FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

STARZ ENTERTAINMENT, LLC,

Plaintiff-Appellee,

v.

MGM DOMESTIC TELEVISION 

DISTRIBUTION, LLC,

Defendant-Appellant.

No. 21-55379

D.C. No.

2:20-cv-04085-

DMG-KS

OPINION

Appeal from the United States District Court

for the Central District of California

Dolly M. Gee, District Judge, Presiding

Argued and Submitted February 10, 2022

San Francisco, California

Filed July 14, 2022

Before: Kim McLane Wardlaw, Sandra S. Ikuta, and 

Bridget S. Bade, Circuit Judges.

Opinion by Judge Wardlaw
2 STARZ ENTERTAINMENT V. MGM

SUMMARY*

Copyright

The panel affirmed the district court’s denial of a motion 

to dismiss copyright infringement claims as barred by the 

three-year limitations period set forth in 17 U.S.C. § 507(b).

Generally, a copyright claim accrues when the 

infringement occurs. The panel held that Petrella v. MetroGoodwyn-Mayer, Inc., 572 U.S. 663 (2014), did not do away 

with the discovery rule, under which a claim alternatively 

accrues when the copyright holder knows or reasonably 

should know that an infringement occurred. Declining to 

adopt the approach taken by the Second Circuit, the panel 

held that the discovery rule allows copyright holders to 

recover damages for all infringing acts that occurred before 

they knew or reasonably should have known of the 

infringing incidents, and the three-year limitations period 

runs from the date the claim accrued.

The panel held that the district court correctly applied the 

discovery rule to conclude that plaintiff timely filed its 

claims of copyright infringement. Because plaintiff brought 

its claims within three years after they accrued, it was not 

barred from seeking damages for all acts of infringement.

* This summary constitutes no part of the opinion of the court. It 

has been prepared by court staff for the convenience of the reader.
STARZ ENTERTAINMENT V. MGM 3

COUNSEL

Mark A. Perry (argued), Gibson Dunn & Crutcher LLP, 

Washington, D.C.; Orin Snyder, Gibson Dunn & Crutcher 

LLP, New York, New York; Blaine H. Evanson, Gibson 

Dunn & Crutcher LLP, Irvine, California; Jay P. Srinivasan, 

Gibson Dunn & Crutcher LLP, Los Angeles, California; for 

Defendant-Appellant.

J. Wesley Earnhardt (argued), Evan R. Chesler, and Justin 

C. Clarke, Cravath Swaine & Moore LLP, New York, New 

York; Robert N. Klieger, Hueston Hennigan LLP, Los 

Angeles, California; for Plaintiff-Appellee.

Tyler T. Ochoa, Santa Clara University School of Law, 

Santa Clara, California, for Amicus Curiae Professor 

Tyler T. Ochoa.

Benjamin H. Diessel and Michael Rondon, Wiggin and Dana 

LLP, New Haven, Connecticut; Nathan E. Denning, Wiggin 

and Dana LLP, New York, New York; for Amici Curiae 

Authors Guild Inc., and Other Artists’ Rights Organizations.
4 STARZ ENTERTAINMENT V. MGM

OPINION

WARDLAW, Circuit Judge:

The Copyright Act, 17 U.S.C. § 101 et seq., provides that 

a civil action for copyright infringement is timely so long as 

it is “commenced within three years after the claim accrued.” 

17 U.S.C. § 507(b). Generally, the claim “accrues” when the 

infringement or violation of one of the copyright holder’s 

exclusive rights occurs, known as the “incident of injury 

rule.” In our circuit, and every other circuit to have reached 

the question, an exception to that infringement rule has 

developed. Known as the “discovery rule,” a claim 

alternatively accrues when the copyright holder knows or 

reasonably should know that an infringement occurred.

In 2014, the Supreme Court addressed the interplay 

between § 507(b) and the doctrine of laches, holding that 

laches does not bar relief on a copyright infringement claim 

brought within § 507(b)’s three-year limitations period. 

Petrella v. Metro-Goldwyn-Mayer, Inc., 572 U.S. 663, 667–

68 (2014). Since then, defendants accused of copyright 

infringement have seized upon certain language in Petrella

to argue that the Court also did away with the discovery rule. 

Most courts, including the district court here, have rejected 

that argument, reasoning that Petrella addressed only the 

availability of laches in cases where the copyright owner is 

seeking damages for infringing acts that occurred during the 

three-year window before a claim is filed. Moreover, 

because Petrella noted, but did not pass upon, the discovery 

rule, any language in that opinion discussing relief beyond 

that window is dicta and did not affect the viability of the 

discovery rule. Because we agree with the district court that 

the discovery rule of accrual of copyright claims is alive and 

well, we affirm.
STARZ ENTERTAINMENT V. MGM 5

I.

A.

1. The exclusivity agreements

Starz Entertainment LLC (Starz) provides premium 

subscription video programming through a suite of premium 

cable television channels and on-demand services. The 

content Starz provides to subscribers includes original 

programming as well as popular movies and television 

shows licensed from other studios. To acquire external 

content, Starz enters into licensing agreements with studios 

and other copyright holders, providing Starz with the 

exclusive right to exhibit specific content on its services for 

a defined period.

On July 26, 2013, Starz entered into a licensing 

agreement (a “Library Agreement”) with MGM Domestic 

Television Distribution LLC (MGM). The parties entered 

into a second Library Agreement on May 7, 2015, providing 

Starz with exclusive exhibition rights to more MGM-owned 

content. Together, the two Library Agreements provided 

Starz with the exclusive right to exhibit 585 movies and 

176 television series episodes in exchange for about $70 

million. More specifically, MGM granted Starz the 

exclusive right to exhibit those MGM-owned movies and 

television series episodes on Starz’s suite of services within 

the United States for specified time periods ranging from 

months to years. For some titles, Starz secured multiple 

license periods from MGM, resulting in more than 1,000 

separate license periods each operating on its own time 

frame. In addition to the exclusive exhibition rights, Starz 

received contractual warranties from MGM that it would not 

exhibit or license to third parties any of the licensed content 

in violation of Starz’s exclusive rights.
6 STARZ ENTERTAINMENT V. MGM

2. Discovery of MGM’s infringement

In August 2019, a Starz employee discovered that one of 

the films covered by the licensing agreements, Bill & Ted’s 

Excellent Adventure, was available to stream on Amazon 

Prime Video during Starz’s exclusivity period. Starz 

notified MGM of its discovery, and MGM admitted that this 

improper license violated Starz’s rights. MGM offered to 

provide additional periods of exclusivity to remedy this 

violation. At the time, MGM did not inform Starz of any 

additional potential exclusivity violations.

Starz decided to investigate further, and, by the end of 

August, discovered that twenty-two additional movies 

covered by the Library Agreements were available on 

Amazon Prime Video. MGM acknowledged these 

violations in September 2019. Starz then sought formal 

assurances from MGM in October 2019 that the identified 

titles were not licensed to any other service provider and that 

MGM licensed no other covered content in violation of the 

Library Agreements. Instead of those assurances, in 

November 2019, MGM provided Starz with a list of 

136 movies and 108 television series episodes that had been 

licensed to other service providers (including MGM-owned 

rival service Epix) in violation of the Library Agreements. 

Starz continued to conduct its own investigation and 

subsequently identified nearly 100 additional movies not 

included on MGM’s November list that were licensed to 

third parties during time periods they were exclusively 

licensed to Starz.

B.

Starz sued MGM in May 2020, asserting 340 claims of 

direct copyright infringement, 340 claims of contributory 

copyright infringement, 340 claims of vicarious copyright 
STARZ ENTERTAINMENT V. MGM 7

infringement, one claim of breach of contract, and one claim 

of breach of the covenant of good faith and fair dealing. In 

July 2020, MGM moved for dismissal under Federal Rule of 

Civil Procedure 12(b)(6), arguing that many of Starz’s 

copyright infringement claims are barred by the Supreme 

Court’s decision in Petrella, which MGM asserts “imposes 

a strict bar to collecting any damages for copyright 

infringements that occur more than three years prior to the 

filing of the complaint.”1 In a well-reasoned order, the 

district court concluded that Petrella left unaffected the 

discovery rule—that under the Copyright Act there exists “a 

three-year damages bar [under § 507(b)] except when the 

plaintiff reasonably was not aware of the infringements at 

the time they occurred.”

II.

The district court had jurisdiction pursuant to 28 U.S.C. 

§ 1338, which confers subject matter jurisdiction over 

copyright actions. At MGM’s request, the district court 

certified its order for interlocutory appeal, which we 

accepted, vesting us with jurisdiction pursuant to 28 U.S.C. 

§ 1292(b).

We review the district court’s denial of a motion to 

dismiss under Federal Rule of Civil Procedure 12(b)(6) de 

novo. Platt v. Moore, 15 F.4th 895, 901 (9th Cir. 2021). We 

accept all well-pleaded factual allegations contained in the 

complaint as true, Ashcroft v. Iqbal, 556 U.S. 662, 678 

(2009), and decide whether the complaint articulates 

“enough facts to state a claim to relief that is plausible on its 

1 The parties entered into a tolling agreement that made the operative 

date of the Complaint for assessing the statute of limitations March 24, 

2020.
8 STARZ ENTERTAINMENT V. MGM

face,” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). 

The district court’s interpretations of the Copyright Act are 

reviewed de novo. Perfect 10, Inc. v. Giganews, Inc., 

847 F.3d 657, 665 (9th Cir. 2017).

III.

A.

17 U.S.C. § 507 establishes the statute of limitations 

under the Copyright Act: “No civil action shall be 

maintained under the provisions of this title unless it is 

commenced within three years after the claim accrued.” The 

key question we must answer is when does a copyright 

infringement claim accrue?

A claim ordinarily accrues when the plaintiff has a 

“complete and present cause of action.” Bay Area Laundry 

& Dry Cleaning Pension Tr. Fund v. Ferbar Corp. of Cal., 

522 U.S. 192, 201 (1997) (citation omitted). In the copyright 

context, a claim accrues “when an infringing act occurs,” 

Petrella, 572 U.S. at 670, i.e., when the infringer “violates 

any of the exclusive rights of the copyright owner,” Bell v. 

Wilmott Storage Servs., LLC, 12 F.4th 1065, 1080 (9th Cir. 

2021) (emphasis omitted) (quoting 17 U.S.C. § 501(a)), 

although this is not the only time a claim accrues, as 

explained below.

In Roley v. New World Pictures, Ltd., 19 F.3d 479 (9th 

Cir. 1994), we addressed the situation of a continuing 

violation, where the copyright holder, Roley, had witnessed 

the original screening of a new movie in August 1987 that 

he claimed, at that time, infringed his screenplay. We held 

that a “cause of action for copyright infringement accrues 

when one has knowledge of a violation or is chargeable with 

such knowledge.” Id. at 481. But Roley did not file his 
STARZ ENTERTAINMENT V. MGM 9

complaint alleging infringement until February 1991. Id. 

at 480. He sought the benefit of the Seventh Circuit’s then2

view of the three-year limitation period, “that so long as any 

allegedly infringing conduct occurs within the three years 

preceding the filing of the action, the plaintiff may reach 

back and sue for damages or other relief for all allegedly 

infringing acts,” beginning when the first infringing act 

occurred, no matter how long ago. Id. at 481 (citing Taylor 

v. Meirick, 712 F.2d 1112, 1118–19 (7th Cir. 1983)). We 

squarely rejected that theory of recovery for continuing 

copyright violations, holding that Roley could recover only 

for infringing acts that occurred within the three years 

preceding the filing of the copyright infringement lawsuit. 

Id. Thus, as early as 1994, we both recognized the discovery 

rule in the “specific context of cases where infringement and 

accrual happen simultaneously,” and that when the copyright 

holder knew of earlier infringing acts, recovery was 

allowable only for infringing acts occurring within the threeyear window before commencing suit.

Our subsequent decision in Polar Bear Productions, Inc. 

v. Timex Corp., 384 F.3d 700 (9th Cir. 2004) (as amended), 

recognized the latter point—that Roley did not create a bar

against recovery for acts of infringement that occurred prior 

to the three-year window. Rather, Roley held that a claim 

accrues at “the moment when the copyright holder ‘has 

knowledge of a violation or is chargeable with such 

knowledge,’” and therefore “the three-year clock begins 

upon discovery of the infringement.” Id. at 706 (quoting 

2 At that time, the Seventh Circuit applied the “continuing violation” 

doctrine to copyright infringement. It has since recognized that the 

“‘continuing violation’ doctrine is incompatible with the separateaccrual rule of § 507(b) . . . .” Chicago Bldg. Design, P.C. v. Mongolian 

House, Inc., 770 F.3d 610, 616 (7th Cir. 2014).
10 STARZ ENTERTAINMENT V. MGM

Roley, 19 F.3d at 481). Therefore, under Roley, § 507(b) 

does not prohibit the recovery of damages for infringing acts 

that occurred outside the three-year window so long as “the 

copyright plaintiff was unaware of the infringement, and that 

lack of knowledge was reasonable under the circumstances.” 

Id. We reasoned:

Without the benefit of tolling in this situation, 

a copyright plaintiff who, through no fault of 

its own, discovers an act of infringement 

more than three years after the infringement 

occurred would be out of luck. Such a harsh 

rule would distort the tenor of the statute. 

Section 507(b), like all statutes of limitations, 

is primarily intended to promote the timely 

prosecution of grievances and discourage 

needless delay. It makes little sense, then, to 

bar damages recovery by copyright holders 

who have no knowledge of the infringement 

. . . .

Id. In other words, a claim for copyright infringement may 

accrue when the copyright owner discovers, or reasonably 

should have discovered, the infringement. Id. at 705.

In addition to first establishing the discovery rule, Roley 

was important for another reason—while not labeling it as 

such, it recognized the “separate accrual” rule. In examining 

whether any actionable conduct occurred in the three years 

before Roley filed his complaint, we recognized that the 

statute of limitations runs separately for each successive 

incident of infringement. See Roley, 19 F.3d at 481. 

Although we held that “an action may be brought for all acts 

that accrued within the three years preceding the filing of the 

suit,” in an ironic twist, Roley was unable to adduce any 
STARZ ENTERTAINMENT V. MGM 11

evidence of any infringing act that occurred during that 

period. Id. at 481–82.

Fast forward two decades from Roley to Petrella v. 

Metro-Goldwyn-Mayer, Inc., 572 U.S. 663 (2014). There, 

the Supreme Court was tasked with determining whether the 

doctrine of laches could bar claims of infringement that 

accrued within the three-year window of § 507(b). Paula 

Petrella, the heir to the author of the 1963 screenplay upon 

which MGM’s 1980 movie Raging Bull was based, renewed 

the copyright in the 1963 screenplay. Petrella, 572 U.S. 

at 673. She became aware that she had a copyright 

infringement claim against MGM for its continued 

exploitation of Raging Bull at least as early as 1998, but she 

waited to commence an action until January 6, 2009, when 

the movie began to show profits. Id. at 674–75. However, 

recognizing that the statute of limitations for copyright 

claims requires commencement of suit within three years

after the claim accrued, 17 U.S.C. § 507(b), Petrella sought 

damages for only those acts of infringement that occurred on 

or after January 6, 2006. Id. at 674–75. MGM asserted the 

defense of laches based on Petrella’s knowledge of her 

potential infringement claim since 1998. Id. at 675.

The Court held that laches is not a defense to claims for 

relief for violations that accrue within the three-year 

limitations window. It first explained that “the separateaccrual rule attends the copyright statute of limitations,” 

such that “each infringing act starts a new limitations 

period.” Id. at 671. Thus, in deciding that laches is 

inapplicable, the Court explained that “the copyright statute 

of limitations, § 507(b), itself takes account of delay.” Id. 

at 677. It continued:

As earlier observed, a successful plaintiff can 

gain retrospective relief only three years back 
12 STARZ ENTERTAINMENT V. MGM

from the time of suit. No recovery may be 

had for infringement in earlier years. Profits 

made in those years remain the defendant’s to 

keep. Brought to bear here, § 507(b) directs 

that MGM’s returns on its investment in 

Raging Bull in years outside the three-year 

window (years before 2006) cannot be 

reached by Petrella. Only by disregarding 

that feature of the statute, and the separateaccrual rule attending § 507(b), could the 

Court of Appeals presume that infringing acts 

occurring before [three years prior to filing 

suit] bar all relief, monetary and injunctive, 

for infringement occurring on and after that 

date.

Id. (cleaned up).

The discovery rule had no place in the Court’s laches 

analysis, nor could it. In the course of discussing the 

question of when a claim accrues, the Court stated the 

general rule: A copyright claim “‘accrue[s]’ when an 

infringing act occurs,” which it labeled “the incident of 

injury rule.” Id. at 670 (alteration in original). It then 

dropped a footnote, noting that

[N]ine Courts of Appeals have adopted, as an 

alternative to the incident of injury rule, a 

“discovery rule,” which starts the limitations 

period when “the plaintiff discovers, or with 

due diligence should have discovered, the 

injury that forms the basis for the claim.” 

William A Graham Co. v. Haughey, 568 F.3d 

425, 433 (3d. Cir. 2009) (internal quotation 

marks omitted). See also 6 W. Patry, 
STARZ ENTERTAINMENT V. MGM 13

Copyright § 20:19, p. 20–28 (2013) . . . (“The 

overwhelming majority of courts use 

discovery accrual in copyright cases.”).

Id. at 670 n.4. However, the Court expressly noted that it 

had “not passed on the question,” and it did not do so in 

Petrella. Id. Nor has it had the occasion to address the 

discovery rule since. See, e.g., SCA Hygiene Prods. 

Aktiebolag v. First Quality Baby Prods., LLC, 137 S. Ct. 

954, 962 (2017) (recognizing that the Court has not decided 

“whether the Copyright Act’s statute of limitations is

governed by [a discovery] rule”). And because the Petrella

Court was solely concerned with laches—a doctrine 

addressing concerns about delay when plaintiffs know of 

their claims, but sleep on their legal rights3—it could not 

have intended its language to address the situation where a 

copyright holder does not know about the infringing act to 

which the discovery rule, not the incident of injury rule, 

applies. It thus seems fair to draw the conclusion that in 

Petrella, “the Court acknowledged that the ‘incident of 

injury’ rule it described in the main text of the case is not the 

only [accrual] rule that federal courts apply in copyright 

infringement cases,” Mitchell v. Capitol Recs., LLC, 287 F. 

Supp. 3d 673, 677 (W.D. Ky. 2017), but said nothing else 

about the discovery rule’s continued viability.

3 See Restatement (Second) of Torts § 939 (1979) (defining laches 

as an equitable remedy that may bar relief where there is “delay by the 

plaintiff in bringing suit, after he knew or should have known of the tort 

. . . if the delay has operated to the prejudice of the defendant or has 

weakened the court’s facility of administration”).
14 STARZ ENTERTAINMENT V. MGM

B.

“The overwhelming majority of courts” today use the 

discovery rule for determining accrual in copyright cases. 

See 6 William F. Patry, Patry on Copyright § 20:19 (2013) 

(collecting cases). Our circuit has continued to apply the 

discovery rule post Petrella. See Oracle Am., Inc. v. Hewlett 

Packard Enter. Co., 971 F.3d 1042, 1047 (9th Cir. 2020) 

(“[A] copyright infringement claim accrues—and the statute 

of limitations begins to run—when a party discovers, or 

reasonably should have discovered, the alleged 

infringement.”); Media Rts. Techs., Inc. v. Microsoft Corp., 

922 F.3d 1014, 1022 (9th Cir. 2019) (same). But most 

circuit courts, including ours, have not yet addressed 

whether Petrella imposed a damages bar separate from the 

statute of limitations, as MGM suggests.

The Second Circuit is the only exception. See Sohm v. 

Scholastic Inc., 959 F.3d 39 (2d Cir. 2020). There, Sohm, a 

professional photographer, entered into an agreement with 

different agencies to issue limited licenses to third parties to 

use his photographs. Id. at 42. In 2004, one of those 

agencies entered into an agreement with Scholastic, a 

publisher and distributor of children’s books, that 

established fees for certain print-run ranges of Sohm’s 

photos. Id. Some twelve years later, in May 2016, Sohm 

sued Scholastic for copyright infringement, alleging that 

Scholastic used his photos in numbers in excess of those 

contemplated in the monthly invoices governing 

Scholastic’s licenses. Id. Scholastic moved for summary 

judgment, arguing that the incident of injury rule should 

apply to determine when Sohm’s claim accrued and, even if 

the discovery rule applied, first, Sohm should have 

discovered the ongoing infringements more than three years 

before he filed suit, and second, that Petrella created a 
STARZ ENTERTAINMENT V. MGM 15

“damages bar” such that damages should be strictly limited 

to three years from the time the complaint was filed. See id. 

at 44. The district court rejected each of Scholastic’s 

arguments, applied the discovery rule, found Sohm was not 

on inquiry notice three years before he filed suit, and was 

thus entitled to damages for infringing acts before the threeyear period preceding suit. See id.

The Second Circuit affirmed the district court’s grant of 

summary judgment, concluding “that the discovery rule 

applies for statute of limitations purposes in determining 

when a copyright infringement claim accrues under the 

Copyright Act.” Id. at 50. It explained that “an infringement 

claim does not ‘accrue’ until the copyright holder discovers, 

or with due diligence should have discovered, the 

infringement,” citing its binding precedent in Psihoyos v. 

John Wiley & Sons, Inc., 748 F.3d 120 (2d Cir. 2014). Sohm, 

959 F.3d at 50. It recognized that the Supreme Court in 

Petrella “specifically noted that it was not passing on the 

question of the discovery rule,” a position that was 

“reaffirmed” in SCA Hygiene Products. Id. 

“Consequently,” the Second Circuit found that “in light of 

the Supreme Court’s direct and repeated representations that 

it has not opined on the propriety of the discovery or injury 

rules, it would contravene settled principles of stare decisis

for this Court to depart from its prior holding in Psihoyos on 

the basis of Petrella.” Id.

The Second Circuit next considered whether the district 

court correctly found that Sohm “did not discover, nor with 

due diligence should have discovered, Scholastic’s 

purported copyright infringements more than three years 

prior to when he filed suit.” Id. It concluded that Scholastic 

failed to identify any facts or circumstances that would have 

put Sohm on inquiry notice that Scholastic was infringing its 
16 STARZ ENTERTAINMENT V. MGM

copyrights, reasoning that “Scholastic cannot rely on the 

passage of time alone to establish that Sohm should have 

discovered” the infringing acts. Id. at 51. It upheld the 

district court’s determination that Sohm’s claims accrued 

within the statute of limitations—that he discovered the 

earlier acts of infringement within the three-year period 

before he filed suit. That should have been the end of 

discussion, but it wasn’t.

Scholastic, like MGM here, went on to argue that even if 

the discovery rule means the pre-three-year window claims 

timely accrued, Petrella created a separate damages bar that 

limits damages to only those arising from acts of 

infringement within the three-year window. The Second 

Circuit agreed, holding that the Petrella Court “explicitly 

delimited damages to the three years prior to the 

commencement of a copyright infringement action.” Id. It 

found that “Petrella’s plain language explicitly dissociated 

the Copyright Act’s statute of limitations from its time limit 

on damages.” Id. at 52. The Second Circuit reasoned from 

Psihoyos and certain language in Petrella that “we must 

apply the discover[y] rule to determine when a copyright 

infringement claim accrues, but a three-year lookback period 

from the time a suit is filed to determine the extent of the 

relief available.” Id. Accordingly, the Sohm court 

concluded that “a plaintiff’s recovery is limited to damages 

incurred during the three years prior to filing suit,” even 

where the copyright holder was unaware of the infringing 

acts, and the district court’s contrary conclusion was in error. 

Id.

C.

MGM asks us to adopt the approach taken by the Second 

Circuit in Sohm, and hold, in light of Petrella, that the 

damages that Starz may recover on its infringement claims 
STARZ ENTERTAINMENT V. MGM 17

are strictly limited to damages for the incidents of 

infringement that occurred during the three-year period 

before Starz filed suit, without regard to the date of accrual. 

We disagree that such a limitation on recovery of damages 

is dictated by Petrella. We hold that the discovery rule for 

accrual allows copyright holders to recover damages for all 

infringing acts that occurred before they knew or reasonably 

should have known of the infringing incidents and that the 

three-year limitations period runs from the date the claim 

accrued, i.e., from the date when the copyright holder knew 

or should have known of the infringement.

Applying a separate damages bar based on a three-year 

“lookback period” that is “explicitly dissociated” from the 

Copyright Act’s statute of limitations in § 507(b) would 

eviscerate the discovery rule. There is no reason for a 

discovery rule if damages for infringing acts of which the 

copyright owner reasonably becomes aware years later are 

unavailable. This case provides a textbook example of the 

absurdity of such a rule. The Library Agreements between 

Starz and MGM covered hundreds of titles under separate 

time periods, and some of the exclusivity periods ended as 

early as 2013. Under the approach urged by MGM and 

adopted in Sohm, damages may only be recovered for a 2013 

infringement if the complaint is filed within three years of 

2013, or by 2016. But here, Starz did not discover any

infringement until August 2019, and Starz brought suit less 

than a year later. Thus, while Starz’s copyright infringement 

claim accrued upon discovery in August 2019, and was 

therefore timely under § 507(b) because the complaint was 

filed before August 2022, under MGM’s theory, that same 

act of infringement has been nonrecoverable since 2016. As 

the district court noted, under Sohm’s rule, “[t]o the extent 

the discovery rule ‘saved’ the claims, it was a pyrrhic 

victory.” Moreover, recognizing a damages bar would 
18 STARZ ENTERTAINMENT V. MGM

render the “discovery rule” functionally identical to the 

“incident of injury” rule. See Br. of Amicus Curiae 

Professor Tyler Ochoa in Supp. of Pl.-Appellee & 

Affirmance at 13–15. By purporting to apply the discovery 

rule but imposing a three-year damages bar, Sohm is 

inherently self-contradictory. See 3 Melville B. Nimmer & 

David Nimmer, Nimmer on Copyright § 12.05[B][2][d][ii] 

(2021) (“But, immediately after nominally reaffirming the 

discovery rule, Sohm v. Scholastic took a hundred-andeighty degree turn . . . In sum, the practical import of this 

case is to adopt the injury rule and reject the discovery rule 

that it had previously upheld.”). The overwhelming majority 

of district courts in discovery rule circuits has rejected the 

concept of a damages bar in discovery rule cases, as Starz 

argues.4

4 Starz cites in its brief nearly thirty cases that have explicitly or 

implicitly rejected the notion that Petrella, a non-discovery rule case, 

created a damages bar in cases where the discovery rule applies. See, 

e.g., Mavrix Photo, Inc. v. Rant Media Network, LLC, No. CV 19-7270-

DMG-AFMx, 2020 WL 8028098, at *4 (C.D. Cal. Nov. 2, 2020); 

D’Pergo Custom Guitars, Inc. v. Sweetwater Sound, Inc., 516 F. Supp. 

3d 121, 135 (D.N.H. 2021); Stross v. Hearst Commc’ns, Inc., No. SA18-CV-01039-JKP, 2020 WL 5250579, at *8 (W.D. Tex. Sept. 3, 2020); 

Menzel v. Scholastic, Inc., No. 17-cv-05499-EMC, 2019 WL 6896145, 

at *6 (N.D. Cal. Dec. 18, 2019); Adobe Sys. Inc. v. NA Tech Direct Inc., 

No. 17-cv-05226-YGR, 2019 WL 5579472, at *8 (N.D. Cal. Oct. 29, 

2019); Krasemann v. Scholastic, Inc., No. CV-18-08313-PCT-DWL, 

2019 WL 3220535, at *7 (D. Ariz. July 17, 2019); Evox Prods. LLC v. 

Chrome Data Sols., LP, No. 3:16-cv-0057-PK, 2018 WL 6059530, 

at *16 (D. Or. Sept. 6, 2018); Kelly v. Maricopa Cnty. Sheriff’s Off., No. 

CV-15-02572-PHX-GMS, 2017 WL 6054675, at *2 (D. Ariz. Dec. 7, 

2017); Phoenix Techs. Ltd. v. VMware, Inc., No. 15-cv-01414-HSG, 

2017 WL 1289863, at *7 (N.D. Cal. Jan. 6, 2017); Yue v. MSC Software 

Corp., No. 15-cv-05526-PJH, 2016 WL 3913001, at *1 (N.D. Cal. July 

20, 2016); Wolf v. Travolta, 167 F. Supp. 3d 1077, 1092–93 (C.D. Cal. 

2016); UMG Recordings, Inc. v. Glob. Eagle Ent., Inc., No. CV 14-3466 
STARZ ENTERTAINMENT V. MGM 19

The Supreme Court did not create a damages bar 

separate from the statute of limitations in Petrella. The 

language that MGM relies on in Petrella is relevant only to 

incident of injury rule cases, not to cases where we apply the 

discovery rule. MGM relies, like the Second Circuit in 

Sohm, on the Petrella Court’s statement that “the statute 

‘itself takes account of delay’ by limiting damages to the 

three years prior to when a suit is filed.” Sohm, 959 F.3d 

at 52 (quoting Petrella, 572 U.S. at 677). This statement is 

accurate when the incident of injury rule applies because the 

MMM (JPRx), 2015 WL 12752881, at *8 (C.D. Cal. Aug. 27, 2015); 

Oracle USA, Inc. v. Rimini St., Inc., No. 2:10-CV-00106-LRH-PAL, 

2015 WL 5089779, at *6 (D. Nev. Aug. 27, 2015); Richardson v. 

Kharbouch, No. 19-C-02321, 2020 WL 1445629, at *6–7 (N.D. Ill. Mar. 

25, 2020); Design Basics, LLC v. Forrester Wehrle Homes, Inc., 305 F. 

Supp. 3d 788, 792–94 (N.D. Ohio 2018); Energy Intel. Grp., Inc. v. CHS 

McPherson Refinery, Inc., 300 F. Supp. 3d 1356, 1371 (D. Kan. 2018); 

Krist v. Scholastic, Inc., 253 F. Supp. 3d 804, 811–12, 812 n.44 (E.D. 

Pa. 2017); Mitchell287 F. Supp. 3d at 677–78; Design Basics, LLC v. 

McNaughton Co., No. 3:17-cv-258, 2017 WL 11068761, at *4–5 (M.D. 

Pa. Nov. 15, 2017); Boehm v. Svehla, No. 15-cv-379-jdp, 2017 WL 

4326308, at *8–9 (W.D. Wis. Sept. 27, 2017); Topline Sols., Inc. v. 

Sandler Sys., Inc., No. ELH-09-3102, 2017 WL 1862445, at *21 (D. Md. 

May 8, 2017); Alfa Laval Inc. v. Flowtrend, Inc., No. H-14-2597, 2016 

WL 2625068, at *5–6 (S.D. Tex. May 9, 2016); Energy Intel. Grp., Inc. 

v. Kayne Anderson Cap. Advisors, LP, No. H-14-1903, 2016 WL 

1203763, at *4 (S.D. Tex. Mar. 22, 2016); Raucci v. Candy & Toy 

Factory, 145 F. Supp. 3d 440, 448 (E.D. Pa. 2015); Design Basics LLC 

v. J & V Roberts Invs., Inc., 130 F. Supp. 3d 1266, 1281–82 (E.D. Wis. 

2015); Design Basics LLC v. Campbellsport Bldg. Supply Inc., 99 F. 

Supp. 3d 899, 919 (E.D. Wis. 2015); Grant Heilman Photography, Inc.

v. McGraw-Hill Cos., Inc., 28 F. Supp. 3d 399, 410–11 (E.D. Pa. 2014);

Frerck v. Pearson Educ., Inc., 63 F. Supp. 3d 882, 887 n.3 (N.D. Ill. 

2014); Beasley v. John Wiley & Sons, Inc., 56 F. Supp. 3d 937, 945 n.5 

(N.D. Ill. 2014); Panoramic Stock Images, Ltd. v. McGraw-Hill Glob. 

Educ. Holdings, LLC, No. 12 C-9881, 2014 WL 6685454, at *3 (N.D. 

Ill. Nov. 25, 2014); Frerck v. John Wiley & Sons, Inc., No. 11-cv-2727, 

2014 WL 3512991, at *6 n.5 (N.D. Ill. July 14, 2014).
20 STARZ ENTERTAINMENT V. MGM

three-year look-back period from the date of filing suit is 

coextensive with the three-year period following the act of 

infringement. When accrual is triggered by the act of 

infringement, we can accurately describe the statute of 

limitations as running forward from the act of infringement 

or looking backward from the date the complaint is filed—

either way it is the same exact period of time.

MGM argues that Petrella’s “look-back” language 

created a three-year damages bar that is determined solely 

by the date the complaint is filed even in cases where the 

discovery rule applies. But the text of the statute provides 

no support for this argument. In Petrella, the Court 

explained that, in the Copyright Act, Congress provided for 

just “two controlling time prescriptions: the copyright term 

. . . and § 507(b)’s limitations period.” Petrella, 572 U.S. 

at 672. Section 507(b)’s limitation period is not based on the 

date the complaint is filed, but instead limits civil actions to 

“three years after the claim accrued.” In other words, the 

claim under the Copyright Act does not arise—is not even 

actionable—until accrual.5

 Nowhere in § 507(b), or 

anywhere else in the Copyright Act, is there any reference to 

a separate three-year damages bar based on the complaint’s 

filing date. The Court did not disregard the plain text of the 

Copyright Act and invent a third time prescription for 

damages in a case where the issue was not before it. Plainly 

the Court’s look-back language was simply a shorthand for 

the statute of limitations laid out in § 507(b) in incident of 

5 See Black’s Law Dictionary (11th ed. 2019) (defining “accrue” as 

“[t]o come into existence as an enforceable claim or right; to arise,” and 

providing the following example: “the plaintiff’s cause of action for 

silicosis did not accrue until the plaintiff knew or had reason to know of 

the disease”).
STARZ ENTERTAINMENT V. MGM 21

injury cases—where infringement and accrual occur 

simultaneously.

Nor does § 504, the provision of the Copyright Act 

governing damages, support the imposition of a damages 

bar. Rather, § 504 allows recovery for “actual damages . . .

as a result of the infringement,” “any profits . . . attributable 

to the infringement,” 17 U.S.C. § 504(b), or “statutory 

damages for all infringements involved in the action,” id. 

§ 504(c)(1) (emphasis added). Had Congress intended to 

limit recoverable damages or profits to those arising only 

from acts of infringement during the three-year period before 

suit was commenced, it would have said so, and said so in 

§ 504, which sets forth detailed instructions as to the proper 

calculation of actual and statutory damages and profits.

Finally, unlike laches which serves to discourage a 

plaintiff from knowingly “sleeping upon his rights,” where 

the discovery rule applies, the plaintiff reasonably does not 

know that he is in such a slumber. Adopting a damages bar 

would mean that “a copyright plaintiff who, through no fault 

of its own, discovers an act of infringement more than three 

years after the infringement occurred would be out of luck. 

Such a harsh rule would distort the tenor of the statute.” 

Polar Bear, 384 F.3d at 706. “Section 507(b), like all 

statutes of limitations, is primarily intended to promote the 

timely prosecution of grievances and discourage needless

delay.” Id. It makes little sense to bar recovery of damages 

beyond the three-years before the suit was filed where the 

copyright holder did not delay, but acted in accordance with 

§ 507(b) by filing his complaint within three years of 

discovery. This is particularly true in a case such as this 

where the alleged infringer knows of and controls the 

infringing acts and the copyright holder has little means of 

discovering those acts. This would incentivize violation of 
22 STARZ ENTERTAINMENT V. MGM

the copyright holder’s exclusive rights, not protect those 

rights, which is the purpose of the Copyright Act itself.6 As 

amici argue, with the constant evolution of technology, 

copyright infringement is now “easier to commit, harder to 

detect, and tougher to litigate.” Br. of Amici Curiae The 

Authors Guild, Inc. and Other Artists’ Rights Organizations 

in Sup. Of Pl.-Appellee & Affirmance at 3; see also William 

A. Graham Co. v. Haughey, 568 F.3d 425, 437 (3d Cir. 2009) 

(“Technological advances such as personal computing and 

the internet have [made] it more difficult for rights holders 

to stridently police and protect their copyrights.” (internal 

quotation marks and citation omitted)).

The district court correctly concluded that “the best read 

of Petrella is that it did not change any law in the Ninth 

Circuit pertaining to the discovery rule and the three year 

damages bar.” This is because the discovery rule is an 

exception to the general incident of injury rule. When 

copyright infringement occurs prior to discovery, a simple 

application of the general rule to the three-year statute of 

limitations in § 507(b), undertaken by the Court in Petrella, 

is impossible. Instead, the three-year limitations period 

begins only when the copyright holder knows or should 

know of the infringing act. Neither the text of the Copyright 

Act nor Petrella imposes a three-year damages bar in a 

discovery rule case.

6 See 1 Nimmer, supra, § 1.02 (explaining that the Copyright Act, 

like all copyright laws, serves to promote the progress of science and 

other useful arts by providing protection for a limited time of certain 

exclusive rights in their works).
STARZ ENTERTAINMENT V. MGM 23

D.

The district court correctly applied the discovery rule to 

conclude that Starz timely filed its claims of copyright 

infringement. Taking all the facts in the complaint as true, 

there were no events that occurred that should have placed 

Starz on notice that MGM was violating its exclusive rights 

until Starz’s employee discovered the movie Bill & Ted’s 

Excellent Adventure on Amazon Prime Video in August 

2019. And as the district court aptly put it, “When Starz did 

detect smoke, in the form of Bill & Ted’s Excellent 

Adventure, it quickly discovered the fire and promptly sued 

for all 340 infringements.” Because Starz brought its claim 

within three years after its claim accrued, Starz is not barred 

from seeking damages for all acts of infringement.

IV.

We therefore affirm the district court’s denial of MGM’s 

motion to dismiss under Rule 12(b)(6).

AFFIRMED.