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Prescription for copyright protection: Register stat!

Aug 17, 2020 | Copyright Law, Newsletter

Copyright protection generally takes effect as soon as you create an original work, but it might not be as extensive as you think. To get the full protection, including the ability to sue for infringement, you must register your work with the U.S. Copyright Office — and you should do so ASAP.

A copyright holder recently learned the risks of delaying registration the hard way. While the issue was distinctive, according to the U.S. Court of Appeals for the Fifth Circuit, the result was familiar.

The district court’s diagnosis

Physicians must undergo a credentialing process involving several forms to practice at a hospital. Southern Credentialing Support Services verifies the forms. From 2010 to 2013, it created custom forms for its client Hammond Surgical Hospital, including a credentialing packet and a recredentialing packet, designed to increase the efficiency of the hospital’s process.

After the business relationship ended, the hospital continued to use at least 50 pages of Southern’s forms packet. By 2017, these forms could be accessed on the website of Hammond’s new credentialing provider.

Southern registered copyrights for its credentialing and recredentialing packets in February and July 2014, respectively. After Hammond refused to stop using the materials, Southern sued for copyright infringement.

The trial court ruled in Southern’s favor before trial and awarded statutory damages for both packets. Hammond appealed, arguing that the Copyright Act barred awarding statutory damages because it began infringing before the copyrights were registered.

A bitter pill for the plaintiff

The Copyright Act allows a copyright holder to elect statutory damages, generally in an amount set by the court between $750 and $30,000 per infringed work, instead of actual damages. But, under Section 412 of the law, statutory damages aren’t available for “any infringement of copyright in an unpublished work commenced before the effective date of its registration.” This limit is intended to encourage authors to register their works promptly and give potential infringers notice that works are protected.

Citing the 1992 case Mason v. Montgomery Data, Inc., the trial court pointed out that it has interpreted Sec. 412 to bar statutory damages even for post-registration infringement when the same defendant infringed the same work in the same fashion before and after registration. The question in this case, though, was whether the bar applies when the defendant engages in a different type of infringement after registration (distributing the forms publicly available on the website) than it did before registration (copying the forms). The trial court found that it didn’t.

The Court of Appeals, however, noted that no court had previously applied the lower court’s approach and that one district court in the Fifth Circuit had “persuasively rejected it.” That court reasoned that the Fifth Circuit’s rationales in Mason applied with equal force when infringement occurring before and after registration violates different rights protected by copyright law.

The appellate court agreed with this reasoning. It saw no reason that infringements occurring after registration would be more worthy of punishment because they’re different in kind from those occurring earlier.

Congress prohibited statutory damages when “any infringement” precedes registration, the Fifth Circuit said. And maintaining the rule — even when the infringements were of different exclusive rights afforded to copyright owners — promotes the early registration incentive.

Alternative remedies

It’s worth noting that the court’s holding doesn’t leave copyright holders without remedy against infringers who violate their rights both before and after registration. Although statutory damages are barred in such circumstances, actual damages remain available when a plaintiff can prove them. Southern couldn’t do so here, but it obtained yet another remedy — an injunction against future infringement.

Southern Credentialing Support Svcs., LLC v. Hammond Surgical Hosp., LLC, No. 18-31169, Jan. 9, 2020, 5th Cir.

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