What to Know Before You Sue for Infringement
July 1, 2012
Let’s say that your photographs have been infringed, the infringer won’t pay, and you are deciding whether or not to file a copyright infringement action in federal court. Let’s also say that you have a best-case scenario: You registered the images before the infringement took place and you have received the registration certificates from the Copyright Office; you have a competent copyright attorney who has agreed to represent you on a contingent fee basis, so you won’t have to pay your attorney’s fees; and the defendant is a corporation with plenty of assets with which to pay a judgment if you win. Filing suit is a no-brainer, right?
Not necessarily. There are a couple of things that can still go wrong, and they can go wrong in a big, bad way. First, you might lose. Most potential plaintiffs feel strongly that they have been wronged and that anyone would have to be blind not to see that. However, justice is blind, and every case in which the defendant wins is a case where the judge and/or jury didn’t see facts and law the same way that the plaintiff did.
Second, you might find that the litigation is sucking the life out of you, your life and your business, and that you just can’t do this any more and want to withdraw the lawsuit. Or you become incapacitated or die, and your personal representatives decide that the litigation just can’t continue without your active participation and want to drop the case.
What happens if you lose or withdraw the lawsuit? Don’t you just walk away? Unfortunately, the answer is somewhere between “not necessarily” and “probably not.” Let’s see what can happen, and often does.
Unlike a number of other countries, the U.S. has a legal system in which, in most types of lawsuits, each side pays its own legal fees, win or lose. The U.S. does, however, provide for exceptions in certain specific types of cases, and one of those exceptions is in suits for copyright infringement. The U.S. Copyright Act of 1976 has two provisions dealing with attorney’s fees and lawsuit-related costs:
§505 – Remedies for infringement: Costs and attorney’s fees
In any civil action under this title, the court in its discretion may allow the recovery of full costs by or against any party other than the United States or an officer thereof. Except as otherwise provided by this title, the court may also award a reasonable attorney’s fee to the prevailing party as part of the costs.
§412 – …no award of…attorney’s fees, as provided by section… 505, shall be made for --
(1) any infringement of a copyright in an unpublished work commenced before the effective date of its registration; or
(2) any infringement of a copyright commenced after first publication of the work and before the effective date of its registration, unless such registration is made within three months after first publication of the work.
In other words, in cases where registration took place before the infringement (or within three months of publication), the court can make the losing side pay the winner’s attorney’s fees.
For many years, most copyright lawyers thought that language was talking about successful plaintiffs. For example, if you registered your copyrights early and sued for infringement and won, the court had the power to make the guys you sued pay for your lawyers, in addition to whatever damages the court might award. Then, in the mid-1990s, the U.S. Supreme Court issued a decision in a lawsuit between John Fogerty (of Credence Clearwater Revival fame) and Fantasy Records that turned the copyright world on its head. It ruled that an unsuccessful plaintiff could be ordered to pay the defendant’s legal fees when suing for infringement. Suddenly, filing a suit for copyright infringement was no longer relatively risk-free.
Put another way, if you file an infringement suit and lose or withdraw the suit, the judge may have the discretion to make you pay the winning side’s attorney’s fees. What’s worse, the legal fees, especially in copyright infringement cases and especially where defendants with deep pockets are involved, can be astronomical, often in the hundreds of thousands—or even millions—of dollars. I don’t know many photographers who can afford to take that kind of risk.
Compounding the problem is the fact that the ways that judges exercise that discretion can vary considerably. In some federal circuits, that discretion is sometimes viewed as almost a presumption that the winning side should win, no matter how meritorious the lawsuit appeared to the plaintiff.
So, what are you to do? Should you just assume that you can never afford to lose a copyright infringement case and therefore should never file one? No, I am not saying that at all. What I am saying is that the risk of losing is one of the considerations that should be carefully examined and discussed with your attorney before the decision whether or not to sue is made.
In addition, there may be some things that you and your lawyer can do ahead of time to minimize the risk. For example, I know one lawyer who advises his photographer clients to form a separate corporation with minimal assets and then assign both the copyrights at issue and the rights to sue for infringement to the corporation. That way, most of the client’s assets will not be available to be paid out if the suit proves to be unsuccessful. Will that work? I don’t know the answer to that, but I mention it so that you can understand that there may be ways to file infringement suits without incurring unacceptable levels of risk. As always, make sure that you have a good lawyer and discuss all of the possibilities with him or her.
Victor Perlman is general counsel to the American Society of Media Photographers, Inc. (ASMP). He is co-author (with Richard Weisgrau) of the book Licensing Photography, published by Allworth Press.