The Supreme Court’s 2014 decision in Petrella v. MGM generated debate over whether the “discovery rule” allows copyright plaintiffs to access damages accrued outside the three-year statute of limitations. The Second Circuit has resolved that debate in favor of defendants, holding that copyright damages cannot extend beyond the three-year window before suit is filed.
Petrella seemed unequivocally to impose a three-year limitation on copyright damages. It observed that the Copyright Act “bars relief of any kind for conduct occurring prior to the three-year limitations period.” Petrella v. Metro-Goldwyn-Mayer, Inc., 572 U.S. 663, 667 (2014). Some copyright plaintiffs nonetheless pointed to a footnote in Petrella—in which the Court stated that it was not “pass[ing] on” the discovery rule, id. at 670 n.4—to argue that recovery for infringement outside the three-year limitations period is still permitted so long as suit is filed within three years of the plaintiff’s discovery of the alleged infringement.
The Second Circuit has now resolved this question in favor of defendants in Sohm v. Scholastic Inc., 959 F.3d 39, 45 (2d Cir. 2020). In Sohm, a photographer sued a book publisher for exceeding the scope of its license to reproduce plaintiff’s photographs. Some of the alleged infringements occurred more than three years before the filing of the lawsuit. 959 F.3d at 44.
Sohm held that, although the discovery rule is still theoretically viable after Petrella, the Supreme Court nonetheless limited damages for copyright actions to the three years prior to the filing of the lawsuit. As the Second Circuit put it, “[d]espite not passing on the propriety of the discovery rule in Petrella, the Supreme Court explicitly delimited damages to the three years prior to the commencement of a copyright infringement action.” Id. at 51 (emphasis added). Consequently, even if the discovery rule might bear on the time limit for Petrella’s filing of his lawsuit, damages outside the three-year window prior to filing could not be recovered. Id. at 52.
Conrad & Metlitkzy is continuing to follow developments in federal jurisprudence relating to copyright damages and defenses in the wake of Petrella. Check out our firm’s blog for our latest observations on the issue.