Vondran Legalr Copyirght Infringement Updates: The Fifth Circuit's Important Copyright Ruling in Southern Credentialing Support Services v. Hammond Surgical Hospital
Copyright owners sometimes assume that registering a copyright after discovering infringement will at least allow them to recover statutory damages for infringements that occur after registration.
In the Fifth Circuit, that assumption can be a costly mistake.
In Southern Credentialing Support Services, L.L.C. v. Hammond Surgical Hospital, L.L.C., 946 F.3d 780 (5th Cir. 2020), the United States Court of Appeals for the Fifth Circuit addressed an important question under Section 412 of the Copyright Act:
If infringement begins before copyright registration, can the copyright owner recover statutory damages when the defendant later commits a different type of infringement after registration?
The Fifth Circuit's answer was no—at least where the defendant's conduct is part of the same uninterrupted course of infringement involving the same copyrighted work.
The decision is an important reminder that copyright registration is not merely an administrative formality. Timing can determine whether a successful copyright plaintiff has access to two of the Copyright Act's most powerful remedies: statutory damages and attorney's fees.
The Copyright Registration Problem Under Section 412
The starting point is 17 U.S.C. § 412.
Section 412 generally prevents a copyright owner from recovering statutory damages or attorney's fees for an infringement that "commenced" before the effective date of registration, subject to the statute's rules concerning works registered shortly after first publication.
This matters because statutory damages can dramatically change the economics of copyright litigation.
Under 17 U.S.C. § 504(c), a copyright owner who qualifies for statutory damages may generally elect an award ranging from $750 to $30,000 per infringed work, with potential statutory damages of up to $150,000 per work for willful infringement.
But those remedies are subject to Section 412.
As the Fifth Circuit explained, Section 412 creates an incentive for copyright owners to register their works promptly.
The difficult question is determining when an infringement "commences."
That issue became central in Southern Credentialing.
What Happened in Southern Credentialing?
Southern Credentialing Support Services provided healthcare credentialing services to Hammond Surgical Hospital.
Healthcare credentialing involves collecting and verifying information from physicians who seek privileges to practice at hospitals.
Southern Credentialing developed customized credentialing materials for Hammond, including an initial credentialing application packet and a recredentialing packet. According to the Fifth Circuit, the initial packet was approximately 83 pages long, while the recredentialing packet was approximately 113 pages.
Southern Credentialing's relationship with Hammond ended in 2013.
But Hammond subsequently hired another credentialing provider—and that provider continued using materials containing approximately 50 pages identical to Southern Credentialing's forms.
From 2013 until 2017, physicians could access the application materials through a password-protected website. By 2017, however, the materials were posted so that they could be accessed without a password by someone who knew where to locate them.
There was one major problem for Southern Credentialing:
It had not registered the copyrights before Hammond's allegedly infringing use began.
Southern Credentialing subsequently registered the original packet in February 2014 and the recredentialing packet in July 2014.
It then asserted copyright infringement against Hammond and ultimately filed suit.
Southern Credentialing Wins on Copyright Ownership and Infringement
Southern Credentialing was successful on some extremely important issues.
The district court granted summary judgment concerning the existence of valid copyrights and infringement.
The Fifth Circuit ultimately agreed that Southern Credentialing possessed valid copyrights protecting the selection and arrangement of information contained in its credentialing forms. It also affirmed the conclusion that Hammond had infringed those copyrights.
Importantly, the Fifth Circuit also affirmed a permanent injunction preventing future infringement.
So this was not a case in which the plaintiff failed to establish copyright infringement.
Instead, the major appellate fight concerned remedies.
And that is where Section 412 became decisive.
The District Court Awards Statutory Damages
After determining infringement, the district court conducted a bench trial concerning damages.
Southern Credentialing elected statutory damages.
Ordinarily, Section 412 would create a serious obstacle because Hammond's infringement had begun before Southern Credentialing registered the copyrights.
Southern Credentialing, however, had an interesting argument.
Its theory was essentially that Hammond's later conduct constituted a different kind of copyright infringement.
Before registration, the infringing conduct involved reproduction of the copyrighted materials.
Later, the materials became publicly available through the website, implicating the copyright owner's distribution rights.
Those are different exclusive rights under Section 106 of the Copyright Act.
The district court accepted the distinction and concluded that the post-registration distribution activity was sufficiently "different in kind" from the earlier conduct to permit statutory damages.
It awarded Southern Credentialing $5,000 in statutory damages after finding that Hammond's infringement was not willful.
The Fifth Circuit disagreed.
The Fifth Circuit: Changing the Type of Infringement Does Not Necessarily Create a New Commencement
The key issue was whether the post-registration conduct constituted a new infringement for purposes of Section 412.
Southern Credentialing's argument had intuitive appeal.
Copyright law gives copyright owners several separate exclusive rights under 17 U.S.C. § 106.
For example, copyright owners generally have exclusive rights to:
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reproduce the copyrighted work;
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prepare derivative works;
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distribute copies;
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publicly perform certain works;
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publicly display certain works; and
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in the case of sound recordings, perform them publicly through digital audio transmission.
So why shouldn't a pre-registration violation of the reproduction right and a later post-registration violation of the distribution right constitute separate commencements?
The Fifth Circuit rejected that approach.
The court held that Section 412's bar can apply even when the defendant violates one exclusive right before registration and a different exclusive right in the same copyrighted work after registration.
As the court explained, the Copyright Act does not create the type of distinction Southern Credentialing proposed between different forms of infringement for purposes of determining commencement under Section 412.
The practical consequence was significant:
The post-registration distribution did not reset the statutory-damages clock.
The Earlier Mason Decision Was Critical
The Fifth Circuit's earlier decision in Mason v. Montgomery Data, Inc., 967 F.2d 135 (5th Cir. 1992) played an important role.
Mason had already established that when a defendant begins copying a work before registration and continues copying it after registration, the later copying generally does not constitute a new commencement that suddenly makes statutory damages available.
The infringement is treated as an ongoing series beginning with the first pre-registration infringement.
Southern Credentialing presented a twist.
The plaintiff was not simply arguing:
"The defendant copied before registration and copied again afterward."
Instead, the argument was effectively:
"The defendant violated one exclusive copyright right before registration and a different exclusive right after registration."
The Fifth Circuit nevertheless concluded that the rationale of Mason still applied.
That makes Southern Credentialing particularly important.
It prevents a copyright owner from circumventing Section 412 merely by characterizing later conduct as infringement of a different § 106 right.
One Work, One Continuing Course of Infringement
The practical rule emerging from Southern Credentialing is powerful:
When the same defendant begins infringing the same copyrighted work before registration and continues an uninterrupted course of infringement after registration, the later infringement ordinarily does not create a new commencement merely because it implicates a different exclusive right under Section 106.
That means lawyers should focus less on labels such as "reproduction" versus "distribution" and more on the chronology and continuity of the defendant's conduct.
The Fifth Circuit emphasized that Hammond's infringement was ongoing and had continued without interruption.
That fact is important because the court expressly left another question unresolved.
What If There Is a Substantial Gap Between the Infringements?
This is one of the most interesting aspects of the decision.
The Fifth Circuit did not decide whether the result would be different if there were a substantial break between the defendant's pre-registration and post-registration conduct.
The court noted that Hammond's infringement had continued without interruption, so it had no reason to decide whether a "substantial gap" could cause later infringement to constitute a new commencement for purposes of Section 412.
That leaves an important litigation issue open.
Suppose, for example:
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Defendant infringes a copyrighted work in 2022.
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The infringement completely stops.
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The copyright owner registers the work in 2023.
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Eighteen months later, the defendant independently begins infringing the work again.
Is the later infringement part of the original commencement?
Or is it a new infringement that commenced after registration?
Southern Credentialing does not definitively answer that question.
That distinction may become extremely important when litigating statutory damages.
A Different Exclusive Right Does Not Automatically Mean a New Infringement for Section 412
One of the biggest lessons from the case is the distinction between identifying an act of infringement under Section 106 and determining when infringement "commenced" under Section 412.
A defendant can violate different exclusive rights.
For example:
Before registration: Defendant reproduces copyrighted photographs.
After registration: Defendant distributes the photographs.
Or:
Before registration: Defendant creates an unauthorized derivative work.
After registration: Defendant distributes the derivative work.
The plaintiff might characterize those acts as separate infringements.
But under Southern Credentialing, that characterization alone does not establish a new commencement for Section 412.
The court expressly rejected the proposition that statutory damages become available merely because the post-registration conduct violates a different exclusive copyright right than the pre-registration conduct.
Why the Rule Matters So Much in Copyright Litigation
The practical consequences can be enormous.
Imagine a photographer discovers that a company has been using a photograph without authorization for several years.
The photographer registers the photograph today.
The company continues using the image tomorrow.
A common assumption might be:
"Everything after registration qualifies for statutory damages."
Not necessarily.
If the defendant's post-registration conduct is simply part of the same continuing infringement that began before registration, Section 412 may prevent statutory damages.
And because Section 412 also affects attorney's fees, the financial consequences can extend far beyond the damages calculation.
This can radically change settlement leverage.
A plaintiff who believes the case potentially involves $150,000 in statutory damages plus attorney's fees may discover that those remedies are unavailable because the infringement commenced before registration.
Registration After Discovering Infringement May Be Too Late for Statutory Damages
This is perhaps the most important business lesson from the case.
Copyright owners frequently wait until infringement occurs before thinking seriously about registration.
That strategy can backfire.
Consider two copyright owners.
Copyright Owner A
Creates a work.
Registers it promptly.
Six months later, infringement begins.
Section 412 generally does not present the same statutory-damages obstacle because the infringement commenced after registration.
Copyright Owner B
Creates a work.
Does not register it.
Six months later, infringement begins.
Owner discovers the infringement and then registers the copyright.
The infringement continues.
Under Southern Credentialing and Mason, the continuing post-registration infringement may still be treated as having commenced before registration.
Copyright Owner B may therefore lose access to statutory damages and attorney's fees for that continuing infringement.
The difference between the two owners is not necessarily the strength of their copyright.
It is the timing of registration.
The Plaintiff Still Had Meaningful Remedies
Losing statutory damages did not mean Southern Credentialing had no copyright rights.
This distinction is important.
The Fifth Circuit affirmed that Southern Credentialing possessed valid copyrights and that infringement had occurred.
It also affirmed the permanent injunction against future infringement.
Section 412 is therefore best understood as a limitation on particular remedies—not a declaration that infringement occurring before registration is lawful.
The unavailability of statutory damages does not transform infringement into permitted conduct.
Indeed, federal courts applying Southern Credentialing continue to recognize that the Section 412 statutory-damages limitation does not necessarily eliminate equitable remedies such as injunctive relief.
Practical Litigation Questions After Southern Credentialing
For copyright litigators practicing in the Fifth Circuit, a Section 412 analysis should begin very early in the case.
Important questions include:
When was the copyrighted work created?
When was it first published?
When was the copyright application filed and registration made effective?
When did this particular defendant first infringe?
Was the defendant's conduct continuous?
Did the infringement ever completely stop?
How long was any interruption?
Did the defendant later begin a genuinely new course of conduct?
Were different copyrighted works involved?
Did the post-registration activity merely use a different method of exploiting the same work?
Those questions can affect millions of dollars in potential exposure in a large copyright case.
The "Same Defendant" and "Same Work" Questions Matter
Lawyers should also be careful about overreading Southern Credentialing.
The decision concerned ongoing infringement involving the defendant and the same copyrighted works.
Different factual patterns may require different analyses.
For example, Section 412 questions may become more complicated when:
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different defendants begin infringing at different times;
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newly created copyrighted works are introduced;
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revised versions receive separate registrations;
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there is a substantial interruption in infringement;
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a new product or campaign begins after registration; or
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the relationship between earlier and later infringing activity is disputed.
The word "commenced" therefore becomes one of the most consequential words in the remedies phase of a copyright lawsuit.
The Case Also Shows Why Copyright Registration Is a Litigation Asset
Many creators think copyright registration is something to worry about only when somebody steals their work.
That gets the sequence backward.
Registration can be most valuable before infringement occurs.
Prompt registration potentially gives the copyright owner access to statutory damages and attorney's fees that may otherwise be unavailable once infringement has already commenced.
That leverage can influence:
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cease-and-desist negotiations;
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settlement discussions;
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litigation budgets;
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contingency-fee evaluations;
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mediation positions;
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insurance considerations; and
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the defendant's overall assessment of litigation risk.
In other words, copyright registration is not simply about proving ownership.
It can dramatically affect the economics of enforcement.
A Simple Example
Assume a company copies a photographer's image onto its website on January 1.
The photographer has not registered the image.
The photographer discovers the infringement on March 1 and immediately registers the copyright.
The company continues displaying the photograph through December.
The photographer might argue that every day after registration represents a new infringement eligible for statutory damages.
Under the Fifth Circuit's approach, however, that argument faces a major problem.
The defendant's infringement commenced before registration.
The continued post-registration exploitation may therefore remain part of the same continuing infringement for purposes of Section 412.
Now change the facts.
Suppose the company removes the photograph completely in March.
Two years later, it launches an entirely new advertising campaign and begins using the photograph again.
That scenario raises the unresolved question identified in Southern Credentialing: whether a sufficiently substantial interruption could cause the later conduct to constitute a new commencement.
The answer will depend on the applicable law and facts, and Southern Credentialing expressly did not resolve that situation.
Key Takeaway: Register Before the Infringement Begins
Southern Credentialing Support Services v. Hammond Surgical Hospital provides copyright owners with a straightforward lesson:
Do not assume that registering a copyright after infringement begins will make statutory damages available for the defendant's later conduct.
In the Fifth Circuit, where the same defendant continues an uninterrupted infringement of the same copyrighted work, the infringement may be treated as having commenced before registration even when the defendant's later conduct violates a different exclusive right under Section 106.
The Fifth Circuit therefore reversed the statutory-damages award while leaving the plaintiff's victory on copyright validity, infringement, and injunctive relief intact.
For creators, photographers, software developers, designers, businesses, and other copyright owners, the business lesson is simple:
Create. Register. Then Enforce.
Waiting until infringement occurs can mean waiting too long to obtain some of the Copyright Act's most powerful financial remedies.
Case Citation
Southern Credentialing Support Services, L.L.C. v. Hammond Surgical Hospital, L.L.C., 946 F.3d 780 (5th Cir. 2020).
United States Court of Appeals for the Fifth Circuit, No. 18-31160, decided January 9, 2020.
The Fifth Circuit affirmed the findings concerning copyright validity and infringement and affirmed the permanent injunction, but reversed the award of statutory damages and attorney's fees under 17 U.S.C. § 412.
Attorney Steve® Copyright Law Tip
If you own valuable photographs, videos, music, software, written content, graphics, website materials, training materials, forms, or other creative works, consider copyright registration before infringement occurs. Once an infringement has commenced, later registration may not restore eligibility for statutory damages and attorney's fees for an uninterrupted course of infringement.
This article is provided for general educational and informational purposes only and is not legal advice. Copyright cases are highly fact-specific, and the availability of statutory damages, attorney's fees, actual damages, profits, and injunctive relief depends on the applicable facts and law.
