Framing Issue on Appeal Narrowly, Second Circuit Avoids Copyright Issues in Copyright Infringement Claim Arising From Amended Pleading Filed in Class Action
Unclaimed Property Recovery Service (UPRS) and Bernard Gelb were among the named plaintiffs in a class action in which Norman Kaplan was the plaintiffs' attorney. According to the allegations in the later copyright infringement suit, Gelb conducted the research for the class action complaint, hired Kaplan to represent the class, wrote the amended class action complaint, and compiled 305 pages of accompanying exhibits. Gelb and UPRS also alleged that they had copyrights in the amended complaint and exhibits.
Kaplan signed and filed the amended complaint and exhibits on behalf of the class action plaintiffs. The district court later dismissed the class action as time-barred and Kaplan appealed on the plaintiffs' behalf.
But while the appeal was pending, Kaplan and Gelb had a falling out, Kaplan informed Gelb that he wouldn't represent Gelb or UPRS, who then retained new attorneys. Kaplan remained attorney of record for three other class action plaintiffs.
New counsel for Gelb and UPRS later moved to withdraw the pending appeal, which the Second Circuit granted but only as to them. After that decision, Gelb and UPRS obtained copyright registration certificates for the amended complaint and exhibits.
The appeal proceeded with respect to the other class action plaintiffs and ultimately, the Second Circuit vacated the district court's dismissal of the action.
On remand, the class action plaintiffs still represented by Kaplan were granted leave to file a second amended complaint, which Kaplan did on their behalf. Significant portions of this second amended complaint and exhibits were identical to portions of the first amended complaint and exhibits in which Gelb and UPRS claimed copyright.
Gelb and UPRS then sued Kaplan, alleging in part that he infringed their copyrights in the first amended complaint and exhibits by copying portions of those documents in the second amended complaint and exhibits that he filed.
The district court dismissed the copyright infringement claim concluding that Gelb and UPRS had granted Kaplan an irrevocable implied license to file amended versions of the first amended complaint and exhibits. The court thus did not reach the question whether Gelb and UPRS had valid copyright interests in the first amended complaint and exhibits in the first instance. The district court then declined to exercise supplemental jurisdiction over the state law claims for conversion and unfair competition.
Gelb and UPRS appealed.
The Second Circuit framed the issue narrowly in a way that avoided broader copyright questions: "[W]hether the holder of a copyright in a litigation document who has authorized a party to a litigation to use the document in the litigation may withdraw the authorization after the document has already been introduced into the litigation and then claim infringement when subsequent use is made of the document in the litigation."
The Second Circuit answered that question in the negative, holding that "where the holder of a copyright in a litigation document has authorized a party to the litigation to use the document in the litigation, this constitutes an irrevocable authorization to all parties to the litigation (and to their attorneys, as well as the court) to use the documents thereafter in the litigation throughout its duration."
The court largely based its conclusion on practical considerations, noting that "[l]itigation cannot be conducted successfully unless the parties to the litigation and their attorneys are free to use documents that are a part of the litigation."
But the Second Circuit also questioned the plaintiffs' theory on policy grounds, stating that plaintiffs asked the court to endorse and enable "their questionable litigation practices" that would impinge on the trial court's discretionary case management authority by preventing it from allowing pleadings to be amended only in part.
In reaching its conclusion, the Second Circuit noted all the questions it (unfortunately) was not deciding:
Our decision today is based on the particularities of the facts before us. We do not decide whether legal pleadings or other legal documents are subject to copyright law. We do not decide whether a party who is authorized to file a legal pleading in one case is also authorized to file it in other cases. We do not decide whether the parties to the litigation may use the pleading for other purposes unrelated to the litigation.
The court further qualified its conclusion by noting that it did "not mean to suggest that permission of the copyright holder is inevitably needed for use of a copyrighted document in litigation;" rather, its "ruling concern[ed] only the consequence of a grant of authorization for use in litigation which the holder then purports to withdraw."
The case cite is Unclaimed Prop. Recovery Serv., Inc. v. Kaplan, Appeal No. 12-4030 (2d Cir. Aug. 20, 2013).