NC Court Grants Motion in Allen v. Cooper to Reconsider Takings Claim

On March 23, 2020, the Supreme Court remorsefully found in Allen v. Cooper that its own precedents obligated it to affirm that states are immune from federal litigation in claims of copyright infringement. On September 4, 2020, plaintiff Rick Allen filed a motion to reconsider the North Carolina district court’s 2017 dismissal of his takings claim under the Fifth Amendment for that state’s unlicensed use of his audio-visual works documenting the recovery of Blackbeard’s ship Queen Anne’s Revenge. On August 18, 2021, the court granted Allen’s motion.

Anyone who has followed the matter of sovereign immunity and state infringement of copyrighted works is aware of the byzantine, Heller-esque logic at the heart of this mess in which no reasonable party believes that justice is being served. Still, here’s the general reasoning in plain terms:

The Eleventh Amendment bars persons from bringing federal lawsuits against state or state actors …

BUT Congress, believing (perhaps naively) in its Article I powers to make laws, passed a trio of IP remedy statutes, clearly articulating its intent to abrogate sovereign immunity in cases where the state, or state actors, infringe trademarks, patents, or copyrights.

BUT in a series of cases in the late 1990s and culminating in 2000, the Supreme Court decided that Congress does not have the right under Article I to abrogate Eleventh Amendment immunity, and thus, held the three IP remedy laws to be unconstitutional.

BUT in Allen v. Cooper, although the Supreme Court affirmed those 90s-era decisions under the principle of stare decisis, the justices seemed pretty sad about it, even calling the state of North Carolina et al “pirates” for their conduct toward Mr. Allen et al. Thus, the Court also provided a roadmap for Congress to validly abrogate sovereign immunity in the future.

NOW, one of the principles supporting Eleventh Amendment immunity is that a plaintiff who has a beef with a state is presumed to have recourse to due process in that state’s courts. BUT there is no mechanism for bringing a copyright infringement claim in state courts. SO, that’s a head-scratcher.

MEANWHILE, the Fifth Amendment prohibits the state from taking private property for public use without due process, and the Fifth Amendment naturally carries more weight than a few pesky statutes written by Congress.

BUT at the time that Mr. Allen initially filed a takings claim against North Carolina in 2017, the legal precedent held that before a party may file a claim in federal court, he must first try to remedy his complaint in state court.

BUT when the complaint is an unconstitutional taking of an intangible form of property protected by federal statute, devising a state complaint is dubious at best. AND even if a plaintiff does file a claim in state court and loses, he is then barred from filing a claim in federal court.

MEANWHILE, just to be total dicks about this particular case, North Carolina passed a statute colloquially called “Blackbeard’s Law” which asserts state ownership of any AV material captured of any historic vessel found in North Carolina waters.

THEN, in 2019, the Supreme Court held in a municipal takings case, Knick v. Township of Scott, that a plaintiff need not exhaust state remedies prior to appealing to a federal forum for a claim of “unconstitutional treatment.”

SO, the decision in Knick created the foundation for Allen’s motion to reconsider his takings claim, and the District Court for the Eastern District of North Carolina agreed.

PLUS, because the Supreme Court held that the copyright remedy law was invalid as a prophylactic abrogation of immunity, the district court will now reconsider Allen’s case in light of United States v. Georgia (2006), which allows for case-by-case abrogation, if there is both a violation of federal statute and constitutional rights.

NOW, this will be interesting to watch. For one thing, if Rick Allen finally achieves justice and compensation, other rightsholders with infringement claims against state actors may also find remedies.

More broadly, though, when the Supreme Court ruled in Allen, it invited Congress to have another go at writing statutes to abrogate state immunity in IP infringement claims against states.[1] But in doing so, the Court drew a very narrow roadmap through the Fourteenth Amendment §5, which grants Congress authority to pass laws that bar state deprivation of property without due process under §1 of that amendment. So, with that in mind, this quote from the district court’s decision to grant Allen’s motion for reconsideration seemed worthy of highlight:

“Even though Knick was not a sovereign immunity case, its conclusion that a compensatory remedy is constitutionally-required was necessary to its decision and is contrary to [the precedent] conclusion that state sovereign immunity can bar takings claims brought under the Fourteenth Amendment.”

What that suggests to this lay reader is that if Allen prevails in his takings claim, and Congress does write new IP remedy laws, the statutes are likely to hold up to a constitutional challenge predicated on sovereign immunity. In fact, in granting this motion, the district court also reiterated its own interpretation on the limits of Eleventh Amendment immunity, writing:

“…this Court stated that the position that the Eleventh Amendment was intended to constitutionalize a broad principle of sovereign immunity contradicts both the historical evidence and the plain meaning of the Amendment that the founders wrote a Constitution upon the sovereignty of the people, rather than that of the States.”

Meanwhile, any state actors who interpret the SCOTUS outcome in Allen as a license to steal intellectual property, may want to reconsider adding to the body of evidence showing that state infringement is rampant, because that evidence will be the foundation on which Congress writes new laws abrogating sovereign immunity in IP cases.

This all seems like a long way to go to right an obvious wrong, and kudos to Rick Allen and his counsel for continuing this fight, even after defeat in the Supreme Court. Assuming this issue will one day be resolved, rightsholders will owe Allen and others in this fight a tremendous debt of gratitude.

[1] With the exception of Justice Thomas, who stated in his concurring opinion that the Court has no business directing Congress to do anything at all.

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