authorization to use complaint is irrevocable, precluding copyright claim

Unclaimed Property Recovery Service, Inc. v. Kaplan, No. 12-4030 (2d Cir. Aug. 20, 2013)

H/T The Trademark Blog.

The rule articulated here is clear but narrow: “[W]here 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.”  It is not, I think, a copyright rule; if it were, interesting questions would arise.

Plaintiffs UPRS and Gelb authorized the clients of Kaplan, an attorney, to file a legal complaint and exhibits written and compiled by Gelb.  Gelb allegedly conducted the research underpinning the allegations in a class action complaint, located and obtained powers attorney from several class plaintiffs, and hired Kaplan to represent the class.  The district court dismissed the class action as time-barred, and Kaplan appealed.  He had a falling out with Gelb, and Gelb and his company (from now on for clarity they’ll be “Gelb”) retained new attorneys.  The class plaintiffs revoked the powers of attorney they’d given Gelb, and Kaplan remained their attorney of record.  Gelb’s new counsel moved to withdraw the pending appeal, a motion granted with respect to Gelb but denied with respect to the other appellants.  The Second Circuit resolved the appeal in the class action plaintiffs’ favor.  On remand, the district court granted the class action plaintiffs leave to file a second amended complaint to address issues raised in the Second Circuit’s order, and Kaplan did so.  Significant portions of the second complaint and exhibits were identical to portions of the first complaint and exhibits, and Gelb sued for infringement.

A copyright holder in a litigation document who authorizes a party to use the document in litigation “necessarily conveys, not only to the authorized party but to all present and future attorneys and to the court, an irrevocable authorization to use the document in the litigation thereafter.”  This doesn’t mean that permission is inevitably needed for the use of a copyrighted document (i.e., all of them) in litigation—rather, the ruling is only about a grant of authorization that is purportedly withdrawn.

The rationale is the need to conduct litigation, which requires that parties and their attorneys be free to use documents that are part of the litigation.  They rely on such documents to establish the nature of the dispute and the facts and legal arguments at issue. “The courts could not thoroughly and fairly adjudicate a matter if suddenly in the midst of litigation the parties lost the right to give the court copies of documents already used in the litigation that support their arguments.  The holder of the copyright in a document who authorizes a party to use that document in a litigation knows, or should know, those inevitable consequences of the authorization.”  Thus, authorization for use is irrevocable “throughout the duration of the litigation” to all parties and to the court for appropriate litigation purposes. This isn’t like authorization in a private dispute, where a party often has the right to be a jerk and disrupt expectations, since what’s at stake is “the ability of the courts to perform their function. The needs of the courts prevail over the copyright holder’s selfish interests.”

Assuming (without deciding) copyrightability, that couldn’t prevent defendants here from creating and filing an amended complaint.  A contrary holding would “encourage sharp litigation practices, undermine the attorney-client relationship, and limit the district court’s ability to manage its cases.”  Gelb was attempting to influence the class action by a “novel” use of copyright—Gelb shouldn’t be able to threaten the class action plaintiffs with the ability to “pull[] the proverbial rug out from under them—by pulling the complaint out from under the litigation.”  Gelb withdrew from the class action and shouldn’t have such unreasonable control over its course. 

The consequences would be even worse in the usual case where an attorney is the one who drafts a pleading.  The attorney’s authority over the use of the pleading would interfere with the client’s authority to control the litigation, and the lawyer’s pecuniary interests could be pitted against those of her client, at least potentially, in every litigation.  “Under the theory advanced by UPRS and Gelb, the attorney could deny the client the right to reproduce the pleading or prepare derivative works if the client fires the attorney and seeks to hire different counsel.”  That would be bad.

Plus, Gelb’s theory would prevent the district court from exercising its discretion in case management.  “Courts often permit a party to amend a pleading in part but not in full.  Under these circumstances the court, in effect, requires that an amended pleading retain a portion of the original pleading.  Imposing such a requirement is within the purview of the district court.   The plaintiffs point to no aspect of the copyright law or its legislative history indicating that Congress intended that copyright should interfere with that authority.”

The court ended by saying what it wasn’t deciding: it wasn’t deciding the copyrightability of legal pleadings or other legal documents. It wasn’t deciding whether authorization to file a document in one case carried over to other cases.  It wasn’t deciding whether parties could use a pleading for purposes unrelated to the litigation.  It wasn’t relying on the traditional law of license, so it didn’t need the district court’s theory of implied license.  And it wasn’t relying on the initial authorization to Kaplan: even if the class plaintiffs had substituted a new attorney who’d never interacted with Gelb, that attorney would be entitled to use the complaint and exhibits as the class plaintiffs’ agent.

So basically, this is like the judicially made-up rule that professors’ scholarly writings aren’t works for hire, no matter the tension with the text of the Copyright Act.  Otherwise, it would be a holding about copyright licenses more generally (and the court says it isn’t, but never says what the alternative to the “traditional law of license” is).  Compare Walthal v. Rusk, 172 F.3d 481 (7^th cir. 1999) (allowing termination at will of copyright license with no specified term), with Rano v. Sipa Press, 987 F.2d 580 (9th Cir. 1993) (nonexclusive license with no termination date isn’t terminable until the 35-year termination period passes; this result also implies that a similar license to create derivative works is irrevocable).  Here, the needs of the judicial system substitute for consideration in making the license irrevocable (but does this last beyond 35 years? Inquiring minds want to know; my mother’s been litigating a case for roughly that long).