Copyright Settlement Agreement
(Pro-Copyright Holder)

Summary

This template is a settlement agreement for settling a copyright infringement litigation brought in a U.S. district court, with terms favorable to the copyright holder (plaintiff). This template includes practical guidance, drafting notes, and alternate and optional clauses. This settlement agreement is intended to be used in tandem with a Consent Order that includes a stipulated permanent injunction. Federal copyright disputes are settled in more than 70% of cases, and settlement agreements are commonly used to settle such disputes. This form may be used to resolve a case that is already in litigation, or be adapted for settling a dispute in the pre-litigation phase. Counsel should always make sure that any resolution is memorialized in a binding, written agreement, even if the client itself engages in direct oral negotiations with a potential adversary or reaches an oral resolution. Note that ABA Model Rule 4.2 (the "no contact" rule) forbids a lawyer from communicating with a client the lawyer knows is represented by counsel, unless the client has consented to the communication or the communication is otherwise authorized by law or court order. The No Contact rule "provide[s] protection of the represented person against overreaching by adverse counsel, safeguard[s] the client-lawyer relationship from interference by adverse counsel, and reduce[s] the likelihood that clients will disclose privileged or other information that might harm their interests." ABA Formal Opinion 95-396 (1995). However, consider whether such direct client-to-client settlement discussions may be helpful or hurtful to settlement deliberations in your particular case, including whether the client is emotionally invested or prejudiced to the opposing party, or whether money is the only remedy sought in litigation (which may result in less complex settlement discussion), as some judges have described that settlement discussions "are not as effective when the clients want to control the negotiation or there are many variables to the settlement." See JAMs, Five Strategies for Effective Settlement Negotiations (HON BROWN (RET.)). As an attorney, it is still your duty to fully and fairly advise the client of your professional judgment as to the exercise of the client's rights in furtherance of the representation, including advice as to the objective strengths and weaknesses of each parties' settlement demands, propose appropriate counter-offers, etc. It is assumed for purposes of this form that: • there are only two parties – a copyright owner who has alleged that its work has been infringed ("Plaintiff") by a single accused infringer ("Defendant"); • a single work has been allegedly infringed ("Plaintiff's Work") • the alleged infringement is embodied in a single work ("Defendant's Work") This form can also be adapted for use in settling a dispute with more than two parties, more than one infringed work, and/or or more than one infringing work. Make sure to detail the scope of the settlement (i.e., geographic area, covered works, different media) and the scope of the release from liability, if any. Careful drafting ensures not only a clean resolution to the present dispute, but provides predictability for both sides on enforcement in case of a future breach of the settlement agreement. Consider all possible issues between the parties so that your client's present and future interests are adequately covered. Numerous variables in this template will be determined by the form and medium of Plaintiff's Work and Defendant's Work. Specific post-settlement requirements and restrictions, for example, will differ widely depending on whether Plaintiff's Work is a software program, a sculpture, a training manual, a choreographic work, a play, or a song. Variables will also be determined by the specific right that is alleged to have been infringed from Plaintiff's Work. The protected rights are: • reproduction (making copies or phonorecords) • adaptation (making derivative works based on copyright-protected works) • distribution (disseminating copies or phonorecords to the public) • performing a copyright-protected work publicly (e.g., plays, musical works, choreographic works, pantomimes) • displaying copyrighted works publicly (e.g., literary, musical, dramatic, and choreographic works, pantomimes, and pictorial, graphic, sculptural or cinematic works) • performing copyrighted sound recordings via digital audio transmission See 17 U.S.C.S. § 106. For more information on copyright rights, claims and infringement, see Copyright Fundamentals, Pre-suit Considerations in Copyright Litigation, and Complaint (Copyright Infringement). For additional information on copyright infringement with specific reference to caselaw in your jurisdiction, see Copyright Enforcement Resource Kit under "Pre-suit Preparation". For more on settlement in copyright cases, see Nimmer on Copyright § 40.01 (2021). As mentioned above, for an example of a Consent Order to be used in combination with this Settlement Agreement. To see a list of resources for federal government attorneys who work on IP and copyright related matters, see Intellectual Property for Federal Government Attorneys Resource Kit.