On March 2, the U.S. Supreme Court held that registration according to 17 U.S.C. 411(a) is "a precondition to filing a copyright infringement claim that does not restrict a federal court's subject matter jurisdiction." Reed Elsevier Inc. v Muchnick, 130 S. Ct. 1237, 1241 (2010). Although not apparent in the Court's opinion, international treaty obligations may have played a role in the Supreme Court granting certiorari and in the final holding. Because of existing international treaty obligations in the area of intellectual property, this holding is not only beneficial to the parties below but also to the United States by avoiding a potential action before the World Trade Organization (WTO).

In a copyright class action brought on behalf of freelance authors with registered copyrights and freelance authors without registered copyrights, the U.S. Court of Appeals for the 2d Circuit held that, because some of the copyright holders had failed to register their copyrighted works with the U.S. Copyright Office, the district court lacked jurisdiction to certify the class. Such a holding, if upheld, would have required a copyright holder to register with the Copyright Office prior to bringing suit in a federal court for two reasons: to meet the registration requirement of § 411 and to meet the federal subject-matter jurisdiction requirement. (Although the Supreme Court reversed on the jurisdictional issue, it declined "to address whether § 411(a)'s registration requirement is a mandatory precondition to suit that...district courts may or should enforce sua sponte by dismissing copyright infringement claims involving unregistered works." So although the Supreme Court ruled that a district court has jurisdiction over cases involving unregistered copyrights, a court might nonetheless rule that failure to register a U.S. work is a bar to suit.)

Had the 2d Circuit's holding not been overruled, the United States, as a member nation, would have been in violation of the Berne Convention for the Protection of Literary and Artistic Works, the Agreement of Trade-Related Aspects of Intellectual Property Rights (TRIPS), the World Intellectual Property Organization (WIPO) Copyright Treaty (WCT) and the WIPO Performances and Phonograms Treaty (WPPT). An explanation follows.

For an author of a member nation, the Berne Convention protects that author's copyrights in each of the other member nations without discrimination, as if he or she were a local author. When a nation joins the Berne Convention, that nation must adhere to Article 5 of the Berne Convention, in part requiring member nations to provide copyright protection without formalities — such as registration. TRIPS and WCT adopt the same nonformality requirement through the incorporation by reference of Article 5 of the Berne Convention: TRIPS through Article 9 and WCT through Article 3. WTTP does not reference the Berne Convention but provides harmonization with its own Article 20: "The enjoyment and exercise of the rights provided for in this Treaty shall not be subject to any formality."

The registration requirement of § 411 is exactly the type of formality that is prohibited by the Berne Convention, TRIPS, WCT and WTTP. As Mihaly Ficsor in his 2003 Guide to the Copyright and Related Rights Treaties by World Intellection Property Organization wrote: "[I]f certain remedies are only available if some formalities are fulfilled (such as registration before an infringement suit), it is in conflict with the principle of formality-free protection. Id. ¶ BC-5.7. In order to comply with the Berne Convention, TRIPS, WCT and WTTP, Congress provided an exception in § 411 for preserving the nonformality requirement or, maybe better stated, the formality nonrequirement.

In relevant part, § 411 states: "[N]o action for infringement of the copyright in any United States work shall be instituted until preregistration or registration of the copyright claim has been made in accordance with this title." Justice Clarence Thomas, in his opinion, framed the exceptions to this significant section as follows: "§ 411(a) expressly allows courts to adjudicate infringement claims involving unregistered works in three circumstances: where the work is not a U.S. work, where the infringement claim concerns rights of attribution and integrity under § 106A, or where the holder attempted to register the work and registration was refused." 130 S. Ct. at 1246 (emphasis in original). The Court did not explain the significance of the phrase "where the work is not a U.S. work," probably because, after the Court found jurisdiction, the registration question became moot with regard to preserving the status quo for non-U.S. work nonformalities. To be clear, the requirement that "any United States work" has to be federally registered to bring a claim in federal court leaves the door wide open for foreign authors, who are rights holders, to enter federal court without registration.

But the 2d Circuit's holding that jurisdiction is not available without registration slammed the door shut in violation of the above-mentioned treaties because there is no jurisdictional exception contained in § 411 to remedy the 2d Circuit's holding. Thus, after the 2d Circuit's ruling, a foreign copyright holder of a non-U.S. work would have to register with the Copyright Office to be able to bring a claim in federal court. That formality requirement would have placed the United States in violation of the above-mentioned treaties and, most importantly, exposed the United States, as a member of TRIPS, to the WTO's Dispute Settlement Understanding procedures as being in violation of a treaty measure.

Of course, the Supreme Court does not and cannot base a holding solely on international treaties. But as can be seen in such recent intellectual property cases as KSR Int'l Co. v. Teleflex Inc., 550 U.S. 398 (2007), and MGM Studios Inc. v. Grokster Ltd., 545 U.S. 913 (2005), the Supreme Court is more than aware of policy and, most importantly, cognizant of downstream effects of its rulings. Here, in Muchnick, the Court easily found subject-matter jurisdiction for both registered U.S. works and nonregistered foreign works in 28 U.S.C. 1331 and 1338 without directly addressing the non-U.S. works: "[N]either § 1331, which confers subject-matter jurisdiction over questions of federal law, nor § 1338(a), which is specific to copyright claims, conditions its jurisdictional grant on whether copyright holders have registered their works before suing for infringement." 130 S. Ct. at 1246.

Granted, in many cases the foreign national might be able to bring a copyright infringement case in federal court under diversity jurisdiction if the amount in controversy can be met and if the domicile requirement can be met. But such a backdoor approach would not be a catch-all, as many foreign authors live in the United States, such as in New York City, increasing the likelihood that both the plaintiff and the defendant would be domiciled in the same jurisdiction. Also, such an argument would probably not carry much weight before the WTO Dispute Board. Regardless, the Court's ruling makes such an analysis moot.

Although the Court preserved the status quo by ruling on the subject-matter jurisdiction issue, the Court, as stated above, expressly declined "to address whether [the] registration requirement is a mandatory precondition to suit." It is also worth noting that, even if the Supreme Court had not taken this case under review and then ruled to maintain the status quo, or if the Court had found that jurisdiction was not available without registration, Congress could have stepped in and promulgated a new § 411, maintaining the nonformality requirements for non-U.S. works.

Although Muchnick maintained the status quo for non-U.S. works, an opportunity was lost to provide dicta that could guide the lower courts and, more importantly, educate parties, on the nonformality requirements. Because Muchnick only briefly mentions — and not in the holding — that non-U.S. works are an exception to the formality of registration, counsel may want to use their complaint as an opportunity to explain the exception to the judge, if needed, and most certainly to opposing counsel who may be viewing such a claim as subject to easy dismissal under § 411.

Reprinted with permission from the May 15, 2010 Web edition of the National Law Journal © 2010 ALM Media Properties, LLC. All rights reserved. Further duplication without permission is prohibited. For information, contact 877-257-3382, reprints@alm.com or visit www.almreprints.com.