Addressing the proper analysis for awarding attorneys’ fees and costs under the Copyright Act in the wake of the Supreme Court of the United States’ ruling in Kirtsaeng v. John Wiley & Sons, the US Court of Appeals for the Ninth Circuit upheld a fee award to the defendants where the copyright claim was objectively unreasonable. Shame on You Productions, Inc. v. Banks, Case No. 16-55024 (9th Cir., June 21, 2018) (Smith, J).

In May 2014, actor Elizabeth Banks and others (collectively, Banks) released a film titled Walk of Shame. Just prior to the movie’s release, Shame on You Productions, Inc., (SOYP) sent Banks letters claiming that her film copied elements from SOYP president David Rosen’s screenplay, titled “Darci’s Walk of Shame.” According to Rosen, he had previously sent the screenplay to Banks and even met with the actor in 2007 in the hope that she might star in his movie, although nothing came of the meeting. When Banks failed to produce the documents requested in SOYP’s letters, SOYP sued for copyright infringement.

After protracted discovery disputes, the district court ultimately granted Banks’s motion for judgment on the pleadings, finding that “as a matter of law there was no substantial similarity between the two works.” Thereafter, Banks filed a motion for attorneys’ fees and costs, which the district court granted, awarding Banks approximately $319,000. SOYP appealed.

On appeal, SOYP argued that the district court, in assessing whether to award attorneys’ fees, had failed to consider the Supreme Court’s ruling in Kirtsaeng v. John Wiley & Sons (IP Update, Vol. 19, No. 6), which had issued only two months prior to the district court decision. The Ninth Circuit disagreed, further noting that “Kirtsaeng did not effect a significant change in the law.” 

Typically, courts in the Ninth Circuit consider the following nonexclusive factors when determining whether to award attorneys’ fees and costs under the Copyright Act: “(1) the degree of success obtained, (2) frivolousness, (3) motivation, (4) reasonableness of losing party’s legal and factual arguments, and (5) the need to advance considerations of compensation and deterrence.” The shift post-Kirtsaeng merely requires that courts give “substantial weight to the fourth factor,” the Court said.   

In this case, the district court’s determination of objective unreasonableness was based on the lack of similarities between the works. The district court found that “the two works at issue tell fundamentally different stories with different plots, themes, dialogues, moods, settings, paces, and characters.” Although Kirtsaeng dictates that substantial weight should be given to the fourth factor—the reasonableness of the losing party’s claim (or lack thereof)—the remaining factors should still be taken into account. In this particular case, the other factors “do not combine to outweigh the objective unreasonableness of SOYP’s claim,” according to the Ninth Circuit. 

The Ninth Circuit further concluded that (1) the district court did not err in declining to apportion fees because the Copyright Act claim and state law claim for breach of an implied contract were interrelated, (2) the fee award was reasonable, and (3) the motion for fees and costs had been timely filed.

Practice Note: Kirtsaeng has not fundamentally changed the analysis for awarding attorneys’ fees in copyright cases; it has only shifted the emphasis to the unreasonableness factor.