Panoramic Stock Images, Ltd. v. McGraw-Hill Companies, Inc.

961 F. Supp. 2d 918, 108 U.S.P.Q. 2d (BNA) 1064, 2013 WL 4047651, 2013 U.S. Dist. LEXIS 112866
CourtDistrict Court, N.D. Illinois
DecidedAugust 9, 2013
DocketNo. 12 C 9881
StatusPublished
Cited by2 cases

This text of 961 F. Supp. 2d 918 (Panoramic Stock Images, Ltd. v. McGraw-Hill Companies, Inc.) is published on Counsel Stack Legal Research, covering District Court, N.D. Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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Panoramic Stock Images, Ltd. v. McGraw-Hill Companies, Inc., 961 F. Supp. 2d 918, 108 U.S.P.Q. 2d (BNA) 1064, 2013 WL 4047651, 2013 U.S. Dist. LEXIS 112866 (N.D. Ill. 2013).

Opinion

[920]*920 MEMORANDUM OPINION AND ORDER

REBECCA R. PALLMEYER, District Judge.

Plaintiff Panoramic Stock Images, Ltd. (“Panoramic”) is an Illinois business that licenses photographs to publishers, including Defendant The McGraw-Hill Companies, Inc. (“McGraw-Hill”), an education publisher. For several years, the parties operated under an agreement that permitted McGraw-Hill to make limited use of photographs in which Panoramic claims to hold a copyright. In this lawsuit, Panoramic alleges that McGraw-Hill has exceeded the scope of the license agreement by publishing copyrighted photos in unspecified “additional publications.” (Compl. [1] ¶ 12.) Panoramic charges McGraw-Hill with copyright infringement and contributory copyright infringement and claims that McGraw-Hill itself maintains “a list of its wholly unauthorized uses.” Id. McGraw-Hill has moved to dismiss certain of Panoramic’s claims for failure to state a claim on the ground that, according to McGraw-Hill, those claims rely on defective or unissued copyright registrations in violation of 17 U.S.C. § 411(a). For the reasons explained below, Defendant’s motion to dismiss [10] is denied.

FACTUAL BACKGROUND

Panoramic is a stock photography agency. It licenses photographs created by various photographers to other entities such as textbook publishers. McGrawHill is a licensee of Panoramic. (Compl. [1] ¶¶ 1-2, 7.) Between 1991 and 2012, McGraw-Hill paid Panoramic for limited licenses to use copies of 170 photographs 1 over which Panoramic claims copyright in some of McGraw-Hill’s educational publications. (Compl. ¶¶ 5-7; Table of Images [1-1], Ex. 1 to Compl.) The licenses expressly limited the number of copies McGraw-Hill could use, as well as the distribution area, image size, language, duration and nature of the media in which McGraw-Hill was entitled to use the images. (Id.)

At some point prior to December 2012, Panoramic allegedly learned that McGraw-Hill had violated the licensing agreements by exceeding the permitted uses of the photographs at issue here, including by using the photographs in publications that exceeded the licensing agreements’ scope and terms. (Compl. ¶¶ Ills.) Panoramic claims that “McGraw[Hill] alone knows [the full extent of] these wholly unauthorized uses,” but alleges that Defendant “has developed a list of its wholly unlicensed uses and Panoramic’s Photographs are among those McGraw[Hill] has so identified.” (Compl. ¶ 12.) On December 4, 2012, Plaintiff provided Defendant with a detailed listing of the 276 limited licenses (involving 170 photographs) at issue, including the photographs’ authors, descriptions, copyright registration identifications, and license limits. (Compl. ¶ 13.) According to Plaintiff, Defendant did not respond to Plaintiffs request that Defendant provide accurate information about Defendant’s actual use of the photographs and declined to state which, if any, of the photographs it infringed. (Compl. ¶ 13.)

Plaintiff further alleges that Defendant has a pattern of copyright infringement. According to Panoramic, McGraw-Hill re[921]*921peatedly requests and pays for limited use licenses and then proceeds to exceed those limited uses. (Compl. ¶ 14.) Plaintiff asserts that Defendant’s entire business model is, in fact, “built on a foundation of pervasive and willful copyright infringement.” (Id.) As support for its claim, Plaintiff lists a series of suits filed by other stock photography agencies and photographers against Defendant, asserting similar copyright infringement claims. (Compl. ¶ 15.)

In response, McGraw-Hill argues that Panoramic cannot sue for copyright infringement of 101 of the 170 photographs at issue because, it claims, Panoramic lacks valid copyright registration for those 101 photos. (McGraw-Hill does not challenge Panoramic’s standing to sue on the remaining 69 photographs.) According to Defendant, 52 of the relevant photographs lack valid copyright registrations, and 49 more are not registered at all. McGrawHill argues that Panoramic’s claims that arise from those 101 photographs should therefore be dismissed because the alleged copyright registration deficiencies “preclude Panoramic from litigating the majority of its copyright infringement claims.” (Def.’s Partial Mot. to Dismiss [10], hereinafter “Def.’s Mot.”, at 2.)

DISCUSSION

Standard of Review

A party may seek dismissal of a complaint for a “failure to state a claim upon which relief can be granted.” Fed. R. Civ. P. 12(b)(6). A complaint must “contain sufficient factual matter, accepted as true, ‘to state a claim to relief that is plausible on its face.’ ” Ashcroft v. Iqbal, 556 U.S. 662, 663, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)). The court reads the complaint in the light most favorable to Plaintiff in order to determine whether Plaintiff has stated a plausible claim for copyright infringement. See Hobbs v. John, 722 F.3d 1089, 1093-95 (7th Cir.2013). To establish copyright infringement, Plaintiff must allege that it had ownership of a valid copyright and that Defendant committed unauthorized copying of constituent elements of original work. Id. (citing Peters v. West, 692 F.3d 629, 632 (7th Cir.2012)).

Plaintiff Panoramic has adequately alleged that McGraw-Hill made unauthorized use of the photographs at issue. At this stage, the parties dispute only whether Plaintiff held valid copyrights in those photographs. McGraw-Hill asserts that Panoramic failed to identify the authors or titles for 52 of the 101 disputed photographs when it sought copyright protection. As a result, McGraw-Hill urges, those registrations are improper and the photographs do not qualify for copyright protection. With respect to 49 other photographs, Panoramic has submitted a copyright application but has not yet received a registration certificate from the Copyright Office. McGraw-Hill contends that Panoramic is not entitled to enforce its copyright for those photographs in this action until the certificate has issued. The court addresses these arguments separately.

I. Copyright Protection for Works Listed Without an Author or Title

The court first addresses the matter of the photographs’ identification in copyright registrations. A plaintiff must register a copyright claim with the Copyright Office before bringing a civil action for infringement. 17 U.S.C. § 411(a). As McGrawHill observes, 52 of the photographs at issue here were registered for copyright protection without their individual authors or titles listed. (Reply Mem. of Law in Further Support of Def.’s Partial Mot. to [922]*922Dismiss [19], hereinafter “Def.’s Mem.”, at 2, referencing registrations VA841-131, VA957-799, VA957-800, and VA1-002-221 [10-1], Ex.

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961 F. Supp. 2d 918, 108 U.S.P.Q. 2d (BNA) 1064, 2013 WL 4047651, 2013 U.S. Dist. LEXIS 112866, Counsel Stack Legal Research, https://law.counselstack.com/opinion/panoramic-stock-images-ltd-v-mcgraw-hill-companies-inc-ilnd-2013.