Current Issues

“Discovering” Copyright lnfringement2

It is virtually impossible today to run a business without licensing copyrighted material. If you use a computer, you are probably running licensed software. If you have a website, your website probably includes photographs. Unless you create your own advertisements, you may have used licensed material.

Despite the prevalence of copyrighted material, most companies are not very good at keeping records regarding their copyright licenses. License certificates for software often get lost among other business documents, and licenses for photographs, etc. are not kept or are misplaced over the years. Failing to keep copyright licenses, however can be significant mistake. This is particularly so in light of the application of the “Discovery Rule” with respect to copyright infringement.

A Statute of Limitations is a deadline by which an injured party must seek legal relief. Under the Copyright Act, a copyright claim must be brought within 3 years of accrual. This would appear to mean that a claim for copyright infringement must be brought within 3 years of the date that infringement occurred. However, the courts in Utah, and many other jurisdictions have ruled that accrual begins at the date on which the copyright owner knew or should have known that their copyright been infringed. This approach to the Statute of Limitations is commonly referred to as the “Discovery Rule.”

The application of the Discovery Rule opens up Pandora’s Box for copyright licenses. What if a copyright owner believes that a business has infringed their copyright on a website 10 or 15 years after the website was developed. While some businesses are very good at keeping records, the odds that they will have access to records regarding copyrights 5 or 10 years later is fairly small. Thus, the business is left to the record keeping of the copyright owner to determine whether a license existed at that time.

Making the matter even more complex is the fact that many small businesses use independent designers to create their websites and other materials. The independent designer may be the only one who has access to copyright license information. This provides little help if the designer has moved on and cannot be located.

Furthermore, the license may not be in the name of the business, but may be in the name of the web designer or even a name of an individual at the business. For example, if you asked a friend to create a website for your business, he may have registered the license in your name, the name of your business, his name or the name of his business. If you get a notice 10 years later from Getty Images, Corbis, or one of the other copyright licensing agencies, you may have a difficult time determining the name of the licenses on which the license was taken. Of course, knowing is only important if they have record of the license and are honest about it.

The availability of way back machine ( simply expands the possibility that old websites will become fertile ground for finding potential copyright infringers years after the allegedly infringing material has been removed. Just in case you are “discovered!” – keep good records.