Wednesday, April 02, 2008

Judge Posner and the Continuing Violation Doctrine

Seventh Circuit Judge Richard Posner issued an opinion yesterday that spells out his interpretation of the continuing violation doctrine in statute of limitations law. The case, Limestone Development Corp. v. Village of Lemont, Illinois, may be found here on the court's website. The docket number is 07-1438. The case is not a copyright case, but no matter, the principles are the same. Judge Posner draws a distinction between the discovery rule, which determines when the limitations begins, and the continuing violation doctrine, which governs the period of time for which damages may be recovered.

The two principles operate in tandem: ordinarily, if a discrete act occurs, in the case of copyright, one has three years from the occurrence of that act to bring suit or else all claims are barred. There is a split on the courts about whether the limitations period runs from the date the infringement occurs (injury accrual) or the date from which a reasonable person would have discovered the infringement (discovery accrual), but the continuing violation doctrine rides on top of either: if the infringement is a continuous one, suit may be brought anytime within three years from the date an ongoing infringement finally stops but, and this is what the opinion yesterday makes clear, damages may be recovered only three years back.

For example, an infringement begins in 2002 and continues until April 1, 2005. You had until March 31, 2008 to bring suit, but if you bring it on that date, your damages will only go back to March 31, 2005. In the past, Judge Posner's views on this have been misunderstood; the current case will dispel that misunderstanding. On one point though his opinion may be misunderstood. He states "The office of the misnamed doctrine is to allow suit to be delayed until a series of wrongful acts blossoms into an injury on which suit can be brought." That statement may be misunderstood to mean that the continuing violation doctrine somehow governs when there is a cause of action. I don't think that is what Judge Posner meant (hence his use of the phrase "a series of wrongful acts"): in all cases, until there is a cause of action, no suit can be brought, and thus the limitations period can't begin to run at all. The continuing violation doctrine also includes instances where there are initial injuries for which the copyright owner could sue if it chose to, but where the copyright owner decides to delay perhaps in the hope the infringement will stop, or, because the injury, though actionable, was small and not worth the candle, and only over time might it become enough of a threat that the expensive mechanism of litigation is justifiable.


Dean C. Rowan said...

I think you are too generous to Judge Posner with respect to the remark about which he is likely to be "misunderstood." In fact, I think the remark exhibits misunderstanding, or at least faulty expression. The example in his opinion following the sentence about the "series of wrongful acts" involves an initial occasion of an incipient recurrence of sexual harassment, an offensive action "too trivial to count as actionable harassment...." His analysis then perceives that each instance of such an act would itself not be actionable, and so, he concludes, "continuing violation" really amounts to "cumulative violation." In the contexts of sexual harassment and RICO, this is indeed how the doctrine might function. But there is no reason, by virtue of that fact, to deem it "misnamed," as Posner does, since in order for violations to accumulate, they must continue.

More importantly, the opinion relies on Klehr v. A.O. Smith Corp., 521 U.S. 179 (1997), as authority for the doctrine. In that case, the Court held plaintiffs' RICO claim untimely, despite the continuing nature of the defect in their dairy silo purchased twenty years prior to their filing suit. A continuing defect is distinct from a continuing series of violative acts, hence the outcome. But the Court also describes how the "continuing violation" doctrine operates:

"Antitrust law provides that, in the case of a 'continuing violation,' say, a price-fixing conspiracy that brings about a series of unlawfully high priced sales over a period of years, 'each overt act that is part of the violation and that injures the plaintiff,' e.g., each sale to the plaintiff, 'starts the statutory period running again, regardless of the plaintiff's knowledge of the alleged illegality at much earlier times.'" 521 U.S. at 189. (The Court cites to Areeda and Hovenkamp for the internal quotations.)

In short, although there are circumstances in which the "continuing violation" doctrine does serve the function specified by Posner—"to allow suit to be delayed until a series of wrongful acts blossoms into an injury on which suit can be brought"—it also serves the purpose of allowing the limitations period to be shifted forward, albeit at the cost of recovering for injuries occurring prior to the shifted period. The effect is not purely cumulative.

Anonymous said...

How do the Circuits currently split on the doctrine? The Squirrel Hill case states that the Ninth, Sixth, Fifth, and Second have rejected the doctrine, but does not name any that have embraced it outside the Seventh.