District Court Finds Plaintiff Satisfies “Case or Controversy” Requirement and Sufficiently Alleges Copyright Misuse in Declarat

Plaintiff Carol Loeb Shloss (“Plaintiff”) is the author of Lucia Joyce: To Dance in the Wake, a book describing the creative impact of Lucia Joyce on the literary works of her father, author James Joyce. Defendants Seán Sweeney and the Estate of James Joyce (“Defendants”) own and control copyrights in some of the works of James Joyce and his relatives. When Plaintiff contacted the grandson of James Joyce to request help in writing her book, Joyce’s grandson refused. In subsequent communications, Defendants took steps to interfere with Plaintiff’s research, repeatedly forbidding Plaintiff from using materials related to Lucia Joyce, and threatening Plaintiff by referring to Defendants’ successful copyright litigation record. Stephen James Joyce, the grandson of James Joyce and a trustee of the Joyce Estate, also notified the Publisher of Shloss’ book that he refused to grant permission to use copyrighted materials and made veiled threats regarding future litigation.

In an attempt to avoid a lawsuit by Defendants, substantial documentary support was cut from Plaintiff’s manuscript published in 2003. Reviews of the book remarked on the lack of documentary support for Plaintiff’s theories. In response, Plaintiff created an electronic supplement to the book on a password-protected website that contained the material removed out of fear of litigation. Plaintiff plans to make the website available as a resource to the general public in the United States. Plaintiff’s counsel wrote to Defendants to describe the website and to communicate Plaintiff’s belief that the work was protected by copyright fair use doctrine. Based on Defendant’s continued threats of litigation, Plaintiff filed an action for declaratory judgment based on four counts: (1) non-infringement, (2) fair use, (3) copyright misuse, and (4) unclean hands.

Defendants subsequently filed a motion to dismiss, contending that (1) Plaintiff failed to prove a reasonable apprehension of being subject to copyright infringement liability at the time of filing, (2) a covenant not to sue eliminated any such reasonable apprehension, and (3) any ruling would be an advisory opinion because Plaintiff has not yet published the electronic supplement. The Court denied Defendants’ motion to dismiss by relying on principles from Societe de Conditionnement en Aluminum v. Hunter Engineering Co., 655 F.2d 938 (9th Cir. 1981) and Hal Roach Studios, Inc. v. Richard Feiner & Co., 896 F.2d 1542 (9th Cir. 1982). In Societe, the Court held that a plaintiff satisfies the “case or controversy” requirement by demonstrating a “real or reasonable” apprehension of being subject to liability for infringement, and that such threat need not be made by the putative rights-holder. Although some of the pretrial threats toward Plaintiff were implicit and/or made by an individual who may not have been the rights-holder to Defendants’ copyrights, the Court found that Plaintiff had a “real and reasonable” apprehension of copyright liability. In addition, although Defendants proposed a covenant not to sue based on the electronic supplement “as it existed in 2005,” the Court interpreted Defendants’ unwillingness to extend that commitment regarding the amended electronic supplement at issue in the amended complaint as a continuing threat of litigation. The Court also found that it could rule without issuing an advisory opinion where Plaintiff’s website was in a final form that would not be changed without leave of the Court. In declining to exercise its discretionary refusal to hear the case, the Court further emphasized that Plaintiff need not “publish” her work before bringing suit against Defendants.

Defendants’ motion to dismiss the complaint for copyright misuse alleged that the copyright misuse defense can only be applied when a rights-holder commits antitrust violations or engages in unduly restrictive licensing agreements. The Court disagreed, stating that a claim of copyright misuse merely requires “a nexus between the copyright holder’s actions and the public policy embedded in the grant of a copyright.” In applying this standard, the Court found that Plaintiff’s scholarly work embodied the type of creativity that copyright laws exist to facilitate. The Court also found that Defendants’ attempts to intimidate Plaintiffs from using non-copyrightable fact works and works to which Defendants did not own or control copyrights sufficiently demonstrated a “nexus” between Defendants’ actions and copyright’s public policy of promoting creative expression. The Court therefore denied Defendants’ motion to dismiss the complaint for copyright misuse.

Defendants also moved to strike four allegations of Plaintiff’s amended complaint: (1) Plaintiff’s request for declaratory judgment that the first edition of Ulysses is in the public domain; (2) Plaintiff’s claim for copyright misuse; (3) Plaintiff’s claim for unclean hands; and (4) paragraph 26 of Plaintiff’s Amended Complaint. The Court denied Defendants’ request for declaratory judgment because the status of Ulysses is material to Plaintiff’s case. The Court denied the motion to strike the defense of copyright misuse because it is a proper defense during the period of misuse and can be asserted based on Defendants’ actions vis-à-vis third parties. The Court also denied the motion to strike the claim for unclean hands, but granted the motion to strike paragraph 26 because of its irrelevance to the lawsuit.

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