Intellectual Property Legal Alert

Today the Supreme Court upheld as constitutional the Sonny Bono Copyright Term Extension Act of 1998 ("CTEA"). In Eldred v. Ashcroft, 573 U.S. ___ (Jan. 15, 2003), the Court held that Congress acted within its authority when it granted copyright terms extensions for published works with existing copyright protection.

The case rests in part on a challenge by individuals and businesses that desire to copy or derive products from formerly copyrighted works that have gone into the public domain following the expiration of their copyright protection. The petitioners sought a declaration that the CTEA violated the provision of Article I, §8, cl. 8 of the Constitution, which specifies that Congress may secure copyright protection to authors for "limited Times". Under the CTEA, Congress extended the copyright term for most works – including existing works – to life of the author plus 70 years. The extension brought the terms of United States copyrights into harmony with the terms adopted by the European Union. The petitioners claimed that Congress overstepped its bounds under the Copyright Clause and the First Amendment by applying the extension retroactively.

Writing for the Court, Justice Ruth Bader Ginsburg found that the CTEA is consistent with prior term extensions in the 1831, 1909 and 1976 Copyright Acts, as well as extensions for patents, by placing all existing and future copyrights in parity. The Court rejected the petitioners’ argument that "a time prescription, once set, becomes forever ‘fixed’ or ‘inalterable’". Slip Op. at 8. The Court found that the term "limited" means in 2003 the same as at the time the Constitution was framed: "confined within certain bounds," "restrained" or "circumscribed". Thus, a limited time frame does not cease to be limited when applied to existing copyrights. Id. The Court noted that Congress could find that it would be unfair to place the author of an older work on unequal ground with the authors of newer works. The Court deferred to Congress on the subject of whether the CTEA was a "rational exercise of legislative authority conferred by the Copyright Clause." Slip Op. at 13-14. The Court found that placing U.S. copyright holders in an equal position with their European counterparts, as well as demographic, economic and technological changes and "rationally credited projections that longer terms would encourage copyright holders to invest in the restoration and public distribution of their works," id. at 16, were sufficient reasons to surpass constitutional scrutiny.

Justice Ginsburg next rejected the contention that permitting Congress to extend copyright terms repeatedly evades the "limited Times" constraint. The Court found that the petitioners had failed to demonstrate how the CTEA crosses a constitutionally significant threshold that the 1831, 1909 and 1976 term extensions did not. Id. at 18-19. The Court also rejected the argument that term extension overlooks the requirement of "originality" as required by Feist Publications, Inc. v. Rural Telephone Service Co., 499 U.S. 340 (1991) because once published, a work is no longer original. The Court stated that Feist addressed the core question of copyrightability, and did not reach the issue of duration of protection.

The Court then addressed the petitioners’ argument that the meaning of "limited Times" must be read in the context of the preamble to the clause: to "promote the Progress of Science". The petitioners contended that the CTEA failed to meet this end because it did not stimulate the creation of new works, but merely rewarded those who have previously created copyrightable subject matter. The Court again deferred to Congress, finding that "it is generally best for Congress, not the courts, to decide how best to pursue the Copyright Clause’s objectives." Id. at 22. The Court also held that authors reasonably would comprehend the legislative bargain – exclusive rights for a limited time in exchange for free public domain use thereafter – to include a renewal or extension legislated during that time. The Court distinguished copyright protection from the line of "quid pro quo" patent cases, holding that copyrights withhold only a certain expression, and not any knowledge or ideas, from the public. Id. at 26.

Finally, the Court rejected the petitioners First Amendment arguments, finding that the copyright law "contains built-in First Amendment accommodations" and that the CTEA "supplements these traditional First Amendment safeguards." Id. at 29, 30.

Justice Breyer wrote in dissent that the economic effect of the CTEA is to make the copyright term "virtually perpetual". Dissent, Breyer, J. at 1. Justice Breyer contended that the CTEA actually inhibits the "Progress of Science" and proposed a higher level of scrutiny than required by the majority. Id. at 3. Breyer found that the CTEA, in contrast to the goal of the Copyright Clause to promote artistic creativity for the public good, provided only a special private benefit. Breyer relied mainly on an economic theory to show that the retroactive term extension was not justified or rational. He also found that the Act did not harmonize United States copyright terms with European Union protections, nor would the supposed conformity encourage creation.

Justice Stevens found that the dual purposes of encouraging new works and adding to the public domain applies to both patents and copyrights. Dissent, Stevens, J. at 6. Retroactive term extensions, therefore, result in a "gratuitous transfer of wealth from the pubic to authors, publishers, and their successors in interest." Id. Like the majority, Stevens reviewed the past copyright and patent term extensions and found that "the general presumption that historic practice illuminates the constitutionality of congressional action is not controlling in this case" because no member of Congress in 1831 or later was a delegate to the framing convention. Id. at 17. In addition, he criticized the majority’s reliance on caselaw interpreting earlier legislative enactments as unsupported. Finally, Justice Stevens found the argument of equity between older and newer works unpersuasive, as all authors would receive precisely the term they expected at the time protection was granted.