Can An Individual Sue a State For Damages For Copyright (or Patent) Infringement?

By Shane Wax

That was the question ostensibly to be decided by the Supreme Court when it heard arguments in Allen v. Cooper last fall, and, in a unanimous decision released on March 23, 2020,[1] from behind closed doors, the answer was, a widely expected, resounding no. Or was it?

The issue in Allen centered around Section 511 of the Copyright Act, which authorized private lawsuits for money damages against States and their officials or employees for copyright infringement.  A unanimous Supreme Court struck down this statute as an unconstitutional abrogation of the States’ sovereign immunity, following its 1999 precedent in Florida Prepaid,[2] which struck a nearly identical statute under the Patent Act.  In this case, Allen sued the State of North Carolina after the State published some of his photographs and videos on its website(s) without Allen’s permission.  The Supreme Court followed its holding in Florida Prepaid and held in Allen that, under the doctrine of sovereign immunity, North Carolina cannot be held liable for money damages absent its own consent, and Congress lacked the authority to make that choice for North Carolina and every other state in enacting Section 511.

While a cursory review of the Allen decision could leave one to believe the overbroad news headlines that States are now “immune” from copyright infringement suits, all is not lost.  First, most states have statutorily waived sovereign immunity, at least to some degree, and, albeit, often with restrictions including strict time limitations, procedural hurdles and damage caps. For example, New York State has waived its immunity from liability from most lawsuits, including torts and contract actions, as long as the suit is filed in its own Court of Claims in accordance with quasi-jurisdictional requirements, such as by requiring a Notice of Claim to be filed within 90 days after a claim has accrued, while North Carolina’s Tort Claims Act creates a special judicial commission with sole jurisdiction to determine the state’s liability for tort suits and damages, which are capped at $1 million.[3]  Additionally, a nuanced reading of Allen and Florida Prepaid reveals a potentially important federal path to redress.

As noted in both Allen and Florida Prepaid, Section 1 of the Fourteenth Amendment prohibits the State from depriving “any person of life, liberty, or property, without due process of law,” while Section 5 of the Fourteenth Amendment gives Congress the ability to enforce that prohibition, and “allows Congress to enact reasonably prophylactic legislation to deter constitutional harms.”[4]  Importantly, the Allen and Florida Prepaid Courts held that, in enacting Section 511 of the Copyright Act and Section 271(h) of the Patent Act, respectively, Congress had not identified any pattern of State-sanctioned infringement of intellectual property laws.[5]  Thus, the Court held that there was an insufficient record of unconstitutional behavior to support the sweeping remedy of a broad abrogation of sovereign immunity without exceptions (such as by limiting state liability to cases of intentional infringement), and therefore, the Fourteenth Amendment could not support the enactment of Section 511 and Section 271(h).

However, by identifying what was missing from the Congressional records for these statutes, the Supreme Court not only outlined a path under the Fourteenth Amendment for Congress to properly abrogate the States’ sovereign immunity via future amendments to the Patent Act and Copyright Act, but also hinted at a path forward for individuals, at least in some cases.  For example, in Florida Prepaid, the Supreme Court noted that “Congress did nothing to limit the coverage of the Act to cases involving arguable constitutional violations, such as where a State refuses to offer any state-court remedy for patent owners whose patents it had infringed . . . [nor] confine the reach of the Act by limiting the remedy to certain types of infringement, such as nonnegligent infringement or infringement authorized pursuant to state policy.”[6]  And in Allen, the Court acknowledged that “Copyrights are a form of property” and that intentional, or even reckless, copyright infringement might, in appropriate cases, “come within the reach of the Due Process Clause,” namely in cases where a State “fails to offer an adequate remedy for an infringement,” such as in a case of eminent domain or other “just compensation” violations.[7]

Perhaps most important is that Congress has already enacted a statute – 42 U.S.C. § 1983 – that effectively enables citizens to sue State actors for damages arising from due process and other constitutional violations, which has already survived Supreme Court scrutiny on several occasions.[8]  Section 1983 creates a private civil cause of action against any “person acting under color of any statute, ordinance, regulation, custom, or usage, of any State” (i.e., a state or local government official or employee) for any “deprivation of any rights, privileges, or immunities secured by the Constitution and [federal] laws” (e.g., due process violations).[9]  While the statute only allows “persons acting under color” of law to be sued in their personal capacities, and does not authorize suit against a state itself, or even individuals in their official capacity, in reality, a State will often indemnify its own officers and employees.

Moreover, while neither the State nor State officials are considered “persons” under this statute,  local governments, municipalities, municipal corporations and their employees are considered “persons” and can be named as defendants provided that the plaintiff’s injury can be fairly attributed to a municipal “policy or custom.”[10]  This “policy or custom” requirement is meant to root out cases of simple “respondeat superior” liability (i.e., holding an employer vicariously liable for the torts of its employees), but does cover a broad array of unlawful actions that can be fairly “blamed” on the municipality itself. For example, Section 1983 permits lawsuits against a municipality where a low-level municipal employee violates a person’s Constitutional or federal rights in following either written rules or policies as well as unwritten customs evidenced by widespread, permanent and well-settled practices.[11]  A municipality can also be held liable for a single action or decision by an individual with final policymaking authority,[12] or for a single action by a municipal employee whose negligent or reckless action can be traced to lack of training from the municipality, “where the failure to train amounts to deliberate indifference to the rights of persons.”[13]  These requirements for municipal liability under Section 1983 resemble the points made by the Supreme Court in Allen and Florida Prepaid that Congress could reenact Section 511 of the Copyright Act upon evidence of a “pattern of unconstitutional conduct,” or with limiting relief to “nonnegligent infringement or infringement authorized pursuant to state policy.”

While it is unlikely that a particular municipality maintains any policies or customs relating to intellectual property infringement, a failure to maintain any policy may give rise to a plausible “failure to train” argument.  For example, if the Allen case involved a municipality instead of a state, and an employee of the City of Raleigh hypothetically culled the petitioner’s photographs for use on the city’s website, Allen might have had an argument that the City of Raleigh’s failure to train employees to avoid committing copyright infringement demonstrates a “deliberate indifference to” intellectual property rights.  It could also be possible that a municipality’s decision to use federally protected intellectual property without the owner’s consent may be made by a higher official, such as a local head of tourism.

Ultimately, what this means in a post-Allen world is that content owners are not completely powerless from enforcing their copyrights against states and lower levels of government, but it will be an uphill battle in the face of time limitations, notice requirements, damage caps, and burdens of proof.

[1] Allen v. Cooper, No. 18-877, 589 U.S. ___ (2020).

[2] College Savings Bank v. Florida Prepaid Postsecondary Ed. Expense Bd., 527 U.S. 627 (1999).

[3] See N.Y. CTC § 8; N.C. Gen. Stats. § 143-291.

[4] Allen, supra, n.1, slip op p. 10-11.

[5] Allen, supra n.1, slip op p. 12-13.

[6] Florida Prepaid, 527 U.S. at 646-47.

[7] Allen, Supra, n.1, slip op p. 11-12; See also Florida Prepaid, 527 U.S. at 642 (“Patents . . .  have long been considered a species of property.”); U.S. Const. Amend. XIV, cl.5.

[8] See, e.g., Knick v. Township of Scott,. 588 U.S. ___ 139 S. Ct. 2162, 2172-73 (2019); Baker v. McCollan, 443 U.S. 137, 145 n.3 (1979) (Section 1983 “is not itself a source of substantive rights, but a method for vindicating federal rights elsewhere conferred by those parts of the United States Constitution and federal statutes that it describes.”); Chapman v. Houston Welfare Rights Organization, 441 U.S. 600, 617-19 (1979) (noting that Section 1983 protects federal rights beyond civil rights); Monell v. N.Y. City Dep’t of Social Servs., 436 U.S. 658, 695-701 (1978); See generally Jett v. Dallas Indep. Sch. Dist., 491 U.S. 701, 722-31 (1989) (discussing history behind adoption of and amendments to Section 1983)

[9] 42 U.S.C. § 1983.

[10] See Monell, 436 U.S. at 685-90.

[11] See Id. at 690-91; Patterson v. County of Oneida, N.Y, 375 F.3d 206, 226 (2d Cir. 2004); Thomas v. Cook Cnty. Sheriff’s Dep’t, 604 F.3d 293, 303 (7th Cir. 2009).

[12] Pembaur v. Cincinnati, 475 U.S. 469, 483 (1986).

[13] Canton v. Harris, 489 U.S. 378, 388 (1989)