Court to rule on copyright settlement
on Mar 2, 2009 at 10:05 am
After examining the case multiple times, the Supreme Court agreed on Monday to rule on the scope of federal court authority to decide cases involving copyright infringement, when the claims have been settled. The Court limited its review to a question it had composed: “Does 17 USC 411 (a) restrict the subject matter jurisdiction of the federal courts over copyright infringement actions?” The case is Reed Elsevier, et al., v. Muchnick, et al. (08-103). It was the only case granted Monday.
As stated, the question appears to be a variation on the first question raised by the petition: “Whether the usual power of lower courts to approve a comprehensive settlement releasing claims that would be outside the courts’ subject matter jurisdiction to adjudicate, confirmed in Matushita Elec. Indus. Co. v. Epstein, 516 U.S. 367 (1996), was eliminated in copyright infringement actions by 17 USC 411 (a).”
As a practical matter, the case involves whether the courts had authority to scuttle an $18 million, nationwide settlement of copyright infringement claims that authors made when their free-lance articles or photos in major publications were made freely available in those publishers’ electronic databases. This was a class-action lawsuit.
A District Court had approved the settlement, but the Second Circuit Court ruled that the federal law limiting copyright lawsuits to those who have registered their works meant that the District Court had no jurisdiction over the lawsuit, and thus had no authority to approve the settlement. Some 99 percent of the claims covered by the settlement were by creators of unregistered works.  A group of publishing companies then took the issue on to the Supreme Court, arguing that the nullification of the settlement contradicted the Supreme Court’s decision in 2001 in New York Times, et al., v. Tasini, et al.
Among the cases the Court refused on Monday to hear was a plea to clarify what public school teachers, coaches and staff may do, without violating the Constitution, when their students engage voluntarily in prayers at school (Borden v. East Brunswick Township School District (08-482). The Third Circuit Court had upheld that a public school guideline against teachers and staff taking any part in student-initiated prayer did not violate a coach’s rights, even though he had remained silent though still present when his players prayed.
The Court invited the U.S. Solicitor General to offer the federal government’s views on two controversies: what does the Employee Retirement Income Security Act require in order to show that workers voluntarily surrendered their right to challenge the terms of a pension benefit plan in return for severance pay, an issue that arises in three cases: Frommert v. Conkright (08-803), Conkright v. Frommert (08-810), and Pietrowski v. Conkright (08-826); and whether federal law on Medicaid benefits bars a state from recovering benefits it had paid to a person who died, if that person had transferred all assets to a spouse before dying (Vos v. Barg, 08-603).
The Court, in another order, accepted supplemental briefs from both sides discussing the impact of the new Lilly Ledbetter Act, involving workers’ right to equal pay, on a case that the Court heard on Dec. 10, AT&T v. Hulteen (07-543).
The copyright case the Court added to its docket for decision at its next Term had been pending at the Court since before the Term opened. It was listed ten times for consideration at the Justices’ private Conferences, leading finally to Monday’s order.
The provision at issue in the case, part of the Copyright Act of 1976, says that “No action for infringement of the copyright in any United States work shall be instituted until…registration of the copyright claim has been made in accordance with this title.” Congress adopted that clause to assure that courts, in dealing with infringement claims, would have a chance to consider the views of the U.S. Copyright Office, which decides whether a work may qualify for copyright protection.
The Second Circuit, in its decision in the Elsevier case, ruled that when a class action involving copyright infringement claims is before the court, every member of the class must have registered the work before suing. Since many of the authors involved in this case had not done so, the class had no right to sue, the Circuit Court said, so the District Court had no authority to approve the settlement.
The Court’s grant was limited to the jurisdictional question. It thus did not accept for review a second question, testing whether the Second Circuit had ignored the Supreme Court’s Tasini opinion seeming to encourage settlement of the copyright claims at issue.
