Cooper v. NCS Pearson, Inc.

FILED
United States Court of Appeals
Tenth Circuit
August 19, 2013
Elisabeth A. Shumaker
Clerk of Court
PUBLISH
UNITED STATES COURT OF APPEALS
TENTH CIRCUIT
JULIA COPELAND COOPER, an
individual United States citizen,
Plaintiff-Appellant,
v. No. 12-1096
NCS PEARSON, INC., a Minnesota
corporation,
Defendant-Appellee.
Appeal from the United States District Court
for the District of Colorado
(D.C. No. 1:10-CV-02840-PAB-CBS)
Harold R. Bruno III of Robinson Waters & O’Dorisio, P.C., Denver, Colorado,
for Plaintiff-Appellant.
Gregory S. Tamkin (Kerry LeMonte with him on the brief) of Dorsey & Whitney,
LLP, Denver, Colorado, for Defendant-Appellee.
Before LUCERO, SEYMOUR, and MURPHY, Circuit Judges.
SEYMOUR, Circuit Judge.
Julia Copeland Cooper (Copeland) appeals from a grant of summary
judgment dismissing on statute of limitations grounds her Copyright Act claims
against NCS Pearson, Inc. for co-ownership of a psychological test. The statute
of limitations for claims under the Copyright Act is three years. 17 U.S.C. §
507(b). Because any such claims available to Ms. Copeland would have accrued
in 1993 or 1996 and she did not bring this action until 2010, we affirm.
I.
On review of summary judgment, we recite the relevant facts in the light
most favorable to the non-moving party. Fye v. Oklahoma Corp. Comm’n, 516
F.3d 1217, 1220 n.1 (10th Cir. 2008). In the 1980s and 1990s, Ms. Copeland
co-created a psychological test instrument called the Battery for Health
Improvement (BHI) with Mark Disorbio, her husband at the time, and Daniel
Bruns. Ms. Copeland is a physical therapist and Dr. Disorbio and Dr. Bruns are
both clinical psychologists. After creating the BHI, Ms. Copeland, Dr. Bruns, and
Dr. Disorbio formed a corporation called Battery for Health and Illness, Inc.
(BHI, Inc.). Dr. Bruns and Dr. Disorbio were the corporation’s directors and
Ms. Copeland was its President and registered agent. The record does not reflect
who owned the stock. In 1993, Dr. Bruns and Dr. Disorbio assigned their
intellectual property rights in the BHI to the corporation. Each assignment stated
that Dr. Bruns and Dr. Disorbio were the joint authors and owners of the BHI and
the “absolute proprietor[s] of the copyright and all attendant intellectual property
rights of the Work.” Aplt. App., vol. 1 at 103-04 (Dr. Bruns assignment), 143-44
(Dr. Disorbio assignment). The assignments further warranted that Dr. Bruns and
Dr. Disorbio “exclusively own[] all intellectual property rights in the Work and
that no other person has an option, claim, or right to the Work.” Id. at 104, 144.
Ms. Copeland executed these assignments as president of BHI, Inc.
Effective May 4, 1993, Dr. Bruns, Dr. Disorbio, and BHI, Inc. granted
defendant’s predecessor corporation, National Computer Systems (NCS), “all
right, title, and interest” in the BHI, granting the right to publish and market the
test in exchange for royalties. Id. at 78. The Publication Agreement with NCS
defined the “authors” of the BHI as Dr. Bruns, Dr. Disorbio, and BHI, Inc., and
warranted that they “exclusively own all Intellectual Property Rights” in the BHI
“and that no other person has an option, claim, or right” to the test. Id. at 82.
The Publication Agreement did not identify Ms. Copeland as an author. It was
signed by Ms. Copeland for BHI, Inc., Dr. Bruns, Dr. Disorbio, and a
representative of NCS. We accept for summary judgment purposes Ms.
Copeland’s explanation that she signed the Agreement because Dr. Disorbio told
her that only clinical psychologists could be listed as authors of psychological
tests on “legal documents,” and she believed him at the time.
In 1996, NCS first published the BHI. The cover stated that it was “by”
Dr. Bruns and Dr. Disorbio, “with contributions by” Ms. Copeland. Id., vol. 2 at
538. She was also listed below Dr. Bruns and Dr. Disorbio in the section “About
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the Authors.” Ms. Copeland was aware that she was being credited in this
manner. See id., vol. 1 at 255 (Ms. Copeland checked to see if there had been any
change in “the way I was credited since 1996”). In 1996, NCS began to send
royalty checks to BHI, Inc., to the attention of Ms. Copeland as President. She
disbursed 50% of the money to Dr. Bruns and 50% to Dr. Disorbio. Because she
and Dr. Disorbio were married, however, she effectively shared in his portion of
the royalties. They divorced in 1999. 1
In 2002, defendant published new editions of the BHI that did not list
Ms. Copeland’s name on the cover or on the page about the authors. 2
Ms. Copeland discovered the change in 2009 and brought this action in federal
court in 2010. Her complaint sought a declaration that she is a one-third co-
owner (with NCS Pearson owning the other two-thirds) of the copyright to the
BHI, an order requiring NCS Pearson to start crediting her “in the same manner”
as it credits Dr. Bruns and Dr. Disorbio, and an accounting for her share of
revenues. Id. at 9. The district court granted summary judgment for defendant on
statute of limitations grounds, and thus did not reach defendant’s equitable
1
Ms. Copeland receives one-third of Dr. Disorbio’s royalties through their
divorce decree. It appears she did not raise any claims related to co-ownership of
the BHI in the divorce proceedings.
2
In both of these editions, Ms. Copeland was acknowledged as follows:
“The authors wish to express their appreciation to [plaintiff] whose knowledge,
professional expertise, and support greatly facilitated the completion of this
project.” Aplt. App., vol. 1 at 65, 72; id., vol. 2 at 415.
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defenses of estoppel, laches, and unclean hands.
II.
We review a grant of summary judgment de novo. Colorado Dep’t of Pub.
Health & Env’t v. United States, 693 F.3d 1214, 1221 (10th Cir. 2012). Summary
judgment is appropriate if there is “no genuine dispute as to any material fact and
the movant is entitled to judgment as a matter of law.” Id. (quoting F ED . R. C IV .
P. 56(a)).
No civil action under the Copyright Act can proceed “unless it is
commenced within three years after the claim accrued.” 17 U.S.C. § 507(b). The
Act is silent as to when a copyright claim “accrues,” and neither this circuit nor
the Supreme Court has specifically defined copyright claim accrual. However,
the statute of limitations for a federal cause of action generally “begins to run
when the plaintiff knows or has reason to know of the existence and cause of the
injury which is the basis of his action.” Indus. Constructors Corp. v. U.S. Bureau
of Reclamation, 15 F.3d 963, 969 (10th Cir. 1994). In the copyright co-ownership
context, no form of notice or constructive notice is clearer than “plain and express
repudiation of co-ownership . . . communicated to the claimant.” Zuill v.
Shanahan, 80 F.3d 1366, 1369 (9th Cir. 1996); id. at 1368 (contract offered to
plaintiffs stating that defendant was “sole owner and copyright holder” put
plaintiffs on notice even though plaintiffs did not sign contract); Ritchie v.
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Williams, 395 F.3d 283, 288 n.5 (6th Cir. 2005) (same, in letter); see also Roger
Miller Music, Inc. v. Sony/ATV Publ’g, LLC, 477 F.3d 383, 390 (6th Cir. 2007).
The district court held that the 1993 Publication Agreement put Ms.
Copeland on notice that NCS was repudiating her ownership interest, assuming
she had one, in the BHI. Accordingly, the court held that her claim accrued in
1993. We reject Ms. Copeland’s argument that the district court impermissibly
weighed evidence or decided disputed facts to reach this conclusion. The court
relied only on the undisputed fact that Ms. Copeland signed the 1993 Agreement
knowing what it said, i.e., that NCS was acquiring “all Intellectual Property
Rights” to the BHI and that no person other than Dr. Bruns and Dr. Disorbio “has
an option, claim, or right” to the BHI. Aplt. App., vol. 1 at 82. Ms. Copeland has
not alleged that she signed the Agreement due to some form of fraudulent
concealment, inducement, or other improper behavior on defendant NCS
Pearson’s part which made her unaware of its contents. See, e.g., Indus.
Constructors, 15 F.3d at 969. We agree with the district court that the 1993
Agreement placed Ms. Copeland on notice that her ostensible copyright co-
ownership claim was in jeopardy and thereby started the statute of limitations
running.
Ms. Copeland’s only explanation for why she signed the Agreement is that
Dr. Disorbio told her she could not be listed as an author of the BHI on legal
documents. She also asserts that Dr. Disorbio and Dr. Bruns continued to credit
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her as a co-author of the BHI on their own personal materials and CVs after 1993,
which kept her from realizing that NCS did not consider her a co-author. While
fraudulent concealment, inducement, or trickery by a defendant can toll the
statute of limitations of a federal cause of action, Indus. Constructors, 15 F.3d at
969; Irwin v. Dep’t. of Veterans Affairs, 498 U.S. 89, 96 (1990), Dr. Bruns and
Dr. Disorbio are not defendants in this action, and Ms. Copeland does not allege
any connection between their actions and defendant NCS Pearson.
Ms. Copeland argues that the district court wrongly attributed dispositive
weight to the 1993 Agreement and ignored her explanation that she signed it only
because Dr. Disorbio told her that as a non-psychologist she could not be
recognized as an author on legal documents, which she believed to be legally
correct. But the district court’s analysis of the 1993 Agreement and
Ms. Copeland’s proffered facts was not a fact determination; it was an application
of the legal principle that ignorance of the law does not toll a statute of
limitations. Gatewood v. R.R. Ret. Bd., 88 F.3d 886, 889-90 (10th Cir. 1996).
The district court reasoned in the alternative that if Ms. Copeland’s claim
did not accrue in 1993, it clearly accrued by 1996. We agree. Although Ms.
Copeland admitted she was aware of the 1996 BHI, which represented that it was
“by” Dr. Bruns and Dr. Disorbio, “with contributions by” her, in the present
action she nevertheless claims the right to be recognized in the same manner as
Dr. Bruns and Dr. Disorbio. Awareness that one is not being credited in the same
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manner as other authors starts the statute of limitations running for copyright
co-ownership claims. Aalmuhammed v. Lee, 202 F.3d 1227, 1231 (9th Cir. 2000).
Because Ms. Copeland was aware in 1996 of the basis for this claimed right – that
she was not being attributed in the same manner – her claim accrued then if it had
not already accrued in 1993.
It is undisputed that Ms. Copeland was aware in 1996 she was not receiving
royalties but that Dr. Bruns and Dr. Disorbio were. Awareness that one is not
receiving royalties also puts one on notice of the basis for a copyright
co-ownership claim. Cambridge Literary Props., Ltd. v. W. Goebel
Porzellanfabrik, 510 F.3d 77, 90 (1st Cir. 2007); see also Santa-Rosa v. Combo
Records, 471 F.3d 224, 228 (1st Cir. 2006). Ms. Copeland argues that because
she received money paid as royalties for the BHI through Dr. Disorbio when she
was married to him, and later through the divorce decree, the district court should
not have attributed “dispositive significance” to the fact that she was not paid an
individual share of royalties by defendant or its predecessor. This argument is
specious. Spouses may share in one spouse’s royalties during a marriage by the
operation of marital property laws, and royalties can accordingly be divided upon
divorce as a form of marital property. See, e.g., Matter of Marriage of Monslow,
912 P.2d 735, 747 (Kan. 1996); In re Marriage of Heinze, 631 N.E.2d 728, 786
(Ill. App. Ct. 1994). That Dr. Disorbio’s royalty payments benefitted
Ms. Copeland because she was his spouse does not support even a weak inference
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that NCS recognized her to be a co-author of the BHI. Indeed, if Dr. Disorbio
and Ms. Copeland were each one-third owners of the copyright but had for some
reason agreed to receive their royalty payments in one check, we would expect
their “marital” share of royalties to have been two-thirds, with Dr. Bruns taking
the other third. Instead, Dr. Disorbio received half and Dr. Bruns received half.
This arrangement reinforces, rather than undermines, the conclusion the district
court drew from the other undisputed facts: that NCS believed Dr. Disorbio and
Dr. Bruns to be the only two authors of the BHI, and that Ms. Copeland, having
signed the 1993 Agreement and seen the 1996 BHI, knew or should have known
that NCS so believed.
All of Ms. Copeland’s other proffered fact disputes are immaterial. “A fact
is ‘material’ if, under the governing law, it could have an effect on the outcome of
the lawsuit.” E.E.O.C. v. Horizon/CMS Healthcare Corp., 220 F.3d 1184, 1190
(10th Cir. 2000). Ms. Copeland relies heavily on the (disputed) fact that Dr.
Bruns and Dr. Disorbio represented her to be a BHI co-author on some of their
personal materials after 1993 and 1996, such as their CVs and websites. She does
not contend that these representations were done in connection with defendant
NCS Pearson and, as we have already noted, Dr. Bruns and Dr. Disorbio are not
defendants in this action. Thus, those facts, even if true, would not affect when
her claim accrued against NCS Pearson. Ms. Copeland also refers to evidence
that she was acknowledged as a co-author of other publications: an article about
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the BHI in a magazine, and a guidebook called Advanced BHI Interpretation.
Although these publications are related to the BHI, we fail to see (and
Ms. Copeland does not explain) how they would call into question NCS’s express
repudiation of her authorship of the BHI itself.
Finally, Ms. Copeland contends that “throughout the 2000s” she saw
materials published by defendant that gave her authorship credit. But as we have
explained, the statute of limitations started running in 1993 or at best 1996, so it
would have expired in 1996 or 1999. Even assuming there were grounds to toll
the statute of limitations in “the 2000s,” therefore, that would not make
Ms. Copeland’s claim timely because the basis for tolling would have arisen after
the limitations period expired. Merchant v. Levy, 92 F.3d 51, 56 (2d Cir. 1996).
Any copyright co-ownership claims Ms. Copeland might have had accrued
in 1993 or 1996 and are therefore barred by the three-year statute of limitations
set out in 17 U.S.C. § 507(b). 3 We affirm.
3
Any reference herein to Ms. Copeland’s copyright co-ownership claims is
purely hypothetical and not just because we have not reached their merits.
Equitable estoppel “prevent[s] a party from taking a legal position inconsistent
with an earlier statement or action that places his adversary at a disadvantage.”
Penny v. Giuffrida, 897 F.2d 1543, 1545 (10th Cir. 1990). Although we need not
reach the issue, we note that defendant’s equitable estoppel defense against even a
timely copyright co-ownership claim by Ms. Copeland would likely succeed,
given that she signed a document warranting to NCS that she did not have an
ownership interest in the BHI.
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