Published by LawTechie - October 9, 2013 - LawTechie

Intellectual PropertyAccording to the District Court of Alaska, the 9th Circuit’s previous prohibition on copyright holders assigning litigation agencies a “right to sue” is not a blanket prohibition as long as the copyright assignment is written a certain way. Alaska Stock, LLC v. Pearson Education, Inc., No. 3:11-cv-00162-TMB (D. Alaska Sept. 11, 2013).

Background

Back in May, the 9th Circuit delivered the final blow to copyright litigator (some would say “troll”) Righthaven which had been suing publications all over the country for allegedly infringing on the copyrights of local newspapers. Righthaven was formed as an entrepreneurial venture by a Las Vegas attorney who had the company receive copyright assignments to stories published by local newspapers and then proceeded to threaten and sue any blog or website that reprinted all or parts of those stories. Since Righthaven was not itself a publisher, just a quasi-law firm, it was essentially attempting to make a business model out of small scale copyright litigation.

The 9th Circuit ruled that Righthaven had no right to sue anyone because its copyright assignments were in fact nothing more than an assignment of a “right to sue” which is not an existing copyright but merely something that copyright holders can do to enforce their copyrights. To be clear: no assignment of the newspapers’ exclusive rights as copyright owners (e.g., right of reproduction, right to make derivative works, etc…) were made in their assignments to Righthaven. Thus, held the 9th Circuit, Righthaven had no right to do anything.

Alaska Stock

In Alaska Stock, a group of stock photographers assigned their copyrights to Alaska Stock, LLC which proceeded, like Righthaven before it, to sue various publishers that made unlicensed use of the assigned stock photos. According to the District Court of Alaska, what set this case apart from Righthaven is that the Alaska Stock assignment contract assigned all copyrights (not just the illusory “right to sue”) to Alaska Stock until the resolution of the infringement claims, at which point the contract obligates Alaska Stock to assign the copyrights back to the photographers.

Thus, according to the District Court, Alaska Stock was not assigned merely a “right to sue” but was assigned the full exploitation rights to the photographs. Therefore, as a valid copyright holder, Alaska Stock has a right to sue infringers.

My Two Cents

This seems like a very technical way to distinguish the Righthaven ruling.

Here’s one problem: If the photographers assigned all of their rights to Alaska Stock, even if temporarily, those photographers have no right to reproduce, license or otherwise sell their stock photos until Alaska Stock is done with its lawsuits and assigns the copyrights back to the photographers. If the photographers are okay with this, then they are basically admitting that their photos have no value apart from the statutory damages Alaska Stock could win from alleged infringers. In which case, the whole concept of statutory damages under the Copyright Act as a remedial mechanism goes out the window (you are not remedying anything when you win arbitrary litigation damages on admittedly worthless photos).

On the other hand, the photographers may have a complicated licensing side-deal with Alaska Stock wherein while Alaska Stock holds the copyrights to the photos, it licenses back to the photographers the right to reproduce and sublicense the photos. If this is the case then, all legal jargon aside, such a mixture of copyright assignment and back-license would essentially make it so that all Alaska Stock got from the photographers was a “right to sue.” This would of course violate the spirit, if not the technical language, of the Righthaven ruling.

Hat tip to Pamela Chestek of PropertyIntangible.com for finding and covering this case.

LawTechie is a blog focusing on trends in tech and digital media. Areas covered include intellectual property, cyberlaw, venture capital, transactions and litigation as they relate to the emerging sectors. The blog is edited by the firm's partner Tim Bukher with contributions from the firm's experts in their respective areas of law.

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