Allen v. Cooper - U.S. States Have Sovereign Immunity from Copyright Damages

Capture of the Pirate, 

Blackbeard, 1718

By J. L. G. Ferris

Last month, this Kat posited my observations and predictions regarding a case before the U.S. Supreme Court about state sovereign immunity in copyright, Allen v. Cooper. Today, the Supreme Court issued a disappointing ruling; all 9 justices concurred that Florida Prepaid (a similar Supreme Court case in the patent context) is binding precedent. As a result, the Court unanimously ruled that Congress did not validly abrogate state sovereign immunity through the Copyright Remedy Clarification Act (CRCA) under neither Article 1 of the Constitution nor under Section 5 of the 14th Amendment.


Although the Court has cemented an unfortunate limitation on copyright with this decision, it has left the door open for this Kat's predictions to be validated. Let's explore this decision on piracy and state sovereignty.

Supreme Court Case

This case arises from the sunken depths of North Carolina's coastline. In 1718, Blackbeard the Pirate wrecked his ship, the Queen Anne's Revenge "on a sandbar a mile off Beaufort, North Carolina." Nearly 300 years later, the Petitioner, Fredrick Allen was commissioned to photograph and take videos of efforts to salvage the wreck. Allen properly registered the works for copyright. 

Despite his exclusive right in the videos and photos, the State of North Carolina utilized them online without permission. After Allen's initial complaints, the state settled for $15,000 and agreed to provide attribution and timestamps on all future uses. When the state continued to use these works without attribution, Allen sued North Carolina and several officials in federal court. 

The Eastern District of North Carolina ruled that Allen was entitled to damages for copyright infringement, as the CRCA validly abrogated state sovereign immunity in copyright under Section 5 of the 14th Amendment. This ruling was reversed by the Fourth Circuit Court of Appeals, which read Florida Prepaid to preclude abrogation under both Article 1 of the Constitution and Section 5 of the 14th Amendment. The Supreme Court held oral argument on November 5, 2019; the Court issued a 9-0 ruling in favor of Cooper and the State of North Carolina on March 23, 2020 with Justice Kagan writing for the Majority.

Abrogation

In the U.S. federal system, state governments retain significant immunity vis-à-vis the federal government and federal laws. That immunity is enshrined in the 11th Amendment of the Constitution, which reads:

"The Judicial power of the United States shall not be construed to extend to any suit in law or equity, commenced or prosecuted against one of the United States by Citizens of another State, or by Citizens or Subjects of any Foreign State."

The Court has interpreted this to require (1) "unequivocal statutory language" abrogating state sovereign immunity (2) enacted pursuant to valid constitutional authority.  That the CRCA satisfies the first requirement is not a dispute; the act was passed with the sole aim of making states liable for copyright infringement damages. The Court considered two potential grounds for constitutional authority for Congress to abrogate state sovereign immunity in this regard: Article 1 of the Constitution and the Due Process clause of Section 5 of the 14th Amendment.

Article 1 Abrogation

Allen's primary argument rested constitutional authority to abrogate state sovereign immunity in Article 1, Section 8 of the Constitution - the enumerated powers of Congress. Particularly, Allen argued that Clause 8 of that Section, the Patent and Copyright Clause provided Congress the necessary authority abrogate state sovereign immunity under the CRCA. 

The Supreme Court did not agree with this notion, having ruled that Article 1 was not a proper basis for abrogation in the patent context in Florida Prepaid. The Court had "based that conclusion on Seminole Tribe v. Florida, decided three years earlier."

Despite this Allen offered the Court's decision in Central Virginia Community College v. Katz, in which the Court ruled abrogation of state sovereign immunity regarding bankruptcy to be valid under Article 1 as a reason to re-examine the holding of Florida Prepaid. The Court declined to do so, holding Katz to be limited to the bankruptcy context, rather than serving as grounds for a "clause-by-clause" re-examination of abrogation under Article 1. 

The Court noted that rather than merely permitting congressional abrogation under Article 1, "the bankruptcy clause itself" abrogated state sovereign immunity in bankruptcy as the plan of the convention. The Court considers this a unique circumstance providing for a limited exception to an otherwise settled rule against Article 1 abrogation of state sovereign immunity.

In addition to the inapplicability of Katz, the Court addressed abrogation under the same clause of Article 1 Section 8 in Florida Prepaid. In that case, the Court ruled that Article 1 could not serve as the basis for abrogation; in the present case, the Court recognized the principle of stare decisis with respect to that case. However, the Court elevated stare decisis in this decision, demanding a “special justification,” over and above the belief “that the precedent was wrongly decided” in order to rule incongruently with the precedent; Justice Thomas disagreed with this standard for stare decisis.

Due Process: 14th Amendment, Section 5 Abrogation

Although the 11th Amendment precludes (most) abrogation of state sovereign immunity under Article 1, Section 5 of the 14th Amendment affirmatively grants Congress the authority to abrogate such immunity to ensure the protections afforded by the amendment. Although this Kat identified several potential protections of the 14th amendment as grounds for abrogation, the Court only considered one: the deprivation of property (copyrights) without due process of law.

Looking again to Florida Prepaid, the Court considered the legislative record for the patent statute at issue, noting only two cases of patent infringement against states identified. The Court found this insufficient to serve as a pattern of constitutional violations required under the City of Boerne test for Section 5 abrogation in Florida Prepaid, failing to enforce Section 1 of the 14th Amendment for its broad scope in relation to violations identified.

This Kat does not seem pleased to be a pirate.

In the present case, the Court considered the scope of the statutes to be identical; thus, the Court would only uphold the CRCA if stronger evidence of infringement was presented in the legislative record. Despite a somewhat broader legislative record - including a report from then-Register of Copyrights, Ralph Oman - the Court determined that the seven identified cases were insufficient such that the congruence and proprtionality element of the City of Boerne test was not met. Further, the record failed to consider whether these cases were constitutional violations as deprivations of property without due process of law; although City of Boerne v. Flores was decided several years after the CRCA was enacted, the statute was held to the standard outlined in that case and failed to meet it.

Despite this rejection, the majority leaves the door open for future legislation to address state sovereign immunity in copyright. The Court notes that Congress will now have learned the lessons of Seminole Tribe, Florida Prepaid, and Boerne; thus, Congress can pass a law tailored to curtail copyright infringement by states pursuant to Section 5 of the 14th Amendment. As this Kat predicted, there may be a swell in state infringement, now that states have the approval of the highest court in the land. Such a swell would serve as the basis for a new statute, also with the approval of the highest court in the land:

"That kind of tailored statute can effectively stop States from behaving as copyright pirates. Even while respecting constitutional limits, it can bring digital Blackbeards to justice."

Justice Thomas Concurrence

Although Justice Thomas concurred with the conclusion of the Court, he wrote separately to identify three points of disagreement. First, Justice Thomas did not agree with the "special justification" requirement for stare decisis in spite of wrongly decided cases. Rather, the Justice considers it the obligation of the Court - when faced with demonstrably erroneous precedent - to “correct the error, regardless of whether other factors support overruling the precedent.” Justice Thomas concluded, however, that Florida Prepaid was correctly decided, prompting adherence with stare decisis.

Second, Justice Thomas declined to participate in discussing future copyright legislation, preferring to leave that to the legislature without the blessing of the judiciary. Finally, the Justice does not consider the question of copyright infringement as a deprivation of property without due process of law to be settled, leaving open the potential that such infringements do not rise to the level of constitutional violations. Because both parties ceded the point, considering the infringements at issue to be due process violations, Justice Thomas nevertheless concurred in the judgement.

Justice Breyer Concurrence

Additionally, Justice Breyer wrote a separate concurrence to which Justice Ginsburg signed on; Justice Breyer expresses discontent with the judgement, despite concurring with the conclusion:

"One might therefore expect that someone injured by a State’s violation of that duty could 'resort to the laws of his country for a remedy,' especially where, as here, Congress has sought to provide one."

Justice Breyer clearly disagrees with the Court's 11th Amendment jurisprudence, noting that "we went astray in Seminole Tribe" and "erred again in Florida Prepaid" over Justice Breyer's objections. However, recognizing that his "longstanding view has not carried the day," Justice Breyer concurred with the judgment as the proper result of the precedent of Florida Prepaid.

Comment

This Kat will wait patiently for a legislative answer

Copyright suffered a blow in the United States today, at least with respects to infringement by state actors. As Justice Breyer alluded to in the oral argument for this case, and this Kat predicted in a prior post, one may expect rampant copyright infringement by states and their agents in the wake of this decision which endorses the behavior. Perhaps the legislature will now venture to adopt legislation with Florida Prepaid, Seminole Tribe, and City of Boerne in mind, as six justices endorsed and two considered; unfortunately, this Kat doubts any progress will be made in that regard while the world deals with COVID-19.

On the other hand, this pandemic may inspire clever state governments to rely on this decision to the benefit of their residents as they shelter-in-place. Perhaps states could authorize their libraries to provide their catalogs to residents digitally without any concern of damages for copyright infringement. This could encourage compliance with shelter-in-place orders for those with reduced access to digital entertainment options in this time of crisis. Certainly, state governments will develop other clever means of exploiting this immunity to copyright damages, providing congress a basis for future abrogation of state sovereign immunity under Section 5 of the 14th Amendment.