Supreme Court: In Copyright, Laches Cannot Preclude Actions Taken Within Three Year Statute of Limitations

By Dennis Crouch

Petrella v. MGM (Supreme Court 2014)

Frank Petrella wrote a screenplay back in 1963 based on the life of Jake LaMotta and assigned rights to UA/MGM who made the movie Raging Bull. Under the old renewal system, renewal rights went to Petrella’s heir, Paula Petrella, who renewed the copyright in 1991 in a fashion that (seemingly) eliminates the prior license. In 1998 she informed MGM that its continued exploitation of the Raging Bull movie violated her copyright. Finally, in 2009, she did sue – alleging copyright infringement.

Copyright infringement has a three-year statute of limitations indicating that “No civil action shall be maintained under the [Act] unless it is commenced within three years after the claim accrued.” 17 U.S.C. §507(b). However, as in patent law, copyright follows a “separate-accrual rule” that sees each successive violation of a copyright as a new infringing act with its own statute of limitations. Thus, under the statute of limitations, MGM could be liable for its post-2006 actions such as copying and distributing the work.

In the lawsuit, MGM separately asserted the equitable defense of laches based upon the long and unreasonable delay in bringing suit.

In a 6-3 decision, the Supreme Court has sided with Petrella – finding that the statute of limitations does all the work on the question of liability – leaving latches only to potentially shape the remedy.

Laches, we hold, cannot be invoked to preclude adjudication of a claim for damages brought within the three-year window. As to equitable relief, in extraordinary circumstances, laches may bar at the very threshold the particular relief requested by the plaintiff. And a plaintiff’s delay can always be brought to bear at the remedial stage.

The court was clear that equitable estoppel may also apply, but that generally requires some affirmative act by the rights-holder (that leads to

In a footnote, the court draws some parallels with the six-year statute of limitations for collecting back-damages in patent law. 35 U.S.C. § 286. In a 1992 en banc decision, the Federal Circuit held that laches can be an additional bar to collecting back-damages even within the six-year limit. A. C. Aukerman Co. v. R. L. Chaides Constr. Co., 960 F. 2d 1020 (Fed. Cir. 1992) (en banc). Noting that decision, the Supreme Court here only remarked that “We have not had occasion to review the Federal Circuit’s position.”

One interesting aspect of the decision was the unusual split between the majority and dissent. Justice Ginsburg penned the majority opinion that was joined by Justices Scalia, Thomas, Alito, Sotomayor, and Kagen.  Justice Breyer dissented and was joined by Chief Justice Roberts and Justice Kennedy.

41 thoughts on “Supreme Court: In Copyright, Laches Cannot Preclude Actions Taken Within Three Year Statute of Limitations

  1. Anonymous, re Petralla, the holding was, in addition to the facts, that a legal claim with a SOL is not subject to a laches defense.

    Laches, they noted in dicta, was an equitable defense that could bar an equitable remedy.

    Shift to patents: unless there is legislative history that compels a different outcome, the above now applies to patent cases. Legal claims are not barred because of the patent SOL. Equitable remedies can be – that means injunctions, preliminary and post, can be barred by laches.

  2. Dennis,

    I’m very familiar with laches as well as estoppel from the patent side. See Laches and Estoppel: The Patentee Who Procrastinates in Filing Suit May Be Lost, AIPLA Quarterly Journal, Vol. 31, No. 1 (Winter 2003). Actually, Aukerman didn’t hold that laches in patent infringement cases could occur prior to 6 years (it simply referred to some early Federal Circuit cases that had so held), but merely established that a delay of at least 6 years in bringing suit created a “presumption” of laches (know as the “Aukerman presumption”). In fact, the Federal Circuit showed extreme reluctance to apply laches unless there had been a delay in filing suit for more than 6 years.

    Frankly, I agree with the dissenters in Petrella. The majority takes the view (incorrect in my opinion) that the equitable defense of laches is inconsistent with the statute of limitations for damages. It is not. What laches bars is recovery of any damages that have occurred prior to the filing of the suit, but not the recovery of damages after the date of filing of the suit. In other words, even if laches applies, damages may still be recovered (albeit only those incurred after the filing of the suit) as long as the suit is filed within the statute of limitations. Also, laches requires not just unreasonable delay in bringing suit, but also prejudicial reliance on such delay. That’s why a laches defense was rarely successful if the delay period didn’t exceed the corresponding statute of limitations. Also, imposition of laches is always “at the discretion” of the trial court to impose.

    1. Just to be clear, EG, damages are barred by laches in Aukerman, and this is not possible under Petrella.

      From the case,

      “In summary, for reasons to be more fully discussed, we hold with respect to laches:

      1. Laches is cognizable under 35 U.S.C. § 282 (1988) as an equitable defense to a claim for patent infringement.
      2. Where the defense of laches is established, the patentee’s claim for damages prior to suit may be barred.
      3. Two elements underlie the defense of laches: (a) the patentee’s delay in bringing suit was unreasonable and inexcusable, and (b) the alleged infringer suffered material prejudice attributable to the delay. The district court should consider these factors and all of the evidence and other circumstances to determine whether equity should intercede to bar pre-filing damages.
      4. A presumption of laches arises where a patentee delays bringing suit for more than six years after the date the patentee knew or should have known of the alleged infringer’s activity.
      5. A presumption has the effect of shifting the burden of going forward with evidence, not the burden of persuasion.”

      1. Anonymous,

        You’re correct that laches merely requires prejudice (due to the delay), while (equitable) estoppel also requires detrimental reliance on patentee conduct that materially prejudices the accused infringer, usually as a threat to sue by the patentee that the patentee fails to follow through with (followed by a long period of silence before filing suit) for which the period of delay(e.g., silence) can be as little as 3.5 years as was held in the 1998 Federal Circuit decision of Scholle Corp. v. Blackhawk Molding Co.

        1. Anonymous: have you read Petrella?

          Notice of infringement.
          Ten year delay.
          Suit.

          No estoppel. Laches does not apply.

          1. Ned,

            Yes, I have read the decision (although not the dissent). But, I’m not sure why you ask. I was responding to EG’s comment, which stated:

            “Also, laches requires not just unreasonable delay in bringing suit, but also prejudicial reliance on such delay.”

            I didn’t think this was technically correct, so I posted. EG in turn responded responded and clarified his original post, along with case law citation.

            My comment was not directed at you though, Ned. There may just be some confusion. Sometimes its hard to see who is responding to whom on these comments, and it looks like you responded to some of my other posts below.

            While, I’m talking with you though, you did make this statement below:

            “According to the SC, laches bars equitable claims and does not apply to legal. The Federal Circuit would allow equitable claims and bar damages.”

            I don’t think the Supreme Court actually held this in Petrella. That may be the case, but the issue wasn’t actually before the Court. I think it’s an open question whether laches can apply to legal relief where there is not a statute of limitations. (But I wouldn’t put patents in that bucket, because section 286 is effectively a statute of limitations, even if not technically.) Some of the earlier Supreme Court cases (cited by Petrella) indicate that you are right, but I just don’t think Petrella definitively answered that question. (And while I think Aukerman should be dead, trademarksmay be distinguishable for the reason given in the Supreme Court’s footnote, although I have not studied that issue.)

  3. Since this Sup. Ct. copyright decision has stirred up renewed interest in the viability of Fed. Cir. case law on patent suit laches, here is some of it of
    particular interest:
    Wanlass v. General Electric Co., 148 F.3d 1334 (Fed. Cir. 1998).
    Wanlass v. Fedders, 145 F.3d 1461 (Fed. Cir. 1998).
    A.C. Aukerman Co. v. R.L. Chaides Construction Co., 960 F.2d at 1032, 22
    USPQ2d 1321 (CAFC March, 1992) (en banc)
    Note that although the Wanlass v. Fedders case was published before
    the GE case, and is an arguably inconsistent decision by a different panel
    as to the same patent, the Wanlass v. General Electric case was decided
    before Fedders. [Wanlass v. GE was decided on 8 June 1998. Wanlass v.
    Fedders was decided on 18 June 1998.] Therefore, in my opinion, Wanlass v.
    GE should control under CAFC stare decisis law.
    In Wanlass v. General Electric the he Federal Circuit upheld a
    summary judgment against inventor Wanlass based on “laches.” Wanlass did
    not sue GE until 1995 for infringing his patent on a “run capacitor”
    electric motor issued years earlier. He alleged GE’s infringement began in
    1986. He did not ever test GE products for infringement until 1992, even
    though they were available to him to do so. The Federal Circuit said he
    should have known of GE’s infringement before 1989, and he thus failed to rebut
    the presumption, which is raised by a delay of more than six years, that his
    delay prejudiced GE. [Judge Rader dissented, arguing that Wanlass did not
    have a duty to police the marketplace.]
    {Note the prior, en banc, CAFC Auckerman case for the CAFC’s 6
    year patent enforcement laches presumption, and its exceptions and
    limitations.}

    1. It is clear that the Federal Circuit has the doctrine of latches wrong in two ways, it denies damages but authorizes an injunction.

      I was reviewing the Supreme Court case Lane and Bodley that the Federal Circuit relied upon in part for its holding in Aukerman. While the Court spoke of laches, in truth, the defense sounded in equitable estoppel — an employee’s continued employment for a long period of time without asserting his patent after having informed the employer of the existence of the patent was misleading. The Supreme Court held in Petrella that estoppel was a proper defense to a legal remedy.

      1. Ned, the Federal Circuit doctrine on laches isn’t wrong. See my comment above. Laches only bars recovery of damages prior to the filing of the suit. Estoppel bars all recovery by the patentee, including denying injunctive relief.

        1. EG, The SC made the distinction between estoppel and laches, and did not cite any of the SC cases that the Federal Circuit relied on in Aukerman. That got me wondering. Was the SC overturning precedent to the contrary?

          So, I read the case cited by Aukerman, Land & Bodley. While the court said laches, it had all the elements of estoppel.

          Thus, I think there is some confusion in the Supreme Court case law.

          But, now there is none.

          Laches will not bar a legal remedy with a SOL.

          Thus, I think all future litigators will instead assert estoppel.

          But Petralla is also interesting on the point that notice of infringement was given, and still this did not count as estoppel. There has to be something misleading in the statement, as in, I will not sue you.

          1. I will not sue you“…

            … on what exactly?

            Remember Ned, this case is dealing with copyright issues and a new issue occurs with each new copyright infringement offense.

            One can easily see (with facts not present) a hypothetical situation in which someone says I will not sue you on your transgressions that occurred prior to X date. Clearly, there is no estoppel created for transgressions that occur after X date – without more, such as some question and reliance that the “no-sue” statement was more than just applicable to those acts prior to X date.

        2. Well, above you say that you agree with the dissenters. So you may think that the Federal Circuit is correct, but it does appear to be inconsistent with Petrella. Or do you disagree with that?

          1. Anonymous, I don’t understand why EG is continuing arguing that the Federal Circuit doctrine of laches is good law.

            As noted above, a notice of infringement combined with long silence is not enough to bar right to damages prior to filing suit. That is not estoppel per Petrella, and laches does not apply as a matter of law to legal claims having a SOL. The Court did not limit its holding to copyright.

            I would be very surprised if the Supreme Court would allow patent law to be unique on this issue unless the statue specifically stated that laches was an available defense to damages. It does not.

  4. In related news:

    link to time.com

    You may have never heard of the band Spirit, but Led Zeppelin has. Not only did they play shows with Zeppelin in 1969, but Spirit has also now sued them for allegedly lifting what may be one of the most famous riffs in rock history — the opening notes of “Stairway to Heaven.” ….

    “It’s been a long time coming,” attorney Francis Alexander Malofiy said in Bloomberg Businessweek. Malofiy is representing a trust for writer Randy California, the deceased Spirit guitarist who wrote “Taurus,” the instrumental track that appeared on the band’s eponymous 1968 debut album and from which the chord progression is allegedly lifted.In 1997, California went public with his claims about the origins of “Stairway to Heaven.” “I’d say it was a ripoff,” California said in Listener magazine. “And the guys made millions of bucks on it and never said ‘Thank you,’ never said, ‘Can we pay you some money for it?’ It’s kind of a sore point with me.” However, California and Spirit never sued, even though fans had noted the similarity between the songs for years. “Nobody had any money, and they thought the statute of limitations was done,” Mick Skidmore, who manages California’s trust, explained to Businessweek.

    The Spirit track begins with four similar descending chords which resolve completely differently. If this is enough for a copyright suit, then US copyright law is an even bigger joke than I thought.

    That’s not to mention the fact that the suit should have been brought forty years ago.

  5. There is NO true statute of limitations, or statute of repose, for patent infringement suits! There is merely a statutory limit of six years on recoveries for back damages prior to bringing suit of 35 USC 286. Not any time limit on when suit can be brought. Thus, suit can be brought for injunctions and/or damages at any time until the patent expires [ 20 or more years from the formal U.S. filing date or 17 years from the issued date for older patents], and even up to six years later than that for suits for partial past damages. Other than that, there is only the relatively weak equitable doctrines of laches and estoppel. The latter is rarely provable and the former (laches) ends whenever the suit is brought [it is only retroactive]. “Paper” patents or methods have no 35 USC 287 “marking” requirements, or any other restraint on belated infringement suits.

    1. Yes – this is one of the distinguishing points between copyright and patent in that the copyright statute bars any civil action past the three year mark while the patent statute only bars the collection of damages beyond the six year mark. That said, I don’t understand what non-damages relief would be available for infringement that occurred more than six years ago.

      1. I guess in theory one could sue on a six-year-old infringement and ask for an injunction, although it is hard to believe that a court would ever award an injunction in such a case.

          1. Dennis, the reason I brought this up was simply because many folks erroneously assume that the tort of patent infringement has a statute of limitations or a statute of repose, like other tort suits.
            Since there is not, one could statutorily bring a suit for patent infringement for patent infringement that had already been continuously ongoing for up to 25 or more prior years! [With only the six year back damages recovery limitation.]
            Note that a key rationale for the doctrine of litigation delay laches is the difficulty in finding live witnesses and documents to facts occurring such a long time before trial. The present Fed. Cir. case law confirms a long standing presumption of laches for unexcused patent infringement suit filing delays exceeding said six years. [Shifting to the party suing the burden of showing the absence of laches.]

            1. It seems the Federal Circuit has created a distinction out of nothing but mere terminology. The Supreme Court’s analysis seems to equally apply to patents with 286.

            2. Anonymous, the Federal Circuit, and other circuits, seem oblivious to Supreme Court cases.

              According to the SC, laches bars equitable claims and does not apply to legal. The Federal Circuit would allow equitable claims and bar damages.

              Backwards.

              I suspect that the Federal Circuit will get in line. But, in the past, they have shown they will not get in line even after they are reversed.

            3. But, in the past, they have shown they will not get in line even after they are reversed.

              Not only are you mixing up your issues Ned, you are heading down that well-trod path of yours on over-blowing Supreme Court dicta and ignoring the signs of a power addiction of the Royal Nine.

              Let’s not have you ride that merry-go-round on this thread, ok?

          2. Dennis, according to Petrella, laches is a defense in equity and to an equitable remedy. It does not bar a legal claim.

            The Federal Circuit has it 100% backwards, using laches to bar damages and but not barring an injunction.

            Estoppel will bar a legal claim. If one reviews the precedents relied upon by Aukerman, in every case there was a bar to a legal claim there were the elements of estoppel — some action by the patent owner that was misleading as in, “I have no intention of enforcing my claim,” that was communicated to the defendant and that he relied upon to his detriment.

            What Petralla stands for in addition to barring laches to a legal claim, is that a naked charge of infringement coupled with long silence is not estoppel.

    2. Other than that, there is only the relatively weak equitable doctrines of laches and estoppel

      This of course is an example of something that Congress has written into patent law (through the section on remedies and the like) allowing the courts to decide (in direct contrast to any retrograde revival of defining the term “invention” through the use of the tool of common law evolution).

    3. Paul, let’s keep this simple.

      The SC indicated, if not held, that laches is not a defense to legal causes of action.

      Period.

  6. Let’s be generous to the Fed. Cir. They relied on Federico in that 1992 decision who actually said that laches was a defense to infringement.

    But, it IS remarkable that the Fed. Cir. did not cite to the several Supreme Court cases that had previously held that laches did not apply to actions at law and/or that any applicable statute of limitations was controlling.

    Thus, once again, as was their wont and practice, the Federal Circuit, as the CCPA before them, relied on ambiguous language in the ’52 Act to ignore the Supreme Court and do their own thing.

    I am going to politely suggest to all that everything the CCPA or Federal Circuit did or does has to be checked against controlling Supreme Court case law. The Federal Circuit is, with the Ninth Circuit, achieving a significant reputation of consistently getting it wrong on key issues precisely because they choose to ignore the Supreme Court.

      1. Ned – perhaps it is a volume thing – several posts that have no offensive words (in fact posts that merely repeat EXACTLY what has already been allowed) have found their way to be stuck in the moderation filter.

    1. “[W]e adhere to the position that, in face of a statute of limitations enacted by Congress, laches cannot be invoked to bar legal relief,”

      Dennis, the holding of the court is not limited to copyrights.

  7. Great catch on that § 286 footnote, Dennis! I read the opinion but skipped over most of the footnotes, including this one. That looks pretty ominous to me for accused patent infringers relying on a laches defense.

    1. Andrew, If you read Aukerman, the patent owner made the exact point in his defense that is the Supreme Court holding here, and the Fed. Cir. dismissed it based on Federico’s testimony that 282 allowed laches as a defense to infringement.

      The Federal Circuit cited no Supreme Court case in its support. It failed to distinguish the Supreme Court cases that held the opposite. (I assume that the patent owner had cited these to the Federal Circuit.)

      It just appears that the Federal Circuit wanted to change the law and did so, relying on Federico’s testimony.

      1. hmm,

        First you blamed Rich, then you blamed the CAFC, and now you blame the CAFC through your idol Frederico…

        (never mind you totally ignored Prof. Hricik’s use of Frederico in a recent 101 discussion on his side of the blog)

        You are doing that selective parsing thing again Ned.

        1. Parsing?

          I can see now why Scalia does not like congressional testimony to supplement the statute.

          Federico made a mistake to the extent he included laches as an equitable defense to a legal claim. I don’t know why he made that mistake, but he did.

  8. I spent most of my time when reading this opinion trying to figure out why a person can’t assign their inchoate rights in the copyright renewal to a third party until the renewal is actually due. Seemed like shenanigans that if they kick the bucket before the renewal is due, then the assigned copyright renewal rights revert to the author’s heirs (and poor public policy besides, since it would have led to a substantial motivation for people to kill their screenwriter parents).

    1. Copyright has several interesting non-assignability issues. Some parts seem as if they were written by an estates attorney who loved possibilities-of-reverter and rights-of-reentry. At the time the statute was written, those were generally non-assignable. However, over the past forty years those common law restrictions have changed while the statutory limitations in copyright remain.

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