[stextbox id=”alert”]UPDATE and preface: Almost everyone who has written on the “jurisdiction” issue decided in Reed Elsevier, Inc. v. Muchnick, 130 S.Ct. 1237, in which the Supreme Court ruled that while a copyright registration was a statutory prerequisite to initiation of a copyright infringement lawsuit, it was not a “jurisdictional prerequisite,” has noted that the ruling would have little practical effect on litigation. (Here are some fine blogs that have addressed the case, which I should have done here, too. Then again, they did it quite well.)
This post is about a case where this distinction would have made a difference, at least in theory.
I blogged about the legal issue that arose concerning a last-minute “suggestion of lack of jurisdiction,” effectively an attempt to dismiss a copyright claim for lack of subject matter jurisdiction, on the eve of trial. It was originally posted during the pendency of LOC® readers’ favorite case. The motion was based on the then-pertinent concept that absent the allegation of a copyright registration or even an application for one at the time the complaint was filed, and absent as well any amended or supplemented complaint that alleged the same, the court lacked subject matter jurisdiction. Hence dismissal was proper, indeed required, at any time pursuant to Fed. R. Civ. P. 12(h)(3).[/stextbox]
LIKELIHOOD OF CONFUSION® has recently run up against the following issue in litigation and welcomes views from the house. We think we’re on the right side of it, but there’s no question some courts have waved it away, though not usually with a lot of analytical rigor:
It is known to be a common practice for plaintiffs to file copyright claims for unregistered works, file an
expedited application for registration and amend the complaint to recite or incorporate the registration before anyone calls them on it. Frequently this is not too offensive because the copyright claim is one of a number of otherwise unproblematic counts. Some courts affirmatively bless this practice; others even sua sponte “deem” a complaint amended or supplemented if somehow the record reflects the subsequent registration. But others are not so lackadaisical about operating as time machines.
Because the Copyright Act (17 USCS § 411) explicitly requires that a copyright holder own a registration to “institute” a claim for infringement — because it is a jurisdictional requisite ][UPDATE: Not quite; see above] — there is an increasingly authoritative body of authority that even where an amendment to the pleadings may be appropriate under the usual (liberal) standard, amendment may not create jurisdiction retroactively. This appears to run contrary to earlier trends among the cases that allowed a retroactive cure in the spirit of the axiom that amendment of pleadings is to be permitted liberally.
Courts are increasingly questioning whether that kind of time travel works. In Harris v. Garner, 216 F.3d 970 (11th Cir. 2000), a case involving a statutory predicate for immigration appeals, the Eleventh Circuit held, very stridently — and over the objections of an equally assertive dissent — that where a statutory requirement for jurisdiction is not met at the time of filing, even if it is met until later an amended complaint cannot create jurisdiction retroactively. The Circuit Court discussed the application of the rule to an earlier copyright decision that suggested otherwise, and in dictum, rejected that analysis.
“When Plaintiffs initiated this action the Court,” the District of New Jersey ruled earlier this year, “was without subject matter jurisdiction to hear Plaintiffs’ copyright claims.” There was no registration. Continued the court:
As such, 28 U.S.C. § 1653, which provides ‘that ‘[d]efective allegations of jurisdiction may be amended, upon terms, in the trial or appellate courts,’ does not apply to help Plaintiffs here. Section 1653 ‘addresses only incorrect statements about jurisdiction that actually exists, and not defects in the jurisdictional facts themselves.’
Wellness Publ. v. Barefoot, 2008 U.S. Dist. LEXIS 1514 at *32 (D.N.J. Jan. 8, 2008), citing Newman-Green, Inc. v. Alfonzo-Larrain, 490 U.S. 826 (1989). Also this year, in Walton v. United States, 80 Fed. Cl. 251, 264 (Fed. Cl. 2008), the Federal Circuit permitted retention of jurisdiction where an amended / supplemented complaint had been filed, but did not allow relation back to the original date of the complaint. The court wrote, “it appears that binding Federal Circuit case law has not departed from the established rule that jurisdiction is determined on the basis of the facts that exist at the time the complaint was filed.”
All things considered, it would seem to be a good idea for a copyright plaintiff under such circumstances to amend as early as possible and avoid objections of prejudice or undue delay — factors that can militate even against the routine grant of motions to amend. Liberality is one thing, but jurisdiction is bigger that than that, and in contrast a lack of subject matter jurisdiction can be raised substantively at any time, even on appeal. It cannot be waived; it’s constitutional; it’s existential: Federal Rule 12(h)(3) provides, “Whenever it appears by suggestion of the parties or otherwise that the court lacks jurisdiction of the subject matter, the court shall dismiss the action.”
That’s “whenever.”
Here are the papers. Whatever.
UDPDATE continued: The District of Arizona disagreed with our argument, as set out in the transcript appended to the embedded PDF, which starts with our “suggestion of lack of jurisdiction,” below. That denial was one issue we were prepared to pursue as a cross-appeal in the Designer Skin case. That appeal never happened due to a global settlement with indoor tanning lotion monopolist and gelded litigation bully New Sunshine LLC.
And now it turns out now to be a non-issue, because while dismissal on this ground would have been available under Rule 12(b)(6), that Rule does not have the broad, and arguably constitutional, power of the Rule 12(h)(3)’s “Whenever,” which our client needed to call on because of the unusual procedural aspects of this litigation.
Whatever.
UPDATE: The U.S. Supreme Court negates this entire post, ruling that while a copyright registration is indeed a prerequisite to initiating a lawsuit to enforce a copyright, this is a statutory requirement and not, technically, a “jurisdictional” requirement. See the box at the top.
Originally posted 2010-05-26 12:48:32. Republished by Blog Post Promoter
Many courts seem to be reluctant to dismiss on this basis since Sec. 411 actually provides for jurisdiction *whether or not* registration is granted (assuming the Register is served with a copy of the complaint). Since jurisdiction will inevitably exist once a proper form of application for registration (and fee) is filed, refusing to accept jurisdiction may seem to some to be an extreme form of elevating form over substance.
That’s an odd rationale, Balt. That just means that if registration is applied for timely, jurisdiction exists at the time of filing, not that it doesn’t matter whether or not there’s a registration. In such cases if there is litigation, the court has the opportunity to pass on the Copyright Office’s decision to refuse registration as well. I don’t see how that bears on this question.
I don’t actually know the answer to this question, but as long as the statute of limitations has not passed, couldn’t the plaintiff just re-file the complaint after a dismissal for lack of jurisdiction? Substantively, there would be no difference between that and allowing an amendment. Partly for this reason, I don’t think there is anything wrong with allowing an amendment to a complaint to cure a jurisdictional defect. I think it happens all the time in other contexts (e.g., dismissing a non-diverse party). The harder and more important question I think is whether the amendment should be allowed to relate back to the date the original complaint was filed. It is problematic to allow relation back to a time when the court had no jurisdiction. The Barefoot court might have been right on that one.
Regardless, your advice to amend sooner rather than later is undoubtedly good. Why wait?
That is the rationale, yes: Since you could just re-file, what’s the point of dismissing?
Sometimes, procedurally, there could be a big difference, though.
It just ate my homework 🙁
Anyways, there is indeed a debate between copyright giants on this very issue. My view is that being on the right side means a valid application and registration (or rejection).
Procedurally, the difference can be huge – statutory damages and attorneys’ fees are at play.
You should review Torres-Negron.
You’ve said:
“Because the Copyright Act (17 USCS § 411) explicitly requires that a copyright holder own a registration to “institute†a claim for infringement…”
But this is not actually accurate. “Own[ing] a registration” is only one of two ways to institute a claim.
The actual language of 17 USCS § 411:
“…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 an action for infringement if notice thereof, with a copy of the complaint, is served on the Register of Copyrights.”
Once I’ve properly delivered the deposit, application and fee to the Copyright Office, only one of two things can ultimately happen: the Copyright Office can grant a registration, or the Copyright Office can refuse registration. No matter what happens (registration or refusal), the court has jurisdiction, at least once the Copyright Office has acted (and in the case of refusal, the Copyright Office is served). If there are only two choices and either one leads to jurisdiction, then some might feel that refusing jurisdiction based on the fact that the Copyright Office has not yet taken an action is elevating form over substance.
The typical response to this is to not have much sympathy for a plaintiff who has waited so long as to butt up against the statute of limitations, but the (two) times this has impacted my clients it has been when a registration has been applied for and then infringement occurs while waiting for the Copyright Office to respond. Ever try to get the Copyright Office to expedite an existing application? I’d rather poke out my own eye.
Wondering how readers think that sec. 410(d) comes into play, if at all:
“The effective date of a copyright registration is the day on which an application, deposit, and fee, which are later determined by the Register of Copyrights or by a court of competent jurisdiction to be acceptable for registration, have all been received in the Copyright Office.”
Is this section merely establishing the registration date retroactively, or does it provide that registration is effective upon receipt of the application, deposit and fee, regardless of when the certificate of registration finally issues? If the latter, would evidence of receipt with the Copyright Office meet sec. 411, which says suit may not be filed “until registration of the copyright claim has been made,” rather than until issuance of a certificate of registration?
Well, Judge Teilborg just deemed the complaint amended in the Designer Skin case in Phoenix, despite the absence of even a motion to amend, recognizing the plain language of the statute and the ruling in the Fifth Circuit, but predicting that the Ninth Circuit would not approve dismissal at this late moment. He acknowledged that this is a potential appellate issue.
So we are voir dire’ing the jury right now…
If the defendant is prejudiced by the procedural differences that would arise between (1) amending the complaint and (2) dismissing the complaint and refiling, then that should be an argument against allowing the amendment, especially if the plaintiff had no good excuse for waiting (in that case, “justice” would not “require” the amendment under Rule 15(a)(2)). Of course, the district judge has some leeway in this regard.
I also meant to say that a sua sponte amendment of the complaint raises its own set of issues.