Unicolors, Inc. v. Urban Outfitters, Inc.

853 F.3d 980, 2017 WL 1208459, 2017 U.S. App. LEXIS 5675
Court of Appeals for the Ninth Circuit·Decided April 3, 2017·No. 15-55507·Published·Cited by 84 cases

Opinion

OPINION

ORRICK, District Judge:

INTRODUCTION

Urban Outfitters, Inc. and Century 21 Department Stores, LLC (collectively “Urban”) appeal the judgment against them in a copyright infringement case involving fabric designs. The district court granted plaintiff Unicolors Inc.’s motion for summary judgment on the issue of copyright infringement and, following a two-day trial, a jury found Urban liable for willful infringement. We reject Urban’s arguments that the district court erred in its application of the subjective “intrinsic test” and in its conclusion that Unicolors had validly registered the Subject Design, and further conclude that there was substantial evidence to support the jury’s verdict for willful infringement. 1 We thus affirm.

I. BACKGROUND

Unicolors is a Los Angeles company in the business of designing and selling fabrics to customers in the apparel markets. Unicolors typically registers copyrights in its designs to protect its investment and maintain a competitive advantage in its artwork.

*984 In September 2008, Unicolors purchased the intellectual property rights to an original piece of work named “QQ-692” created by art studio Milk Print, LLC. It used a computer drafting utility program to reformat and make minor alterations to the QQ-692 design so that it could be printed onto bolts of fabric. It renamed this derivative design “PE1130” (“Subject Design”). On November 26, 2008, Unicolors registered its “Flower 2008” collection with the Copyright Office. Under “Contents Titles,” Unicolors listed several designs, including QQ-692, and it attached an image of the design with the label “QQ-692 (PE1130).” Under “Material excluded from this claim,” the application listed “Milk Print: QQ-692.” Between 2008 and 2011, Unico-lors sold approximately 14,000 yards of fabric bearing the Subject Design to customers in the United States.

Urban Outfitters is a specialty retail company operating over 500 stores worldwide. Century 21 is a department store that purchases products from Urban Outfitters. In late 2010, Urban Outfitters developed a women’s dress (the “Accused Dress”) with a fabric design similar to the Subject Design. Unicolors sent a cease- and-desist letter to Urban’s counsel two years later, asserting that the Accused Dress infringed Unicolors’s PE1130 design. Unicolors then filed suit against Urban alleging copyright infringement of the Subject Design.

At summary judgment, the district court concluded that both defendants were hable for copyright infringement. The court held that Unicolors owns and properly registered a copyright in the Subject Design and that Urban created and sold garments bearing a design that was substantially similar to the Subject Design.

Following a two-day trial on the issues of willfulness and damages, a jury found that Urban had willfully infringed Unico-lors’s copyright in the Subject Design and awarded $164,400 in damages. The court then granted Unicolors $366,910.17 in fees and costs. Urban timely appealed the district court’s grant of summary judgment and the jury’s finding of willfulness.

II. STANDARD OF REVIEW

We review the district court’s grant of summary judgment de novo. Benay v. Warner Bros. Entm’t, Inc., 607 F.3d 620, 624 (9th Cir. 2010). In reviewing the jury’s verdict, we ask whether the verdict is supported by substantial evidence. See Harper v. City of Los Angeles, 533 F.3d 1010, 1021 (9th Cir. 2008). “A jury’s verdict must be upheld if it is supported by substantial evidence, which is evidence adequate to support the jury’s conclusion, even if it is also possible to draw a contrary conclusion.” Id. (quoting Pavao v. Pagay, 307 F.3d 915, 918 (9th Cir. 2002)).

III. DISCUSSION

“To prove copyright infringement, a plaintiff must demonstrate (1) ownership of the allegedly infringed work and (2) copying of the protected elements of the work by the defendant.” Pasillas v. McDonald’s Corp., 927 F.2d 440, 442 (9th Cir. 1991). Urban asserts that the district court erred in concluding at summary judgment that these elements were met.

A. Copying

A plaintiff must show “copying” of a protected work to prove copyright infringement. Id. If there is no direct evidence of copying, a plaintiff may prove this element through circumstantial evidence that (1) the defendant had access to the copyrighted work prior to the creation of defendant’s work and (2) there is substantial similarity of the general ideas and expression between the copyrighted work *985 and the defendant’s work. Sid & Marty Krofft Television Prods., Inc. v. McDonald’s Corp., 562 F.2d 1157, 1162 (9th Cir. 1977), superseded on other grounds by 17 U.S.C. § 504(b). Circumstantial evidence of access is generally shown through either evidence of a “chain of events ... between the plaintiffs work and defendants’ access to that work” or evidence that “the plaintiffs work has been widely disseminated.” Three Boys Music Corp. v. Bolton, 212 F.3d 477, 482 (9th Cir. 2000). If there is no evidence of access, a “striking similarity” between the works may allow an inference of copying. Baxter v. MCA, Inc., 812 F.2d 421, 423 (9th Cir. 1987).

In assessing whether particular works are substantially similar, or strikingly similar, this Circuit applies a two-part analysis: the extrinsic test and the intrinsic test. Three Boys Music Corp., 212 F.3d at 485. The extrinsic test requires plaintiffs to show overlap of “concrete elements based on objective criteria,” id. while the intrinsic test is subjective and asks “whether the ordinary, reasonable person would find ‘the total concept and feel of the works’ to be substantially similar,” Pasillas, 927 F.2d at 442 (quoting Krofft, 562 F.2d at 1164). Because “substantial similarity is usually an extremely close issue of fact ... summary judgment has been disfavored in cases involving intellectual property.” Litchfield v. Spielberg, 736 F.2d 1352, 1355 (9th Cir. 1984). However, “[a] grant of summary judgment for [the] plaintiff is proper where works are so overwhelmingly identical that the possibility of independent creation is precluded.” Twentieth Century-Fox Film Corp. v. MCA Inc., 715 F.2d 1327, 1330 (9th Cir. 1983).

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Unicolors, Inc. v. Urban Outfitters, Inc., 853 F.3d 980, 2017 WL 1208459, 2017 U.S. App. LEXIS 5675 (9th Cir. 2017).

853 F.3d 980 (Unicolors, Inc. v. Urban Outfitters, Inc.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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