By Government Contracts Editorial Staff
A contractor’s motion to dismiss a copyright infringement claim was granted by the District Court for the Eastern District of Virginia because the court lacked subject matter jurisdiction over the claim. The plaintiff worked on a business process improvement project for a Defense Contract Management Agency contractor. He alleged that, independent of those responsibilities, he developed computer software that automated defense contract reviews that DCMA had been performing manually. He also alleged that, at his employer’s direction, he provided a copy of the software and source code to DCMA, which in turn “removed [his] name as author,” “renamed the application ConCISE,” and “collaborated with [the defendant, another DCMA contractor] to copy [the software] and prepare a derivative work ….” After the Copyright Office accepted his application to copyright the software, the plaintiff filed suit in federal district court alleging infringement under 17 USC 504–05.
Trade Secret Claim Survived. However, the waiver of sovereign immunity in 28 USC 1498(b) provides that when the government has infringed a copyright, “the exclusive action … shall be … in the Court of Federal Claims …,” and the restriction extends to government contractors that infringe copyrighted work. The statute creates a jurisdictional bar to claims in district court against private parties for copyright infringement. It is not merely an affirmative defense, as held by the Court of Appeals for the Federal Circuit. Although the limitation in §1498(b) only applies if the defendant acted “for the [g]overnment and with the authorization or consent of the [g]overnment,” it was undisputed that the defendant here was a government contractor, and the plaintiff’s complaint alleged not only that the infringement occurred under the government’s authorization and consent, but that it was performed by the government with support from the defendant. Thus, the plaintiff’s remedy was limited to a claim against the government in the CFC. Finally, although the plaintiff’s state law business conspiracy claim was also dismissed because it was subsumed by the Copyright Act (17 USC 101, et seq.), his misappropriation of trade secret claim under 18 USC 1836(b)(1) survived. The plaintiff plausibly alleged that, by obtaining his software, the contractor was able to access the source code, as evidenced by its attempt to recreate it. (Zaccari v. Discover Technologies, LLC, DC ED Va, 63 CCF ¶81,556).
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