Joint Authorship Claim Does Not Accrue Until Authorship is Expressly Repudiated: Third Circuit | Practical Law

Joint Authorship Claim Does Not Accrue Until Authorship is Expressly Repudiated: Third Circuit | Practical Law

In its decision in Brownstein v. Lindsay, the US Court of Appeals for the Third Circuit decided two questions of first impression in the Third Circuit. In its decision, it held that a joint authorship claim arises and accrues only when a party's joint authorship has been expressly repudiated and that courts have no authority to cancel copyright registrations.

Joint Authorship Claim Does Not Accrue Until Authorship is Expressly Repudiated: Third Circuit

by Practical Law Intellectual Property & Technology
Published on 31 Jan 2014 • USA (National/Federal)
In its decision in Brownstein v. Lindsay, the US Court of Appeals for the Third Circuit decided two questions of first impression in the Third Circuit. In its decision, it held that a joint authorship claim arises and accrues only when a party's joint authorship has been expressly repudiated and that courts have no authority to cancel copyright registrations.
On January 29, 2014, the US Court of Appeals for the Third Circuit issued its decision in Brownstein v. Tina Lindsay holding that:
  • A joint authorship claim arises and accrues only when a plaintiff's authorship has been expressly repudiated.
  • Courts do not have authority to cancel copyright registrations.
(Nos. 12-2506, 12-4471, (Jan. 29, 2014).)
During the time that Brownstein and Lindsay worked for a direct mailing list company, they began developing an ethnic identification system. Beginning in about December 1993, Lindsay began devising the idea and developing rules for categorizing names by ethnicity. These rules became known as the Ethnic Determinate System (EDS). This system would use the rules to run a computer program that would predict the ethnicity of a random list of names from a direct mailing database. In January 1994, Lindsay enlisted Brownstein to turn her rules into computer code. These programs became known as the ETHN programs. The combined system of Lindsay's rules and Brownstein's computer code was named the LCID.
The result of Brownstein's and Lindsay's work on the ethnic identification system was that:
  • Lindsay was the sole author of the EDS.
  • Brownstein was the sole author of the ETHN programs.
  • Lindsay and Brownstein were joint authors of the LCID.
In 1996, Brownstein and Lindsay formed a company to commercialize the LCID. They later decided to register the copyrights in their works. Lindsay filed for and obtained two copyright registrations for EDS in 1996. In the second registration, Lindsay included a copy of Brownstein's ETHN programs as a deposit copy and referred to a computer process and codes associated with the copyright. Lindsay applied for the registrations without Brownstein's involvement and listed herself as the only author.
Brownstein and Lindsay continued to be employed by the direct mailing list company, but as their business venture developed, they both left in 1997. Over the course of several years, Lindsay executed a number of agreements to form new business entities to promote the LCID and to attempt to transfer ownership of the LCID to those entities. During this time Brownstein let Lindsay handle the affairs of their venture while he focused on the computer code for the LCID. Unfortunately, Lindsay's and Brownstein's business relationship deteriorated and the parties became embroiled in a number of lawsuits against their former employer and between themselves. Brownstein ultimately signed two settlement agreements in connection with these lawsuits.
In 2009, Brownstein filed for his own copyright registrations for the ETHN programs. He subsequently filed this lawsuit in 2010 seeking, among other things, a declaratory judgment of joint authorship of the LCID. Lindsay filed a counterclaim to cancel Brownstein's 2009 copyright registrations to the ETHN programs. The basis for Brownstein's lawsuit was Lindsay's deposition testimony in one of the other litigations where she testified that she might be claiming sole authorship of the LCID.
The US District Court for the District of New Jersey ruled in favor of Lindsay:
  • Determining that the Copyright Act's statute of limitations had run since Brownstein had adequate notice of his authorship claim more than three years before he filed the complaint.
  • Granting summary judgment cancelling Brownstein's copyright registrations.

Joint Authorship Claim

In deciding Brownstein's joint authorship claim, the Third Circuit focused on whether:
  • Brownstein is a co-author of the LCID.
  • Brownstein's joint authorship claim is barred by the statute of limitations.

Joint Authorship

Lindsay conceded at oral argument that Brownstein and Lindsay were co-authors of the LCID through 1997. In addition, the Third Circuit noted that Brownstein's copyrights and ownership interest in the ETHN programs and the LCID were not affected by:
  • Lindsay's copyright registrations in the LCID because copyright registration does not establish the copyright but simply:
    • creates a record of the creation of the work; and
    • allows the author to bring claims under the Copyright Act.
  • The series of agreements arising from Brownstein and Lindsay's business venture because:
    • Lindsay could not have transferred ownership of the LCID before 1998 without Brownstein's consent in a signed writing; and
    • any agreements that Brownstein did sign did not address his rights as a co-author of LCID or as the sole author of the ETHN programs.

Statute of Limitations

The Third Circuit noted that an authorship claim begins to accrue and the statute of limitations begins to run when the author is on inquiry notice of his authorship claim. This inquiry notice depends on when:
  • A cause of action first arose. In its analysis, the Third Circuit followed the Second, Seventh and Ninth Circuits in adopting the express repudiation rule for this determination. The express repudiation rule means that a joint authorship claim arises and an author is alerted to the potential violation of his rights when his authorship has been expressly repudiated by his co-author.
  • He should have known that a cause of action had arisen. The discovery rule, which states that a claim accrues when a plaintiff discovers or should have discovered with due diligence that his rights had been violated, governs this determination.
Applied to this case, Brownstein's injury occurred whenever Lindsay expressly repudiated his joint authorship of the LCID. This required Lindsay to do something that communicated that she was the sole author or that Brownstein was not a co-author. The Third Circuit concluded that this express repudiation of Brownstein's authorship did not arise from either:
  • Lindsay's copyright registrations.
  • The various agreements referenced above, unless there were statements in an agreement that were hostile or adverse to Brownstein's authorship rights. This is a question that should have been determined by the jury.
The Third Circuit therefore remanded the case for a new trial.

Copyright Registrations

The Third Circuit also held that courts do not have authority to cancel copyright registrations, relying on:
  • The view of other courts that addressed this issue.
  • The absence of any statutory authority in the Copyright Act to cancel copyright registrations, noting that the Copyright Act:
    • explicitly states that generally all administrative copyright functions are the responsibility of the Register of Copyrights; and
    • grants courts cancellation authority for original designs but did not do so for copyright registrations.