moved for summary judgment, claiming Petrella's suit was barred by laches — unreasonable, prejudicial delay in bringing suit. The district court agreed and dismissed the case, and the Ninth Circuit Court of Appeal affirmed. These courts found that MGM was prejudiced by Petrella's delay because it had made significant investments in Raging Bull believing that it had complete ownership and control of the film.

The U.S. Supreme Court reversed. Because the Copyright Act includes a three-year statute of limitations, the Court held, laches “cannot be invoked to preclude adjudication of a claim for damages brought within the three-year window.”

The Court recognized “the essentially gap-filling, not legislation-overriding, office of laches.” It distinguished laches from equitable tolling, which is read into every federal statute of limitations and lengthens the time for bringing a civil action in appropriate circumstances.

The Court rejected MGM's argument that the laches defense must be available “to prevent a copyright owner from sitting still, doing nothing, waiting to see what the outcome of an alleged infringer's investment will be.” Indeed, Petrella admitted she delayed filing suit because “the film hadn't made money.” The Court did not find this improper. Rather, it observed, the law permits a copyright owner “to defer suit until she can estimate whether litigation is worth the candle.” Holding otherwise would lead to an unnecessary “profusion of litigation.”

The Court found the Copyright Act's statute of limitations prevents inequitable results, because a successful plaintiff cannot recover for acts of infringement more than three years prior to bringing suit. “Profits made in those years remain the defendant's to keep.”

Nonetheless, the Court held that in “extraordinary circumstances,” a copyright owner's delay may bar equitable relief at the outset of litigation. For example, in an earlier case where a copyright owner had waited two years to seek a restraining order against a book that contained allegedly infringing material — after the book had been “printed, packed, and shipped” — the court properly rejected the possibility of injunctive relief. In addition, the Court explained, a copyright owner's delay may ultimately limit monetary remedies. However, “[w]hatever adjustments may be in order in awarding injunctive relief, and in accounting for MGM's gains and profits,...there is no evidence basis for immunizing MGM's present and future uses of the copyrighted work, free from any obligation to pay royalties.”


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