SCOTUS and Flo Rida: What the Court Did—and Did Not—Decide About Copyright Damages

On May 9, 2024, the U.S. Supreme Court handed down its decision in Warner Chappell Music, Inc., et al. v. Sherman Nealy, et al.  The case involves a dispute between a Miami music producer and Warner Music over the rapper Flo Rida’s 2008 song “In the Ayer,” which incorporated elements of the 1980s song “Jam the Box.”   Claiming copyright infringement, the producer sued in 2016 for damages going back to Flo Rida’s song’s release in 2008. 

What the Court Decided

In its 6-3 decision, the court held that if a copyright infringement lawsuit is timely filed under the discovery rule, copyright damages are recoverable for infringement that occurred prior to the Copyright Act’s three-year statute of limitations. 

Under the Copyright Act, a plaintiff must file its lawsuit within three years of when the claim accrues or the claim is barred.  Some courts have held that this three-year period starts when the infringement occurs, while other courts hold that the period doesn’t begin to run until the plaintiff discovers the infringement (which is referred to as the “discovery rule”).

If the discovery rule is not applied, plaintiffs can recover damages only from the three-year period after the infringement occurs.  When the discovery rule is applied, however, the issue arises as to whether the Plaintiff can only recover damages for the three-year period prior to filing the lawsuit or whether the Plaintiff can recover damages going back to the date of the infringement (which, as in this case, can be substantially longer than three years).  Prior to the Supreme Court’s decision, the U.S. Courts of Appeals were split on this issue, with the Second Circuit holding that damages were limited to the three-year period and the Eleventh Circuit holding that damages were recoverable going back to the date of infringement.

The Supreme Court resolved this split and held that as long as the lawsuit is timely filed under the discovery rule, the plaintiff is entitled to damages for all actionable infringements, regardless of when they occurred.  The court held that the Second Circuit’s opinions to the contrary were “essentially self-defeating” because they recognized the discovery rule but then took away the value that the discovery rule provides.

What the Court Did Not Decide

Despite resolving this issue, however, the court expressly noted that it was not opining on whether application of the discovery rule was appropriate in copyright infringement actions in the first place, as that issue was not before the court.  Thus, substantial uncertainly remains after this opinion because it applies only if a court finds that the discovery rule should be used in the copyright context.  The dissent recognized this fact and stated that the court should have passed on deciding the case altogether because it concerns a rule of law that “very likely does not exist.”

To read the Supreme Court’s opinion, click here.

Our firm regularly advises on and litigates copyright issues.  Feel free to contact us if we can be of help.