27 Apr 2020 in Newsletter
Allen v. Cooper – The Supreme Court Blesses Copyright Infringement by States
In a near unanimous decision, the Supreme Court held in Allen v. Cooper that the Copyright Remedy Clarification Act of 1990 (the “CRCA”) – which abrogated state immunity for acts of copyright infringement – was unconstitutional under the Eleventh Amendment of the United States Constitution. As a result, individual states and state agencies (such as state universities) are free to infringe copyright owners’ rights with near complete impunity.
By way of background, the Eleventh Amendment generally holds that states may not be sued in federal court (absent the state consenting to be sued). However, for many years the Supreme Court recognized that Congress had the power to abrogate state Eleventh Amendment immunity for violations of federal law, typically reasoning that Congress had such power under the Commerce Clause or other Article I provisions. In the early 1990’s, Congress passed statutes that abrogated state immunity for copyright infringement (the CRCA) and patent infringement (the Patent and Plant Variety Protection Act (the “PPCPA”).
A few years later, however, the Supreme Court upended Eleventh Amendment law in the case of Seminole Tribe of Florida v. Florida, opining in that case that Congress could not abrogate Eleventh Amendment immunity except under only very narrow circumstances. In 1999, in the case of Florida Prepaid Postsecondary Education Board v. College Savings Bank, the Court applied the reasoning of Seminole Tribe to find the PPCPA unconstitutional, reasoning that there had not been a sufficient showing of widespread state acts of patent infringement to warrant the abrogation of Eleventh Amendment immunity.
Muddying the waters further, in the 2006 case of Central Va. Community College v. Katz, the Supreme Court held that Congress could legally abrogate states’ Eleventh Amendment immunity in bankruptcy cases, citing the need for uniformity of federal bankruptcy law.
This brings us to the case of Allen v. Cooper. Allen is the owner of copyrights in photographs and videos documenting the salvage of the pirate Blackbeard’s ship The Queen Anne’s Revenge, which sank off the coast of North Carolina in 1718. Without Allen’s consent, the State of North Carolina uploaded these materials to its website. After Allen complained, the State of North Carolina agreed to pay him $15,000 and entered into an agreement laying out the parties’ prospective rights regarding Allen’s works. However, North Carolina subsequently violated this agreement by making further unauthorized use of the works. Allen then sued for copyright infringement, asserting that the CRCA abrogated North Carolina’s Eleventh Amendment immunity. North Carolina asserted that the CRCA was unconstitutional, and thus it enjoyed immunity from Allen’s suit. The district court agreed with Allen, finding that the CRCA properly abrogated North Carolina’s immunity for suits for copyright infringement. On interlocutory appeal, however, the Fourth Circuit reversed, finding that under the logic of Florida Prepaid, the CRCA was unconstitutional. Allen then appealed to the Supreme Court, which granted his petition for review.
Supreme Court Justice Kagan’s opinion recognized Allen’s argument that the Copyright Clause of the U.S. Constitution could be argued to specifically authorize abrogation of Eleventh Amendment immunity for copyright infringement. Nevertheless, the Supreme Court ruled that that argument had been rejected in Florida Prepaid, and that there was not a sufficient material difference between patent infringement and copyright infringement to justify not following Florida Prepaid. The Court distinguished its contrary decision in Central Va. Community College by saying, essentially, “bankruptcy law is just different.”
In additional non-binding comments, the Supreme Court noted that Congress might be able to pass a new law in the future that partially abrogates state immunity for copyright infringement if it limited such abrogation to willful acts that rose to the level of violations of a copyright owners’ due process rights. Of course, this observation (which, as Justice Thomas noted in his concurrence, is jurisprudentially suspect) is of little comfort to Allen and other copyright owners who are currently left without any remedy when a state decides to simply misappropriate their intellectual property.
As Justice Ginsburg noted at oral argument in the case, there is “something unseemly” for states being able to own copyrights (and patents) and sue for their infringement, while also saying “we can infringe to our heart’s content and be immune for any compensatory damages.” (Indeed, there is a case currently pending before the Supreme Court (Georgia v. public.resource.org) in which the State of Georgia is asserting ownership of copyrights in the official annotations to state statutes, and suing for copyright infringement.) At the very least, Congress should take her suggestion and bar a state from owning or suing on copyrights or patents unless the state has agreed to waive its Eleventh Amendment immunity for infringement suits.