In Rimini Street Inc. et al. v. Oracle USA Inc.,1 the Supreme Court held the Copyright Act, which gives federal district courts discretion to award “full costs” to a party in a copyright litigation, does not authorize awards of litigation expenses beyond the six categories of costs specified in the general costs statute. In addition, the Court held that the Copyright Act did not specifically permit costs for expert witness fees, e-discovery expenses and jury consultant fees, and these costs were outside the six categories of costs detailed in the general costs statute. The Court explained the holding as follows:
The Copyright Act gives federal district courts discretion to award “full costs” to a party in copyright litigation. 17 U.S.C. § 505. In the general statute governing awards of costs, Congress has specified six categories of litigation expenses that qualify as “costs.” See 28 U.S.C. §§ 1821, 1920. The question presented in this case is whether the Copyright Act’s reference to “full costs” authorizes a court to award litigation expenses beyond the six categories of “costs” specified by Congress in the general costs statute. The statutory text and our precedents establish that the answer is no. The term “full” is a term of quantity or amount; it does not expand the categories or kinds of expenses that may be awarded as “costs” under the general costs statute. In copyright cases, § 505’s authorization for the award of “full costs” therefore covers only the six categories specified in the general costs statute, codified at §§ 1821 and 1920.
Oracle sued Rimini and its CEO asserting claims under the Copyright Act alleging that Rimini, while furnishing software support services to Oracle customers, improperly copied Oracle’s software without licensing it. A jury held that Rimini had infringed various Oracle copyrights. The jury awarded Oracle $35.6 million in damages for copyright infringement. The district court directed Rimini to pay Oracle $12.8 million for litigation expenses such as expert witnesses, e-discovery and jury consulting. The Court of Appeals, Ninth Circuit affirmed the district court’s $12.8 million award.
On appeal, the Supreme Court reversed. The Court explained that the Copyright Act specifies that a district court in a copyright case “in its discretion may allow the recovery of full costs by or against any party other than the United States or an officer thereof.” 17 U.S.C. § 505. In the general “costs” statute, codified at 28 U.S.C. §§ 1821 and 1920, Congress detailed six categories of expenses that can be awarded as litigation costs. Sections 1821 and 1920 in essence define what the term “costs” encompasses in the subject-specific federal statutes that provide for an award of costs. The six categories that a federal court may award as costs are:
- Fees of the clerk and marshal
- Fees for printed or electronically recorded transcripts necessarily obtained for use in the case
- Fees and disbursements for printing and witnesses
- Fees for exemplification and the costs of making copies of any materials where the copies are necessarily obtained for use in the case
- Docket fees under Section 1923 of this title
- Compensation of court-appointed experts; compensation of interpreters; and salaries, fees, expenses and costs of special interpretation services under Section 1828 of this title
The Court explained that:
Sections 1821 and 1920 create a default rule and establish a clear baseline against which Congress may legislate. Consistent with that default rule, some federal statutes simply refer to “costs.” In those cases, federal courts are limited to awarding the costs specified in §§ 1821 and 1920. If, for particular kinds of cases, Congress wants to authorize awards of expenses beyond the six categories specified in the general costs statute, Congress may do so. For example, some federal statutes go beyond §§ 1821 and 1920 to expressly provide for the award of expert witness fees or attorney’s fees. . . . But absent such express authority, courts may not award litigation expenses that are not specified in §§ 1821 and 1920.
The Court thereupon held the following:
Our cases, in sum, establish a clear rule: A statute awarding “costs” will not be construed as authorizing an award of litigation expenses beyond the six categories listed in §§ 1821 and 1920, absent an explicit statutory instruction to that effect. . . .
Here, the Copyright Act does not explicitly authorize the award of litigation expenses beyond the six categories specified in §§ 1821 and 1920. And §§ 1821 and 1920 in turn do not authorize an award for expenses such as expert witness fees, e-discovery expenses, and jury consultant fees, which were expenses encompassed by the District Court’s $12.8 million award to Oracle here.
Oracle argued, however, that the English copyright statutes awarding “full costs” permitted the award of all litigation expenses beyond specific costs. According to Oracle, the asserted meaning in the 1831 statute controlled over anything that Congress passed in any costs statute in 1853 or later. The Court was not persuaded:
In light of the commonly understood meaning of the term “full costs” as of 1831 and the case law since 1831, Oracle’s historical argument falls short. The best interpretation is that the term “full costs” meant in 1831 what it means now: the full amount of the costs specified by the applicable costs schedule.
The Court therefore held the following:
The Copyright Act authorizes federal district courts to award “full costs” to a party in copyright litigation. That term means the costs specified in the general costs statute, §§ 1821 and 1920. We reverse in relevant part the judgment of the Court of Appeals, and we remand the case for further proceedings consistent with this opinion.
Why it matters:
The Rimini Street decision has important consequences for copyright litigants. Specifically, copyright litigants will be significantly limited in the types of costs that are recoverable in the discretion of the district court, assuming they are the prevailing party, and will need to plan to absorb expenses such as expert witness, e-discovery and jury consulting fees. The Rimini Street decision, however, does not disturb a copyright litigant’s ability to recover reasonable attorney fees as part of the costs.
Irah Donner is a partner in Manatt’s intellectual property practice and is the author of Patent Prosecution: Law, Practice, and Procedure, Tenth Edition, with 2018 Supplement, published by Bloomberg Law/BNA. This case analysis will be included in the next edition of the treatise.
1 Rimini Street Inc. et al. v. Oracle USA Inc., ---- S.Ct. ----, 129 USPQ2d 1459, 2019 WL 1005828 (2019).