No. 17-___
`
`IN THE
`Supreme Court of the United States
`————
`
`DRK PHOTO, a Sole Proprietorship,
`Petitioner,
`
`v.
`MCGRAW-HILL GLOBAL EDUCATION HOLDINGS, LLC
`and MCGRAW-HILL SCHOOL EDUCATION HOLDINGS, LLC,
`Respondents.
`
`————
`
`On Petition for a Writ of Certiorari to the
`United States Court of Appeals
`for the Ninth Circuit
`
`————
`
`PETITION FOR A WRIT OF CERTIORARI
`
`————
`
`CHRISTOPHER SEIDMAN
`HARMON SEIDMAN BRUSS
`& KERR, LLC
`101 South Third Street
`Suite 265
`Grand Junction, CO 81501
`(970) 245-9075
`
`MAURICE HARMON
`Counsel of Record
`HARMON SEIDMAN BRUSS
`& KERR, LLC
`11 Chestnut Street
`New Hope, PA 18938
`(917) 561-4434
`maurice@harmonseidman.com
`
`Counsel for Petitioner
`
`February 2, 2018
`
`WILSON-EPES PRINTING CO., INC. – (202) 789-0096 – WASHINGTON, D. C. 20002
`
`
`
`IN THE
`Supreme Court of the United States
`————
`
`DRK PHOTO, a Sole Proprietorship,
`Petitioner,
`
`v.
`MCGRAW-HILL GLOBAL EDUCATION HOLDINGS, LLC
`and MCGRAW-HILL SCHOOL EDUCATION HOLDINGS, LLC,
`Respondents.
`
`————
`
`On Petition for a Writ of Certiorari to the
`United States Court of Appeals
`for the Ninth Circuit
`
`————
`
`PETITION FOR A WRIT OF CERTIORARI
`
`————
`
`CHRISTOPHER SEIDMAN
`HARMON SEIDMAN BRUSS
`& KERR, LLC
`101 South Third Street
`Suite 265
`Grand Junction, CO 81501
`(970) 245-9075
`
`MAURICE HARMON
`Counsel of Record
`HARMON SEIDMAN BRUSS
`& KERR, LLC
`11 Chestnut Street
`New Hope, PA 18938
`(917) 561-4434
`maurice@harmonseidman.com
`
`Counsel for Petitioner
`
`February 2, 2018
`
`WILSON-EPES PRINTING CO., INC. – (202) 789-0096 – WASHINGTON, D. C. 20002
`
`
`
`QUESTIONS PRESENTED
`1. The Copyright Act provides that the “legal or
`beneficial owner” of copyright “is entitled” to institute
`an action for infringement, 17 U.S.C. § 501(b), but
`Section 501(b) does not say whether an assignee of an
`accrued infringement claim, who is not a copyright
`owner, has standing. The Ninth Circuit in this case
`held that Petitioner, a stock photography agency author-
`ized to issue licenses for use of photographs and share
`licensing revenue, is not a copyright owner and there-
`fore lacks standing to sue its licensee for infringing
`copyright. The Ninth Circuit so held even though 74
`of Petitioner’s contributing photographers executed
`assignments granting it “all copyright rights and com-
`plete legal title in the Images” at issue, together with
`accrued infringement claims.
`The first question is: Whether an assignee of an
`accrued claim who is not a legal or beneficial owner
`of copyright has standing to sue for infringement, as
`the Fifth Circuit ruled in Prather,1 or does not have
`standing, as the Ninth Circuit ruled in Silvers?2
`2. The second question is: Whether an unequivocal
`transfer of copyright ownership, together with accrued
`claims, is effective to give the transferee the statutory
`right to sue as legal owner of copyright, even when the
`purpose of the transfer is to facilitate an infringement
`action?
`3. The third question is: Whether “beneficial owner” –
`which the Copyright Act does not define – extends to
`an assignee of accrued claims who has pre-existing
`interests in the copyright and is injured by infringement?
`
`1 Prather v. Neva Paperbacks, Inc., 410 F.2d 698 (5th Cir. 1969).
`2 Silvers v. Sony Pictures Entm’t, Inc., 402 F.3d 881 (9th Cir.
`2005).
`
`(i)
`
`
`
`ii
`PARTIES TO THE PROCEEDING AND
`CORPORATE DISCLOSURE
`There are no parties to the proceedings other than
`those listed in the caption. Petitioner DRK Photo was
`plaintiff in the district court and appellant in the court
`of appeals. Respondents McGraw-Hill Global Education
`Holdings, LLC and McGraw-Hill School Education
`Holdings, LLC were defendants in the district court
`and appellees in the court of appeals.
`Petitioner DRK Photo, a sole proprietorship, is not
`subject to the corporate disclosure requirements of
`S. Ct. Rule 29.6.
`
`
`
`
`
`
`TABLE OF CONTENTS
`
`Page
`
`i
`
`ii
`vi
`1
`1
`1
`2
`5
`5
`
`6
`
`9
`11
`12
`12
`16
`18
`18
`
`QUESTION PRESENTED ..................................
`PARTIES TO THE PROCEEDING AND
`CORPORATE DISCLOSURE .........................
`TABLE OF AUTHORITIES ................................
`OPINIONS BELOW ............................................
`JURISDICTION ..................................................
`STATUTORY PROVISIONS INVOLVED ..........
`INTRODUCTION ................................................
`STATEMENT OF THE CASE ............................
`A. Statutory Background ..............................
`B. The fragmented decision in Silvers and
`the bare-right-to-sue rule .........................
`C. The parties and the transfers of copyright
`ownership and accrued claims at issue ....
`D. The District Court proceedings ................
`E. The Ninth Circuit proceedings .................
`1. The panel decision ...............................
`2. Judge Berzon’s concurrence ................
`3. Denial of rehearing en banc ................
`REASONS FOR GRANTING THE WRIT ..........
`
`
`
`
`
`(iii)
`
`
`
`iv
`TABLE OF CONTENTS—Continued
`
`Page
`
`I. THE PETITION SHOULD BE GRANTED
`TO RESOLVE A CIRCUIT-SPLIT
`REGARDING ASSIGNABILITY OF
`COPYRIGHT INFRINGEMENT CLAIMS
`TO A NON-OWNER OF COPY-RIGHT,
`AND THE ASSIGNEE’S STANDING TO
`PURSUE THEM .......................................
`A. Silvers conflicts with decisions of the
`Fifth and Second Circuits ...................
`B. The Ninth Circuit’s bare-right-to-sue
`rule is erroneous, and conflicts with
`the statutory text and this Court’s
`precedents ............................................
`II. THE PETITION SHOULD ALSO BE
`GRANTED TO RESOLVE CONFUSION
`ABOUT TRANS-FERS OF COPYRIGHT
`OWNERSHIP, AND THE EXTENT
`OF “BENEFICIAL OWNER-SHIP” OF
`COPYRIGHT .............................................
`A. The bare-right-to-sue rule leads to
`wasteful litigation invalidating crystal
`clear transfers of copyright ownership
`for purposes of litigation .....................
`B. The Court should take this oppor-
`tunity to examine the
`important
`question of who qualifies as “beneficial
`owner” of copy-right under the 1976
`Copyright Act .......................................
`
`19
`
`19
`
`24
`
`30
`
`30
`
`33
`
`
`
`
`
`
`
`
`v
`TABLE OF CONTENTS—Continued
`
`III. THIS CASE IS OF SUBSTANTIAL
`IMPORTANCE AND PRESENTS AN
`IDEAL VEHICLE FOR RESOLVING
`THE QUESTIONS PRESENTED ............
`CONCLUSION ....................................................
`
`APPENDIX
`
`Page
`
`35
`37
`
`1a
`
`APPENDIX A: OPINION, U.S. Court of
`Appeals for the Ninth Circuit (September
`12, 2017) .........................................................
`APPENDIX B: ORDER, U.S. Court of
`Appeals for the Ninth Circuit (November 7,
`2017) ............................................................... 28a
`APPENDIX C: ORDER, U.S. Court of
`Appeals for the Ninth Circuit (November 15,
`2017) ............................................................... 29a
`APPENDIX D: ORDER, U.S. District Court
`for the District of Arizona (June 10, 2014) .... 30a
`APPENDIX E: ORDER, U.S. District Court
`for the District of Arizona (January 8, 2015) 47a
`APPENDIX F: STATUTORY PROVISIONS
`INVOLVED .................................................... 49a
`17 U.S.C. § 101 .......................................... 49a
`17 U.S.C. § 106 .......................................... 49a
`17 U.S.C. § 201(d) ..................................... 50a
`17 U.S.C. § 301 .......................................... 51a
`
`
`
`
`
`
`
`
`
`
`vi
`TABLE OF AUTHORITIES
`
`CASES
`
`Page(s)
`
`9
`
`4
`
`A. Brod, Inc. v. SK & I Co., L.L.C.,
`998 F.Supp. 314 (S.D.N.Y. 1998) ..............
`ABKCO Music, Inc. v. Harrisongs Music, Ltd.,
`944 F.2d 971 (2d Cir. 1990) .....................passim
`Alaska Stock, LLC v. Houghton Mifflin
`Harcourt Publishing Co.,
`747 F.3d 673, 685 (9th Cir. 2014) .............
`Bandai America, Inc. v.
`Bally Midway Mfg. Co.,
`775 F.2d 70 (3d Cir. 1985) ........................ 16, 34
`BG Litigation Recovery I, LLC
`v. Barrick Gold Corp.,
`180 F.Supp.3d 316 (S.D.N.Y. 2016)..........
`Broadcast Music, Inc. v. Columbia
`Broadcasting System, Inc.,
`441 U.S. 1 (1979) .......................................
`Community for Creative
`Non-Violence v. Reid,
`490 U.S. 730 (1989) ...................................
`Corbello v. DeVito,
`777 F.3d 1058 (9th Cir. 2015) ...................
`Crown Die & Tool Co. v. Nye Tool
`& Machine Works,
`261 U.S. 24 (1923) .....................................
`Davis v. Blige,
`505 F.3d 90 (2d Cir. 2007) ........................ 21, 23
`Duncan v. Walker,
`533 U.S. 167 (2001) ................................... 16, 34
`
`28
`
`32
`
`26
`
`13
`
`29
`
`
`
`
`
`vii
`TABLE OF AUTHORITIES—Continued
`
`
`
`Page(s)
`
`29
`
`11
`
`29
`
`21
`
`29
`
`Eden Toys, Inc. v. Florelee
`Undergarment Co, Inc.
`697 F.2d 27 (2d Cir. 1982) ................ 7, 8, 28, 29
`Eldred v. Ashcroft,
`537 U.S. 186 (2003) ...................................
`Grant Heilman Photography, Inc. v. McGraw-
`Hill Global Educ. Holdings, LLC,
`2015 WL 1279502 (E.D. Pa. 2015) ...........
`Hacienda Records, L.P. v, Ramos.,
`__ Fed.Appx. __, 2018 WL 297163 (5th
`Cir. Jan. 4, 2018) ......................................passim
`Impression Products, Inc. v. Lexmark
`Intern., Inc.,
`137 S.Ct. 1523 (2017) ................................
`Isbell v. DM Records, Inc.,
`591 F.Supp.2d 871 (E.D. Tex. 2008),
`rev’d on other grounds, 586 F.3d 334
`(5th Cir. 2009) ...........................................
`Kirtsaeng v. John Wiley & Sons, Inc.,
`568 U.S. 519 (2013) ...................................
`Lexmark Intern., Inc. v. Static
`Control Components, Inc.,
`134 S.Ct. 1377 (2014) ...............................passim
`Mazer v. Stein,
`347 U.S. 201 (1954) ...................................
`Minden Pictures, Inc. v.
`John Wiley & Sons, Inc.,
`795 F.3d 997 (9th Cir. 2015) ......... 12, 13, 14, 18
`
`31
`
`
`
`
`
`viii
`TABLE OF AUTHORITIES—Continued
`
`
`
`Page(s)
`
`34
`
`33
`
`16
`
`Moran v. London Records, Ltd.,
`827 F.2d 180 (7th Cir. 1987) .....................
`Order of St. Benedict of
`New Jersey v. Steinhauser,
`234 U.S. 640 (1914) ...................................
`Parker v. Winwood,
`2017 WL 6886076 (M.D. Tenn. Oct. 17,
`2017) ..........................................................
`Prather v. Neva Paperbacks, Inc.,
`410 F.2d 698 (5th Cir. 1969) ....................passim
`Rawlings v. National Molasses Co.,
`394 F.2d 645 (9th Cir. 1968) .....................
`Ray Charles Foundation v. Robinson,
`795 F.3d 1109 (9th Cir. 2015) ............. 33, 34, 35
`Righthaven, LLC v. Hoehn,
`716 F.3d 1166 (9th Cir. 2013) ..................passim
`S.O.S., Inc. v. Payday, Inc.,
`886 F.2d 1081 (9th Cir. 1989) ...................
`Silvers v. Sony Pictures Entertainment, Inc.,
`2001 WL 36127624 (C.D. Cal. 2001),
`aff’d, 330 F.3d 1204 (9th Cir. 2003),
`reversed, 402 F.3d 881 (9th Cir. 2005)
`(en banc) ....................................................
`Silvers v. Sony Pictures Entertainment, Inc.,
`330 F.3d 1204 (9th Cir. 2003),
`reversed, 402 F.3d 881 (9th Cir. 2005)
`(en banc) ................................................ 6, 7, 19, 28
`
`33
`
`25
`
`6
`
`
`
`
`
`
`
`
`
`7
`
`29
`
`ix
`TABLE OF AUTHORITIES—Continued
`Page(s)
`Silvers v. Sony Pictures Entertainment, Inc.,
`370 F.3d 1252 (9th Cir. 2004) ...................
`Silvers v. Sony Pictures Entertainment, Inc.,
`402 F.3d 881 (9th Cir. 2005) (en banc) ....passim
`Sony Corp. of America v. Universal
`City Studios, Inc.,
`464 U.S. 417 (1984) ...................................
`Sprint Communications Co. L.P.
`v. APPC Services, Inc.,
`554 U.S. 269 (2008) ..................................passim
`Sygma Photo News, Inc.
`v. Globe International, Inc.,
`616 F.Supp. 1153 (S.D.N.Y. 1985) ............
`Topolos v. Caldeway,
`698 F.2d 991 (9th Cir. 1983) .....................
`U.S. v. Chalupnik,
`514 F.3d 748 (8th Cir. 2008) .....................
`Wallach v. Eaton Corp.,
`837 F.3d 356 (3d Cir. 2016) ......................
`Warner/Chappell Music, Inc.
`v. Blue Moon Ventures,
`2011 WL 662691 (M.D. Tenn. Feb. 14,
`2011) ..........................................................
`Wooster v. Crane & Co.,
`147 F. 515 (8th Cir. 1906) .........................
`Wu v. Pearson Educ., Inc.,
`277 F.R.D. 255 (S.D.N.Y. 2011), 2012
`WL 6681701 (S.D.N.Y. 2012) ....................
`
`36
`
`9
`
`35
`
`19
`
`27
`
`35
`
`36
`
`
`
`
`
`x
`TABLE OF AUTHORITIES—Continued
`
`CONSTITUTION
`
`Page(s)
`
`U.S. Const. art. III ........................................ 26, 27
`
`STATUTES AND REGULATIONS
`
`5
`17 U.S.C. § 28 (1909) ....................................
`17 U.S.C. § 101 ............................................. 2, 4
`17 U.S.C. § 101(b) (1909) ..............................
`20
`17 U.S.C. § 106 ............................................passim
`17 U.S.C. § 201 .............................................
`4
`17 U.S.C. § 201(d) ..................................... 2, 24, 30
`17 U.S.C. § 201(d)(2) ....................................
`4
`17 U.S.C. § 203 .............................................
`34
`17 U.S.C. § 301(a) ......................................... 2, 26
`17 U.S.C. § 301(b) .........................................
`2
`17 U.S.C. § 304(c) .........................................
`34
`17 U.S.C. § 501(b) ........................................passim
`28 U.S.C. § 1254(l) ........................................
`1
`28 U.S.C. § 1291 ...........................................
`1
`28 U.S.C. § 1331 ...........................................
`1
`28 U.S.C. § 1338 ...........................................
`1
`47 U.S.C. § 226 ............................................. 14, 26
`Act of May 21, 1790, 1st Cong., 2d Session,
`1 Stat. 124, § 1 ..........................................
`37 C.F.R. 202.3(a)(3).....................................
`
`5
`11
`
`
`
`
`
`
`
`xi
`TABLE OF AUTHORITIES—Continued
`
`RULES
`
`Page(s)
`
`Fed. R. Civ. P. 20 ..........................................
`
`18
`
`
`
`OTHER AUTHORITIES
`H.R. Rep. No. 1476, 94th Cong., 2d Sess.
`159, reprinted in 1976 U.S. Code Cong. &
`Ad. News 5659, 5775 ................................ 5, 34
`3 Nimmer on Copyright § 12.02[A] (2015) ..
`20
`3 Nimmer on Copyright § 12.02[B]
`(2000) ............................................... 6, 20, 21, 28
`3 Nimmer on Copyright § 12.02[C] (2015) .. 8, 20
`2 Party on Copyright (2017) .........................
`20
`R. Blair & T. Cotter, The Elusive Logic
`of Standing Doctrine in Intellectual
`Property, 74 TUL. L. REV. 1323 (2000) ......
`S. Balganesh, Copyright Infringement
`Markets, 113 COLUM. L. REV. 2277
`(2013) ............................................. 14, 20, 26, 27
`
`30
`
`
`
`
`
`PETITION FOR A WRIT OF CERTIORARI
`DRK Photo respectfully petitions for a writ of
`certiorari to review the judgment of the United States
`Court of Appeals for the Ninth Circuit in this case.
`
`OPINIONS BELOW
`The opinion of the United States Court of Appeals
`for the Ninth Circuit, App. 1a-27a, is reported at 870
`F.3d 978. The opinion of the United States District
`Court for the District of Arizona, App. 30a-46a, is not
`reported but is available at 2014 WL 2584811.
`
`JURISDICTION
`The district court had jurisdiction under 28 U.S.C.
`§§ 1331 and 1338, and Ninth Circuit had jurisdiction
`under 28 U.S.C. § 1291. The Ninth Circuit denied
`Petitioner’s timely-filed petition for rehearing on
`November 7, 2017. App. 28a. This Court’s jurisdiction
`rests on 28 U.S.C. § 1254(1).
`
`STATUTORY PROVISIONS INVOLVED
`Section 501(b) of the Copyright Act provides:
`The legal or beneficial owner of an exclusive
`right under a copyright is entitled, subject to
`the requirements of section 411, to institute
`an action for infringement of that particular
`right committed while he or she is the owner
`of it. The court may require such owner to
`serve written notice of the action with a copy
`of the complaint upon any person shown, by
`the records of the Copyright Office or other-
`wise, to have or claim an interest in the
`copyright, and shall require that such notice
`be served upon any person whose interest is
`likely to be affected by a decision in the case.
`
`
`
`2
`The court may require the joinder, and shall
`permit the intervention, of any person having
`or claiming an interest in the copyright.1
`Other pertinent sections of the Copyright Act (17
`U.S.C. §§ 101 (definitions), 106 (exclusive rights in
`copyright work), 201(d) (transfer of ownership), and
`301(a) and (b) (preemption)) are reproduced in the
`Appendix.
`
`INTRODUCTION
`This copyright case presents the “now often litigated
`issue of whether a stock photography agency ... has
`standing under the Copyright Act of 1976 to pursue
`infringement claims involving photographs from its
`collection.” App. 3a.
`The Act’s core purpose is to encourage dissemination
`of creative works for the public benefit by making
`copyrights enforceable – not just in theory, but as a
`practical matter. The decision below applied three
`rigid standing rules – each meriting this Court’s
`review – which bar enforcement efforts by parties best
`situated to pursue them and allow infringers to escape
`accountability.
`First, the decision below perpetuates a circuit split
`on the question whether a plaintiff to whom accrued
`copyright infringement claims have been assigned has
`standing to pursue the claims if the plaintiff is not
`also a “legal or beneficial owner of copyright” under
`17 U.S.C. § 501(b). Constrained by the Ninth Circuit’s
`“bare-right-to-sue” rule in Silvers v. Sony Pictures
`Entm’t, Inc.2 – split 7-2-2 with two dissents, and
`
`
`1 17 U.S.C. § 501(b).
`2 402 F.3d 881 (9th Cir. 2005).
`
`
`
`3
`“wrongly decided,” in Judge Berzon’s view (App. 23a)
`– the decision below held Petitioner DRK Photo cannot
`rely on assignments of accrued claims for standing
`because DRK is neither a legal nor beneficial owner of
`copyright.
`The Silvers bare-right-to-sue rule conflicts with
`Prather v. Neva Paperbacks, Inc.,3 where the Fifth
`Circuit held an “assignee of all choses in action for
`infringement, whether a ‘proprietor’ [of copyright] or
`not, has standing to sue.”4 Silvers also conflicts with
`this Court’s holding in Sprint Communications Co.
`L.P. v. APPC Services, Inc.5 that assignees of aggre-
`gated, accrued claims under another federal statute
`(the Communications Act) had standing to pursue the
`claims.
`Second, the decision below found that 74 photo-
`graphers’ unambiguous assignments to DRK of “all
`copyright rights and complete legal title in the Images,”
`together with accrued claims, (App. 5a-6a) transferred
`only accrued claims and no copyright interest. Imple-
`menting the bare-right-to-sue rule, Righthaven, LLC
`v. Hoehn6 held courts must second-guess and invalidate
`agreements purporting to transfer copyright owner-
`ship if the purpose of the transfer is to facilitate an
`infringement action. Constrained by Righthaven, the
`decision below held DRK cannot rely on crystal-clear
`assignments of copyright ownership for standing,
`because their purpose was to give DRK standing to
`
`
`3 410 F.2d 698 (5th Cir. 1969).
`4 Id. at 700.
`5 554 U.S. 269 (2008).
`6 716 F.3d 1166 (9th Cir. 2013).
`
`
`
`4
`sue, and the authors of the photographs retained some
`rights in them. App. 17a-19a.
`Silvers and Righthaven together undermine the
`principles of free transferability and divisibility of
`copyright ownership that are hallmarks of the 1976
`Copyright Act. 17 U.S.C. § 201(d)(2) authorizes unlim-
`ited subdivision and transfer of an owner’s “exclusive
`rights,” identified in 17 U.S.C. § 106, which can be
`co-owned.7 There is no statutory limit on the number
`of co-owners of copyright, and no rule that only an
`“exclusive license” transfers copyright ownership.8 Nor
`does the Act prohibit a transfer of copyright ownership
`for purposes of litigation. Rejecting these principles,
`the decision below invalidated the photographers’
`transfer of an ownership interest sufficient to support
`DRK’s standing.
`This result conflicts with the Ninth Circuit’s holding
`in Alaska Stock, LLC v. Houghton Mifflin Harcourt
`Publishing Co.9 – at the urging of the Copyright Office
`and the United States as amicus curiae – that tempo-
`rary transfers of copyright ownership are effective and
`support stock photography agencies’ registrations of
`copyright. Here, the very same assignments that
`supported DRK’s copyright registrations, as copyright
`owner, were held to be “shams” for purposes of prose-
`cuting an infringement action.
`Third, despite DRK’s undisputed interest in the copy-
`rights (as grantor of the limited licenses at issue) and
`its injuries from serial infringements (lost licensing
`
`7 See, e.g., 17 U.S.C. § 201 (“The authors of a joint work are
`coowners of copyright in the work.”).
`8 See 17 U.S.C. § 101 (defining “transfer of copyright owner-
`ship”).
`9 747 F.3d 673, 685 (9th Cir. 2014).
`
`
`
`5
`revenue), the decision below held DRK does not have
`standing to sue as “beneficial owner” of copyright.
`App. 20a-21a. The Act does not define “beneficial
`owner,” and the lower courts consistently limit it to the
`single example in the legislative history (an author
`who parts with legal title in exchange for royalties).10
`The copyright holders’ transfer to DRK of the right to
`authorize others to use their copyrighted works, along
`with the right to share licensing proceeds, conveys
`beneficial ownership to DRK sufficient for standing
`under § 501(b). The extent of beneficial ownership of
`copyright under the 1976 Act is an important issue of
`federal law that this Court has not addressed, and
`should consider now.
`
`STATEMENT OF THE CASE
`A. Statutory background.
`Copyright statutes have long recognized that copy-
`right ownership is transferable.11 But no act of
`Congress has expressly addressed, or prohibited, assign-
`ment of accrued infringement claims. Yet, “where
`Congress chooses to expressly prohibit assignment, it
`knows how to do so explicitly.”12
`
`
`10 H.R. Rep. No. 1476, 94th Cong., 2d Sess. 159, reprinted in
`1976 U.S. Code Cong. & Ad. News 5659, 5775.
`11 See, e.g., Act of May 21, 1790, 1st Cong., 2d Session, 1 Stat.
`124, § 1 (conferring rights upon authors and assigns who “legally
`acquired the copyright”); 17 U.S.C. § 28 (1909) (“Copyright
`secured under this title or previous copyright laws of the United
`States may be assigned, granted, or mortgaged by an instrument
`in writing signed by the proprietor of the copyright, or may be
`bequeathed by will.”).
`12 Silvers, 402 F.3d at 900 (Bea, J., dissenting).
`
`
`
`6
`B. The fragmented decision in Silvers and the
`bare-right-to-sue rule.
`As Judge Berzon explained in her concurrence in
`this case, the holding that DRK lacks standing turned
`upon the Silvers bare-right-to-sue rule. App. 23a.
`The plaintiff in Silvers alleged defendants’ motion
`picture “Stepmom” infringed copyright in the tele-
`vision movie “The Other Woman,” written by Silvers
`as a work-for-hire for Frank & Bob Films II. She
`asserted standing to sue because Frank & Bob, the
`copyright owner, “assigned to her the accrued cause
`of action.”13 The district court found Silvers had
`standing, citing Nimmer on Copyright § 12.02[B]
`(2000). Citing Prather, Nimmer stated that “the
`assignee of an accrued infringement cause of action
`has standing to sue without the need to join his
`assignor, even if the latter retains ownership of all
`other rights under the copyright.” Id. Finding this
`“not a settled question of law,” the district court
`certified interlocutory appeal.14
`A three-judge Ninth Circuit panel affirmed.15 It
`found “no court ha[d] squarely resolved the issue”
`whether “an accrued cause of action for copyright
`infringement may be assigned to a third party,
`without any other copyright rights accompanying the
`assignment.”16 It agreed with Prather – the “authority
`closest on point” – and held “an accrued cause of action
`
`
`13 Silvers v. Sony Pictures Entm’t, Inc., 2001 WL 36127624, at
`*1 (C.D. Cal. Jan. 25, 2001).
`14 2001 WL 36127626, at *1 (C.D. Cal. Mar. 29, 2001).
`15 330 F.3d 1204 (9th Cir. 2003).
`16 Id. at 1206.
`
`
`
`7
`for copyright infringement may be assigned to a third
`party.”17
`The three-judge panel found defendants’ reliance on
`Eden Toys, Inc. v. Florelee Undergarment Co, Inc.18
`misplaced, because there was no “bare right to sue”
`issue in Eden Toys. The standing problem in Eden
`Toys arose not from plaintiff’s lack of copyright owner-
`ship, but from the lack of any clear transfer to plaintiff
`of any right to sue on accrued causes of action.19 The
`three-judge panel also “disagree[d] with Eden Toys to
`the extent that it suggests that 17 U.S.C. § 501(b)
`permits only the legal or beneficial owner of a copy-
`right to bring an action for copyright infringement.”20
`“Nothing in the language of § 501(b) specifies or
`suggests that the legal or beneficial owners are the
`exclusive plaintiffs in copyright infringement cases.”21
`And “[n]othing in the statute prohibits the legal or
`beneficial owner of the exclusive rights under a copy-
`right from assigning an accrued cause of action for
`infringement of that right. Such an assignment is like
`assignment of any other chose in action under contract
`theory.”22
`The Ninth Circuit granted rehearing en banc.23
`Over two detailed and compelling dissents, divided
`7-2-2, the Ninth Circuit reversed.24 The majority held
`
`17 Id.
`18 697 F.2d 27 (2d Cir. 1982).
`19 Silvers, 330 F.3d at 1208.
`20 Id. (original emphasis).
`21 Id.
`22 Id.
`23 370 F.3d 1252 (9th Cir. 2004).
`24 402 F.3d 881 (9th Cir. 2005).
`
`
`
`8
`the “bare assignment of an accrued cause of action is
`impermissible under 17 U.S.C. § 501(b),” and found
`that is all the plaintiff held.25
`The fractured end result in Silvers reflects three
`divergent views: (1) the majority’s absolute prohibition
`against assignments of the “bare right to sue” regard-
`less of the assignee’s legitimate interest in the copyright,
`or the assignee’s injury as a result of infringement;
`(2) Judge Bea’s view (joined by Judge Kleinfeld)
`that there is nothing wrong with an entirely free
`“aftermarket in accrued causes of action for copyright
`infringement”;26 and (3) the “middle course” advocated
`by Judge Berzon (joined by Judge Reinhardt) –
`specifically, that “Silvers, given her status as the
`original creator of the contested ‘work-for-hire,’ may
`pursue the accrued claims assigned by Frank & Bob
`Films, while a complete stranger to the creative
`process could not.”27
`The Ninth Circuit judges deciding Silvers en banc
`could not even agree about how to avoid a circuit
`split.28 The majority concluded, in error, that its hold-
`ing was “parallel” with the Second Circuit’s decision in
`Eden Toys, and it wrongly brushed Prather aside as a
`1909 Act case.29 But in the view of Judges Bea and
`Kleinfeld, “Eden Toys is inapposite,” and to “avoid the
`
`
`25 Id. at 890.
`26 Id. at 905 (Bea, J., dissenting).
`27 402 F.3d at 891 (Berzon, J., dissenting).
`28 See 3 Nimmer on Copyright § 12.02[C] (2015) (two dissenters
`“forcefully characterized their views, rather than the majority’s,
`as avoiding a circuit conflict”), and n. 69.
`29 402 F.3d at 889-90, and n. 2.
`
`
`
`9
`creation of a circuit split” the Ninth Circuit should
`have followed “the rationale of Prather.”30
`In sum, Silvers created more confusion than it
`resolved.
`The Ninth Circuit then made matters worse in
`Righthaven, which held “the purported transfer of
`legal title coupled with the transfer of accrued claims
`does not confer standing when the transaction, in
`substance and effect, merely transfers a bare right
`to sue.” App. 14a-15a. The bare-right-to-sue rule, as
`applied in Righthaven, has led courts to second-guess
`and invalidate part of assignments – only the part
`transferring copyright ownership – when the parties
`transfer copyright ownership for the purpose of
`facilitating an infringement action. But absent fraud,
`there is nothing wrong with transferring copyright
`ownership together with accrued claims for purposes
`of copyright infringement litigation. Justice Sotomayor,
`when she was a District Court judge in New York,
`found no fault in a “temporary assign[ment]” of copy-
`right ownership “for purposes of ... litigation.”31
`
`C. The parties and the transfers of copyright
`ownership and accrued claims at issue.
`DRK is a stock photography agency that licenses use
`of images created by its contributing photographers to
`publishing entities, including Respondents McGraw-
`
`
`30 402 F.3d at 907 (Bea, J., dissenting).
`31 A. Brod, Inc. v. SK & I Co., L.L.C., 998 F.Supp. 314, 324
`(S.D.N.Y. 1998); see also Sygma Photo News, Inc. v. Globe Int’l,
`Inc., 616 F.Supp. 1153, 1155-58 (S.D.N.Y. 1985) (granting leave
`to amend based on photographer’s assignment of copyrights in
`photographs of Royal Family “for the sole and exclusive purpose
`of prosecuting” copyright infringement claims).
`
`
`
`10
`Hill Global Education Holdings, LLC and McGraw-
`Hill School Education Holdings, LLC (collectively,
`“McGraw-Hill”). App. 4a. Since its inception in 1981,
`DRK has built a collection of hundreds of thousands of
`photographs, primarily depicting worldwide wildlife,
`marine life, and natural history. Id. McGraw-Hill
`publishes K-12 educational, post-secondary, profes-
`sional, and trade textbooks and publications. Id.
`From about 1992 to 2009, DRK granted hundreds of
`limited licenses to McGraw-Hill for use of images from
`DRK’s collection in McGraw-Hill’s textbooks. Id.
`Before issuing licenses to McGraw-Hill, DRK entered
`into “Representation Agreements” with photographers
`whose images are in DRK’s collection. App. 4a-5a.
`With respect to the claims on appeal, DRK was appointed
`nonexclusive agent to license covered photographs.
`App. 4a, n. 1. Each Agreement empowered DRK to act
`as “agent with ... respect to the sale or leasing of the
`photographs or transparencies” delivered to DRK, and
`provide that DRK and the photographer split evenly
`the proceeds from licenses granted by DRK. App.
`4a-5a.
`Each photographer also executed a “Copyright
`Assignment, Registration, and Accrued Causes of
`Action Agreement” (“Assignment”), which provides in
`pertinent part:
`The undersigned photographer ... grants to
`DRK all copyrights and complete legal title in
`the Images. DRK agrees to reassign all copy-
`rights and complete legal title back to the
`undersigned immediately upon completion
`of the registration of the Images ... and
`resolution of infringement claims brought by
`DRK relating to the Images.
`
`
`
`11
`The undersigned agrees and fully transfers
`all right, title and interest in any accrued or
`later accrued claims, causes of action, choses
`of action ... or lawsuits, brought to enforce
`copyrights in the Images, appointing and
`permitting DRK to prosecute said accrued or
`later accrued claims, causes of action, choses
`in action or lawsuits, as if it were the
`undersigned.
`App. 5a-6a. The Assignments also provide that
`DRK and the photographers will share equally the
`net proceeds of any litigation award or settlement.
`App. 6a.
`As assignee of copyright ownership, and as copy-
`right “claimant,”32 DRK obtained 244 certificates of
`copyright registration for images at issue.
`
`D. The District Court proceedings.
`In May 2012, DRK sued McGraw-Hill, asserting it
`infringed copyright by printing and distributing more
`textbooks containing at-issue images than the DRK-
`issued licenses permitted. DRK asserted 1,120 claims
`of infringement regarding 636 unique photographs,
`created by 74 of DRK’s contributing photographers.
`App. 7a.33
`
`
`32 37 C.F.R. 202.3(a)(3) (“copyright claimant” includes “(ii) A
`person or organization that has obtained ownership of all rights
`under the copyright initially belonging to the author.”).
`33 McGraw-Hill is an adjudicated infringer of copyright in cases
`like this one. See Grant Heilman Photography, Inc. v. McGraw-
`Hill Global Educ. Holdings, LLC, 2015 WL 1279502, at *3 (E.D.
`Pa. Mar. 20, 2015) (jury found McGraw-Hill infringed copyright
`53 times by exceeding limited licenses issued by stock photog-
`raphy agency).
`
`
`
`12
`The district court granted partial summary judg-
`ment to McGraw-Hill, finding DRK lacks standing
`with respect to photographs taken by photographers
`for whom DRK was “nonexclusive agent.”34 App. 30a.
`The district court found the Representation Agree-
`ments did not grant DRK any “exclusive rights” under
`Section 106 – even though the Agreements gave DRK
`the power “to authorize,” i.e., grant licenses – and
`instead were non-exclusive licenses. App. 40a. Citing
`Righthaven, the district court found the Assignments,
`in substance and effect, conveyed to DRK nothing
`more than the “bare right to sue,” even though each
`Assignment grants to DRK “all copyrights and com-
`plete legal title in the Images.” App. 41a. The district
`court also found DRK is not a “beneficial o
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