SCOTUS ruling could affect spats over Mariah's 'Christmas,' Tupac tune
2023 IPDBRF 0143
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By Patrick H.J. Hughes
WESTLAW Intellectual Property Daily Briefing
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December 1, 2023
(December 1, 2023) - The U.S. Supreme Court will decide in coming months how damages should be calculated when copyright infringement that happened long ago is only recently discovered, and its decision could affect high-profile disputes involving popular music.
Warner Chappell Music Inc. et al. v. Nealy et al., No. 22-1078, petitioners' brief filed, (U.S. Nov. 27, 2023).
In their Nov. 27 opening brief to the high court, music labels Warner Chappell Music Inc. and Artist Publishing Group LLC urge the justices to establish that the limitations period for collecting damages starts when a plaintiff has a "complete and present cause of action, not when he discovers the injury."
"There is no sound basis for permitting retrospective relief for acts occurring more than three years before the filing of suit," the labels say.
"The whole music industry is watching to see what happens here," says Zach Al-Tabbaa, an intellectual property attorney with Hall Estill who is not involved in the high court dispute.
Carey released the song in 1994 and claimed to have written it when she was "a little girl," but the plaintiffs say they filed suit only recently because Carey's story had been disputed during a December 2022 podcast.
Al-Tabbaa also points to a suit over Tupac Shakur's "Dear Mama," released in 1995. Musician Terence Thomas filed the suit Nov. 18 against music label executives he says withheld royalties he deserved. Thomas v. Pizarro, No. 23-cv-10159, complaint filed (S.D.N.Y. Nov. 18, 2023).
Thomas alleges that he collaborated with Shakur and others on the tune, but only recently realized he was owed royalties when he saw the Hulu series "Dear Mama."
"These lawsuits concerning copyrights from works created decades ago, whether they succeed or not, could set a precedent for similar cases," Al-Tabbaa says. "Musician royalties have consistently been a source of dispute in the industry, and it's possible that the resolution of the Tupac case might inspire other artists to reexamine their royalty payments to ensure they are being adequately compensated for their contributions."
No more laches
The U.S. Supreme Court in 2014 resolved a question about the timeliness of suits similar to the ones concerning the tunes by Carey and Shakur. Before then, courts often nullified such suits under the doctrine of laches, a defense that lets defendants off the hook if they suffered prejudicial delay.
The high court held in Petrella v. Metro-Goldwyn-Mayer Inc., 572 U.S. 663 (2014), that laches could no longer be invoked to prevent a plaintiff from filing a copyright suit, but reserved judgment on the application of a limitations period for late-discovered infringement. Since Petrella, courts generally have followed a rule in which damages are calculated according to the statute of limitations — three years before the filing.
In the case before the 11th Circuit, the "discovery accrual rule" allowed a musician who failed to discover he was being denied royalties to recover damages from infringement that happened over a 10-year period.
The music labels, citing concerns over increased expenses and problems obtaining witnesses, persuaded the high court to intervene. Warner Chappell Music Inc. v. Nealy, No. 22-1078, cert. granted, (U.S. Sept. 29, 2023).
If not overturned, the 11th Circuit's ruling will create a situation in which "companies would be unable to manage risk responsibly in the face of the constant potential for massive recoveries based on long-past conduct," the labels say.
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