Supreme Court Review of Kirtsaeng v. Wiley Has Broad Implications for Fee-Shifting Rules in Copyright Cases
The Supreme Court’s grant of certiorari Friday in Kirtsaeng v. John Wiley & Sons sets the court up to potentially change the standards for awarding attorney’s fees to the prevailing party in copyright lawsuits, copyright lawyers and stakeholders told us in interviews. The Supreme Court granted certiorari in response to Thai citizen Supap Kirtsaeng’s petition for a review of the U.S. Court of Appeals for the 2nd Circuit’s ruling in May that Kirtsaeng wasn’t entitled to receive attorney’s fees from textbook company Wiley after winning a 2013 Supreme Court case. The court had ruled Kirtsaeng’s resale an import of textbooks from Thailand to the U.S. that was covered by the first-sale doctrine (see report in the March 20, 2013, issue).
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Kirtsaeng urged the Supreme Court to hear the case because it needed to resolve a “circuit split” on the rules for awarding attorney’s fees in copyright cases since several other circuits would have awarded the attorney’s fees to him after the Supreme Court’s 2013 ruling. The 2nd Circuit said Wiley’s argument in its suit against Kirtsaeng wasn’t “objectively unreasonable” and therefore didn’t meet the “objective reasonableness” standard for fee shifting. “Had Kirtsaeng prevailed in the Ninth or Eleventh Circuit, he would have obtained his reasonable attorneys’ fees,” Kirtsaeng said in his petition. “Had he prevailed in the Fifth or Seventh Circuits, he would have had a rebuttable presumption in favor of obtaining his attorneys’ fees. Had he prevailed in the Third, Fourth, or Sixth Circuits, Kirtsaeng very likely would have obtained his attorneys’ fees.”
Wiley said Kirtsaeng’s petition unsuccessfully repackaged “various courts’ applications of a fact-intensive discretionary standard as an extensive series of circuit split” when there's no true circuit split. The 2nd Circuit derived its emphasis on the objective reasonableness standard “from examining the approaches of other federal appellate courts,” including several of the circuits Kirtsaeng cited in his petition, Wiley said. “Every circuit emphasizes objective reasonableness,” Wiley said. “Even if there were a presumption in favor of awarding fees to prevailing parties, it would only be a presumption, and such a presumption might very well be overcome in a case like this one.” Lawyers for Kirtsaeng and Wiley didn’t comment.
The Supreme Court’s eventual ruling on Kirtsaeng could resolve unanswered questions about fee-shifting rules that lingered after the court’s precedential 1994 fee-shifting ruling in Fogerty v. Fantasy, though the fee-shifting issue hasn’t been on stakeholders’ radar, said Copyright Alliance CEO Keith Kupferschmid. “I’m surprised the court is taking this case again give the many other copyright issues percolating,” he said. “The House Judiciary Committee’s spent more than two years on its Copyright Act review and [fee shifting] is not one of the issues that anyone has ever complained about.” Fee shifting is an issue that doesn’t typically get attention in policy circles “but in the world of litigation it makes an enormous difference,” said Library Copyright Alliance counsel Jonathan Band.
Kirtsaeng “could have broad implications in every copyright case from here on out,” said Dorsey & Whitney IP attorney Michael Keyes, who primarily represents content owners. Case law on fee-shifting in copyright cases “is very confused, so it probably makes sense to have the standards clarified,” Band said. Kirtsaeng “doesn’t seem to challenge” the Fogerty rule that parties should be treated equally in fee-shifting rules, but rather asks “what is the standard” for fee shifting, Band said. It’s “hard to forecast” based on the Supreme Court’s Fogerty decision how the court will rule on Kirtsaeng since “even though the Supreme Court has said courts should be even-handed on fee shifting, each circuit is using different tests” in their rulings, Keyes said. “With so many different tests to choose from, it’s hard to assess with any degree of certainty” how the Supreme Court will rule.
Kirtsaeng could “raise a lot of interest among those outside the copyright community,” Kupferschmid said. “Fee-shifting has broad implications for many other areas of law, most notably for patent stakeholders. So I think you’ll see other parties interested in this issue chime in and seek to file amicus briefs” in Kirtsaeng. It would also “make sense” for parties who are facing or could potentially face hefty attorney’s fees in their own copyright cases to also be interested in filing amicus briefs in Kirtsaeng, Keyes said. Neither the Copyright Alliance nor LCA has made a decision about whether to file an amicus brief in Kirtsaeng, Kupferschmid and Band said separately.