Earlier this year, we wrote about the Supreme Court’s questioning of a record company’s bid to cap damages for copyright infringement occurring more than three years before the filing of suit. On May 9, 2024, the Supreme Court ruled in favor of plaintiff Sherman Nealy, whose pursuit of relief for copyright infringement was hindered by his incarceration over several decades for drug-related criminal offenses.
In Warner Chappell Music, Inc. v. Neely, No. 22-1078, 2024 WL 2061137 (U.S. May 9, 2024), the Court held that the Copyright Act entitles a copyright owner to obtain monetary relief for any timely infringement claim, no matter when the infringement occurred. Justice Kagan delivered the 6-3 opinion, which she was joined by Chief Justice Roberts and Justices, Sotomayor, Barrett, and Jackson. Justice Gorsuch dissented, in which Justices Thomas and Alito joined.
The Copyright Act contains a three-year limitations period for filing suit, 17 U.S.C. § 507(b), which begins to run when a claim accrues upon its discovery. But that provision does not establish a three-year limit on recovering damages. In reaching its decision, the Court affirmed the Eleventh Circuit’s decision which had allied itself with the Ninth Circuit’s recent decision in Starz Entertainment v. MGM, 39 F. 4th 1236, 1244 (9th Cir. 2022), rather than the Second Circuit’s opposite conclusion in Sohm v. Scholastic, Inc., 959 F. 3d 39, 51-51 (2d Cir. 2020).
The Court criticized the Second Circuit’s conclusion as “having no textual support” and being “essentially self-defeating.” Justice Kagan wrote, “[w]ith one hand, that court recognizes a discovery rule, thus enabling some copyright owners to sue for infringing acts occurring more than three years earlier. And with the other hand, the court takes away the value in what it has conferred, by preventing the recovery of damages for those older infringements. As the court below noted, the three-year damages bar thus ‘gut[s]’ or ‘silently eliminate[s]’ the discovery rule.” Warner Chappell Music, Inc., 2024 WL 2061137, at *4. Rather, “a copyright owner possessing a timely claim for infringement is entitled to damages, no matter when the infringement occurred.” Id.
The Court’s decision in Warner Chappell Music, Inc. is a clear victory for copyright plaintiffs. Musicians, writers, and other authors of protected work must still bring forth timely claims within the Copyright Act’s three-year limitations period, but if they can assert the discovery rule, their scope of recovery is unlimited in time.