Given that Section 301 of the Copyright Act preempts equivalent state law causes of actions and remedies, state courts can not hear claims brought directly under the Copyright Act, or what are really copyright claims dressed up in the sheep’s clothing of a state claim, like unfair competition via mere copying of a work (protected or not). But does this mean that state courts can’t hear any issues in which adjudication an issue under the Copyright Act is raised?
For example, let’s say plaintiff sues defendant in state court for libel. The alleged libel is copyright infringement. Defendant says he is not guilty of libel because although he copied plaintiff’s work without permission, his copying was fair use. Say this is the sole issue in the case. In order to determine whether plaintiff’s state libel claim succeeds, the court (or jury) will be deciding a question that is purely one of federal copyright law. Can the court (or jury) do this? See Mitcham v. Board of Regents, University of Texas Systems, 670 S.W.2d 371 (Tex. App. Texarkana 1984).
This sort of issue was presented recently in Leslie v. Texas Collegiate Baseball League, Ltd., 2008 WL 898935 (N.D. Tex. April 3, 2008)( Civil Action No. 3:07-CV-1582-D)(Sidney Fitzwater, J.) As noted by the court, defendant had earlier sued plaintiff in state court “alleging breach of contract, tortious interference with contract, and an illegal group boycott. TCBL also sought declaratory and injunctive relief to prevent plaintiffs from using certain trademarks and marketing techniques that TCBL allegedly developed. TCBL's claims in the state action rely exclusively on state law.”
Plaintiff then filed suit in federal court under the federal Declaratory Judgment Act, seeking a declaration that they did not breach or unlawfully terminate the contracts at issue, that their conduct did not violate the federal Sherman Act, and that their use of the marketing concepts and designs in question is protected by the Copyright Act and the federal Lanham (trademark) Act. Defendant moved to dismiss, crying foul (or balk).
The court agreed with defendant, noting both that declaratory judgment was discretionary, and that “plaintiffs' claims based on the Copyright Act and the Lanham Act are essentially defenses to TCBL's state-law claim for injunctive and declaratory relief, and plaintiffs do not argue that these defenses are unavailable in the state action.”