Tuesday, May 25, 2010

Knowledge Management: Third Party Infringers Have No Standing To Challenge Assigment

KMMentor, LLC v. Knowledge Management Professional Soc., Inc., 2010 WL 1946339, 1 (D.Kan.) (D.Kan. May 13, 2010)

“Knowledge is a process of piling up facts; wisdom lies in their simplification.” FN1 This case involves several parties engaged in the knowledge management field, a field that creates and uses data and information to manage knowledge. The proceedings so far have been highly contentious, and the parties have compiled numerous facts but have not simplified the process.

So opens a case involving a bitter struggle among knowledge managers.  Defendant alleges that plaintiff's evidence is insufficient to show copyright ownership, relying on 17 USC 204(a).   204(a) provides
§ 204. Execution of transfers of copyright ownership

(a) A transfer of copyright ownership, other than by operation of law, is not valid unless an instrument of conveyance, or a note or memorandum of the transfer, is in writing and signed by the owner of the rights conveyed or such owner's duly authorized agent.

Problem was, the copyright owner (exclusive licensee) listed in the Complaint was not the owner registered with the Copyright Office.  The record owner/author had apparently given an exclusive license that had not been written down or recorded with the Copright Office.

The court said that a third party infringer couldn't invoke 17 usc 204(a) and relied on the following cases:

Billy-Bob Teeth, Inc. v. Novelty, Inc., 329 F.3d 586, 592-93 (7th Cir.2003); Imperial Residential Design, Inc. v. Palms Dev. Group, Inc., 70 F.3d 96, 99 (11th Cir.1995). See also X-IT Products, 155 F.Supp.2d at 603-04.

Practice Tip:  We all get caught in certain situations and it's great to have some case law to pull us out.  But the better practice, and I'd say the far better practice is to marshal the evidence that your client owns a copyright, get it in writing, and record it before you start a lawsuit.  For a fuller discussion of these issues. Check out Chapter 3:  The Client Interview and Initial Investigation and Chapter 4:  The Copyright Office: Litigation Practice in my Copyright Litigation Handbook.

In Chapter 9: Motions Attacking the Complaint, I have a section called "Motions to Dismiss for Lack of Standing".  You will find there how to craft an assignment that deals with accrued litigations and what the assignment needs to say to give an assignee standing.

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