IP Law Daily, COPYRIGHT—D. Conn.: Attorney fees can be awarded in declaratory judgment action, (Sep 27, 2022)

By Matthew Hersh, J.D.

A growing body of caselaw finds that actions to declare ownership or termination rights arise under the Copyright Act.

A Hollywood screenwriter who successfully fended off a declaratory judgment action over the ownership of the screenplay to an iconic 1970s slasher film was entitled to attorney fees in the action, the federal district court in Bridgeport, Connecticut, has held. The court, in granting the award of fees to the writer, also found that the writer was entitled to collect fees at the prevailing rate of nearby New York City rather than the Bridgeport judicial district, in light of the particular expertise his Manhattan-based attorneys brought to the case (Horror Inc. v. Miller, September 26, 2022, Underhill, S.).

The lawsuit involves the screenplay for Friday the 13th, “the classic summer camp thriller that spawned a generation of equally campy horror films,” we wrote in IP Law Daily’s earlier coverage of this case. Victor Miller drafted the screenplay for the movie and, in 1979, transferred ownership of it to a production company. In 2016, he sought to invoke his right under the Copyright Act to terminate the transfer and reclaim ownership of the screenplay. But the production company (or actually, the one that succeeded to the rights of the original company) sued for a declaration that the author had been an independent contractor at the time he wrote the work, which would mean he had no right to terminate and reclaim ownership. The federal court in Bridgeport ruled for the writer, and the Second Circuit, in an opinion handed down almost exactly year ago, affirmed.

The writer then sought to recover his attorney fees in the action, leading to this opinion.

Attorney fees. The court awarded attorney fees to the writer. In so doing, it made several findings of note.

The court first found as a matter of law that the writer was entitled to seek attorney fees under the Copyright Act. In doing so, the court joined a growing range of district courts elsewhere—as well as the Ninth Circuit—in finding that attorney fees could be awarded in a declaratory judgment action to establish copyright ownership. Section 505 of the Copyright Act provides that attorney fees may be awarded in any civil action “under this title,” referring to the title of the U.S. code that covers copyright. The production company, noting that the heading of the section was entitled “remedies for infringement,” argued that attorney fees were appropriate only for infringement actions and not for actions, such as a declaratory judgment actions, that established other rights under the Act. But section headings and titles could not override the plain text of the statute, the court reasoned—and an action for declaration of ownership, insofar as it required interpretation of the Copyright Act, plainly arose “under” that act.

The court also found that the writer was entitled to reclaim attorney fees under the facts of this particular case. Attorney fees are not awarded as a matter of course, the court observed, but generally require a balance of factors such as the reasonableness of the claims, the motivation of the plaintiff, and considerations of deterrence and fairness. Here, the court found, those factors favored the writer. The production company’s case, while not frivolous, was objectively unreasonable, while the manner in which it litigated the case—particularly the inclusion of a barrage of additional common law claims—suggested not a mere effort to clarify a question of copyright law but to intimidate the writer and others similarly situated. Thus, the court concluded, attorney fees were appropriate.

Finally, the court noted, the proper basis for calculating reasonable attorney fees in the case was the hourly rates in the Southern District of New York, rather than the local district. Both parties used major Manhattan-based firms, the court noted, and the writer’s New York-based attorney was particularly specialized in litigating copyright termination cases like this one. It was therefore appropriate to assess fees on the basis of the prevailing rates there as opposed to in Connecticut.

The court awarded the writer a total of $886,564.88 in attorney fees under Section 505 for litigation before the district court and on appeal before the Second Circuit.

The Case is No. 3:16-cv-01442-SRU.

Attorneys: Alexander Rudolf Malbin (Ferdinand IP, LLC) for Horror Inc. John J. Martin (J. Martin Business Law Group, LLC) for Victor Miller.

Companies: Horror Inc.

Cases: Copyright ConnecticutNews