Canada Hockey v. Texas A&M Univ

Case: 20-20503 Document: 00516201715 Page: 1 Date Filed: 02/14/2022
United States Court of Appeals
for the Fifth Circuit
United States Court of Appeals
Fifth Circuit
FILED
February 14, 2022
No. 20-20503 Lyle W. Cayce
Clerk
Canada Hockey, L.L.C., doing business as Epic Sports;
Michael J. Bynum,
Plaintiffs—Appellants,
versus
Texas A&M University Athletic Department; Alan
Cannon; Lane Stephenson, in his individual capacity,
Defendants—Appellees.
Appeal from the United States District Court
for the Southern District of Texas
USDC No. 4:17-CV-181
ON PETITION FOR REHEARING
Before Owen, Chief Judge, Smith and Graves, Circuit Judges.
James E. Graves, Jr., Circuit Judge:*
*
Pursuant to 5th Circuit Rule 47.5, the court has determined that this
opinion should not be published and is not precedent except under the limited
circumstances set forth in 5th Circuit Rule 47.5.4.
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IT IS ORDERED that the petition for rehearing is DENIED. The
opinion, filed September 8, 2021, is WITHDRAWN, and the following is
SUBSTITUTED:
Michael J. Bynum and his publishing company sued Texas A&M
University and its employees after they published a part of Bynum’s
forthcoming book without permission. Relevant here, the district court
dismissed all claims against Texas A&M on state sovereign immunity
grounds and those against two Texas A&M employees for failure to state a
claim. We AFFIRM.
I. Background
For purposes of this appeal, we accept the factual allegations stated in
the complaint as true. See, e.g., Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
Michael J. Bynum is a sportswriter and editor that operates his own
publishing company, Canada Hockey LLC d/b/a Epic Sports (“Epic
Sports”). In 1980, Bynum became interested in the “12th Man” lore while
working on his first book about Texas A&M University’s (TAMU) football
program. Plaintiffs describe the 12th Man story as follows:
The University’s now famous 12th Man tradition was inspired
by the actions of E. King Gill at the 1922 football game known
as the “Dixie Classic.” Gill, a squad player for A&M’s football
team, who was already training with the university’s basketball
team, was up in the press box watching his team face the then
top-ranked Prayin’ Colonels of Centre College, when he was
waved down to the sideline before halftime to suit up in case
his injured team ran out of reserve players. Gill stood on the
sideline, ready to play, for the remainder of the game.
Gill's commitment to step up for his team when in need later
became a legend that was passed down from generation to
generation of Aggies. Today, the 12th Man tradition is a symbol
of the Aggies’ unity, loyalty, and willingness to serve when
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called upon to do so, and is woven into many aspects of life at
A&M.
In 1990, TAMU registered “12th Man” as a trademark and has since
aggressively enforced it.
Intrigued by the story, Bynum decided to write about Gill and his
impact on TAMU’s football program for a forthcoming book titled 12th Man.
For many years, Bynum researched Gill and the 12th Man story, including
reviewing primary documents, visiting relevant locations, and conducting
interviews with personnel in TAMU’s Athletic Department. The personnel
included Brad Marquardt, an Associate Director of Media Relations, and
Alan Cannon, an Assistant Athletic Director for Media Relations. Marquardt
reported to Cannon and managed the Athletic Department’s official Twitter
account dedicated to its football program (@AggieFootball). Cannon handled
media relations for all sports programs in the Athletic Department and
managed the department’s official website. Eventually, Bynum hired Whit
Canning to write a short biography about Gill (the “Gill Biography”), titled
“An A&M Legend Comes to Life,” which Bynum planned to use as the
opening chapter of his book.
In June 2010, Bynum emailed Marquardt seeking photographs to
include in his book, sending along a draft of the book in PDF form. In the
email, Bynum specified that the PDF was “a draft version of the 12th Man
Book” and “a work in progress . . . not in final form yet.” The draft contained
Bynum’s name, copyright date, an indication that Epic Sports owned the
copyright to the book, and a statement that “no part of the book may be
reproduced or used in any form or by any means . . . without the permission
of the publisher.” The Gill Biography was the opening chapter of the book.
Bynum continued to email Marquardt as late as December 2013, asking
questions related to the book. Bynum planned to publish his 12th Man book
in the fall of 2014.
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In January 2014, TAMU’s Athletic Department directed its staff to
find background information on Gill that could be used to promote the 12th
Man story and raise money. Marquardt directed his secretary to retype the
Gill Biography that Bynum sent to Marquardt in 2010; remove any references
to Bynum or Epic Sports; rewrite the byline to read “by Whit Canning,
special to Texas A&M Athletics” to suggest that Canning was commissioned
to write the Biography exclusively for the Athletic Department; and change
the original title of the Biography from “An A&M Legend Comes to Life” to
“The Original 12th Man.” Marquardt provided the retyped Biography to his
work colleagues, including Cannon and Lane Stephenson, the Director of
News & Information Services at TAMU, for approval and publication.
Stephenson was in charge of TAMU’s official Twitter account (@TAMU)
and “TAMU Times,” which was TAMU’s e-newsletter and website.
Soon after, the Athletic Department published the contents of the Gill
Biography as an article on its website. Then, on January 19, 2014, both
TAMU and its Athletic Department tweeted a link to the article on their
respective Twitter accounts. The posts were retweeted and discussed by
news sources. The article was also featured in TAMU Times.
On January 22, 2014, Bynum emailed Marquardt and another
employee of the Athletic Department requesting immediate removal of the
article. Several hours later, Marquardt responded that the article was no
longer on the website, apologized for the “mix-up,” and asked whether it
would “be possible to post the story as an ‘excerpt’ to [his] book.” He also
stated: “I asked my secretary to key [the Biography] in for me which she
did.” Though the article was removed, it was shared by others and reposted
on various online forums. The book remains unpublished.
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In 2017, Bynum and Epic Sports filed suit against the TAMU Athletic
Department, the TAMU 12th Man Foundation, 1 and employees of the
Athletic Department. Relevant here, Plaintiffs assert the following claims: (1)
direct copyright infringement under the Copyright Remedy Clarification Act
(CRCA), 17 U.S.C. § 501, against the Athletic Department, Cannon, and
Stephenson; (2) contributory copyright infringement against the same; (3)
vicarious copyright infringement 2 against the Athletic Department; (4)
violation of the Digital Millennium Copyright Act (DMCA), 17 U.S.C. §
1202, against the Athletic Department; (5) violation of the Takings Clause of
the Texas Constitution against the Athletic Department; and (6) violation of
the Takings Clause of the U.S. Constitution against the Athletic Department.
TAMU, on behalf of the Athletic Department, moved to dismiss the
claims for lack of jurisdiction on state sovereign immunity grounds under
Federal Rule of Civil Procedure 12(b)(1). Cannon and Stephenson moved to
dismiss the claims for failure to state a claim under Rule 12(b)(6) and on
qualified immunity grounds. In March 2019, the district court dismissed
those claims, but later stayed the case pending the Supreme Court’s decision
in Allen v. Cooper, 140 S. Ct. 994 (2020). In September 2020, after Allen was
decided and additional briefing was submitted, the district court entered final
judgment for TAMU, Cannon, and Stephenson. Plaintiffs appeal.
1
Pursuant to a joint motion, the appeal as to the 12th Man Foundation was
dismissed.
2
A direct copyright infringement claim stems directly from the CRCA, but a
contributory or vicarious infringement claim does not. Nevertheless, though “[the CRCA]
does not expressly render anyone liable for infringement committed by another, these
doctrines of secondary liability emerged from common law principles and are well
established in the law.” Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd., 545 U.S. 913,
930 (2005) (internal quotation marks and citations omitted).
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II. Standard of Review
“We review de novo a district court’s grant of a Rule 12(b)(1) motion
to dismiss for lack of subject matter jurisdiction because of state sovereign
immunity.” Meyers ex rel. Benzing v. Texas, 410 F.3d 235, 240 (5th Cir. 2005).
A plaintiff bears the burden of proof that jurisdiction exists. Daniel v. Univ.
of Tex. Sw. Med. Ctr., 960 F.3d 253, 256 (5th Cir. 2020). While legal
conclusions are reviewed de novo, the district court’s factual findings are
reviewed for clear error. Kuwait Pearls Catering Co. v. Kellogg Brown & Root
Servs., Inc., 853 F.3d 173, 178 (5th Cir. 2017).
We review de novo a district court’s grant of a Rule 12(b)(6) motion
to dismiss for failure to state a claim. Thurman v. Med. Transp. Mgmt., Inc.,
982 F.3d 953, 955 (5th Cir. 2020). We accept all well-pled factual allegations
as true, viewing them in the light most favorable to the plaintiff. Id.III. State Sovereign Immunity
State sovereign immunity divests federal courts of jurisdiction over
states and their agencies and instrumentalities, unless the state consents to
suit or Congress has clearly and validly abrogated the state’s sovereign
immunity. See U.S. Const. amend. XI; Perez v. Region 20 Educ. Serv. Ctr.,
307 F.3d 318, 326 (5th Cir. 2002). “The state need not be the named party in
a federal lawsuit, for a state’s Eleventh Amendment immunity extends to any
state agency or entity deemed an ‘alter ego’ or ‘arm’ of the state.” Id. 3
TAMU is inarguably an arm of the state entitled to sovereign immunity. See
3
“‘Eleventh Amendment immunity’ is a misnomer, however, because that
immunity is really an aspect of the Supreme Court’s concept of state sovereign immunity
and is neither derived from nor limited by the Eleventh Amendment. Nevertheless, the
term ‘Eleventh Amendment immunity’ has been used loosely and interchangeably with
‘state sovereign immunity’ to refer to a state’s immunity from suit without its consent in
federal courts.” Meyers, 410 F.3d at 240–41 (citations omitted).
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U.S. Oil Recovery Site Potentially Responsible Parties Grp. v. R.R. Comm’n of
Tex., 898 F.3d 497, 501 (5th Cir. 2018).
As noted above, a state’s immunity from suit is not absolute. With
respect to abrogation, a federal court may entertain a lawsuit against a
nonconsenting state on two conditions: “First, Congress must have enacted
‘unequivocal statutory language’ abrogating the States’ immunity from the
suit. . . . And second, some constitutional provision must allow Congress to
have thus encroached on the States’ sovereignty. Not even the most
crystalline abrogation can take effect unless it is ‘a valid exercise of
constitutional authority.’” Allen, 140 S. Ct. at 1000–01 (citations omitted).
IV. Claims Against TAMU
Appellants argue that the district court improperly dismissed their
claims against TAMU on several grounds. They assert that the Athletic
Department is a separate entity from TAMU and is therefore not an arm of
the state entitled to sovereign immunity. But even if it were, the district court
should not have dismissed the copyright infringement and takings claims
against TAMU. We address each issue in turn.
A. Arm of the State
The district court held that, as a matter of law, the Athletic
Department lacks jural authority and therefore has no capacity to be sued
under Federal Rule of Civil Procedure 17. Since the “correct party”
substitute should be TAMU, the district court held that TAMU, as an arm
of the state, was entitled to sovereign immunity.
The parties do not dispute that the Athletic Department lacks jural
authority to be sued. However, they disagree as to whether the district court
failed to do a full analysis of the Athletic Department’s arm-of-the-state
status under the framework set forth in Clark v. Tarrant County, 798 F.2d 7367
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(5th Cir. 1986). In other words, Appellants assert that the Clark framework
should have been applied, which would have led to the conclusion that the
Athletic Department itself can be sued, whereas Appellees contend that a
Clark analysis was not required because TAMU is the proper party.
We agree with Appellants that under circuit precedent, a court must
analyze whether an entity qualifies as an arm of the state as a matter of law
under the Clark framework. See Williams v. Dallas Area Rapid Transit, 242
F.3d 315, 318–19 (5th Cir. 2001) (“When confronted with a governmental
entity asserting Eleventh Amendment immunity as an arm of the state, we
apply the test established in Clark . . . .”) (holding that the district court
“erred in failing to properly analyze, under Clark, [the entity’s] amenability
to suit”). A proper inquiry under Clark considers six factors: (1) whether the
state statutes and caselaw view the agency as an arm of the state; (2) the
source of funds for the entity; (3) the degree of local autonomy the entity
enjoys; (4) whether the entity is concerned primarily with local, as opposed
to statewide, problems; (5) whether the entity has the authority to sue and be
sued in its own name; and (6) whether the entity has the right to hold and use
property. Clark, 798 F.2d at 744–45. No one factor is dispositive, though it is
well established that the second is the “most important,” while the fifth and
sixth are “less so.” Williams, 242 F.3d at 319 (citing Hudson v. City of New
Orleans, 174 F.3d 677, 681–82 (5th Cir. 1999)). “The goal of this test is to
determine ‘whether the suit is in reality a suit against the state itself.’”
Providence Behavioral Health v. Grant Rd. Pub. Util. Dist., 902 F.3d 448, 456
(5th Cir. 2018) (quoting Hudson, 174 F.3d at 682).
The first factor—state law and caselaw—favors treating the Athletic
Department as an arm of the state. Neither party points to a statute, case, or
a Texas Attorney General opinion relevant to any athletic department of a
state university. Texas law, however, suggests that an athletic department of
a public university is essentially an “auxiliary enterprise” that is an extension
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of the state. An “auxiliary enterprise” is defined as “a business activity that
is conducted at a state agency, provides a service to the agency, and is not
paid for with appropriate money.” Tex. Gov’t Code § 2252.061.
Auxiliary enterprises, like athletic departments, do not operate for purely
educational purposes. See Tex. Const. art. VII, §§ 17(f) 4 & 18(d). 5 But
these enterprises are nevertheless treated as an extension of a public
university. See, e.g., Gulf Reg’l Educ. Television Affiliates v. Univ. of Hous., 746
S.W.2d 803, 808 (Tex. Ct. App. 1988) (concluding that group of school
districts and parochial schools that produced and broadcast television
programming was auxiliary enterprise of University of Houston and had no
authority to file suit without university or State Attorney General’s
permission). Further, courts have treated athletic departments as auxiliary
enterprises. See id. (noting that the “University defines an auxiliary
enterprise as a self-supporting component such as . . . the athletic
department”); Kneeland v. Nat’l Collegiate Athletic Ass’n, 850 F.2d 224, 226–
27 (5th Cir. 1988) (observing unchallenged district court ruling that “athletic
departments of Texas state universities were auxiliary enterprises”); see also
Tanyon T. Lynch, Quid Pro Quo: Restoring Education Primary to College
Basketball, 12 Marq. Sports L. Rev. 595, 607 n.89 (2002) (“Most Division I-
A athletics departments are considered ‘auxiliary enterprises’ and, as such,
are expected to generate revenues sufficient to cover costs.”). Since an
athletic department of a state-supported university is like an auxiliary
4
“The funds appropriated by this section [for educational and general activities]
may not be used for the purpose of constructing, equipping, repairing, or rehabilitating
buildings or other permanent improvements that are to be used only for student housing,
intercollegiate athletics, or auxiliary enterprises.”
5
“The proceeds of the bonds or notes issued under Subsection (a) or (b) of this
section may not be used for the purpose of constructing, equipping, repairing, or
rehabilitating buildings or other permanent improvements that are to be used for student
housing, intercollegiate athletics, or auxiliary enterprises.”
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enterprise, the Athletic Department is similarly an extension of TAMU and
thus an arm of the state.
The second factor—source of funds—favors treating the Athletic
Department as an arm of the state. Though we consider the source of general
operating funds for the entity, because a principal goal of the Eleventh
Amendment is to protect state treasuries, the most significant factor in
assessing an entity’s status is whether a judgment against it will be paid with
state funds. Williams, 242 F.3d at 320 (citing Richardson v. S. Univ., 118 F.3d
450, 452 (5th Cir. 1997)). Texas law prohibits any public funds to be used for
intercollegiate athletic programs, as it requires these programs to be fully self-
supporting. See Tex. Const. art. VII, §§ 17(f) & 18(d); Tex. General
Appropriations Act, 86th Leg., R.S., art. III, § 9 (“[N]o educational and
general funds appropriated may be used for the operation of intercollegiate
athletics.”). Thus, the Athletic Department relies wholly on outside funding.
For instance, in the fiscal year of 2016, it generated approximately $194
million in revenue from, inter alia, ticket sales, contributions, sale of media
rights, and advertisements. It receives $0 in student fees, direct state or other
government support, direct institutional support from TAMU, and indirect
facilities and administrative support.
But while the source of the Athletic Department’s operating funds is
private, it is unclear whether a judgment against the Athletic Department
would be satisfied with private or state-allocated funds. Appellants have the
burden to demonstrate that the Athletic Department will be responsible for
its judgment and debts, not the State. Because they fail to satisfy their burden
in this respect, this factor supports a finding that the Athletic Department is
an arm of the state. See Daniel, 960 F.3d at 258 (concluding second factor
favors finding immunity because plaintiff failed to satisfy burden of showing
that entity would be responsible for judgment and debt, not the state).
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The third factor—degree of autonomy—favors treating the Athletic
Department as an arm of the state. The record shows that the Athletic
Department is a department within, and governed by, TAMU. Scott
Woodward, the Director of Athletics at TAMU, averred: “I report directly
to the President of Texas A&M University, Michael K. Young. President
Young and I stay in frequent contact regarding how the Athletic Department
is performing.” The organizational chart provided by TAMU indicates that
Woodward is part of the TAMU President’s cabinet and reports directly to
the President. Cf. Gulf, 746 S.W.2d at 806–07 (concluding that auxiliary
enterprise was part of state university where enterprise was managed by
university employees who reported through chain of command that went up
to the university’s president). Moreover, policy statements issued by the
TAMU System Board of Regents demonstrate that TAMU exercises
oversight over the Athletics Department. For example, the Board requires
TAMU to “create and maintain an Athletic Council, made up of faculty,
staff, students, alumni, and community members, to advise the president in
the development and administration of the intercollegiate athletics
program,” and that “all intercollegiate athletics programs be maintained in
an academically and fiscally accountable manner with full compliance with
conference and national rules.” TAMU also requires athletic agreements
over $100,000 to be authorized by a university official—generally the
University Contracts Officer, the Chief Financial Officer, or the President.
Further, all athletic coaching employment agreements must be authorized by
the President, and, if over $500,000, with additional approval by the Board
of Regents. Considering TAMU’s oversight and financial regulation, the
Athletic Department does not operate with a level of local autonomy to
consider it independent from the State.
The fourth factor—scope of problem—favors treating the Athletic
Department as an arm of the state. Education is a statewide concern, see
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Sissom v. Univ. of Tex. High Sch., 927 F.3d 343, 349 (5th Cir. 2019), and
though athletic programs do not operate for educational purposes, anyone
who plays a sport managed by the Athletics Department is a student at
TAMU, which belongs to the statewide TAMU System. See United States ex
rel. King v. Univ. of Tex. Health Sci. Ctr.–Hous., 544 F. App’x 490, 495 (5th
Cir. 2013) (finding that University of Texas Health Science Center addressed
statewide concerns of education and research, although its facilities were all
in Houston, as the center belonged to the greater University of Texas System
which had locations throughout the state). Further, the Athletic Department
engages in intercollegiate athletics—i.e., competes with other schools—and
derives financial support from students, alumni, and fans throughout Texas.
Clark’s fourth factor therefore supports finding the Athletic Department as
an arm of the state.
The fifth factor—ability to sue and be sued in its own name—favors
finding the Athletic Department as an arm of the state. Neither party points
to a case in which the department was a named party in a lawsuit.
The sixth factor—right to hold and use property—favors treating the
Athletic Department as an arm of the state. The Board of Regents retains
ultimate control of money collected at TAMU, including “receipts from
school activities.” Tex. Educ. Code § 51.002; see Kneeland, 850 F.2d at
226–27 (observing unchallenged district court ruling that funds generated by
athletic departments of state universities were “public funds belonging to the
State of Texas”). The Athletic Department does not own or purchase real
property, and any real property used by the Athletic Department is managed
by the Board of Regents. Tex. Educ. Code § 85.25 (“The board is vested
with the sole and exclusive management and control of lands and mineral
interests under its jurisdiction and that may be acquired by it.”).
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All six Clark factors weigh in favor of finding that the Athletic
Department is entitled to arm-of-the-state status. Accordingly, we conclude
that the Athletic Department is a part of TAMU and therefore enjoys state
sovereign immunity.
B. Copyright Infringement Claims
Having concluded that the Athletic Department is an arm of the state,
we must next address whether its sovereign immunity is abrogated from the
copyright infringement claims. Because the Athletic Department is an
extension of TAMU, we will now refer to the entity as TAMU.
i. Abrogation
In Allen v. Cooper, 140 S. Ct. 994 (2020), the Supreme Court recently
addressed whether the Copyright Remedy Clarification Act (CRCA) validly
abrogated the states’ immunity from copyright infringement suits. 6 The
CRCA provides that a state “shall not be immune, under the Eleventh
Amendment [or] any other doctrine of sovereign immunity, from suit in
Federal court” for copyright infringement. 17 U.S.C. § 511(a). Though
Congress used clear language to abrogate immunity, the Court held that
Congress had no authority to do so under Article I, which empowers
Congress to protect copyrights, or Section 5 of the Fourteenth Amendment,
which authorizes Congress to enact “reasonably prophylactic legislation”
aimed at preventing states from violating the Fourteenth Amendment. Allen,
140 S. Ct. at 1004 (citations omitted). With respect to Section 5, the CRCA
failed the “congruence and proportionality” test because the evidence of
actual constitutional injury—that is, willful copyright infringement by
6
The Fifth Circuit addressed this question many years ago and concluded that the
CRCA was not a valid abrogation of state sovereign immunity from copyright infringement
suits. See Chavez v. Arte Publico Press, 204 F.3d 601, 605 (5th Cir. 2000).
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states—was “exceedingly slight.” Id. at 1007. Congress therefore lacked
authority to broadly abrogate the states’ immunity from copyright
infringement suits.
Appellants argue, however, that Allen did not foreclose abrogation of
sovereign immunity from copyright infringement suits where a state’s
violation of the CRCA independently constitutes an actual violation of the
Fourteenth Amendment. Specifically, they allege that TAMU committed
two independent violations of the Fourteenth Amendment: (1) deprivation
of property without due process, and (2) takings. Appellants cite to United
States v. Georgia, 546 U.S. 151 (2006), which held that “insofar as Title II [of
the Americans with Disabilities Act] creates a private cause of action for
damages against the States for conduct that actually violates the Fourteenth
Amendment, Title II validly abrogates state sovereign immunity.” Id. at 159(emphasis in original) (reviewing whether state violated prisoner’s Eighth
Amendment right to be free from cruel and unusual punishment, which is
incorporated in the Due Process Clause of the Fourteenth Amendment).
Thus, Georgia arguably set forth two categories of abrogation: (1)
where a statute validly abrogates sovereign immunity for all claims, and (2)
where a statute is not a valid prophylactic abrogation of all claims, but does
abrogate sovereign immunity for those claims based on conduct constituting
an actual violation of the Fourteenth Amendment, for the statutory remedy
would be congruent and proportional as applied to that case. See id. (directing
lower courts to determine “on a claim-by-claim basis, (1) which aspects of
the State’s alleged conduct violated Title II; (2) to what extent such
misconduct also violated the Fourteenth Amendment; and (3) insofar as such
misconduct violated Title II but did not violate the Fourteenth Amendment,
whether Congress’s purported abrogation of sovereign immunity as to that
class of conduct is nevertheless valid”). Appellants contend that this case
falls in the second category.
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In support of their position, Appellants cite to National Association of
Boards of Pharmacy v. Board of Regents of the University System of Georgia
(“NABP”), 633 F.3d 1297 (11th Cir. 2011), where the Eleventh Circuit
applied Georgia in a copyright infringement suit, observing that “[i]t is well
established that § 5 grants Congress the authority to abrogate state sovereign
immunity for violations of the Fourteenth Amendment.” Id. at 1315 (citing
Georgia, 546 U.S. at 158). There, however, the court ultimately rejected the
plaintiff’s claim that the copyright infringement amounted to a violation of
procedural due process, concluding that a pre-deprivation process was not
feasible under the facts alleged and that adequate post-deprivation remedies
were provided by the State. Id. at 1318–19. Appellants also point to oral
argument in Allen, where the State of North Carolina conceded that even if
the Supreme Court held that the CRCA was not a valid prophylactic
abrogation of state immunity, Georgia would still provide a remedy for
copyright infringement constituting an actual violation of the Fourteenth
Amendment. See Transcript of Oral Argument at 39–40, Allen v. Cooper, 140
S. Ct. 994 (2020) (No. 18-877) (“[W]henever a plaintiff can reasonably allege
that there has been intentional copyright infringement and there are not
adequate remedies, then, under this Court’s Georgia decision, they can bring
a direct constitutional claim. We don’t dispute that.”). Further, after Allen
was decided, the district court on remand recently held that the plaintiffs’
copyright infringement claim could still proceed because “[a]lthough the
Supreme Court ruled that the CRCA was unconstitutional insofar as it
attempted to abrogate sovereign immunity prophylactically . . . the statute
remains whenever plaintiff alleges both a constitutional violation as well as a
statutory violation. Therefore, plaintiffs can still use the CRCA as a basis for
its Georgia claim [alleging that defendants’ conduct amounted to an
unconstitutional taking].” Allen v. Cooper, -- F. Supp. 3d --, 2021 WL
3682415, at *11 (E.D.N.C. Aug. 18, 2021).
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ii. Actual Violations of the Fourteenth Amendment
We need not decide whether Georgia extends to copyright
infringement cases, because even assuming it does, Appellants fail to allege
that TAMU’s conduct constitutes an actual violation of the Fourteenth
Amendment.
First, the copyright infringement claim against TAMU for deprivation
of property without due process cannot survive dismissal. To come within
the reach of the procedural requirements of the Due Process Clause, a
violation must (1) be “intentional, or at least reckless,” and (2) lack adequate
post-deprivation state remedies. Allen, 140 S. Ct. at 1004. For due process
purposes, copyrights are a form of property. Id. Appellants sufficiently allege
that the infringement was intentional—Marquardt directed his secretary to
retype the Gill Biography, remove any copyright information, and change its
title and byline to indicate that TAMU owned the work, and then shared it
with his colleagues for approval and publication.
However, meaningful post-deprivation state remedies are available to
redress the injury. Though no tort remedies are available under Texas law, 7
Appellants have a viable takings claim against TAMU for copyright
infringement under the Texas Constitution. More expansive than the federal
Takings Clause, the Texas Takings Clause provides: “No person’s property
shall be taken, damaged, or destroyed for or applied to public use without
adequate compensation being made.” Tex. Const. art. I, § 17. The Clause
7
Texas has not waived its immunity from tort claims arising out of copyright
infringement allegations. See Tex. Civ. Prac. & Rem. Code § 101.021(1) (providing
for limited waiver of governmental immunity for claims of property damage, personal
injury, or death proximately caused by wrongful or negligent conduct of governmental
employee arising out of (1) use of publicly owned motor-driven equipment or motor
vehicle, (2) premises defects, and (3) conditions or uses of certain property).
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itself waives sovereign immunity for a valid takings claim brought in state
court. Texas v. Holland, 221 S.W.3d 639, 643 (Tex. 2007). Though the Texas
Supreme Court recently held that a public university’s single act of copyright
infringement—i.e., displaying a photograph on its website without the
owner’s authorization—did not constitute a per se taking, it nevertheless left
the door open for a copyright owner to bring a regulatory takings claim against
the State for infringement. Jim Olive Photography v. Univ. of Hous., -- S.W.3d
--, 2021 WL 2483766, at *9 (Tex. June 18, 2021); see also id. (Busby, J.,
concurring) (“Nothing in the Court’s opinion should be understood to
indicate a view on [whether a state’s copyright infringement could in some
circumstances require compensation] because Olive has alleged no claim
under the ‘damaged’ or ‘applied’ prongs of the Texas Takings Clause.”).
Accordingly, because Appellants are not foreclosed from pursuing a takings
claim in state court, TAMU did not violate their procedural due process
rights. See McClure v. Biesenbach, 355 F. App’x 800, 805 (5th Cir. 2009)
(“Post-deprivation process is adequate if it allows the prospect of
compensation for the loss.”) (citing Parratt v. Taylor, 451 U.S. 527, 543–44
(1981), overruled in part by Daniels v. Williams, 474 U.S. 327, 330–31 (1986)).
Moreover, the copyright infringement claim against TAMU for its
taking of property fails to survive dismissal as well. The Fifth Amendment
provides that “private property [shall not] be taken for public use, without
just compensation.” U.S. Const. amend. V. The Takings Clause is made
applicable to the states by incorporation through the Due Process Clause of
the Fourteenth Amendment. Murr v. Wisconsin, 137 S. Ct. 1933, 1942 (2017)
(citing Chicago Burlington & Q.R.C. v. Chicago, 166 U.S. 226 (1897)). The
Supreme Court has not addressed whether copyrights are a form of property
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protected by the Takings Clause. 8 And we need not decide this issue because
Appellants have failed to plausibly allege a taking.
The Supreme Court has explained that a “basic distinction” exists
between “individual torts” and “appropriations of a property right.” Cedar
Point Nursery v. Hassid, 141 S. Ct. 2063, 2078 (2021); see also, e.g., Portsmouth
Harbor Land & Hotel Co. v. United States, 260 U.S. 327, 329–30 (1922)
(“[W]hile a single act may not be enough, a continuance of them in sufficient
number and for a sufficient time may prove [the intent to take property].
Every successive trespass adds to the force of the evidence.”).
This court has illuminated the principle that not all torts (i.e.,
infringements) rise to the level of a taking. In Porter v. United States, 473 F.2d
1329, 1337 (5th Cir. 1973), where the widow of Lee Harvey Oswald sought
compensation for the taking of property by the United States, we held:
We turn finally to the question whether Mrs. Porter can
recover for the diminution in value of Oswald’s writings
attributable to their publication in the Warren Commission
Report. It is, of course, quite plain that the recovery sought
here is for infringement by the government of Mrs. Porter’s
common law copyright interest in Oswald’s writings. Such
infringement is not a “taking” as the term is constitutionally
8
The Supreme Court, however, has recognized that other forms of intellectual
property are protected by the Takings Clause. See Horne v. Dep’t of Agric., 576 U.S. 350,
359–60 (2015) (patents); Ruckelshaus v. Monsanto Co., 467 U.S. 986, 1003 (1984) (trade
secrets). And, a handful of sister circuits have suggested that copyrights are protected by
the Takings Clause. See CCC Info. Servs., Inc. v. Maclean Hunter Market Reports, Inc., 44
F.3d 61, 74 (2d Cir. 1994) (“[A] rule that the adoption of such a reference by a state
legislature or administrative body deprived the copyright owner of its property would raise
very substantial problems under the Takings Clause of the Constitution.”); Lane v. First
Nat’l Bank of Boston, 871 F.2d 166, 174 (1st Cir. 1989) (suggesting if state remedies do not
afford just compensation for copyright infringement, “the Takings Clause of the federal
Constitution might at that point enable [owner] to pursue a damage remedy in federal
court”).
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understood. Rather, it has always been held that infringement
of copyright, whether common law, Twentieth Century Fox Film
Corp. v. Dieckhaus, 153 F.2d 893 (CA 8, 1948), or statutory,
Turton v. United States, 212 F.2d 354 (CA 6, 1954) constitutes
a tort.
Like Porter, Appellants have failed to meet their burden that the
purported infringement amounts to a constitutional taking: The alleged
direct infringement was the public display of the book for four total days, and
the indirect infringement likewise stems from these four days. Appellants
have failed to plausibly allege that TAMU continued or repeated any
infringement—direct or indirect—such that the claim amounts to a taking
for Fifth Amendment purposes. Accordingly, in these circumstances, the
copyright infringement claim based on a takings allegation fails.
C. Takings Claims
We next address whether TAMU’s sovereign immunity is abrogated
from the federal and state takings claims, which were pleaded in the
alternative to the copyright infringement claims.
A state is entitled to sovereign immunity from a federal takings claim.
Bay Point Props., Inc. v. Miss. Transp. Comm’n, 937 F.3d 454, 457 (5th Cir.
2019) (affirming dismissal of takings claim against Mississippi on sovereign
immunity grounds). Appellants argue, however, that immunity is abrogated
when no remedy is available in state court. They cite to Williams v. Utah
Department of Corrections, 928 F.3d 1209, 1213 (10th Cir. 2019), which
suggests that a takings claim is barred only “as long as a remedy is available
in state court.” Because we have concluded that Appellants can pursue a
claim under the Texas Takings Clause, state sovereign immunity bars the
federal takings claim here. See supra IV.B.
A state is also entitled to sovereign immunity from a state takings
claim brought in federal court. In Pennhurst State School and Hospital v.
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Halderman, 465 U.S. 89, 119–21 (1984), the Supreme Court held that federal
courts are barred from hearing state law claims against a state, reasoning that
such claims cannot be maintained because supplemental jurisdiction does not
abrogate the state’s sovereign immunity. Further, even though the Texas
Takings Clause waives immunity for state takings claims brought in state
court, “[w]aiver of sovereign immunity in state courts does not waive
Eleventh Amendment immunity from suit in federal court.” Guetersloh v.
Texas, 25 F.3d 1044 (5th Cir. 1994) (unpublished) (citing Pennhurst, 465 U.S.
at 99 n.9). Accordingly, sovereign immunity bars the state takings claim.
V. Claims Against Cannon and Stephenson
Lastly, we address the direct copyright infringement claim against
Cannon, and the contributory copyright infringement claims against Cannon
and Stephenson.
A. Direct Copyright Infringement
Direct copyright infringement requires proof of two elements: “(1)
ownership of a valid copyright, and (2) copying of constituent elements of the
work that are original.” BWP Media USA, Inc. v. T&S Software Assocs., Inc.,
852 F.3d 436, 439 (5th Cir. 2017) (quoting Feist Publ’ns, Inc. v. Rural Tel.
Serv. Co., 499 U.S. 340, 361 (1991)). The purported infringer must have acted
with “volitional conduct,” id.—that is, “[t]here must be actual infringing
conduct with a nexus sufficiently close and causal to the illegal copying that
one could conclude that the machine owner himself trespassed on the
exclusive domain of the copyright owner.” Id. at 440 (quoting CoStar Grp.,
Inc. v. LoopNet, Inc., 373 F.3d 544, 550 (4th Cir. 2004)) (internal quotation
marks omitted).
The allegations do not support the reasonable inference that Cannon
directly infringed the copyright. Marquardt did the actual recopying—he, not
Cannon, retyped the Gill Biography and scrubbed off all copyright
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information to present it as TAMU’s work. Cannon never received the
original work and only received the infringed work from Marquardt. He had
no actual or constructive knowledge of the infringement. Accordingly, we
affirm dismissal of the direct copyright infringement claim against Cannon
for failure to state a claim.
B. Contributory Copyright Infringement
“Contributory infringement is ‘intentionally inducing or encouraging
direct infringement.’” Geophysical Serv., Inc. v. TGS-NOPEC Geophysical
Co., 850 F.3d 785, 798 (5th Cir. 2017) (quoting Metro-Goldwyn-Mayer Studios
Inc. v. Grokster, Ltd., 545 U.S. 913, 930 (2005)). In other words, “[a] party is
liable for contributory infringement when it, ‘with knowledge of the
infringing activity, induces, causes or materially contributes to infringing
conduct of another.’” Alcatel USA, Inc. v. DGI Technologies, Inc., 166 F.3d
772, 790 (5th Cir. 1999) (citation omitted).
The allegations do not support the reasonable inference that Cannon
or Stephenson contributorily infringed the copyright. Again, Cannon had no
knowledge of the underlying infringement—he never received the original
work and only received the infringing article from Marquardt. There was no
intent or even knowledge on Cannon’s part with respect to the infringement.
Further, Stephenson also lacked the requisite knowledge or intent to commit
infringement. He did not receive the original draft of Bynum’s book, as he
only received the retyped article from Marquardt and reasonably assumed it
was not an infringed piece of writing. Accordingly, we affirm dismissal of the
contributory copyright infringement claims against Cannon and Stephenson
for failure to state a claim.
VI. Conclusion
For the foregoing reasons, we AFFIRM.
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