In a 6-3 decision, the justices said that Paula Petrella, daughter of the late screenwriter Frank Petrella, did not wait too long to file her lawsuit against Metro-Goldwyn-Mayer claiming an interest in the film.
Petrella's father collaborated with legendary boxer Jake LaMotta on a book and two screenplays, which inspired the movie directed by Martin Scorsese and starring Robert DeNiro. The elder Petrella died in 1981 and the copyrights passed to his daughter.
She sued MGM in 2009 seeking royalties from continuing commercial use of the film. But a federal judge said she waited too long because she had been aware of the potential to file a lawsuit as early as 1991. The 9th U.S. Circuit Court of Appeals agreed, relying on the studio's argument that Petrella's delay of nearly two decades in bringing the case was unreasonable.
The Supreme Court reversed that ruling, giving Petrella a chance to resurrect her lawsuit. The ruling was a blow to movie studios, which have long relied on the legal doctrine of unreasonable delay to prevent distant relatives and estates from bringing copyright claims years or decades after movies have been released.
"What you have now is the ability for a plaintiff to come out of the woodwork and say that some creative work that was a hit in the 70s, 80s or 90s belonged to them," said Brad Newberg a copyright law expert at the Reed Smith law firm in Northern Virginia. "I would say there's now going to be an explosion of these types of cases."
Federal copyright law allows people to bring copyright claims within three years of an infringing act. Petrella's claim fell within that time because the studio continued to release the film on DVD and other formats for years and every new release essentially reset the clock for copyright purposes.
MGM argued that Petrella delayed filing her case on purpose in hopes of getting more money, saying she waited until after the 25th anniversary of the movie in 2005 to press her claim. Meanwhile, the studio had invested $8.5 million to distribute and promote the film assuming there was no other claim to ownership.
That wasn't a problem for the high court. Writing for the majority, Justice Ruth Bader Ginsburg said there "is nothing untoward about waiting to see whether an infringer is making money, so that litigation is worth the candle."
Allowing Petrella's suit to go forward "will put at risk only a fraction of the income MGM has earned during that period and will work no unjust hardship on innocent third parties, such as consumers who have purchased copies of 'Raging Bull,'" Ginsburg said.
Ginsburg was joined by Justices Antonin Scalia, Clarence Thomas, Samuel Alito, Sonia Sotomayor and Elena Kagan.
In dissent, Justice Stephen Breyer said the legal doctrine of unreasonable delay should apply to Petrella's case because she waited 18 years after renewing her copyright to file a lawsuit. The effect of delaying legal action can give plaintiffs an unfair advantage in a copyright claim as witnesses die and memories fade, Breyer said, and should be a viable defense.
Breyer was joined in dissent by Chief Justice John Roberts and Justice Anthony Kennedy.
Groups including the Motion Picture Association of America, Consumer Electronics Association, DirecTV and TiVo sided with MGM, arguing that it's unfair to allow plaintiffs to wait years or decades to file copyright claims while studios invest millions in their products.
But Petrella won support from groups including the Authors Guild and the Songwriters Guild of America. They argued that the rolling three-year copyright protection is fair to artists and gives them incentive to create their works.
"This is definitely a victory for the little guy," said Jan Constantine, general counsel for the Authors Guild. She called the decision a win for artists "who don't have teams of lawyers and boundless financial resources."
The case is Petrella v. Metro-Goldwyn-Mayer, Inc., 12-1315.
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