S-Corp and Its Sole Owner Are Both Proper Patent, Trademark & Copyright Plaintiffs

Claudia Croft and Sheer Delight, Inc. sued Be Wild, Inc, BWild, Inc, and Brian Cohen for patent, copyright, and trademark infringement. Defendant sought summary judgment that Sheer Delight, Inc. could not be a proper patent infringement plaintiff because Croft owned the patent-at-suit individually and hadn't exclusively licensed it to Sheer Delight. (Similar arguments were presented concerning the trademark and copyright theories.) Plaintiff admitted that it did not have a written exclusive license. But plaintiff argued at summary judgment that it had an implied exclusive license. And this carried the day:

First, as to whether one or both Plaintiffs is the proper party on each of the claims, the Court finds a genuine issue of material fact exists. Plaintiffs posit that because Plaintiff Sheer Delight, Inc., is a sub-chapter S corporation with Plaintiff Claudia Croft as its sole owner, the profits are attributable, or passed through, as income to Croft. Croft's affidavit avers that the intent of Croft as the patent owner was that Sheer Delight, Inc., would be the only licensee of the patent-in-suit. These submissions are sufficient to avoid summary judgment on the issue of implied exclusive licensees of patents and trademarks and legal or beneficial owners and exclusive licensees of copyright.

Croft v. Be Wild, Inc., Slip Op., Case No. 09-863 (M.D. Fla. Oct. 7, 2010) (J. Lazzara)

Submitting an unpublished work to a writing competition doesn't mean unaffiliated people had access to it

Bridgette Burgin submitted her manuscript, The Final Call, to some writing competitions. She later sued Tim LaHaye and Jerry Jenkins, claiming two books they co-authored infringed her copyright. The defendants won summary judgment (in a 28 page opinion), as the court found the defendants did not have access to Burgin's work. Burgin appealed. The Eleventh Circuit agreed with the trial court.

To prove copyright infringement, Burgin needed to show: (1) she owned a valid copyright; and (2) defendants copied protected elements. Defendants didn't challenge the first part. But Burgin couldn't prove that defendants copied protected elements.

There are 2 ways to prove that a defendant copied protected elements: (1) with direct evidence; or (2) with circumstantial evidence. No direct evidence in this case, so Burgin tried to prove copying circumstantially. To do this, Burgin needed to show either: (1) the defendants' works were "strikingly similar" to her work; or (2) the defendants had access to her work and the "probative similarity" of the works. Burgin couldn't do this:

Here, even viewing the evidence in the light most favorable to Burgin, she has not shown that either of the defendants had access to her work, and thus has not established an inference of copying. Burgin has not demonstrated that either LaHaye or Jenkins ever had a reasonable opportunity to view a manuscript of The Final Call. See Corwin v. Walt Disney Co., 475 F.3d 1239, 1253 (11th Cir. 2007) (“Access requires proof of a reasonable opportunity to view the work in question.” (quotation omitted).). The evidence shows that neither LaHaye nor Jenkins was affiliated with the Peter Taylor Prize writing competition, to which Burgin submitted her work. That Jenkins may or may not have corresponded with one of the Peter Taylor Prize judges regarding an entirely separate matter does not establish a reasonable opportunity for Jenkins to have viewed Burgin’s original work. To consider this flimsy “evidence” sufficient to establish access would be entirely speculative. See Ferguson v. Nat’l Broad. Co., 584 F.2d 111, 113 (5th Cir. 1978) (“[A] finding of access in this case would be based on speculation or conjecture, and this is impermissible.”).

Burgin also asserts that submission of a portion of her work to a Writer’s Digest writing competition was sufficient to show access. The evidence shows that LaHaye has never had any connection to the Writer’s Digest prize, and, although Jenkins was a judge for the competition, Burgin has not shown that he had a reasonable opportunity to view the work. Burgin submitted her writing in the competition categories of romance, thriller and suspense, and science-fiction/fantasy; Jenkins judged only the Inspirational Writing (Spiritual/Religious) category. Burgin’s work never progressed past the first round of the competition; Jenkins judged only the second round. Moreover, the evidence shows that the many manuscripts that were not chosen to progress to the second round were set to be destroyed. A mere allegation that Jenkins was affiliated with the same large writing competition to which Burgin submitted her work is not enough to establish access. Concluding that Jenkins may have seen Burgin’s work although he judged a different category and a different round would be impermissibly speculative. See Ferguson 584 F.2d at 113.

Affirmed.

Burgin v. Lahaye, Case No. 09-016066 (11th Cir. Oct 1, 2010)

Fair use to use motorcycle pictures in a magazine? Let the jury decide. But no profits from sales of the motorcycle or magazine for copyright holder

Kawasaki was introducing a new motorcycle, so it hired Roaring Toyz to customize two motorcycles. These custom motorcycles were to be displayed alongside the standard model during Daytona Bike Week. Latimer, a professional photographer, was engaged to take pictures following Roaring Toyz' progress. Latimer emailed some of his pictures to Roaring Toyz (each picture included a notice that it was protected by copyright). Roaring Toyz emailed the pictures to Kawasaki. Kawasaki distributed a press kit which included five of these pictures. Cycle World magazine (which is published by defendant Hachette Filipacchi Media US, Inc.) published an article about the new motorcycle and included one of the pictures. Latimer sued for copyright infringement.

Fair Use

Hachette sought summary judgment that its use was a fair use. The Court weighed the law:

1) Purpose and character of the use

The use of the pictures in a magazine was a commercial use, but Latimer's photographs weren't selected to generate a profit or increase the sales of the magazine. Commercial nature doesn't weigh heavily against finding fair use. But magazine's use of the photographs without significant alteration was not significantly transformative. Thus, balance of this sub-factor weighted slightly against finding fair use.

2) Nature of the copyrighted work

"Original, creative works merit more protection than more factual or derivative works." No dispute that Latimer's photographs are creative, and thus entitled to greater protection.

3) Amount and substantiality of the portion used

The magazine only did minimal cropping of the photographs. But the magazine couldn't really crop them, as doing so would have cut out portions of the motorcycle (and what would have been the point of that?). Thus, this factor was neutral.

4) Effect of the use on the potential market

This factor is where the Court couldn't decide the issue at summary judgment. The magazine argued that Latimer was able to sell other photos to another magazine. But that had nothing to do with the market for the pictures at issue in the lawsuit. "[T]he question is not whether other similar photos could be sold in the future. Rather, it is whether Cycle World's publication impaired the market for the specific photos it used." Record didn't answer that question, so the jury will.

Indirect Profits

The Court also addressed defendants' request for summary judgment that there was no nexus between their profits and the copyrighted work. A copyright plaintiff is entitled to a defendant's profits attributable to the infringement. Per the statute (17 USC 504(b)), the plaintiff must put forth proof of the defendant's gross revenue, and it is the defendant's burden to prove his or her deductible expenses and those elements of profits attributable to factors other than the infringement.

Though the Eleventh Circuit has never ruled on this issue, virtually every other Court of Appeals "has required some nexus between the infringing activity and the gross revenue figure proffered by a plaintiff." Ordonez-Dawes v. Turnkey Props, Inc., 2008 WL 828124 (S.D. Fla. Mar. 26, 2008)

A low initial burden is placed on the copyright holder to make a showing of some causal connection between the infringement and the profits claimed. "[A] plaintiff may not seek gross revenues based entirely on a speculative connection to the plaintiff's claim." Thornton v. J Jargon Co., 580 F. Supp. 2d 1261, 1280 (M.D. Fla. 2008)

Latimer's claim here was too speculative. From Kawasaki, Latimer sought profits from the sales of the motorcycles. And from the magazine publisher, he wanted profits from sales of the magazine. The Court was not convined by Latimer's evidence and argument, and so it granted summary judgment on this issue to defendants.

Latimer v. Roaring Toyz, Inc., Slip. Op., Case No. 06-1921 (M.D. Fla. Sept. 21, 2010) (J. Moody)

One small step for man?

This post has nothing to do with Florida law. Nor does it concern copyrights, trademarks, or patents. But I find the case interesting, so I thought you might also.

Bruce McCandles II was a U.S. Astronaut. Like me, he did his graduate studies at Stanford (his degree is in electrical engineering -- mine is in computer science). Our paths substantially parted there. He became an astronaut. I didn't. He rode to space twice. Once on the Challenger in 1984 (2 years before it exploded) and once on Discovery in 1990. A very impressive career indeed.

During his first space flight in 1984, he apparently became the first astronaut to make an untethered space flight using a Manned Maneuvering Unit (MMU):

Photo source NASA.

So, why am I writing about this? Because he sued Dido's music labels for the cover art of her 2008 album "Safe Trip Home."

Ah, you say to yourself. He's claiming copyright infringement, right? Nope. NASA has a pretty interesting copyright policy. If you're going to use NASA materials, you can't state or imply that NASA endorsed your product or service, and NASA should be acknowledged as the source of the material. You also can't try to claim copyright or other rights in NASA material. Regarding photographs, NASA states:

Photographs are not protected by copyright unless noted. If copyrighted, permission should be obtained from the copyright owner prior to use. If not copyrighted, photographs may be reproduced and distributed without further permission from NASA. If a recognizable person appears in a photograph, use for commercial purposes may infringe a right of privacy or publicity and permission should be obtained from the recognizable person.

That last sentence is how McCandless is pursuing the record companies. He has sued under California's right of publicity statute, which provides a cause of action when someone uses another's name, photograph or likeness for the purpose of advertising without consent. The statute's definition of "photograph" requires that the person suing "is readily identifiable" in the picture. The statute provides some guidance:

A person shall be deemed to be readily identifiable from a photograph when one who views the photograph with the naked eye can reasonably determine that the person depicted in the photograph is the same person who is complaining of its unauthorized use.

So, is McCandless "readily identifiable" in Dido's cover art? Don't know. McCandless cites to publicity surrounding the photo when it was first released, as well as several endorsement requests he has received.

Damages under this statute seem similar to damages under the Copyright Act (NOTE, I'm not a California lawyer). Like the Copyright Act, there is a statutory damages component. Under the Copyright Act, statutory damages can range from $750 to $150,000 (assuming infringement is proved to be willful and the work is timely registered). See 17 U.S.C. § 504(c). Under California's right of publicity statute, statutory damages would be $750. Both acts also provide for actual damages to the plaintiff and disgorgement of profits attributable to the unauthorized use. So, McCandless needs to show what his actual damages are (if any) and then establish what the gross revenues to the music companies are which are attributable to the use of the picture.

Maybe the record companies will give him an Offer of Judgment for $750. We'll see what happens.