Alaska Stock, LLC v. Houghton Mifflin Harcourt Publ'g Co.

• Decision Date: 18 March 2014
• Docket Number: No. 10–36010.,10–36010.
• Citation: 747 F.3d 673
• Court: U.S. Court of Appeals — Ninth Circuit
• Parties: ALASKA STOCK, LLC, Plaintiff–Appellant, v. HOUGHTON MIFFLIN HARCOURT PUBLISHING COMPANY; R.R. Donnelley & Sons Company, Defendants–Appellees.

747 F.3d 673

ALASKA STOCK, LLC, Plaintiff–Appellant,

v.HOUGHTON MIFFLIN HARCOURT PUBLISHING COMPANY; R.R. Donnelley & Sons Company, Defendants–Appellees.

No. 10–36010.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted July 27, 2011.

Submission Withdrawn June 7, 2012.

Resubmitted Jan. 10, 2014.

Filed March 18, 2014.

Maurice Harmon (argued), Harmon & Seidman LLC, Northampton, PA; Christopher Seidman, Autumn W. Boyd, and Craig F. Wallace, Harmon & Seidman LLC, Grand Junction, CO; Brent R. Cole, Marston & Cole PC, Anchorage, AK, for Plaintiff–Appellant.

J. Russell Jackson (argued), Skadden, Arps, Slate, Meagher & Flom LLP, New York, NY; Daniel C. Kent, Birch, Horton, Bittner, and Cherot, Anchorage, AK, for Defendants–Appellees.

Tony West, Assistant Attorney General; Scott McIntosh and Melissa N. Patterson (argued), Attorneys, Appellate Staff, Department of Justice, Civil Division, Washington, D.C.; David Carson, General Counsel; Robert Kasunic, Deputy General Counsel, United States Copyright Office, Washington, D.C., for Amicus Curiae United States of America.

Appeal from the United States District Court for the District of Alaska, H. Russel Holland, Senior District Judge, Presiding.

Before: DIARMUID F. O'SCANNLAIN,^*ANDREW J. KLEINFELD, and CONSUELO M. CALLAHAN, Circuit Judges.

OPINION

KLEINFELD, Senior Circuit Judge:

We address whether copyright registration of a collective work registered the component works within it.

Facts

This case was dismissed for failure to state a claim, so we assume for purposes of analysis that the facts were as pleaded in the complaint.

Alaska Stock, a stock photography agency, registered large numbers of photographs at a time, listing only some of the authors and not listing titles for each photograph. It licensed Houghton Mifflin Harcourt Publishing Company to use pictures it had registered, for fees based on the number of publications. Houghton Mifflin and its printer, R.R. Donnelley & Sons, greatly exceeded the number of publications Houghton Mifflin had paid for, so Alaska Stock sued for injunctive relief, actual and statutory damages, attorneys' fees, and costs.

Alaska Stock owned the copyrights to all the photographs at issue, pursuant to assignment by the individual photographers. It registered the copyrights by registering CD catalogs and databases of the stock photos, entitled “Alaska Stock CD catalog 4” and so forth, which contained images of each of the photographs. For “name of author” on its application, it listed only three of many, in the form “1) Jeff Schultz 2) Chris Arend 3) Johnny Johnson & 103 others.”

This form of registration was prescribed by the Register of Copyrights and was consistent with Copyright Office procedure for thirty years. The district court nevertheless dismissed the claims on the ground that the registrations were defective, because Alaska Stock had not provided the names of each of the photographers and the titles of each of the photographs in its registrations. The theory of the dismissal was that the registrations succeeded only in registering the catalogs themselves, not the individual photographs within them, on account of Alaska Stock's failure to list authors and titles. The district court held that the statute unambiguously required titles and authors, so the administrative practice to the contrary and a statutory savings clause for immaterially inaccurate information could not save the claims.

We reverse.

We first expand somewhat on the history that led to the registrations in the form used, and then explain why the registrations sufficed under the statute.

Professional photographers make their living in various ways, sometimes shooting pictures for weddings, sometimes for advertisements, sometimes “stock.” In “stock photography,” the photographer usually makes the images before he has a customer. He then contracts with a stock agency for the agency to handle copyright registration and licensing, often for a cash payment up front to the stock agency and a percentage of whatever the stock agency collects. Purchasers buy permission from the stock agency to use particular pictures, usually for a limited number of copies, with the prices varying from less than a dollar to perhaps a couple of hundred dollars. The photographer's income depends on getting noticed and on volume, since the pictures are licensed so inexpensively. Stock agencies relieve the photographers of some of the burden of managing the commercial end of their business, so that they can focus more on making images, and they relieve publishers of the burden of locating photographers and purchasing rights to use the images they want.

A particularly important task the stock agencies may perform is at issue here: registering copyrights, to deter pirating. That is what Alaska Stock did for the many photographers whose images are affected by this case. Alaska Stock registered thirteen automated databases ¹ and one “CD–ROM collection” of photographs. Alaska Stock's photographs are each independently copyrighted, so the databases and CD–ROM at issue are each a “collective work” under the Copyright Act. The several databases contained between 500 and 6,000 individual photographs each. Each database or CD–ROM contained the work of between 32 and 106 photographers.

The copyright laws and procedures are complex, so photo stock agencies worked out the registration procedure with the federal agency in charge. Some stock agencies (such as the plaintiff in this case) are very small businesses reliant on a trade association to work out the procedures they should follow. In 1995, a trade association of stock agencies, Picture Agency Council of America, Inc., met with the Register of Copyright (the head of the Copyright Office), her Chief Examiner, and other Copyright Office staff, to work out how to register large catalogs of images. The Register agreed that a stock agency could register both a catalog of images and the individual photographs in the catalog in one application if the photographers temporarily transferred their copyrights to the stock agency for the purposes of registration.

The trade association confirmed this with the Copyright Office in writing, and advised its member stock agencies. Using language suggested by the Copyright Office, Alaska Stock's typical pre–2001 agreement with a photographer includes this language: “I grant Alaska Stock the right to register for copyright my photographs which appear in this catalog in the name of Alaska Stock solely for the purpose of catalog registration. Alaska Stock shall reassign such copyright to me upon request.” The post–2001 language was materially similar: “Photographer grants to Alaska Stock, solely for the purpose of registration, the copyright....”

The Copyright Office provided a letter to the trade association telling it how stock photo catalogs ought to be registered. The letter says that listing only three individual photographers by name, followed by the phrase “and x [number] others,” and naming the agency as owner of the copyrights was “acceptable when the accompanying deposit copies are catalogs consisting of photographs.” A copyright examiner would interpret such filings to mean that the claim being registered would include the catalog and “extend also to the photographs themselves.” The letter says that a “registration application submitted for a work created by a large number of authors is considered acceptable ‘if it names at least three of those authors followed by a statement such as “and (number) others.” ’ ” Though the office had a “preference” for naming all the authors, the Copyright Office letter says that it is “just that—a preference but not a requirement.”

Having the written blessing of the federal administrative agency for its method, Alaska Stock filed its applications in accord with what the Copyright Office had said was required. The registration quoted above is its standard form, and was adequate under the Copyright Office procedures in effect at the time to register the individual images. The deposits filed with the registration applications show innumerable beautiful images of mountains, glaciers, polar bears, grizzly bears, bald eagles, dog mushing, and other subjects evoking the North. The Copyright Office approved Alaska Stock's applications and issued certificates of registration to the company.

Alaska Stock's contracts with photographers require the photographers to pay Alaska Stock substantial amounts per image, and entitle them to 35% to 50% of revenues Alaska Stock obtains from their images. Alaska Stock sold Houghton Mifflin limited licenses to copy and distribute limited numbers of copies of the designated images. Houghton Mifflin greatly exceeded the license limits. The complaint alleges that this was a willful and fraudulent business method, designed to lull licensors into a false confidence, because having placed a photograph with a stock agency, a photographer would assume nothing untoward when he saw it reproduced in a school textbook.

The United States has filed an amicus brief in support of Alaska Stock, urging that we reverse. The position of the United States is that the Copyright Office “has long interpreted the Copyright Act to permit an application to seek registration of a collective work and the component works that the claimant owns, even if the application does not specify the authors and titles of the component works.” The government's brief says that internal guidance for the copyright examiners has, consistent with this position, provided that registration of a collective work also registers independently copyrightable works within the component work. The Copyright Office takes the position that only the author of the collective work, not the individual authors of separate contributions, need be provided in the application. The names of three authors followed by a statement “and [number] others” suffices, as the letter from the Office to...