Opinion ID: 6971608
Heading Depth: 3
Heading Rank: 1

Heading: Statutory Damages and Attorney’s Fees

Text: “Statutory damages are designed not solely to compensate the copyright owner for losses incurred, but also to deter future infringement.” F.W. Woolworth Co. v. Contemporary Arts, Inc., 344 U.S. 228, 233, 73 S.Ct. 222, 97 L.Ed. 276 (1952). In cases of willful infringement, the Court is permitted to increase the award to as much as $100,000. 17 U.S.C. § 504(c)(2). In addition, § 505 provides for the award of costs and attorney’s fees at the district court’s discretion. 17 U.S.C. § 505. Section 412(1), however, limits the scope of these two sections by providing that “no award of statutory damages or of attorney’s fees, as provided in sections 504 and 505, shall be made ... [if] infringement of copyright in an unpublished work commenced before the effective date of its registration.” 17 U.S.C. § 412(1). Thus, Johnson cannot recover statutory damages or attorney’s fees under the Copyright Act if Tosch’s infringement “commenced” before the copyright was registered. Ordinarily, we review for an abuse of discretion a court’s decision whether to award attorney’s fees. See, e.g., Wynn Oil Co., 943 F.2d at 607. Section 412(1), however, leaves no room for discretion, mandating that no attorney’s fees or statutory damages be awarded so long as the infringement commenced before registration of the copyright. Johnson does not question the district court’s factual findings as to the date of registration or the dates on which the infringing activity took place. Rather, he challenges the district court’s legal conclusion that the facts in this case demonstrate that the copyright infringement “commenced” before the copyright was registered. We review the district court’s legal conclusion de novo. Duncan v. Coffee County, Tenn., 69 F.3d 88, 92 (6th Cir.1995). The district court correctly noted that Johnson registered his copyright on December 6, 1993. The district court also noted that the infringement of Johnson’s copyright began in November, 1993-a full month before registration. Johnson counters that the district court improperly viewed the infringement as a continuing process, rather than a series of separate acts of infringement. By viewing each of Tosch’s actions as a new act of infringement, Johnson is able to identify the December 22 drawings of the South Addition to the Jones house as an act of infringement that “commenced” after the registration date. Johnson’s interpretation of the word “commenced” conflicts with both the ease law and the purpose of the limitations contained in § 412. Section 412(1) is designed to ensure that an infringer of an unpublished work will be subject to the punitive effects of §§ 504(e) and 505 only if the infringer had constructive notice that the work was protected by a valid copyright. Constructive notice of a valid copyright is presumed upon registration. The purposes of this design are many. First and foremost, Congress intended that § 412 provide copyright owners with an incentive to register early and often. Under the 1909 Copyright Act, both publication and registration were compulsory for most types of works; i.e., no recovery unless the copyrighted work was both published and registered. 17 U.S.C. § 10 (1934) (repealed 1976). The 1976 Copyright Act removed those harsh limitations, thus bringing unpublished works under the umbrella of federal copyright protection and making registration optional. Congress realized,' however, that “copyright registration ... is useful and important to users and the public at large ... and should therefore be induced in some practical way.” H.R.Rep. No. 1476 at 158, 94th Cong., 2d Sess. (1976) U.S.Code Cong. & Admin.News 1976 at 5659, 5774. By offering the additional choice of statutory damages to those who register promptly, § 412 “induce[s] [copyright registration] in some practical way.” Id. In addition to giving copyright owners incentive to register, § 412 also provides potential infringers with an incentive to check the federal register. If § 412 succeeds in encouraging copyright owners to register and in encouraging potential infringers to check registration, then it will have reduced both the search costs imposed on potential infringers and the enforcement costs borne by copyright owners. And, finally, the simplicity of § 412 confers upon all parties involved the clarity and low administrative costs of a brightline rule. These purposes, would be thwarted by holding that infringement is “commenced” for the purposes of § 412 each time an in-fringer commits another in an ongoing series of infringing acts. Under § 412, statutory damages and attorney’s fees are reserved for infringers who had-constructive notice that the work was covered by a valid copyright. Had Tosch checked the federal register when he first began his infringing activity, he would have discovered that Johnson’s copyright was not registered. If the incentive structure of § 412 is to be properly applied, then Johnson should not receive the reward of statutory damages, because he did not satisfy the requirement of prompt registration. Every court to consider this question has come to the same conclusion; namely, that infringement “commences” for the purposes of § 412 when the first act in a series of acts constituting continuing infringement occurs. See, e.g., Ez-Tixz, Inc. v. Hit-Tix, Inc., 919 F.Supp. 728, 736 (S.D.N.Y.1996) (“The alleged acts of infringement that occurred after the copyright was registered do not constitute new acts of infringement but a continuation of the infringement that ‘commenced’ prior to registration.”); Parfums Givenchy, Inc. v. C & C Beauty Sales, Inc., 832 F.Supp. 1378, 1393 (C.D.Cal.1993) (holding that “the first act of infringement in a series of ongoing separate infringements ‘eommence[s]’ one continuing ‘infringement’ ”) (brackets in original); Mason v. Montgomery Data, Inc., 741 F.Supp. 1282, 1285 (S.D.Tex.1990), rev’d on other grounds, 967 F.2d 135 (5th Cir.1992) (“A ‘new1 or ‘separate’ basis for the award of statutory damages is created, however, only where there is a difference between pre- and post-registration infringing activities.”); Singh v. Famous Overseas, Inc., 680 F.Supp. 533, 535 (E.D.N.Y.1988), aff'd, 923 F.2d 845 (2d Cir.1990) (holding that infringement does not “commence” with each new act in an ongoing infringement, because “it would be peculiar if not inaccurate to use the word ‘commenced’ to describe a single act”); Johnson v. Univ. of Virginia, 606 F.Supp. 321, 325 (D.Va.1985) (holding that infringement does not “commence” with each new act in an ongoing infringement, because “ascribing such a meaning to the term ‘commenced’ would totally emasculate § 412”); Whelan Associates, Inc. v. Jaslow Dental Laboratory, Inc., 609 F.Supp. 1325, 1331 (E.D.Pa.1985), aff 'd on other grounds, 797 F.2d 1222 (3d Cir.1986), cert. denied, 479 U.S. 1031, 107 S.Ct. 877, 93 L.Ed.2d 831 (1987) (“Interpreting ‘commencement of infringement’ as the time when the first act of infringement in a series of ongoing discrete infringements occurs ... would best promote the early registration of a copyright. It would strongly encourage prompt registration.”). For these reasons, the district court was correct to deny Johnson’s request for statutory damages and attorney’s fees under §§ 504(c) and 505 of the Copyright Act.