US Supreme Court Rules Laches Does Not Bar "Raging Bull" Copyright Infringement Claim | Practical Law

US Supreme Court Rules Laches Does Not Bar "Raging Bull" Copyright Infringement Claim | Practical Law

In Petrella v. Metro-Goldwyn-Mayer, Inc., the US Supreme Court reversed the judgment of the US Court of Appeals for the Ninth Circuit, holding that laches does not bar Petrella's copyright infringement claim for damages brought within the three-year limitations period.

US Supreme Court Rules Laches Does Not Bar "Raging Bull" Copyright Infringement Claim

by Practical Law Intellectual Property & Technology
Published on 20 May 2014 • USA (National/Federal)
In Petrella v. Metro-Goldwyn-Mayer, Inc., the US Supreme Court reversed the judgment of the US Court of Appeals for the Ninth Circuit, holding that laches does not bar Petrella's copyright infringement claim for damages brought within the three-year limitations period.
In a six to three decision in Petrella v. Metro-Goldwyn-Mayer, Inc., the US Supreme Court on May 19, 2014 reversed the US Court of Appeals for the Ninth Circuit's judgment and held that laches cannot be used to bar Petrella from pursuing a claim for damages brought within the Copyright Act's three-year statute of limitations (No. 12-1315, (S. Ct. May 19, 2014)).
In reversing the Ninth Circuit, the Supreme Court reasoned that:
  • The copyright statute of limitations already takes into account delays by limiting a plaintiff's recovery of the defendant's profits made in the three-year period back from the time of suit.
  • If there is infringement during the three-year look-back period, the defendant may offset:
    • certain expenses incurred in generating those profits; and
    • elements of profit attributable to factors other than the copyrighted work.
  • Laches is an equitable defense and the Supreme Court has cautioned against invoking laches to bar legal relief.
The Supreme Court addressed MGM's arguments and specifically noted that:
  • Laches has never been applied to bar entire claims that occurred within a federally prescribed limitations period.
  • Laches is used as a guide when no statute of limitations controls the claim and cannot be used as a rule for interpreting the statutory limitation.
  • There is nothing wrong with a plaintiff waiting to see if an infringer's act impacts the value of the copyrighted work before filing suit.
  • As to the potential loss of evidence due to the copyright owner's delay:
    • Congress must have known that the passage of time could cause the loss of evidence, but still allowed certain actions to be taken a substantial number of years after certain key events occurred;
    • any hindrance caused by the unavailability of evidence is likely to affect plaintiffs and defendants similarly; and
    • the key evidence in copyright infringement litigation will be the copyright certificate, the original work and the allegedly infringing work.
  • The estoppel doctrine in appropriate situations may bar the copyright owner's claim completely and there should be a distinction between laches and estoppel.
The Court further held that, while laches is not a complete bar to damages claims brought within the three-year window, in extraordinary circumstances it may limit the equitable relief awarded. Should Petrella ultimately prevail on the merits, the district court may take account of her delay in:
  • Determining the appropriate injunctive relief.
  • Assessing damages.
The majority opinion was penned by Justice Ginsberg. Justice Breyer dissented and was joined by Chief Justice Roberts and Justice Kennedy.
For more information on the procedural history and the underlying facts in this case, see Legal Update, Laches Bars "Raging Bull" Copyright Infringement Claim: Ninth Circuit.