Federal Circuit Affirms Dismissal of Copyright Infringement Claims Against a Government Defendant for Lack of Jurisdiction Based on Sovereign Immunity

Holding:

In this appeal, the U.S. District Court for the Federal Circuit affirmed the Court of Federal Claims' ("CFC") dismissal of the claims of Blueport Co., LLC ("Blueport") against the United States Air Force as a government defendant. Blueport brought claims of copyright infringement and violations of the Digital Millennium Copyright Act of 1998 ("DMCA") against the United States Air Force for having infringed on Blueport's copyrighted software. The CFC dismissed Blueport's action for lack of jurisdiction because the CFC held that the government had not waived its sovereign immunity under 28 U.S.C. Section 1498(b). On appeal, the Federal Circuit sustained the CFC's findings, and rejected Blueport’s argument that the government needed to prove that its suit fell under one of the three exceptions to sovereign immunity stated under Section 1498(b). According to the Federal Circuit, the CFC lacks jurisdiction over any copyright infringement claim within the scope of the Section 1498(b) provisos. With regard to Blueport's DMCA claim, the Federal Circuit likewise found that the Air Force similarly had not waived its sovereign immunity for DMCA claims. In so doing, the Federal Circuit cited the rule that a waiver of sovereign immunity cannot be implied but must be unequivocally expressed.

Detailed Summary:

This is an action brought by Blueport against the United States Air Force (“Air Force”) for copyright infringement and violations of the DMCA, Pub. L. No. 105-304, 112 Stat. 2860 (Oct. 28, 1998), codified at 17 U.S.C. § 1201, et seq. The CFC dismissed Blueport’s claims for lack of jurisdiction on the ground that the Air Force, as a government defendant, had not waived sovereign immunity. Opinion, p.1. In the proceedings before the CFC, Blueport claimed that the Air Force infringed Blueport’s copyright in a software program known as “the AUMD program.” The AUMD program was written by Air Force Technical Sergeant Mark Davenport, who assigned all his rights in the AUMD program to Blueport in 2000.

In this appeal, the issue was whether the Air Force waived sovereign immunity for claims brought under the DMCA. Id., p. 5. The Federal Circuit noted the relevant rule in this case as 28 U.S.C. Section 1498(b), which grants copyright owners a right of action for copyright infringement against the United States, subject to three provisos. First, Section 1498(b) does not provide a government employee a right of action “where he was in a position to order, influence, or induce use of the copyrighted work by the Government.” (“the order, influence, or induce proviso”). Id, pp. 6-7, citing Section 1498()b). Second, Section 1498(b) confers no right of action “with respect to any copyrighted work prepared by a person while in the employment or service of the United States, where the copyrighted work was prepared as a part of the official functions of the employee.” (“the official functions proviso”).  Id. Third, Section 1498(b) confers no right of action “with respect to any copyrighted work . . . in the preparation of which Government time, material, or facilities were used.” (“the Government time, material, or facilities proviso”). Id.

Blueport argued that these provisos are affirmative defenses that must be proved by the Air Force; that the Air Force has the burden to show that Blueport’s claims are barred by one of these provisos; and that Blueport’s copyright infringement claim does not fall within any of these provisos. The Federal Circuit rejected these arguments, stating that a reading of § 1498(b) demonstrates that the three provisos to the waiver of sovereign immunity are jurisdictional limitations. That is, the government will be deemed not to have waived sovereign immunity for any claim that falls within the scope of the Section 1498(b) provisos. Id., p. 9, citing Zoltek Corp. v. United States, 442 F.3d 1345, 1350 (Fed. Cir. 2006).  The Federal Circuit reasoned that such a holding comports with the principle that any uncertainty as to the scope of a waiver of sovereign immunity should be resolved by construing the waiver narrowly, in favor of the sovereign. Id., citing Lane v. Pena, 518 U.S. 187, 192 (1996). It follows that “the terms of the Government’s consent to be sued in any court define that court’s jurisdiction to entertain the suit,” Id., citing United States v. Testan, 424 U.S. 392, 953 (1976).

Even assuming that the claim in this case is not barred by sovereign immunity, such claim would still be precluded by the “order, influence, or induce” proviso of Section 1498(b).  At the time that Davenport wrote the AUMD program, he was employed as a manager of the Air Force Manpower Data System (“MDS”), a database containing manpower profiles for each unit in the Air Force. Id.  The Federal Circuit reasoned that Blueport’s rights in the AUMD program were derived from Davenport, whose position in the Air Force gave him access and authority to distribute the AUMD program freely to his colleagues.

Finally, the Federal Court sustained the CFC’s dismissal of Blueport’s DMCA claim on the ground that the Air Force had not waived its sovereign immunity for DMCA claims from the outset. The rule is that a waiver of sovereign immunity “cannot be implied but must be unequivocally expressed.” Id., p. 13, citing United States v. King, 395 U.S. 1, 4 (1969). Here, the DMCA contains no express waiver of sovereign immunity. Indeed, the substantive prohibitions of the DMCA refer to individual government officials waiving sovereign immunity, not the government itself. Id., citing 17 U.S.C. § 1201(a)(1)(A).

For the foregoing reasons, the Federal Circuit affirmed the dismissal of Blueport’s claims against the Government for lack of jurisdiction.

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