The U.S. Supreme Court has ruled that there is no time limit on when you can claim damages following an infringement of your copyright. A previous ruling by the District Court had deemed that you could only recover damages for infringements occurring in the previous three years.
What was the case?
The case related to a claim by record producer Sherman Nealy brought against Warner Chappell Music in 2018. Nealy said that his work had been sampled without his permission in Flo Rider’s track “In The Ayer.” In addition, Nealy’s claim cited infringements over a ten year period back to 2008. This was unusual as it had previously been held that you could only claim damages for the previous three years.
Discovery Rule
Under the U.S. Supreme Court rules no time limit on damages in copyright dispute Copyright Act, you need to file a lawsuit within three years from the date your copyright is infringed. However, Nealy used something called the Discovery Rule. This rule says that your claim needs only to be made within three years of when you first found out about the infringement. Therefore, Nealy argued his claim was valid even though the Flo Rider track was released in 2008. Nealy said he had only discovered that his work had been sampled in the three years prior to his claim in 2018.
What did the courts say?
Nealy’s claim against Warner Chappell Music had been considered by the lower courts before it got to the Supreme Court. Unfortunately, these courts had given different opinions on whether or not the lawsuit was outside the legal time limits. In the District Court, it was ruled that Nealy’s claim exceeded the three-year limit so it was dismissed. Therefore, he appealed the decision to the Supreme Court. However, in a six to three verdict, the Supreme Court sided with Nealy and allowed his claim.
Is that the end of the matter?
Although Nealy has won his case, the issue of time limits for copyright claims is still unclear. The Copyright Act states that a copyright owner must file a claim “within three years of its accrual.” Previously, the word “accrual” has been interpreted to mean when the infringement took place. Alternatively, following the Discovery Rule, it can be interpreted to mean when the infringement was discovered. Due to the nature of the case, the Discovery Rule itself wasn’t assessed in Nealy’s hearing. Some of the Supreme Court Justices expressed the view that the Discovery Rule should not be allowed. However, that will need a future Supreme Court case to be heard before a decision can be given.
What we think
As with so many legal decisions, the outcome is a lot less clear than the headlines suggest. As it stands, the Supreme Court ruling in Nealy’s case is great news. It means that you can make a claim for an infringement of your copyright at any time. The only restriction is that it is within three years of when you first found out. Also, it doesn’t matter that this case was about music. The same interpretation would apply to film, video or works of photography. However, some of the Justices who ruled on the case clearly believe that the Discovery Rule is not the correct interpretation of the law. Therefore, things could all change again in the future.
