The Supreme Court has granted certiorari in Allen v. Cooper, ostensibly to decide the fate of the Copyright Remedies Clarification Act (“CRCA”). The CRCA was enacted in 1990, the first of three laws designed to ensure that states and their instrumentalities, e.g. state universities, would be liable for intellectual property infringement. The Trademark Remedy Clarification Act (“TRCA”) and the Patent and Plant Variety Protection Remedy Clarification Act (“PCA”) were enacted in 1992, but struck down as unconstitutional by the Supreme Court in College Savings Bank v. Florida Prepaid Postsecondary Education Expense Board, 527 U.S. 666 (1999) and Florida Prepaid Postsecondary Education Expense Board v. College Savings Bank, 527 U.S. 627 (1999), respectively.

Since Florida Prepaid and College Savings Bank, lower courts have found the CRCA unconstitutional. Despite this relative consensus, and the lack of a circuit split on the CRCA’s constitutionality, the Supreme Court granted certiorari in Allen v. Cooper and will hear oral arguments on November 5, 2019.

Facts

In November 1996, salvage firm Intersal, Inc. found the shipwreck of Blackbeard’s infamous ship, the Queen Anne’s Revenge, off the coast of North Carolina. Intersal retained Petitioner Allen and his company Nautilus Productions to document the salvage of the ship, and Allen registered copyrights in the resulting photographs and videos, which were licensed to Nautilus. Nautilus alleged that the State of North Carolina infringed these works, including by publicly displaying them on a government website. The State paid $15,000 to Nautilus in settlement of those prior infringements, only to post (and thereby infringe) those same works again. To avoid liability, the State of North Carolina then enacted “Blackbeard’s Law,” H.B. 184, N.C. Gen. Stat. § 121- 25(b) (Aug. 18, 2015) which had the effect of converting Allen’s copyrighted works into “public record” materials not subject to copyright protection. In response, Allen/Nautilus filed suit in federal court.

Procedural History

The district court denied North Carolina’s motion to dismiss Allen’s infringement claims on sovereign immunity grounds. Although it found the CRCA clearly abrogated sovereign immunity, it recognized tension between Supreme Court precedents in Seminole Tribe of Florida v. Florida, 517 U.S. 44 (1996) and Florida Prepaid on one hand, and Central Virginia Community College v. Katz, 546 U.S. 356 (2006), on the other. Avoiding that tension, the district court found the CRCA was a valid exercise of authority under section 5 of the Fourteenth Amendment based on “sufficient evidence of infringement” and a “pattern of current and anticipated abuse.” The Fourth Circuit reversed, applying Seminole Tribe and Florida Prepaid, and distinguishing Katz as “unique to the Bankruptcy Clause.” The Fourth Circuit also found the CRCA an invalid exercise of legislative authority under the Fourteenth Amendment as it failed to expressly cite Section 5 of the Amendment, and was not “‘congruen[t] and proportional[]’ to the Fourteenth Amendment injury” Congress sought to remedy in enacting the CRCA, i.e. state-directed copyright infringement.

Petitioner Allen's Brief

In arguing that the CRCA is a valid exercise of Congressional authority under Article I, Allen claims the Copyright Clause effects a “plan-of-the-convention” waiver of sovereign immunity, evidenced by the text of Copyright Clause. Petitioner reasons that under the Copyright Clause Congress may “secure” to authors an “exclusive” right, which implies abrogation of state sovereign immunity. Citing Alexander Hamilton’s Number 32 of The Federalist, Allen also claims that abrogation flows from the Copyright Clause because that provision “in express terms grant[s] an exclusive authority to the Union… to which a similar authority in the States would be absolutely and totally contradictory and repugnant.” Looking to the purpose of the Copyright Clause, Allen claims the Framers intended a uniform system of exclusive rights, which is evidenced by the contemporaneous Copyright Act of 1790. Allen also notes that the Copyright Clause was ratified without debate or effort to deter governmental overreach, implying that the states intended to waive sovereign immunity in ratifying it.

Rather than asking the Court to overrule Florida Prepaid, Allen argues that the Copyright Clause abrogates sovereign immunity consistent with Seminole Tribe, Florida Prepaid, and Katz. Allen explains that Seminole Tribe overruled Pennsylvania v. Union Gas, 491 U.S. 1 (1989) (which found that the interstate commerce power supported abrogation), finding that the Indian commerce clause could not abrogate sovereign immunity, but ventured too far in stating “Article I cannot be used to circumvent the constitutional limitations placed upon federal jurisdiction.” Allen argues that respondent in Florida Prepaid conceded this dictum from Seminole Tribe, obviating any search for “compelling evidence” that abrogation was intended in ratifying the Copyright Clause. Allen claims that the kind of “clause-by-clause” analysis performed by the Katz Court is warranted here. According to Allen, the Copyright Clause presents “the strongest possible case for abrogation” because it has the same “appeal to in rem jurisdiction that animates Katz.

Allen also argues that the CRCA is valid under Section 5 of the Fourteenth Amendment. Allen rejects the Fourth Circuit’s reasoning that Congress must recite “section 5” or “Fourteenth Amendment” to invoke those Congressional powers. Petitioners reasons that even Florida Prepaid acknowledged that state deprivations of patents can be remedied by Section 5, and that “the CRCA supplies the factual predicate that was lacking in Florida Prepaid.” Such evidence includes (1) a Congressional study performed by the Register of Copyrights finding state infringement was a growing problem; (2) testimony that States must be liable for damages for infringement; and (3) a catalogue of documented State infringement. According to Petitioner, that extensive record revealed pervasive and growing state copyright infringements unremedied by injunctive relief (e.g. because small copyright owners lack the resources to take on states) and that the CRCA was a “necessary remedy” for this infringement.

Respondent State of North Carolina's Brief

In response to Allen’s arguments that the CRCA is valid pursuant to the Copyright Clause, North Carolina argues that abrogation is appropriate only where there is “compelling evidence” of intent to do so by “express words” or by “insurmountable implication” in the Constitution’s text, structure, and history. North Carolina relies on Florida Prepaid in arguing that such compelling evidence is absent, and rejects Allen’s argument that Florida Prepaid does not bind the Court to rule that the Copyright Clause does not abrogate state sovereignty because respondent in Florida Prepaid conceded that point. North Carolina claims that, under the Court’s precedent, such a concession does not erode the binding nature of the explicit jurisdictional holding in Florida Prepaid. North Carolina also counters Allen’s textual argument that Congress’ power to “secure” to authors “exclusive” rights must abrogate state immunity, claiming that the Copyright Clause authorizes Congress to “secure” such “exclusive” rights to authors, not to Congress itself.

Rebutting Allen’s argument that the Copyright Clause “reserves an enumerated power exclusively for Congress,” North Carolina discusses Goldstein v. California, 412 U.S. 546, 558 (1973), which upheld a state law criminalizing unauthorized tape reproductions, and “continued the long tradition of dual federal-state regulation of copyrights.” North Carolina also distinguishes Katz, claiming that the Bankruptcy Clause is unique due to “the singular nature of bankruptcy courts’ [in rem] jurisdiction,” and its “unique” design “specifically to intrude on state sovereignty.” Rejecting Allen’s claim that the first Copyright Act evidences intent to abrogate, North Carolina explains that the Copyright Act only covered infringement by “persons,” a term the Court has held does not include the sovereign. North Carolina contrasts this with the first Bankruptcy Act’s authorization of federal courts to discharge debtors from state prisons, a clear invasion of state sovereign immunity, which North Carolina claims evidences the Framers’ disparate intentions in ratifying the two constitutional provisions under which those Acts were enacted.

North Carolina also argues that the CRCA is not a valid exercise of Congress’ power under Section 5 of the Fourteenth Amendment because it was not passed to remedy unconstitutional conduct, i.e. intentional infringement that cannot otherwise be remedied. According to North Carolina, that is evidenced by Congress’ failure to consider whether the infringement at issue was intentional, or whether there were alternative remedies to the CRCA. Specifically, North Carolina points to the former Register of Copyrights’ testimony that the infringement of concern was often unintentional, and argues that even if injunctive relief is inadequate, other remedies may suffice, e.g. suits in contract or tort, for unconstitutional takings, or section 1983 claims against those responsible. North Carolina also argues that Congress failed to identify a widespread pattern of violations, claiming Congress identified “at most a dozen instances of copyright infringement by States,” that many of these were rejected by courts on their merits or did not involve intentional infringement, and that the CRCA is neither congruent nor proportional to the unconstitutional conduct the CRCA sought to remedy.

Conclusions

There seems little practical justification for a state institution to be allowed to infringe copyright with impunity. Weighed against the harm to publishers that rely on sales to state entities or whose works become commercially unviable after being publicly distributed by state action, there seems to be a policy justification for abrogating sovereign immunity in at least some circumstances of copyright infringement by state actors. However, the narrower question before the Court in Allen v. Cooper is whether the CRCA achieves this policy objective in a constitutional manner. If not, Congress may be asked to revisit the issue with new legislation supported either by Supreme Court direction on the ability to pass Article I legislation that abrogates state immunity, or by a legislative record of widespread constitutional harm from state infringement.