Sunday, January 24, 2016

Screen Shot Smackdown At Second Circuit: Defective Pleadings In Software Copyright Infringement Claim


A Star Group, Inc. v. Manitoba Hydro, 621 Fed.Appx. 681 (2d Cir. July 27, 2015). This case involved A Star, a consultant for Hydro, a hydro-electric power plant.  A Star wrote a report purporting to show security flaws.   Hydro hired KPMG to investigate and KPMG apparently used A Star's report without permission.  A Star sued both Hydro and KPMG for copyright infringement and other claims.

Hydro was dismissed on foreign sovereign immunity grounds.   On A Star's copyright infringement claims, the Second Circuit took an interesting approach.

First, the Second Circuit noted that A Star's copyright registration application had been filed only one day prior to filing suit.   The registrations were granted less than a week later.  The Second Circuit noted that whether or not a pending registration satisfied U.S.C. 411A's requirement of a registration prior to filing suit was an "open question" in the Second Circuit.  Additionally, the Second Circuit noted a split of authority in other circuits ("varying approaches").   However, the Second Circuit declined to reach the question.

Second, the Second Circuit noted that A Star's complaint listed a lot of copyrighted materials that had allegedly been infringed, but noted that that only in a later brief ( and not the complaint) did A Star refer to the materials in question as screen shots ("graphical representations of its code") and pointed out that a party can't amend its pleadings through its briefs.   The Second Circuit dismissed the complaint for failure to state a claim because the complaint did not adequately allege a use of the ostensibly infringing screen shots.

Third, the Second Circuit affirmed the district court's exercise of discretion and denied defendants' application for attorneys fees since the question of whether a pending application for registration satisfied the "registration" requirement of the Copyright Act was an "open question".

In my book Copyright Litigation Handbook, I discuss all of the steps attorneys should take with investigations and dealing with the Copyright Office before filing suit, including obtaining registrations, deposit materials, and correcting, amending and supplementing registrations before a lawsuit is filed.   Such preparation may include registering competing copyright claims for the same subject matter.  These items are covered in Chapter 3:  Client Interviews and Initial Investigations and Chapter 4:  The Copyright Office and Litigation.   Also Chapter 7: Drafting the Infringement Complaint covers pleading issues.  A review of these chapters can help to avoid many mistakes.
 Copyright law, fine art and navigating the courts. All practice, no theory.Copyright Litigation Handbook (Thomson Reuters Westlaw 2014-2015) by Raymond J. Dowd
 Copyright Litigation Handbook on Westlaw

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