Eleventh Circuit: Fair Use, Laches, and Kitchen Sink

The Eleventh Circuit has been on a copyright tear in the last two weeks. In addition to the en banc opinion in the Greenberg - National Geographic Society case, there was a highly technical opinion on the Satellite Home Viewer Act and the Section 119 compulsory license, as well as today's opinion: Peter Letterese & Associates, Inc. v. World Institute of Scientology Enterprises, a 69 page opinion by Judge Tjoflat. The opinion is so vast that he has a introductory section explaining its organization.

So what, you might ask, caused so many trees to be felled and ink to be spilled? There are almost 10 pages of facts, for one thing. I will boil the facts down to this: there was a guy (Leslie Achilles "Les" Dane) who developed a sales book on closing techniques. L. Ron Hubbard liked it, bought some copies, and began teaching its techniques. For many years, Dane and the Scientologists had a good working relationship; Dane went to many Scientology offices and gave seminars. Dane died and a different company, run by a booted-out Scientologist (Peter Letterese), bought Dane's copyrights and sued the Scientologists.

The first issue to be discussed was whether a derivative work was created. Here the facts are unclear to me, but in one part of the opinion it is stated that the Scientologists "did not make copies of the book itself; students would either borrow or purchase the book for their study." The Scientologists did, though, produce their own course book, and may have appended some of Dane's material to it without copying that material. This seems to be what led the Eleventh Circuit to trash-talk the Ninth Circuit's Mirage Editions v. Albuquerque A.R.T. Co., 856 F.3d 1341 (9th Cir. 1988) opinion, which held that remounting an original copy was an infringing work. No way according to the Eleventh, siding with Judge Easterbrook's opinion in Lee v. A.R.T. Co., 125 F.3d 582 (77th Cir. 1997).

There are then 15 pages on whether the two course books were substantially similar. I can sum that up in one word, "no." Next up was fair use, 28 pages. There are a few interesting passages in that discussion. The first is the court of appeals' rejection of the district court's "fifth factor," which it called "the copyright owner's actual consent to the use of the copyrighted material." This factor was held by the court of appeals to be "incorrect, both in terms of logic and precedent." If someone has consented, then one need not rely on fair use, which is a privileged, unconsented to use. The rest of the fair use opinion is straightforward enough, but there is a discussion of out of print books worthy of reading. The court held that the fact that a book is out of print will tend to favor fair use (p. 46-47). But in this case, the plaintiff withheld the book in order to make a decision about when and how to re-release it; hence the book was not out-of-print in the usual sense, i.e., no immediate plans to republish it.

The final part of the opinion deals with whether laches is available for causes of action brought within the statute of limitations period. I have blogged about this before, and my view, siding with the Fourth Circuit's Lyons opinion, is no, it is not. The Eleventh Circuit couldn't bring itself to say "no, never," but did say a: "presumptive 'no;' there is a strong presumption that a plaintiff's suit is timely if it is filed before the statute of limitations has run. Only in the most extraordinary circumstances will laches recognize a defense." The court added,: "Even where such extraordinary circumstances exist, however, laches serves as a bar only to the recovery of retrospective damages, not to prospective relief."