Reed Elsevier, Inc., et al. v. Muchnick, et al., U.S. Supreme Court, March 2, 2010

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  • U.S. Supreme Court reverses Second Circuit to hold that Section 411(a) of the Copyright Act, which requires a copyright owner to obtain copyright registration before filing an action for infringement, is a precondition for filing a copyright infringement claim but does not restrict a federal court’s subject matter jurisdiction to hear claims involving unregistered copyrights.

Several copyright infringement actions, brought by freelance writers against the owners of online databases and print publishers, were consolidated in the SDNY. The consolidated complaint alleged that the named plaintiffs each owned at least one copyright that they had registered in accordance with §411(a) and that the defendants reproduced their works electronically without permission. Section 411(a) requires copyright holders to register their works before suing for copyright infringement, with certain exceptions. The class of plaintiffs, however, included both authors who had registered their copyrighted works and authors who had not.

In March 2005, the parties reached a settlement agreement and moved the district court to certify a class for settlement and to approve the settlement agreement. Ten freelance authors, including Irvin Muchnick, objected. The district court overruled the objections, certified a settlement class of freelance authors, approved the settlement for the entire class and entered final judgment. The Muchnick plaintiffs appealed, renewing their objections to the settlement on procedural and substantive grounds. Shortly before oral argument, the U.S. Court of Appeals for the Second Circuit sua sponte ordered briefing on the question whether §411(a) deprives federal courts of subject matter jurisdiction over infringement claims involving unregistered copyrights. All parties filed briefs asserting that the district court had subject matter jurisdiction to approve the settlement agreement even though it included unregistered works.

Relying on two Second Circuit precedents holding that §411(a)’s registration requirement was jurisdictional (Well-Made Toy Mfg. Corp. v. Goffa Int’l Corp., 354 F. 3d 112 (CA2 2003); Morris v. Business Concepts, Inc., 259 F. 3d 65 (CA2 2001)), the Court of Appeals concluded that the district court lacked jurisdiction to certify a class of claims arising from the infringement of unregistered works, and also lacked jurisdiction to approve a settlement with respect to those claims.

The parties appealed to the U.S. Supreme Court. The Supreme Court formulated the question presented to ask whether §411(a) restricts the subject matter jurisdiction of the federal courts over copyright infringement actions. Because no party supported the Second Circuit’s jurisdictional holding, the Supreme Court appointed an amicus curiae to defend the Second Circuit’s judgment.

The Supreme Court reversed, holding that §411(a)’s registration requirement is a precondition to filing a claim that does not restrict a federal court’s subject matter jurisdiction. According to the court, “jurisdiction” refers to a court’s adjudicatory authority and jurisdictional statutes speak to the power of the court rather than to the rights and obligations of the parties. The court stated that the distinction between jurisdictional conditions and claim-processing rules can be confusing in practice. “Courts—including this Court—have sometimes mischaracterized claim-processing rules or elements of a cause of action as jurisdictional limitations, particularly when that characterization was not central to the case.” The court explained that recent Supreme Court decisions “evince a marked desire to curtail such ‘drive-by jurisdictional rulings’ which too easily can miss the ‘critical difference[s]’ between true jurisdictional conditions and nonjurisdictional limitations on causes of action.” (citations omitted)

Citing Arbaugh v. Y & H Corp., 546 U.S. 500 (2006), the court held that when a legislature clearly states a threshold jurisdictional limitation on a statute’s scope, such limitation should count as jurisdictional; but when a legislature does not identify a statutory limitation as jurisdictional, courts should treat it as nonjurisdictional in character.

Section 411(a) provides:

Except for an action brought for a violation of the rights of the author under section 106A(a), and subject to the provisions of subsection (b), no civil action for infringement of the copyright in any United States work shall be instituted until preregistration or registration of the copyright claim has been made in accordance with this title. In any case, however, where the deposit, application, and fee required for registration have been delivered to the Copyright Office in proper form and registration has been refused, the applicant is entitled to institute a civil action for infringement if notice thereof, with a copy of the complaint, is served on the Register of Copyrights. The Register may, at his or her option, become a party to the action with respect to the issue of registrability of the copyright claim by entering an appearance within sixty days after such service, but the Register’s failure to become a party shall not deprive the court of jurisdiction to determine that issue.

17 U.S.C. §411(a).

In this case, the court held that §411(a) does not clearly state that its registration requirement is jurisdictional, and that the registration requirement is located in a provision separate from those granting federal courts subject matter jurisdiction over copyright claims (i.e., 28 U.S.C. §§1331 and 1338). The court also noted §411(a) allows courts to adjudicate infringement claims involving unregistered works in three circumstances: where the work is not a U.S. work, where the infringement claim concerns rights of attribution and integrity under §106A, and where the holder attempted to register the work and registration was refused. In addition, the court noted that §411(c) permits courts to adjudicate infringement actions over certain kinds of unregistered works where the author “declare[s] an intention to secure copyright in the work” and “makes registration for the work, if required by subsection (a), within three months after [the work’s] first transmission.”

The court concluded by saying a statutory condition that requires a party to take some action before filing a lawsuit is not automatically a jurisdictional prerequisite to suit. “Rather, the jurisdictional analysis must focus on the ‘legal character’ of the requirement. . . . Section 411(a) imposes a precondition to filing a claim that is not clearly labeled jurisdictional, is not located in a jurisdiction-granting provision, and admits of congressionally authorized exceptions. See §§411(a)–(c). Section 411(a) thus imposes a type of pre-condition to suit that supports nonjurisdictional treatment under our precedents.”

The court declined to address whether the registration requirement in §411(a) “is a mandatory precondition to suit that . . . district courts may or should enforce sua sponte by dismissing copyright infringement claims involving unregistered works.”