DENISE COTE, District Judge.
John Wiley & Sons, Inc. ("Wiley"), a domestic publisher of academic textbooks, brought this copyright action in 2008 against Supap Kirtsaeng ("Kirtsaeng"), an importer and reseller of Wiley's foreign edition textbooks, claiming that his activities violated its exclusive right to distribute and import the textbooks. As the prevailing party, Kirtsaeng moves for an award of attorneys' fees. For the following reasons, the motion is denied.
This case is before the Court after its second trip to the Supreme Court. The district court found in 2009 that Kirtsaeng had infringed on Wiley's copyright, and the Second Circuit affirmed, holding that "the District Court correctly decided that Kirtsaeng could not avail himself of the first sale doctrine codified by § 109(a) [of the Copyright Act] since all the books in question were manufactured outside of the United States."
As the prevailing party, Kirtsaeng moved for an award of attorneys' fees under the Copyright Act's fee-shifting provision.
The Supreme Court vacated the Second Circuit's decision, noting that "the Court of Appeals' language at times suggests that a finding of reasonableness raises a presumption against granting fees."
Kirtsaeng submitted an August 26 letter to the district court requesting an opportunity to submit briefs consistent with the analysis articulated in the recent Supreme Court decision. The case was reassigned to this Court on October 26, 2016. On November 3, this Court ordered that "briefs from both parties shall be served by December 9" in the form of either "a single, previously submitted brief and an accompanying memorandum of no more than five pages" or "a new brief no longer than twenty pages without attachment." Having considered the December 9 submissions as well as the entire record in this case, Kirtsaeng's motion for attorneys' fees is denied.
Section 505 of the Copyright Act provides that "the court in its discretion may allow the recovery of full costs by or against any party other than the United States" and that "the court may also award a reasonable attorney's fee to the prevailing party as part of the costs." 17 U.S.C. § 505. "There is no precise rule or formula for making these determinations, but instead equitable discretion should be exercised . . . ."
The Supreme Court emphasized in
Regarding the Copyright Act's goals,
This litigation, looked at holistically and in light of the Copyright Act's goals, does not favor an award of attorneys' fees to Kirtsaeng, even though he is indisputably the prevailing party. Wiley's position, though ultimately unsuccessful, was not objectively unreasonable. As the district court noted in its attorneys' fees opinion, "Wiley's claim — which persuaded this Court, the Court of Appeals, and three Justices of the Supreme Court — represented the legitimate attempt of a copyright holder to enforce its rights against the unauthorized importation of low-priced, foreign-made copies of its copyrighted works."
While substantial weight should be given to the objective reasonableness of Wiley's litigating position, that determination is only the beginning of the relevant inquiry. It is also necessary to examine whether other appropriately considered factors suggest that in the circumstances of this case, and in light of the Copyright Act's goals, Kirtsaeng should be awarded fees. They do not. Several relevant factors weigh strongly against an award of fees. For the same reasons that Wiley's litigating position was objectively reasonable, it was not frivolous. A complaint is frivolous "where it lacks an arguable basis either in law or in fact."
In support of his request, Kirtsaeng makes a series of interrelated arguments. The most prominent themes in its motion are described here. None of its arguments, taken together or singly, however, persuade this Court that he should be awarded fees in this action.
Kirtsaing contends that Wiley's litigation position was not objectively reasonable in its entirety because its complaint also asserted a trademark claim and an unfair competition claim. Wiley withdrew one of these claims early in the litigation and the other before trial. Pleading and litigating these claims for a period of time alongside the copyright claim did not make Wiley's litigating position objectively unreasonable.
Kirtsaeng argues that Wiley had an improper motive in attempting to use the Copyright Act to assert downstream control over the distribution of textbooks even after it profited from the first sale. This simply restates that Wiley's copyright claim was ultimately unsuccessful. Wiley's decision to file and its pursuit of the copyright infringement action against one whom it believed in good faith to have infringed its copyright did not constitute either bad faith or suggest an impermissible motive. "[C]opyright law celebrates the profit motive, recognizing that the incentive to profit from the exploitation of copyrights will redound to the public benefit by resulting in the proliferation of knowledge."
Kirtsaeng urges that he "obtained an extremely high degree of success in litigating this close case," which favors a fee award. But, to award attorneys' fees because the first sale doctrine was a complete defense to the infringement claim would be to "confuse[] the issue of liability with that of reasonableness."
Finally, Kirtsaeng argues that compensation is necessary to "incentiviz[e] impecunious defendants to stand up to corporate goliaths" and to reimburse the defendant and his attorneys. In a closer case for an award of attorneys' fees, this argument might have greater weight. But, in the context of this litigation, it is insufficient to merit an award.
The defendant's motion for an award of attorneys' fees and costs is denied. The Clerk of Court shall close the case.