APL Microscopic, LLC v. United States
| Decision Date | 27 August 2019 |
| Docket Number | No. 18-1851 C,18-1851 C |
| Parties | APL MICROSCOPIC, LLC, Plaintiff, v. THE UNITED STATES, Defendant. |
| Court | U.S. Claims Court |
Copyright Infringement; Motion to Dismiss; Statute of Limitations; Subject Matter Jurisdiction; Display Rights; Separate Harms; Continuing Harm; Failure to State a Claim; Reproduction Rights; Distribution Rights.
Joel Benjamin Rothman, Schneider Rothman Intellectual Property, Boca Raton, FL, for Plaintiff.
Patrick Charles Holvey, Trial Attorney, U.S. Department of Justice, Commercial Litigation Branch, Civil Division, Washington, D.C., with whom were Conrad J. DeWitte, Jr., Of Counsel, Civil Division, Gary L. Hausken, Director, Civil Division, Joseph H. Hunt, Assistant Attorney General, U.S. Department of Justice, for Defendant.
On December 3, 2018, Plaintiff, APL Microscopic, LLC ("APL"), filed a complaint in this Court alleging that Defendant, the United States of America (the "Government"), through the National Aeronautics and Space Administration ("NASA"), infringed on APL's rights under the Copyright Act, 17 U.S.C. § 106, by posting APL's copyrighted photograph (the "Work") on a webpage within NASA's website in 2004. APL sought $150,000 in statutory damages, actual damages, and injunctive relief.
On February 7, 2019, the Government filed a motion to dismiss pursuant to Rules 12(b)(1) and 12(b)(6) of the Rules of the Court of Federal Claims (RCFC).
On March 6, 2019, APL filed an Amended Complaint, still alleging that the photograph posted on NASA's website in 2004 constitutes copyright infringement but now seeking only actual damages.
On March 18, 2019, the Government filed another motion to dismiss pursuant to RCFC Rules 12(b)(1) and 12(b)(6) for lack of subject matter jurisdiction and failure to state a claim.
On June 3, 2019, the Court ordered that APL amend its First Amended Complaint again, directing APL to "separately list[] each of the rights identified in the Copyright Act which Plaintiff believes Defendant has infringed" and "[f]or each of the rights allegedly infringed . . . give some more specific information on damages." In addition, the Court ordered the parties to provide supplemental briefing on the issue of whether public display occurs when the owner of a website puts a protected work on its server (without authorization) so that it is made available for viewing by individual computer users who access the relevant page on the website, or, whether public display occurs only when—and each time—an individual computer user accesses the relevant page on the website.
On June 17, 2019, APL filed its Second Amended Complaint ("SAC"), listing three rights under the Copyright Act which it alleges were infringed upon by the Government: (1) the right of reproduction; (2) the right of public distribution; and (3) the right of public display. Second Am. Compl., ECF No. 19. With respect to damages, APL's SAC seeks "actual damages measured by 'the fair market value' of the licensing fees the owner was entitled to charge for [the use of the copyrighted work]."
On June 24, 2019, the parties filed their respective supplemental briefs on the issue of public display.
On July 23, 2019, the Court ordered supplemental briefing on the following question concerning the right of distribution:
Does a public distribution occur when the owner of a website uploads a protected work on its server (without authorization) so that it is made available for viewing and downloading by individual computer users who access the relevant page on the website, or, does a distribution occur when—and each time—an individual computer user accesses the relevant page on the website?
On August 6, 2019, the parties timely filed their supplemental briefs. This matter is now fully briefed and ripe for a decision.
For the reasons set forth below, the Court GRANTS-IN-PART and DENIES-IN-PART the Government's motion to dismiss for lack of subject matter jurisdiction and DENIES the Government's motion to dismiss for failure to state a claim.
Andrew Paul Leonard is a photographer specializing in microscopic imagery, who markets his photographs through his sole proprietorship APL Microscopic, LLC. See Leonard v. Stemtech International Inc., 834 F.3d 376, 382 (3d Cir. 2016).1 In 1996, Mr. Leonard, throughAPL, created a photograph of human bone marrow stem cells (the "Work"). Second Am. Compl. at 3. Below is the photograph at issue in this case.
Image materials not available for display.
In August 2004, NASA posted the photograph on its webpage with copyright information identifying Mr. Leonard as the copyright holder and attributing the photo to Stanford Magazine. The webpage was last updated on November 30, 2007.
On December 20, 2007, APL registered the Work with the Register of Copyrights and was assigned the registration number VA 1-426-177. Id.
On December 3, 2018, APL filed this suit.
The burden of establishing subject matter jurisdiction rests with the plaintiff. Lujan v. Defenders of Wildlife, 504 U.S. 555, 561 (1992). This Court's jurisdiction to entertain claims and grant relief depends on the extent to which the United States has waived sovereign immunity. United States v. Testan, 424 U.S. 392, 399 (1976).
When faced with a motion to dismiss for lack of subject matter jurisdiction pursuant to the RCFC Rule 12(b)(1), a court must assume that all undisputed facts alleged in the complaint are true and draw all reasonable inferences in the plaintiff's favor. Scheuer v. Rhodes, 416 U.S. 232, 236 (1974); see also Henke v. United States, 60 F.3d 795, 797 (Fed. Cir. 1995). The movant, however, may challenge the truth of any facts upon which jurisdiction depends. SeeRaymark Indus. v. United States, 15 Cl. Ct. 334, 338 (1988). If it does, the plaintiff must come forward with a prima facie showing of jurisdiction. Id. The plaintiff cannot rely only on its allegations. See Hornback v. United States, 52 Fed. Cl. 374, 377 (2002). Moreover, the Court may look to evidence outside of the pleadings in order to ascertain the propriety of its exercise of jurisdiction over a case. Rocovich v. United States, 933 F.2d 991, 994 (Fed. Cir. 1991), aff'd in relevant part, Martinez v. United States, 281 F.3d 1376 (Fed. Cir. 2002).
Under RCFC Rule 8, a pleading must contain a "short and plain statement of the claim showing that the pleader is entitled to relief. Pursuant to RCFC Rule 12(b)(6), the Court will grant a defendant's motion to dismiss if it finds the plaintiff has failed to state a claim upon which relief may be granted. In considering a motion to dismiss for failure to state a claim, the Court "must accept as true all of the allegations in the complaint" and "must indulge all reasonable inferences in favor of the non-movant." Sommers Oil Co. v. United States, 241 F.3d 1375, 1378 (Fed. Cir. 2001).
In order for a claim to be properly stated, the complaint "must contain sufficient factual matter, accepted as true, to state a claim for relief that is plausible on its face." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). "[O]nly a complaint that states a plausible claim for relief survives a motion to dismiss." Id. This plausibility standard requires that a complaint contain "more than an unadorned, the-defendant-unlawfully-harmed-me accusation." Id. (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 556 (2007)). Neither allegations "that are 'merely consistent with' a defendant's liability," nor "threadbare recitals of the elements of a cause of action, supported by mere conclusory statements," are sufficient. Id. A complaint should be dismissed under RCFC 12(b)(6) "when the facts asserted by the claimant do not entitle him to a legal remedy." Lindsay v. United States, 295 F.3d 1252, 1257 (Fed. Cir. 2002).
Section 106 of the Copyright Act grants a copyright owner "exclusive rights," including the right "to reproduce the copyrighted work in copies or phonorecords," "to distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership," and "to display the copyrighted work publicly." 17 U.S.C. § 106(1), (3), (5). Under 17 U.S.C. § 501(a), "[a]nyone who violates any of the exclusive rights of the copyright owner . . . is an infringer of the copyright." Where the United States Government is alleged to have infringed on a copyright, 28 U.S.C. § 1498(b) permits the owner to bring an action in the United States Court of Federal Claims "for the recovery of his reasonable and entire compensation as damages for such infringement." However, this section also provides that "no recovery shall be had for any infringement of a copyright covered by [Section 1498(b)] committed more than three years prior to the filing of the complaint . . . ." 28 U.S.C. § 1498(b).
In its SAC, APL alleges that the Government infringed on three of APL's exclusiverights under the Copyright Act: (1) the right of reproduction; (2) the right of public distribution; and (3) the right of public display. See Second Am. Compl., at 3-6. Specifically, APL alleges that NASA initially infringed on these rights in 2004 when the Work was first uploaded to NASA's server and displayed on its webpage(s). APL also argues that additional, separate infringements have occurred through the present day, because, according to APL, the Work is reproduced, distributed and/or displayed each time an individual user visits NASA's webpage. Second Am. Compl., at 4.
With respect to damages, APL "concedes that the plain language of § 1498(b) prevents APL from recovering for violations . . . that occurred more than three years prior to the filing of the complaint in this case." Pl's Resp., ECF No. 16 at 4. However, APL contends that it has suffered damages within three years of the...
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