USDC D. Colorado, December 22, 2008

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In 1998, plaintiff photographer granted a limited, one-time, non-exclusive license to Random House to use one of his photographs in 25,000 copies of an illustrated version of the book Into Thin Air. When plaintiff learned in 2007 that Random House printed 85,642 copies of the book, plaintiff sued for copyright infringement and fraudulent concealment.

Random House moved to dismiss both claims, arguing that the copyright infringement claim was barred by the Copyright Act’s three-year statute of limitations. The question before the court was whether it should apply the “discovery rule” – which says a claim for copyright infringement accrues when the plaintiff “knows or has sufficient reason to know of the conduct upon which the claim is grounded” – or whether it should apply the “injury rule” – which holds that a claim for copyright infringement accrues when the injury occurred. Random House advocated applying the injury rule, contending that the plaintiff’s claim accrued no later than April 2002 – the date by which Into Thin Air: The Illustrated Edition was out of print.

The court chose to apply the discovery rule, and stated that the defendant bears the burden of proof on the question of when a reasonably prudent person would have discovered the alleged infringement. However, “this a fact-intensive inquiry, not appropriate for determination on the defendant’s motion for summary judgment.”

The court also held that plaintiff’s fraudulent concealment claim was not preempted by the Copyright Act because it includes more than the copyright infringement remedy. Plaintiff contended that the license fee charged for 25,000 copies was less than what Random House would have sought for the larger printing and that Random House fraudulently concealed its intention to print 85,642 copies of the book. According to the court, “the damages for that asserted fraud are different under common law than those available under the Copyright Act” so there is no preemption by the Copyright Act.