UNICOLORS, INC. v. H&M HENNES & MAURITZ L. P. – A Synopsis of a Copyright Infringement Case

Introduction

On February 24, 2022, JUSTICE BREYER delivered the opinion of the Supreme Court in the above-referenced copyright case. Copyright is a branch of IP law, so it merits taking a look at this case, and extract therefrom the IP law insights provided.

As the Supreme Court summarized in its opinion, “[a] valid copyright registration provides a copyright holder with important and sometimes necessary legal advantages. It is, for example, a prerequisite for bringing a “civil action for infringement” of the copyrighted work. 17 U. S. C. §411(a). Additionally, a plaintiff in an infringement action normally cannot obtain an award of statutory damages or attorney’s fees for infringement that occurred prior to registration. §412. To obtain registration, the author of a work must submit to the Register of Copyrights a copy of the work and an application. §§408, 409. The application must provide information about the work. §409…Naturally, the information provided on the application for registration should be accurate. Nevertheless, the Copyright Act provides a safe harbor. It says that a certificate of registration is valid “regardless of whether the certificate contains any inaccurate information, unless—

“(A) the inaccurate information was included on the application for copyright registration with knowledge that it was inaccurate; and

“(B) the inaccuracy of the information, if known, would have caused the Register of Copyrights to refuse registration.” §411(b)(1) (emphasis added).”

Summary of the Copyright Infringement Case

The important question before the Court was whether “a certificate of registration is valid even though it contains inaccurate information, as long as the copyright holder lacked “knowledge that it was inaccurate.” §411(b)(1)(A).” As Supreme Court’s opinion sets forth, “the Court of Appeals for the Ninth Circuit believed that a copyright holder cannot benefit from the safe harbor and save its copyright registration from invalidation if its lack of knowledge stems from a failure to understand the law rather than a failure to understand the facts.” In Supreme Court’s view, however, “§411(b) does not distinguish between a mistake of law and a mistake of fact.” According to the Supreme Court, “lack of knowledge of either fact or law can excuse an inaccuracy in a copyright registration.”

H&M argued that Unicolors’ registration certificate was inaccurate because Unicolors had improperly filed a single application seeking registration for 31 separate works. H&M relied on a Copyright Office regulation, which provides that a single registration can cover multiple works only if those works were “included in the same unit of publication.” 37 CFR §202.3(b)(4) (2020). H&M argued that the 31 fabric designs covered by Unicolors’ single application (and therefore single registration) had not been published as a single unit of publication because Unicolors had initially made some of the designs available for sale exclusively to certain customers, while other designs were immediately available to the general public.

Unicolors has apparently not disputed the failure to meet the “single unit of publication” requirement, but it apparently argued that it did not know it did; in other words, it did not do it with knowledge.

In the Ninth Circuit’s view, it did not matter whether Unicolors did or did not know that it had failed to satisfy the “single unit of publication” requirement. That was because, in the Ninth Circuit’s view, the statute excused only good faith mistakes of fact, not law, and, Unicolors had known the relevant facts, namely, that some of the 31 designs had initially been reserved for certain customers.

The Supreme Court, looking at legislative history and prior case law, disagreed: “[i]f Unicolors was not aware of the legal requirement that rendered the information in its application inaccurate, it did not include that information in its application “with knowledge that it was inaccurate.””

Conclusion

It seems that the nuance highlighted here by the Supreme Court is that, even if Unicolors knew that that some of the 31 designs had initially been reserved for certain customers, it did not know its copyright application and registration would be defective when it claimed “single unit of publication” in it. And thus, the copyright registration should not be invalidated.

It also seems that if the circumstances show that there was no fraud or at least actual knowledge (as opposed to constructive knowledge) in providing wrong information as to facts or the law in a copyright application, the copyright registration will withstand a validity challenge raised by a copyright infringer.