tion for damages in a case where the issue was not before it. Plainly the Court’s look-back language was simply a shorthand for the statute of limitations laid out in § 507(b) in incident of injury cases—where infringement and accrual occur simultaneously.
Nor does § 504, the provision of the Copyright Act governing damages, support the imposition of a damages bar. Rather, § 504 allows recovery for “actual damages … as a result of the infringement,” “any profits … attributable to the infringement,” 17 U.S.C. § 504(b), or “statutory damages for all infringements involved in the action,” id. § 504(c)(1) (emphasis added). Had Congress intended to limit recoverable damages or profits to those arising only from acts of infringement during the three-year period before suit was commenced, it would have said so, and said so in § 504, which sets forth detailed instructions as to the proper calculation of actual and statutory damages and profits.
Finally, unlike laches which serves to discourage a plaintiff from knowingly “sleeping upon his rights,” where the discovery rule applies, the plaintiff reasonably does not know that he is in such a slumber. Adopting a damages bar would mean that “a copyright plaintiff who, through no fault of its own, discovers an act of infringement more than three years after the infringement occurred would be out of luck. Such a harsh rule would distort the tenor of the statute.” Polar Bear, 384 F.3d at 706. “Section 507(b), like all statutes of limitations, is primarily intended to promote the timely prosecution of grievances and discourage needless delay.” Id. It makes little sense to bar recovery of damages beyond the three-years before the suit was filed where the copyright holder did not delay, but acted in accordance with § 507(b) by filing his complaint within three years of discovery. This is particularly true in a case such as this where the alleged infringer knows of and controls the infringing acts and the copyright holder has little means of discovering those acts. This would incentivize violation of the copyright holder’s exclusive rights, not protect those rights, which is the purpose of the Copyright Act itself.[1] As amici argue, with the constant evolution of technology, copyright infringement is now “easier to commit, harder to detect, and tougher to litigate.” Br. of Amici Curiae The Authors Guild, Inc. and Other Artists’ Rights Organizations in Sup. Of Pl.-Appellee & Affirmance at 3; see also William A. Graham Co. v. Haughey, 568 F.3d 425, 437 (3d Cir. 2009) (“Technological advances such as personal computing and the internet have [made] it more difficult for rights holders to stridently police and protect their copyrights.” (internal quotation marks and citation omitted)).
The district court correctly concluded that “the best read of Petrella is that it did not change any law in the Ninth Circuit pertaining to the discovery rule and the three year damages bar.” This is because the discovery rule is an exception to the general incident of injury rule. When copyright infringement occurs prior to discovery, a simple application of the general rule to the three-year statute of limitations in § 507(b), undertaken by the Court in Petrella, is impossible. Instead, the three-year limitations period begins only when the copyright holder knows or should know of the infringing act. Neither the text of the Copyright Act nor Petrella imposes a three-year damages bar in a discovery rule case.
- ↑ See 1 Nimmer, supra, § 1.02 (explaining that the Copyright Act, like all copyright laws, serves to promote the progress of science and other useful arts by providing protection for a limited time of certain exclusive rights in their works).
