Have you ever read a decision and just marveled at the apparent restraint of the judges? â€œWhy donâ€™t they tell this party to shut up?â€ you wonder. â€œWhy donâ€™t they sanction him, throw him in jail, and seize all of his assets, just for advancing such a ludicrous argument?â€ The August 20, 2013, decision of the United States Court of Appeals for the Second Circuit in Unclaimed Property Recovery Service, Inc. v. Kaplan is such a decision for me. I read it and thought some very uncharitable things about the plaintiffs-appellants. You might as well!
The plaintiffs-appellants are a company and its principal: UPRS, a business that locates unclaimed financial property and returns the property to its owners; UPRS is Bernard Gelbâ€™s company. In 2006, UPRS and Gelb were two of several plaintiffs who filed a class action in the United States District Court for the Eastern District of New York (whence this lawsuit also). The class was represented by lawyer Norman Kaplan (of the town where this writer lives, though I donâ€™t believe we have ever met), although Gelb did much of the legwork in preparing the class action complaint. Indeed, Gelb (not a lawyer) allegedly wrote the Amended Class Action Complaint (what the appellate decision defines as the â€œFirst Complaint,â€ for reasons unclear) and compiled the 305 pages of accompanying exhibits (yes, the â€œFirst Exhibitsâ€). Kaplan, as class counsel, signed and filed the First Complaint and First Exhibits on behalf of the class in May 2006. The district court dismissed the class action as time-barred, and Kaplan (timely) appealed on behalf of all class members.
While the appeal pended, Kaplan and Gelb fell out; Kaplan informed Gelb that he would no longer represent Gelb and UPRS. Gelb and UPRS retained new counsel. Three members of the class revoked the powers of attorney that they had given Gelb, keeping Kaplan as their attorney of record in the class action. New counsel for Gelb and UPRS moved to withdraw the pending appeal in its entirety; the Second Circuit granted the motion as to Gelb and UPRS but denied it as to the other appellants/class members. And soon after that decision was issued, â€œGelb and UPRS obtained Certificates of Registration from the United States Register of Copyrights for the First Complaint and First Exhibits.â€ This is where you might want to scratch your head, if you werenâ€™t already doing that.
You know whatâ€™s coming, of course. Disgruntled former clients/class members claim copyright in a class action filing… are no longer part of the class appealing dismissal of the action as time-barred… and then, sure enough, the Second Circuit vacates the dismissal of the class action, granting those three plaintiffs still represented by Kaplan leave to file a second amended complaint to address issues raised in the vacatur order… leaving Gelb and UPRS out in the cold, as it were. So when Kaplan filed an amended complaint with exhibits, which necessarilyâ€”or at least predictablyâ€”included significant portions of the First Complaint and First Exhibits, the wounded Gelb & Co. claimed copyright infringement by Kaplan, their former lawyer.
Oh, yes, they did.
Because it couldnâ€™t have gone any other way in a sane world, the Eastern District dismissed the copyright action for failure to state a claim upon which relief can be granted. The district court held that â€œUPRS and Gelb had granted Kaplan an irrevocable implied license to file an amended version of the First Complaint and Exhibits.â€ The Second Circuit affirmedâ€”both the lower court decision and this blawgerâ€™s belief that some things really are obviously right and others are obviously wrong. The Second Circuit acknowledged that the case presented an issue of first impression: â€œwhether the holder of a copyright in a litigation document who has authorized a party to use the document in the litigation may withdraw the authorization after the document has already been introduced into the litigation and then claim infringement when subsequent use is made of the document in the litigation.â€
The court also noted that it was not suggesting that permission of a copyright holder is â€œinevitably neededâ€ for use of a copyrighted document in litigation, nor was it deciding whether legal pleadings or other legal documents are subject to copyright law. (Indeed, there are a couple of other things the Second Circuit expressly disclaimed deciding.)
We merely hold that, because UPRS and Gelb authorized the class action plaintiffs to file the First Complaint and First Exhibits as the foundation of [the class action], UPRS and Gelb may not use copyright law to prohibit those class action plaintiffs (or their attorney) from continuing to use [those documents] in the context of that litigation.
Because the opposite would have been crazytown bananapants, so to speak.