Illinois Central Railroad Company v. Michael Belcher

Summary

The United States District Court for the Northern District of Indiana addresses cross-motions for summary judgment in a dispute concerning a computer program created by an Illinois Central Railroad employee. The court concludes that the employee’s copyright counterclaims are time-barred and that the program qualifies as a work made for hire owned by the railroad. The court grants summary judgment to the railroad on the copyright and breach-of-contract claims but leaves several other claims for a jury; it also discusses potential evidentiary sanctions for destruction of computer hard drives.

Holdings

1. Belcher's copyright ownership and infringement counterclaim was time-barred because he knew or reasonably should have known of IC's use and asserted ownership of the PMA more than three years before filing the counterclaim.
2. The PMA was a work made for hire because it was prepared by Belcher, an employee, within the scope of his employment; IC therefore owned the PMA and all rights in it.
3. Belcher's constitutional challenge to the Copyright Act and its work-for-hire provision failed as a matter of law.
4. IC was entitled to summary judgment on liability for breach of contract because the undisputed evidence established contracts, Belcher's breaches, and resulting damage.
5. Summary judgment was not warranted on IC's duty-of-loyalty, conversion, trespass-to-chattels, Indiana trade-secret, or federal trade-secret claims because preemption, the applicable theories of misappropriation, criminal intent, and willfulness or malice presented unresolved legal or factual issues.

Questions Presented

1. Whether Belcher's copyright ownership and infringement counterclaim was barred by the Copyright Act's three-year statute of limitations.
2. Whether the PMA was a work made for hire under the Copyright Act, making IC the owner.
3. Whether Belcher's constitutional challenge to the Copyright Act and its work-for-hire provision failed as a matter of law.
4. Whether IC was entitled to summary judgment on its breach-of-contract claim.
5. Whether IC was entitled to summary judgment on its breach-of-duty-of-loyalty, conversion, trespass-to-chattels, Indiana trade-secret, and federal trade-secret claims.
6. Whether IC's motion for evidentiary sanctions under Federal Rule of Civil Procedure 37(e) should be granted.

Disposition

other