Subafilms, Ltd. v. MGM-Pathe Communications Co.

Opinion by Judge D.W. NELSON.

In this case, we consider the “vexing question” 1 of whether a claim for infringement' can be brought under the Copyright Act, 17 U.S.C. § 101 et seq. (1988), when the assert-edly infringing conduct consists solely of the authorization within the territorial boundaries of the United States of acts that occur entirely abroad. We hold that such allegations do not state a claim for relief under the copyright laws of the United States.

Factual and Procedural Background

In 1966, the musical group The Beatles, through Subafilms, Ltd., entered into a joint venture with the Hearst Corporation to produce the animated motion picture entitled “Yellow Submarine” (the “Picture”). Over the next year, Hearst, acting on behalf of the joint venture (the “Producer”), negotiated an agreement with United Artists Corporation (“UA”) to distribute and finance the film. Separate distribution and financing agreements were entered into in May, 1967. Pursuant to these agreements, UA distributed the Picture in theaters beginning in 1968 and later on television.

In the early 1980s, with the advent of the home video market, UA entered into several licensing agreements to…