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Ninth Circuit: Non-Exclusive Licensing Agent Has No Standing to Sue for Copyright Infringement

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By Trisha Farmer Lau and David G. Barker

In DRK Photo v. McGraw-Hill Global Education Holdings, LLC, the Ninth Circuit held that an Arizona stock photo agency could not sue McGraw-Hill under the Copyright Act for using images in textbooks without permission. The court recognized there was no bright line answer to this now oft-litigated issue, when it affirmed summary judgment in favor of the defendants, “because DRK is a nonexclusive licensing agent for the photographs at issue and has failed to demonstrate any adequate ownership interest in the copyrights to confer standing.”

DRK Photo (“DRK”) licenses stock photos created by others to publishing entities.  DRK’s agreements with photographers (1) appoint DRK as a nonexclusive licensing agent, and (2) assign DRK the rights to pursue copyright infringement actions (see a discussion of related issues here). DRK sued the defendants for exceeding their licenses by printing and distributing more textbooks containing the licensed images than the licenses authorized.

Section 501(b) of the Copyright Act establishes that “[t]he legal or beneficial owner of an exclusive right under a copyright” has standing to sue “while he or she is the owner.” The court held that DRK was not a legal owner, because its agreements did not convey an exclusive license to DRK, did not preclude the photographers from working with other licensing agents, and merely transferred the right to sue, not ownership. Without an exclusive license, licensing agents may not sue for copyright infringement, even if photographers grant that right.