Why would copyright holders choose to abandon their statutory rights and rely solely on their common law ones? A few “blockheaded” authors might do so non-monetary reasons, of course. Thanks to the combined effect of copyright misuse and § 505 of the Copyright Act, however, even crassly profit-maximizing copyright holders might find abandonment financially attractive.
Under § 505, courts may in their discretion award attorney’s fees to the prevailing party in copyright litigation. The Supreme Court has interpreted that provision to benefit copyright plaintiffs and defendants alike. The Court suggested that, among other factors, courts should base an award of attorney’s fees under § 505 on “‘frivolousness, motivation, objective unreasonableness (both in the factual and in the legal components of the case) and the need in particular circumstances to advance considerations of compensation and deterrence.'” Those factors could easily describe a typical case of copyright misuse. Not surprisingly, then, courts have found that defendants who suffered copyright misuse—or even something less than misuse—deserve an award of attorney’s fees under § 505.
Common law, like U.S. law generally, takes a very different approach to attorney’s fees. Under the so-called “American Rule,” each party in civil litigation—even the winner—must pay for its own legal representation. Section 505 of the Copyright Act represents a rare and notable exception to that rule.
Here, then, the common law treats authors better than copyright law does. The Copyright Act offers many benefits to copyright holders, of course, such as strict liability and statutory damages. Overzealous copyright holders might find that the doctrine of misuse denies those benefits, however, and that § 505 imposes the costs of paying for an opposing party’s attorney. For some copyright holders, those combined effects might suffice to render abandonment a financially attractive option. That would hold especially true if copyright holders could count on their common law rights to survive abandonment and if entrepreneurs continue to develop private alternatives to the statutory protection of expressive works.
[NB: The above text comes from chapter 6, § D of my draft book, Intellectual Privilege: Copyright, Common Law, and the Common Good. You can find a PDF of the entire chapter, including footnotes, here. I cooked up this argument about the financial benefits of abandonment only recently, and am excited to have found a way—however small—in which common law offers authors better incentives than copyright law does. As always, I welcome your comments.]
[Crossposted to Intellectual Privilege and Agoraphilia]
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