by Dennis Crouch
The Copyright Act has a seemingly simple three year statute of limitations:
No civil action shall be maintained under the provisions of this title unless it is commenced within three years after the claim accrued.
17 U.S.C. 507(b). It is somewhat surprising then that the Supreme Court has just granted certiorari in a case asking whether the statute “precludes retrospective relief for acts that occurred more than three years before the filing of a lawsuit.” Warner Chappell Music, Inc. v. Nealy, 22-1078 (Supreme Court 2023). At first glance the answer appears to be clearly “no,” but in the case, the Eleventh Circuit sided with the copyright holder by concluding that the rule permits plaintiffs to recover damagers for earlier acts.
The particular dispute focuses on when the “claim accrued” — with the appellate court holding that the three year timeline does not begin until the owner “knows or has reason to know she was injured.” This so called “discovery rule” has been implied into many statutes of limitation, has been rejected for some doctrines. When it decided the important laches case of Petrella v. MGM, the Supreme Court highlighted that “[t]he overwhelming majority of courts use discovery accrual in copyright cases.” 572 U.S. 663 (2014). Still, without directly rejecting the discovery rule Petrella also stated that copyright damages are available “running only three years back from the date the complaint was filed.”
In the Subsequent case of SCA Hygiene Prods. Aktiebolag v. First Quality Baby Prods., LLC, 137 S. Ct. 954 (2017), the Supreme Court provided further input on the discovery rule — although still not deciding directly is applicability.
According to First Quality, § 286 of the Patent Act is different because it “turns only on when the infringer is sued, regardless of when the patentee learned of the infringement.”
This argument misunderstands the way in which statutes of limitations generally work. First Quality says that the accrual of a claim, the event that triggers the running of a statute of limitations, occurs when “a plaintiff knows of a cause of action,” but that is not ordinarily true. As we wrote in Petrella, “[a] claim ordinarily accrues when [a] plaintiff has a complete and present cause of action.” While some claims are subject to a “discovery rule” under which the limitations period begins when the plaintiff discovers or should have discovered the injury giving rise to the claim, that is not a universal feature of statutes of limitations. And in Petrella, we specifically noted that “we have not passed on the question” whether the Copyright Act’s statute of limitations is governed by such a rule.
The SCA Hygiene quote clarifies that statutes of limitations generally start running upon accrual of a claim, not discovery of the injury. The discovery rule that starts the clock upon discovery of the injury is an exception to the norm. The presumption then appears to be that the discovery rule will only be applied to a statute of limitations if there is some particular statutory interpretation reason to do so.
Petitioner’s key argument is that the 11th Circuit’s application of the discovery rule to allow damages beyond the 3-year lookback period conflicts with statements by the Supreme Court in Petrella v. MGM that recovery is limited to three years back from the date the complaint was filed. The responsive briefing pointed to a number of litigation issues, to suggest the case was a bad vehicle for certiorari. On the merits, they also focused on the damages provision, Section 504, that contains no 3-year limitation and also noted that Petrella‘s statements are not controlling because that case only held that laches does not apply as a defense; It did not limit damages to 3 years. In its brief the Chamber of Commerce warns against the discovery rule. The organization represents often-sued businesses and does not want to see a transdoctrinal nationwide discovery rule for federal courts that would extend the statutes of limitations against its members.
Patents also have an expiration date which is vastly shorter than for copyrights, and a much longer pre-suit back-damages recovery time period.
Thanks for the input, but unclear what you mean. The statute of limitations for a civil action for patent infringement is six years. 35 U.S.C. §286. What do you think the SOL is?
As Dennis notes per his case quote above: “§ 286 of the Patent Act is different because it “turns only on when the infringer is sued, regardless of when the patentee learned of the infringement.” I.e., it is not a normal statute of limitations. Absent effective laches, one could know of and not take any action re an infringement of a patent for the entire term of the patent and then still bring suit for prior infringements.
In context, what exactly is the meaning of “effective” in your “effective laches?”
Effective for whom?
Sorry, I thought it was obvious – the now absent effectiveness of laches in patent suit delays due to the 2017 the Supreme Court 7-1 decision in SCA Hygiene Products v. First Quality Baby Products, LLC. [Ruling that laches from a plaintiff prejudicing a defendant by waiting too long to sue cannot be invoked as a defense against a claim for patent infringement damages that accrued prior to the date of the suit. The Supreme Court relied heavily on its analogous copyright decision from 2014, Petrella v. Metro-Goldwyn-Mayer, Inc., to overrule a 6-5 en banc decision from the Federal Circuit.]
Why would that be obvious, and — still — effective for whom?
If you want “laches should be MORE effective for Efficient Infringers,” you really should just come out and explicitly state that.
Why? Mere personal opinions are worthless. Readers should be getting useful patent law information.
That made me laugh.
Please follow your own ‘advice.’
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