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Offers of Judgment and Copyright Litigation

BY Francine Miller
November 02, 2005

Rule 68 of the Federal Rules of Civil Procedure provides a defendant with a means to encourage parties to settle their litigation before trial. A defendant may serve a plaintiff with an “an offer to allow judgment to be taken against [defendant] for the money or property or to the effect specified in the offer, with costs then accrued.” F.R.C.P. 68. If the offer is not accepted by the plaintiff, and the “judgment finally obtained by the offeree is not more favorable than the offer, the offeree must pay the costs incurred after the making of the offer.” Id.

Rule 68 by its own terms only refers to “costs”; but the Supreme Court has held that “costs” includes attorney's fees when the underlying statute at issue includes attorney's fees in its definition of costs. See Marek v. Chesny, 473 U.S. 1, 105 S.Ct. 3012 (1985). However, the Copyright Act provides that only the “prevailing party” in a copyright infringement suit may collect its attorney's fees as part of the costs the court can award at its discretion. 17 U.S.C. '505.

What is the relationship between Federal Rule 68 and Section 505 of the Copyright Act? If the defendant in a copyright litigation makes an offer of judgment that the plaintiff refuses, and the plaintiff is awarded damages for infringement that are less than the amount offered by defendant in the offer of judgment, do the post-offer “costs” governed by Rule 68 to which the defendant is entitled include attorney's fees? In other words, can a non-prevailing party collect attorney's fees under Rule 68 in a copyright litigation?

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