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It’s a ‘Form of Extortion’, Dear Watson: 7th Circuit Orders Sherlock Holmes Estate to Pay $30,000 in Attorneys’ Fees

October 1, 2014

Klinger v. Conan Doyle Estate, Ltd.

In a recent opinion, 7th Circuit Judge Richard A. Posner ordered the Conan Doyle estate to pay attorneys’ fees for bringing “nonexistent copyright claims” as a “form of extortion” against author Leslie Klinger.

Klinger previously penned a compilation of Sherlock Holmes stories, entitled In the Company of Sherlock Holmes. Upon learning of Klinger’s ‘Sherlock’ compilation, the estate of Conan Doyle, creator of the Sherlock Holmes character, demanded a $5,000 license from Klinger. In addition, the Doyle estate threatened to prohibit various retailers, including Amazon, from selling Klinger’s book if Klinger were to publish the book without first obtaining a license.

In return, Klinger successfully sued the Doyle estate in district court for a declaratory judgment that In the Company of Sherlock Holmes was a non-infringing work. The Doyle estate appealed, upon which the 7th Circuit affirmed in favor of Klinger as well as awarded Klinger’s motion for approximately $30,000 in attorneys’ fees accrued throughout the appellate process.

The 7th Circuit concluded that the Sherlock Holmes character, which was published before 1923, is no longer protected under copyright law. The court noted, “Once the copyright on a work expires, the work becomes a part of the public domain and can be copied and sold without a license from the holder of the expired copyright.”

Nevertheless, as the 7th Circuit noted, “[t]he Doyle estate’s business strategy is plain: charge a modest license fee for which there is no legal basis, in the hope that the ‘rational’ writer or publisher asked for the fee will pay it rather than incur a greater cost, in legal expenses, in challenging the legality of the demand.”

However, the 7th Circuit’s opinion did not stop there, as the court also criticized the Doyle estate for not only attempting to enforce non-existent copyright claims against Klinger but also for enlisting the help of book publishers to do so. “[T]he estate was playing with fire in asking Amazon and other booksellers to cooperate with it in enforcing its nonexistent copyright claims against Klinger.  For it was enlisting those sellers in a boycott of a competitor of the estate, and boycotts of competitors violate the antitrust laws.”

Consequently, the 7th Circuit awarded Klinger $30,000 in attorneys’ fees.

Under 17 U.S.C. § 505 of the U.S. Copyright Act, a court has discretion in granting “reasonable” attorneys fees to the prevailing party of a civil action brought under the Copyright Act. As part of this determination, a court may consider several factors, including whether or not a party, like Klinger, has already successfully defended against a claim of infringement.

As such, Klinger v. Conan Doyle Estate, Ltd. appears to elucidate additional factors that might tip a court’s favor toward granting attorneys’ fees to the prevailing litigant of a copyright infringement action brought under the Copyright Act; particularly when the court so strongly disapproves of the opposing party’s conduct that the court equivocates it with extortion-like practices.

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