The Software IP Report

Path Cleared for Ninth Circuit to Address Copyright First Sale Doctrine Burdens of Proof

By Charles Bieneman

Categories: Copyright, The Software IP Report

Adobe has been granted partial judgment under Federal Rule of Civil Procedure 54(b) in a copyright infringement case so that the Ninth Circuit may determine which party bears the burden of proof when the first sale doctrine is raised as a defense to copyright infringement. Adobe Systems, Inc. v. Christenson, No. 2:10-CV-00422-LRH-GWF (D. Nev. Oct. 16, 2012). The court had previously granted summary judgment to the defendants on Adobe’s copyright and trademark infringement claims because discovery sanctions precluded Adobe’s use of evidence (i.e., contracts and licenses) that it contended would have overcome the defendants’ first sale defense.

As previously discussed on this blog, in its earlier decision the court had placed the burden on the defendants in raising the first sale defense to show that they had lawfully obtained the copyrighted material. However, the court had also held that the burden then shifted to the plaintiff to show that the software had been licensed, and not sold.

Adobe now sought “partial judgment under Rule 54(b) in order to appeal the adverse evidentiary rulings.” In granting Adobe’s Rule 54(b) motion, the court explained that “the gravamen of Adobe’s claims and the basis for its Rule 54(b) appeal are dissimilar: the claims assert copyright and trademark infringement, but one basis of its Rule 54(b) appeal will be an evidentiary exclusion.”

Further, “[a]nother basis is the unsettled issue (in this Circuit) of who bears the burden of proof on the first sale doctrine” in copyright cases. Noting the significance of the first sale doctrine, and how it is applied, the court explained that “[t]his unsettled legal issue–potentially dispositive on Adobe’s copyright claim–takes this case out of the mine run.”

Certification of a Rule 54 judgment was appropriate where future developments in the case would not likely moot, and therefore force an appeals court to dupplicatively address, issues to be raised when the Rule 54 judgment was appealed. Here, the evidentiary ruling, i.e., the exclusion of Adobe’s evidence, would not be mooted. Therefore, the court granted Adobe’s motion, and also granted a stay pending Adobe’s appeal of the Rule 54 judgment.