The following post comes from Sabren H. Wahdan, a 3L at Scalia Law and a Research Assistant at C-IP2.
In one of his final majority opinions before announcing his retirement, Justice Steven Breyer penned a nuanced ruling that carefully threads the policy needle on copyright registration issues. The case pitted fabric designer Unicolors against fast fashion company H&M, but it was ultimately a victory for creators of art, fashion, music, dance, literary works, and others who rely on copyright registrations to protect their rights but lack the means to hire an attorney to ensure that their registration applications are legally and factually perfect. As a result of the ruling, they can register their works without fear that their registration could be invalidated by a good-faith mistake.
Unicolors v. H&M answers a narrow question of copyright law: what is the requisite level of knowledge to invalidate copyright registration? Justice Stephen Breyer’s majority (6-3) opinion holds that actual knowledge of either a factual or legal mistake is required before a registration is invalidated. This makes good sense because copyright registration applications are often completed by creators who are not lawyers. Some background on the case is useful.
The District Court
In 2016, Unicolors sued H&M for copyright infringement in the United States District Court for the District of Central California, alleging that H&M sold apparel, specifically a jacket and skirt, with a design remarkably similar to a Unicolors-copyrighted design. The jury returned a verdict in favor of Unicolors.[i] Subsequently, H&M filed a renewed motion for judgment as a matter of law, arguing that Unicolors’ copyright registration was invalid because Unicolors knowingly submitted inaccurate information in its application for registration.[ii] The U.S. Copyright Office has established an administrative procedure that allows an applicant to register multiple works that were physically packaged or bundled together as a single unit and first published on the same date.[iii] However, under 37 C.F.R. § 202.3(b)(4), an applicant cannot use this provision if the works were published in different units or first distributed as separate, individual works.
Unicolors had filed an application with the Copyright Office seeking a collective copyright registration for thirty-one of its designs in 2011. H&M contended that Unicolors could not do so because it had sold some of the patterns separately to different customers at different times, invalidating Unicolors’ registration.[iv] The District Court denied H&M’s motion for judgment as a matter of law, holding that a registration may be valid even if it contains inaccurate information, provided the registrant did not know the information was inaccurate.[v] H&M had to show Unicolors had knowledge and intent to defraud in order to invalidate the registration. H&M appealed.[vi]
The Ninth Circuit Decision
On appeal, the U.S. Court of Appeals for the Ninth Circuit reversed the District Court’s judgment holding that invalidation under 17 U.S. Code § 411 does not require a showing that the registration applicant intended to defraud the Copyright Office.[vii] In other words, knowing about the inclusion of inaccurate facts and law in an application is enough to warrant invalidation. Furthermore, the Ninth Circuit stated that Unicolors had failed to satisfy 37 C.F.R. § 202.3(b)(4) – the single unit of publication requirement.[viii] The Court found that Unicolors’ registration was inaccurate because Unicolors registered all thirty-one of its designs together as a single unit with the same publication date, when in fact, the designs were not all published as a single unit. Some designs were available to the public, while others were confined designs only available to particular exclusive customers.[ix] The Court determined that Unicolors knew the designs would not be released together at the same time; therefore, they knew that the registration information was inaccurate.[x] Consequently, the Ninth Circuit remanded the case to the District Court for further proceedings.[xi]
The Supreme Court Reverses the Ninth Circuit Decision
In 2021, Unicolors filed a petition to the Supreme Court asking whether the Ninth Circuit erred in determining that §411(b)(1)(A) required referral to the Copyright Office on any inaccurate registration information, even without evidence of fraud or material error in conflict with other circuit courts and the Copyright Office’s own findings on §411(b)(1)(A). The United States Supreme Court granted certiorari.
Justice Breyer’s Majority Opinion
Justice Breyer is well known for his use of analogies to probe the arguments of parties appearing before the Court. Likewise, in Unicolors, the majority opinion relied not only on statutory construction, legislative history, and the plain language of the statute as informed by dictionary definitions, but also on analogies––both to adjacent provisions of the code, and to analogies involving birdwatching––to reach its conclusion, in the end finding that §411(b)(1)(A) does not distinguish between a mistake of law and a mistake of fact and thus excuses inaccuracies in registration applications premised on either mistakes of fact or law.
To explain employing Justice Breyer’s birdwatching analogy, Breyer imagines a man who sees a flash of red in a tree and mistakenly says it is a cardinal when the bird is actually a scarlet tanager: “[A man] may have failed to see the bird’s black wings. In that case, he has made a mistake about the facts.” Alternatively, if said man saw “the bird perfectly well, noting all of its relevant features,” it is possible that, “not being much of a birdwatcher, he may not have known that a tanager (unlike a cardinal) has black wings.” For Breyer, that is a “labeling mistake” because the man “saw the bird correctly, but does not know how to label what he saw” (analogous to a mistake of law).[xii] A business person in the arts may know specific facts about her business; however, she may not be cognizant of how the law applies to it and applies the law to those facts inaccurately. §411(b)(1)(A) states that a certificate of registration satisfies the requirements of section 411 and section 412, regardless of whether the certificate contains any inaccurate information–—unless the inaccurate information was included on the application for copyright registration with knowledge that it was inaccurate.
The plain language of the text does not support an interpretation that would read constructive knowledge of how legal requirements bear on the facts at issue into the standard. To reach this conclusion, the majority opinion analyzed not only the plain language of the text but also “case law and the dictionary to find that “knowledge” means an applicant’s understanding of the relevant law that applies to the submitted information.[xiii] Therefore, an applicant who believes information submitted on a registration application is accurate cannot have acted with knowledge that the information was inaccurate.
The Majority also examined other provisions in the Copyright Act that refer specifically to circumstances where an individual should have been aware that a particular legal requirement is implicated (e.g., “‘reasonable grounds to know . . .,’” “‘reasonable grounds to believe . . .,`” ”‘not aware of facts or circumstances from which . . . is apparent’” and concluded that §411(b)(1)(A) does not contain any such analogous language.[xiv]
According to the majority, “the absence of similar language in the statutory provision before us tends to confirm our conclusion that Congress intended ‘knowledge’ here to bear its ordinary meaning.” When Congress includes particular language in one section of a statute but omits it in another, there is a presumption that Congress intended a difference in meaning.[xv]
Finally, the majority considered the legislative history of the Copyright Act. The Court understood that Congress wanted to make it easier, not more difficult, for artists and nonlawyers to obtain valid copyright registrations. Congress did not intend for good-faith errors to invalidate registrations, whether those errors were in issues of fact or issues of law. Invalidating copyright registration when a copyright owner was unaware of or misunderstood the law undermines the purpose of the Copyright Act. The Court dismissed the often-cited legal maxim that ignorance of the law is not an excuse by stating that it does not apply to civil cases concerning the scope of a statutory safe harbor that arises from ignorance of collateral legal requirement.[xvi]
Justice Thomas’ Dissent
Careful readers will note that the question the majority opinion answers is somewhat different from that granted certiorari. Justice Clarence Thomas filed a dissenting opinion, joined by Justices Samuel Alito and Neil Gorsuch, arguing primarily that the majority decided a question not properly presented to the Court. The question originally taken up by the Court was whether fraud was necessary to invalidate a registration. The majority found that the knowledge question is close enough to the question presented in the petition to qualify as a “subsidiary question fairly included” in the question presented.[xvii]
Justice Thomas, not joined by Justice Gorsuch, further dissents from the majority view that ignorance of the law is not an excuse.[xviii] He would have ruled that individuals are responsible for knowing the law, whether that be in the context of criminal or civil cases.
Based on the ruling, a mistake in an application for copyright registration is excusable so long as the copyright registrant or claimant lacked actual knowledge of the inaccuracy. The more complex issue perhaps is the proof issue––proving the relevant knowledge or lack of knowledge. While some may worry that there is a risk that claimants will falsely argue lack of knowledge, courts are well-versed in evaluating truthfulness and parsing evidence, including when they must evaluate subjective viewpoints and experiences.
The majority opinion demonstrates a sensitive balancing of the interest in promoting accurate registration with the understanding of the challenges faced by artists, creators, and other non-lawyers who may unintentionally make errors in filing registrations. Importantly, this decision gives little shelter to copyright lawyers if they register works and make a mistake; on the contrary, it should serve as a warning to copyright lawyers to be careful when filing a copyright registration lest they face potential validity challenges in the future.
The case is going back down to the Ninth Circuit on remand, and the question is: what facts and law did Unicolors know when it filed these registration applications?
[i] Unicolors, Inc. v. H&M Hennes & Mauritz, L.P., 959 F.3d 1194, at 1195* (2020).
[ii] Id at 1197.
[iii] See U.S. Copyright Office, Circular No. 34: Multiple Works (2021).
[iv] Unicolors, 959 F.3d 1194, at 1195 (2020).
[v] Id at 1197.
[vii] Id at 1200.
[ix] Id at 1197.
[xii] Unicolors Inc. v. H&M Hennes & Mauritz L.P., No. 20-915, 2022 WL 547681, at 4* (2022).
[xiii] Unicolors, WL 547681, at 4*(2022) (citing Intel Corp. Investment Policy Comm. v. Sulyma, 589 U. S. 140 S.Ct. 768, 776, 206 L.Ed.2d 103 (2020)).
[xiv] Unicolors, WL 547681, at 5*(citing §121A(a), §512(c)(1)(A), §901(a)(8), §1202(b) and §1401(c)(6)).
[xv] Unicolors, WL 547681, at 5* (2022) (citing Nken v. Holder, 556 U. S. 418, 430 (2009)).
[xvi] Unicolors, WL 547681, at 8*(2022) (citing Rehaif v. United States, 588 U. S. (2019)).
[xvii] Unicolors, WL 547681, at 8*(2022).