___________ No. 94-2867 No. 94-2917

___________ Diagnostic Unit Inmate Council; * John Merrick; Eugene Issac * Pitts; Jerry McFarland; Terry * Tolliver; Solomon Eskew; * Earl Thompson, * * Plaintiffs - Appellants, * * Arkansas Department of * Appeals from the United States Correction, * District Court for the * Eastern District of Arkansas. Involuntary Plaintiff, * * v. * * Films Incorporated; Swank * Motion Pictures, Inc., * * Defendants - Appellees. *

___________ Submitted: September 13, 1995 Filed: July 8, 1996

___________ Before BOWMAN, JOHN R. GIBSON, and LOKEN, Circuit Judges.

___________ LOKEN, Circuit Judge.

The Arkansas Department of Corrections ("ADC") shows videotape d movies to inmates in the common areas of its prisons. In 1985, an attorne y repres enting motion picture copyright owners wrote ADC, warning that i t
wou ld infringe owner copyrights to use videotapes licensed for home us e only at these public performances. ADC has since contracted with appellee s Films Inc. ("Films") and Swank Motion Pictures, Inc. ("Swank"), to provide videotaped movies that come with "public perform ance distribution rights."

### The HONORABLE GARNETT THOMAS EISELE, United States Distric t 1 

### Judge for the Eastern District of Arkansas.
-2- Ce rtain Arkansas inmates commenced this class action against Film s and Swank seeking a d eclaratory judgment under the Copyright Act that inpris on showings of "home use only" rented movies do not infringe th e owners' copyrights, either because prison showings are not "publi c performances" within the meaning of 17 U.S.C. §§ 101 and 106(4), or becaus e such showings are "fair use" within the meaning of 17 U.S.C. § 107. The inmates believe that ADC could obtain a more des irable selection of movies at less cost by renting from local video stores. For example, the 199 4 contract between ADC and Swank provided that Swank would supply 12 1 video tapes for a total annual cost of $9,600, whereas the parties hav e stipulated that ADC could rent a comparable number of "home use only " videotapes for an annual cost of about $2,200.

The district court init ially dismissed the complaint for failure to 1 stat e a legally cognizable claim, but we remanded with directions t o consider whether ADC should be joined. Diagnostic Unit Inmate Council v. Motion Picture Ass'n of America, Inc. , 953 F.2d 376, 379 (8th Cir. 1992). On remand, ADC was joined as an involuntary plaintiff under Fed. R. Civ. P. 19(a). However, when ADC declined to take a position in the lawsuit, the district court again dismissed on the ground that there is no actual controversy. The inm ates appeal. Counsel for ADC has advised this court that ADC "did not join with the Inmate Council in appealing the judgment of the district court and is, therefore, not an appellant in this case." Agreeing with the district court that ADC's refusal to participate means there is no actual controversy, we affirm.
1. The Declaratory Judgment Act authorizes federal courts to d eclare the rights of interes ted parties "[i]n a case of actual controversy." 28 U.S.C. § 2201. The requirement of an "actual controversy" is imposed by Article III of the Constitution. See

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Stef fel v. Thompson , 415 U.S. 452, 458 (1974). In general, an actua l controversy is "a sub stantial controversy, between parties having adverse legal interests, of sufficient immediacy and reality to warrant th e issuance of a declara tory judgment." Maryland Cas. Co. v. Pacific Coal & Oil Co. , 312 U.S. 270, 273 (1941).

In patent and copyright cases, there is an actual controversy i f "defen dant in the declaratory judgment lawsuit has either expressly o r implied lycharged the plaintiff with infringement." Sherwood Medica l Indus., Inc. v. Deknatel, Inc. , 512 F.2d 724, 727 (8th Cir. 1975). Th e defenda nt copyright owner must have evidenced its intent to enforce a copyright, usually by a charge or threatened charge of infringement, such
as the 1985 attorney letter to ADC. And the declaratory judgment plaintif f must have engaged in "present activity which cou ld constitute infringement
or concrete steps taken with the intent to conduct such activity." B P Chemicals Ltd. v. Union Carbide Corp. , 4 F.3d 975, 978 (Fed. Cir. 1993). In a copyright case, "plaintiff must show that it has actually published or is preparing to publish the material that is subject to the defendant's copy right [in a manner that] places the parties in a legally advers e position ." Texas v. West Pub. Co. , 882 F.2d 171, 175 (5th Cir. 1989) , cert. deni ed , 493 U.S. 1058 (1990); see also Wembley, Inc. v. Superb a Cravats, Inc. , 315 F.2d 87, 90 (2d Cir. 1963) ("where there is no actual manufacture, use or sale, and no immediate intention and ability t o practice the invention, there is no justiciable [patent] controversy").

Th e inmates as declaratory judgment plaintiffs cannot satisfy thi s standard. True, the inmates have an indirect fi nancial stake in the issue because ADC pays for movie rentals from an Inmate Welfare Fund generated by pro fits from commissaries sales to inmates and prison employees

. However, while that Fund must be spent "for the general benefit of th e inmates," Ark. Code Ann. § 12-29-107, ADC has total authority over all Fun d expend itures and, more importantly, ADC has complete control over th e renting and

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showing of videotapedmovies at its prisons. Inmates may request certain movies, but they cannot rent movie videotapes for prison showings. Th e inma tes do not, and cannot, engage in the activity that prompted th e copyright owners' 1985 charge of infringement. Thus, there is no actual controversy between t he inmates and defendants Films and Swank that would support Declaratory Judgment Act jurisdiction.

2. On remand, we directed the district court to "consider, afte r obtaining the views of the Attorney General of Arkansas, whether [ADC ] should be joined." 953 F.2d at 379. ADC received the 1985 infringement letter, and it continues to rent and show videotaped movies in its prisons

. If ADC credibly asser ted a present intent to use home-use-only movies for these showings, it would have standing to seek a declaratory judgment that such activity would n ot infringe the owners' copyrights. However, though invited to join and later involuntarily joined in the action, ADC ha s steadfastlyrefused to take a position on these copyright issues. There is no other evidence in the record that Films, Swank, or any copyrigh t
owner objects to the way in which ADC is now obtaining and showin g videotaped movies. Accordingly, there is no par ty plaintiff whose present activity, or intended present activity, could constitute infringement.
The inmates nonetheless suggest that ADC's joinder as an involuntary plaintiff, without more, created an actual controversy. We disagree. Rul e 19(a), which authorizes joinder of unwilling plaintiffs, "makes n o provision for a plain tiff to require another person to maintain an action vested solely in such other person, even though its maintenance migh t result in benefit to the plaintiff." Coast v. H unt Oil Co. , 195 F.2d 870, 872 (5th Cir.), cert. denied , 344 U.S. 836 (1952). See also Rhode Island Comm. on Energy v. General Servs. Admin. , 561 F.2d 397, 402-03 (1st Cir. 1977); In re Intersta te Motor Freight System IMFS, Inc. , 71 B.R. 741, 746 (Bankr. W.D. Mich. 1987).

### -5- A narrow exception to this general rule originated with Independent Wireless Tel. Co v. Radio Corp. of Amer. , 269 U.S. 459 (1926), a case in which th e holder of an exclusive patent license sought to sue fo r infringement of the patent. The exception is that an involuntary plaintif f may be joined to cure the original plaintiff's inability to press a claim if t he original plaintiff and the involuntary plaintiff have "such a relati onship that the absent party must allow the use of his name a s plaintiff." 3A James W. Moore et al., Moore's F ederal Practice ¶ 19.06 at 84 (2d ed. 1995). But the inmates and ADC have no such relationship here. ADC has no obligation, contractual or otherwise, to allow the inmates to use its name to secure declaratory judgment reli ef that only ADC may seek.

3. After concluding that this case presents no actual controversy, the district court went on to consider the merits of the inmates' copyrigh t claims because that would achieve judicial econo my in the event this court held , in light of ADC's "somewhat ambiguous position," that there i s declaratoryjudgment jurisdiction. The district court ruled in favor of the co pyright owners, concluding that prison showings are publi c performances and are not fair use.

We do not criticize the district cou rt for provisionally considering these issues. However, one of the problems with advisory opinions is that theyare made on advisory records. Because ADC elected not to intervene to aggressively challenge the copyright owners' position, we do not know the factual details surrounding the showing of videotaped movies in AD C prisons, nor do we kn ow the purposes served by this aspect of ADC's penal program. These kinds of facts seem essential to apply both the fair use and t he public performance statutes. See Sony Corp. v. Universal Cit y Studios, Inc. , 464 U.S. 417 (1984) (fair use); On Command Video Corp. v. Columbia Pictures Indus. , 777 F. Supp. 787, 789-90 (N.D. Cal. 1991) (publi c performance). Accordingly, the district court's

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dis cussion of the merits of these copyright issues should be considere d vacated as moot.
The judgm ent of the district court is affirmed. We thank appointed counsel for his excellent representation of the inmates.
JOHN R. GIBSON, Circuit Judge, dissenting.

I respectf ully dissent. While ADC has been joined as a part y primarily for the purpose of representing the in terests of the inmates, it has declined to take a position in the lawsuit r esulting in its dismissal, and its counsel advises this court that it did not join with the Inmat e Council in appealing the judgment. The court's decision today comes down to the simple statement that "ADC's refusal to participate means there is
no actual controversy, we affirm." In essence, we have allowed a n involu ntaryplaintiff to simply abandon the interests which it wa s appointed to represent.

This runs counter to the principle of providing for involuntar y plaintiff status. An involuntary plaintiff's failure to act or appea l should not imply the absence of a real controversy. The involuntary natur e of the status would not make it unsurprising that the involuntary plaintif f would fail to act. Should this be the case, as it is here, the actua l plain tiffs should be allowed to proceed in the name of the involuntar y plaintiff.
The court's opinion acknowledges the inmate's financial stake in the issue, bec ause ADC pays for movie rentals from an inmate welfare fun d generated by profits from commissary sales to inmates and prison employees

. The opinion goes on t o state that by statute ADC has total authority over all fund expenditures, as well as complete control over the renting an d showing of videotaped movies at its prisons. In my view, the distric t court's joinder of the

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ADC should be viewed as a recognition of a fiduciary duty by ADC toward th e inmate s/Diagnostic Unit Inmate Council. The concept of an involuntar y plaintiff arises from equity. In some situations there is recognition tha t the party sought to b e joined [as an involuntary plaintiff] has a duty to allo w the named plaintiff to use its name in the action. 7 Charles A

. Wright et al., Federal Practice and Procedure § 1606, at 76 (1986). The dut y to allow a plaintiff to use its name implies that if there is a n opposing interest between the involuntary plaintiff and the defendant, the n that controversy is imputed to the plaintiff tha t brought the action. The involuntary plaintiff is sometimes referred to a s "the nominal plaintiff." Thus, it follows that the inmates should be allowed to pursue declaratory judgment "in the name of" the ADC.
The matter of who is named as a party plaintiff is important, b ecause the federal procedural system is premised upon the assumption that those named as parties have rights and duties in the conduct of the litigation. June F. Entman, Compu lsory Joinder of Compensating Insurers; Federal Rule of Civil Procedure 19 and the Role of Substantive Law , 45 Case W. Res. L. Rev. 1, 19 (1994). Nevertheless, in the above-cited article discussing th e compulsory joinder of compensating insurers, the author makes reference to situations where whenthe insured otherwise has control of the claim, but fails or refuses to assert it, some states then permit the insurer to brin g the c laim, citing as an example, City of New York Ins. Co. v. Tice , 15 2 P.2d 836, 842 (Kan. 1944) (insured should sue for itself and as trustee fo r the insurer, but if the insured refuses to sue, "justice requires that the insurer be permitted to bring action"). Again, in the insurance context, when the insurer, because of conflict of interest, is not likely to protec t the insured's interest, a court may permit the insured to bring and contro l his own suit. Entman at 25.

### -8- ADC, as an involuntary plaintiff, sh ould not be allowed to eliminate the "controversy" thr ough its inaction. This, however, is the net result of the court's opinion today.
Rule 17, in providing that an actionshall be prosecuted in the name of t he real party in interest, and specifying "bailee, trustee of a n express trust, a party with whom or in whose nam e a contract has been made for the benefit of another" contains description s that can well be applied to ADC. W hen this is read with Rule 19A with the provision allowin g joinder of a party as an involuntary plaintiff, we should make sure that those p rovisions of the rule are effectuated. Here ADC is in essence a bailee of funds that have come from the inmates, possibly a trustee, and with respect to the movie rentals, a party with whom or in whose name a contra ct has been made for the benefit of the inmates. When th e involuntary plaintiff refuses to act, as it has here, we should not allow that refusal to frustrate the intent of the rule s, i.e., that the interest of the party be represented. We should allow counsel to be appointed to act for the inmates a s actual plaintiffs, in the name of the involuntary, but passive and resistant, plaintiff.

A true copy.

Attest:

CLERK, U. S. COURT OF APPEALS, EIGHTH CIRCUIT.