Computer software was recognized as eligible for protection under the U.S. Copyright Act as early as 1983. Apple Computer, Inc. v. Franklin Computer Corp., 714 F.2d 1240 (3d Cir. 1983). Since then, software has become increasingly more sophisticated and the demand for new and innovative programming continues to rise. Software creators who enter into license agreements with third parties should ensure they take all reasonable steps to protect their licensed product. A good software license agreement can afford licensors contractual protection in the event the agreement is violated. Prudent licensors, however, should also be sure to give themselves adequate copyright protection to allow for greater recovery should a breach occur. Software licensors ought to be sure their work is fully copyrighted promptly and regularly in order to give themselves the best protection.
Although a copyright is created at the time the subject work is created, such a copyright is unenforceable without proper registration. In re World Auxiliary Power Company, 303 F.3d 1120, 1125 (9th Cir. 2002). Section 411(a) of the U.S. Copyright Act states that “no civil action for infringement of the copyright in any United States work shall be instituted until preregistration or registration of the copyright claim has been made.” 17 U.S.C. § 411 (1976). Historically, circuit courts had been split on how “registration” was defined. American Bar Association, Practical Guide to Software Licensing for Licensees and Licensors § 22 (6th ed. 2016). Some courts, for example, held that a pending application for copyright registration with the Register of Copyright was enough, and therefore that registration occurred at the moment an application was received. Id. Earlier this month, however, the U.S. Supreme Court put this registration issue to bed once and for all when Justice Ginsburg issued the Court’s unanimous decision in Fourth Estate Public Benefit Corp. v. Wall-Street.com. Fourth Estate Pub. Ben. Corp. v. Wall-Street.com, LLC, 139 S. Ct. 881, 203 L.Ed.2d 147 (2019).
On March 4, 2019, the Supreme Court held that copyright registration, or refusal of registration, is a nationwide prerequisite for bringing an infringement suit. Id. at 153. No longer is it enough that the creator of a work simply submit an application for registration to the copyright office; registration is not complete unless and until the copyright office issues a response to the application. Id. In Fourth Estate, a producer of online journalism (Fourth Estate Public Benefit Corporation) had its copyright infringement claim quashed. Fourth Estate licensed its works to Wall-Street.com for publication on the latter’s news website. Id. After cancelling the licensing agreement, Wall-Street continued posting Fourth Estate’s articles on its site, in violation of the agreement. Id. However, because Fourth Estate had only applied to register its works with the Register of Copyrights, its infringement claim against Wall-Street was dismissed. Id. at 159. The case stands as a strong warning to owners of copyrightable works that even seemingly open-and-shut cases of infringement will be left unpunished when faced with inadequately registered copyrights.
Thankfully, there are steps you can take as a software licensor to ensure that your work is fully protected by U.S. copyright law. It takes an average of seven months for an application for copyright registration to be processed, so plan ahead and register early. Ciara N. McHale et. al., Lexology, SCOTUS Sees Copyright Registration as Prerequisite for Infringement Claim in Fourth Estate Case (2019), available at https://www.lexology.com/library/detail.aspx?g=64c8 fbc6-64e8-42e9-bca1-3e0a6b933b7a. Those in the tech industry should be prepared to make multiple, regular copyright registrations. Id. Companies that develop products which are likely to go viral or be copied, such as video games and mobile apps, may be more likely to need to rush for an injunction or other quick relief to halt copyright infringement. Id. Companies that produce these types of products may want to consider filing for an expedited copyright registration. Id. Finally, companies that release different, updated versions of their work, as is common with computer software, will need to apply for new registration for each subsequent version. Id.
While applying for copyright registration can be burdensome, especially for tech companies, there are numerous benefits to ensuring your copyright is adequately registered. Although registration is a prerequisite for filing a copyright infringement claim, §411(a) does not stop the enforcement of a copyright, once registered, for infringement predating the registration; nonetheless, without proper registration, a copyright owner’s remedies will be limited. Id. If registration is not made prior to infringement or within three months of the work’s publication, a copyright claimant cannot collect attorneys’ fees or statutory damages in any subsequent infringement suit. Id. Registration within three months of the publication allows a copyright holder to obtain up to $150,000 in statutory damages for intentional infringement even if the holder cannot prove actual loss. American Bar Association, Practical Guide to Software Licensing for Licensees and Licensors § 3 (6th ed. 2016). Furthermore, a claimant’s litigation position may be strengthened by a showing of proper registration, as registration within five years of the work’s publication can serve as prima facie evidence of the validity of the copyright. Id.
Want to Ensure Your Copyright is Protected?
Licensing and copyrighting your software requires careful consideration. In addition to Susan Larsen’s own Copyrights, filings for clients include software, original works of pictorial art, and Copyright infringement settlements.
Susan Larsen is experienced and knowledgeable in software licensing and intellectual property issues and can assist you in protecting your work(s). To find out how an Intellectual Property Attorney might benefit your business, contact Larsen Law at (303) 520-6030.