Facts
Two technical-journal publishers sued Minnesota law firm Schwegman, Lundberg & Woessner, P.A. (“Schwegman”) for copyright infringement, claiming that Schwegman violated the copyright laws by attaching copyright-protected journal articles to patent applications filed with the USPTO and by making copies of the articles for the firm’s files. If credited by the courts, Plaintiff’s theory could have far-reaching consequences for all sorts of legal filings, and even law firm record-keeping practices.
Schwegman tried to gut the case early by filing a motion to dismiss the complaint under Supreme Court precedent Twombly and Iqbal, arguing that Plaintiffs did not sufficiently plead the “ownership” and “copying” elements of a copyright-infringement claim. The court rejected Schwegman’s argument, holding that “a plaintiff does not need to expressly plead facts to support the elements of a claim in the complaint, rather a plaintiff may rely upon plausible inferences from the well-pleaded facts to state a claim for relief.” Because claims for copyright infringement do not have a heightened pleading standard, general allegations that a defendant copied a protected work- product satisfies Twombly and Iqbal without the need for specifics regarding the who, what, where, and when of how the copies were made.
The court also rejected Schwegman’s perhaps more-promising argument—buried in its reply brief—that the USPTO is not “the public” and, therefore, the publishers had failed to establish an essential element of a claim for copyright infringement based on “public” distribution. Although there is case law holding that limited distribution of copyrighted material to government agencies is not “publication” for purposes of the copyright laws, the court found no case that definitively held the USPTO was not “the public” under the Copyright Act. That Schwegman waited until its reply brief for a full briefing on this issue helped the court reach its decision. But, the court did say Schwegman could renew this argument at a later stage in the case.
Although not raised in the motion to dismiss, the heart of this case going forward will likely be whether copying and submitting journal articles as prior art to the USPTO should be considered non-actionable “fair use” under the Copyright Act. The USPTO has issued a statement that such submissions should be considered “fair use” and has since intervened in the Schwegman case to further advance that position.
BuLITS Points
- Obtain a License. Although the courts may eventually adopt the USPTO’s “fair use” position, that issue has not been squarely and finally decided. For now, to fully avoid any risk, companies planning to file a patent application with the USPTO should obtain a license to copy and distribute any journal articles it plans to attach. Also, consider documenting the purpose for filing the patent application, particularly if you contend it’s not for commercial gain.
- Check the Scope of the License. Find out if your license covers the law firm that may be copying and filing the patent application for you. If it doesn’t, make copies of the application and prior art in-house in compliance with the license and then provide only necessary copies to the law firm.
- Go Green. Whether internal copies made by law firms are covered by the “fair use” defense is not so cut and dry. So be judicious: dispense with duplicative file copies and don’t make extra copies of articles “for future reference.”
And Remember
Do not save your key issues for the reply brief. If issues are not squarely raised in an opening brief, your opponent will have a compelling argument that they did not have an adequate opportunity to address it. The Advisory Committee refers to Local Rule 7.1 specifically prohibiting this practice: “It is improper to withhold information . . . from initial moving papers in order to gain advantage.”