IP Law Daily, COPYRIGHT—C.D. Cal.: Cross motions for summary judgment denied in dispute over rights to skull designs, (Jun 18, 2014)

By Mark Engstrom, J.D.

Cross motions for summary judgment were denied to competing clothiers who sold apparel that bore similar skull designs because the evidence for copyright infringement, trademark infringement, and unfair competition was insufficient to grant judgment as a matter of law, the federal district court in Los Angeles has ruled (Lambert Corp. v. LBJC Inc., June 16, 2014, Snyder, C.).

Background

In 2005, clothing designer and wholesaler Lambert Corp. received a U.S. copyright registration for a skull design (the “Lambert Skull”) with floral accents, an inverted heart for a nose, and a flower on each side of the jaw bone.

Steve Kim, the owner of clothing designer and retailer LBJC Inc., received a trademark registration for a similar skull design (the “LBJC Skull”) in 2009. A year later, LBJC acquired the clothing inventory of JLJ Inc. and sold that inventory at “extremely discounted prices.” Some of the acquired clothing bore the design of the LBJC skull.

In 2013, Lambert sued LBJC, its owner, the owner’s spouse (Christine Kim), and ten Doe defendants for copyright infringement, trademark infringement, and unfair competition. The parties filed cross motions for summary judgment.

Personal Liability of Steve and Christine Kim

The court found that Steve Kim could be held personally liable based on his direct participation in the alleged activity and his authority to control the actions of LBJC.

Christine Kim, however, was never a board member, officer, or shareholder of LBJC. Nevertheless, she “appeared at a range of promotional events to support [Steve Kim], and … provided some minimal input in the design of some [LBJC] products.”

On that record, the court could not conclude that Christine Kim’s involvement in the alleged infringement was so insignificant that the possibility of personal liability for indirect infringement could be ruled out.

Because genuine issues of material fact were raised concerning the Kims’ personal liability, summary judgment was denied in that regard.

Copyright Infringement

The court noted that a copyright infringement claim contained two elements: (1) the ownership of a valid copyright and (2) the copying of original elements of the protected work.

Ownership of valid copyright. The defendants argued that the Lambert Skull was not an original work because its “age-old” design had been featured in celebrations of “Dia de los Muertos” for centuries. In support of that argument, the defendants provided evidence that numerous similar skull designs were readily available in the public domain.

The court concluded that the defendants’ public domain images were sufficiently similar to the Lambert Skull that a jury could conclude that the Lambert Skull was not original. Because the defendants raised a factual dispute on the issue of originality, the court decided that the issue was not suitable for disposition on a motion for summary judgment.

Copying of original elements. To prove the copying of constituent elements, a copyright plaintiff had to prove “direct copying” or show that: (1) the defendant had access to the copyrighted material and (2) the works at issue were “substantially similar.”

With respect to access, the record in this case did not show that, prior to the defendants’ first use of the LBJC Skull in 2007, the Kims had attended trade shows that displayed the Lambert Skull. For that reason, Lambert failed to provide conclusive proof of the defendants’ access to the Lambert Skull prior to their first use of the LBJC skull. A genuine dispute of material fact was therefore present with respect to the copying element.

Alternatively, Lambert argued that it could prevail on its copyright infringement claim—without any direct evidence of the defendants’ access to the Lambert Skull—because the Lambert Skull and the LBJC Skull were “strikingly similar.”

The court noted that a majority of courts that recognized the “striking similarity” doctrine had found that the doctrine provided a means of proving access, not that the doctrine obviated the need to prove access. The court also noted that a “striking similarity” was present when two designs were “so much alike that the only reasonable explanation for such a great degree of similarity [wa]s that the later [work] was copied from the first.”

In this case, the court acknowledged that the Lambert Skull and the LBJC Skull shared similar attributes, but it was not persuaded that the “only reasonable explanation” for their similarity was the alleged copying, especially when skull-based designs with floral patterns were prevalent in the public domain.

Because the defendants could have created the LBJC skull independently, the court found that Lambert did not establish “striking similarity” as a matter of law.

Laches. To the extent that Lambert sought damages for copyright infringement, the defense of laches was unavailable to the defendants because the Supreme Court had held in Petrella v. Metro-Goldwyn-Mayer, Inc. (May 19, 2014) that laches could not be invoked to preclude the adjudication of a damage claim that was brought within the three-year statute of limitations.

Trademark Infringement

To prevail on a claim for trademark infringement under §43(a) of the Lanham Act, a plaintiff had to prove: (1) ownership of a valid trademark; (2) use of the mark without the owner’s consent; and (3) a likelihood of consumer confusion.

Ownership and consent. Lambert argued that it owned common law trademark rights to the Lambert Skull design because Lambert had used the design in commerce before the defendants had: (1) registered the LBJC Skull with the U.S. Patent and Trademark Office (in 2009) and (2) first used the mark in commerce (in 2007).

In support of that argument, Lambert provided evidence to show that its predecessor (Joystick Inc.) had included the Lambert Skull design on “approximately 60% of its men’s apparel and on approximately 40% of its women’s apparel.” In addition, it proffered evidence to show that “Joystick began taking orders for and shipping garments bearing the Lambert Skull to stores in or about 2004 and continued to ship such garments through 2008.” Finally, Lambert submitted sales records that allegedly included clothing that bore the Lambert Skull, and it also provided photographs of similar apparel that purportedly was sold between 2004 and 2007.

Because documentary evidence of Lambert’s prior use the Lambert Skull was inconclusive, the court decided that a genuine issue of material fact was present with respect to Lambert’s prior use of the Lambert Skull in commerce.

Likelihood of confusion. The court applied the Ninth Circuit’s likelihood of confusion test to determine whether consumer confusion was likely. The test considered eight factors: (1) the strength of the plaintiff’s mark; (2) the relatedness or proximity of the parties’ goods; (3) the similarity of the parties’ marks; (4) evidence of actual confusion; (5) the degree to which the parties’ marketing channels converged; (6) the type of goods and degree of care that purchasers were likely to exercise in selecting the goods at issue; (7) evidence of the defendant’s intent; and (8) the likelihood that the parties would expand their product lines.

The court concluded that disputed issues of material fact were present as to five of the eight confusion factors: the strength of Lambert’s mark, the proximity of the parties’ goods, the evidence of actual confusion, the degree to which the parties’ marketing channels converged, and the type of goods and degree of care that purchasers exercised. The court thus concluded that the “consumer confusion” element of Lambert’s Lanham Act claim was unsuitable for disposition on a motion for summary judgment.

Prior use. Lambert’s evidence of prior use was insufficiently conclusive to warrant summary judgment to Lambert, but it was sufficient to create a genuine dispute of material fact on the issue of prior use, and that dispute had to be resolved by a jury.

The defendants argued that, to defeat summary judgment, Lambert had to provide documentary evidence of prior use; declarations alone were insufficient. That argument failed, the court explained, because the court was not permitted to weigh evidence in a summary judgment ruling. Moreover, the owner of Lambert had asserted that an exhibit of her declaration was documentary evidence of product sales that bore the Lambert Skull before 2007. According to the court, the reliability or credibility of those assertions was properly determined by a jury.

Abandonment. The defendants argued that they had established a prima facie case of abandonment because: (1) Lambert had not used the Lambert Skull in commerce since 2007 and (2) Lambert provided nothing more than conclusory assertions of its intent to maintain the mark.

The court disagreed. First, Lambert provided evidence that it had used the Lambert Skull in commerce as late as 2008. Second, the owner of Lambert asserted that, since 2007, she had discussed a “re-launch” of the mark with representatives of “high end” retailers, but had not yet executed a re-launch because “the right terms and conditions for doing so ha[d] not been determined.”

In the court’s view, that evidence was sufficient to create a genuine dispute of material fact regarding Lambert’s intent regarding the resumed use of the Lambert Skull. Summary judgment on the ground of abandonment was therefore denied.

Willfulness. The defendants argued that their purported infringement was not willful. However, the court noted that: (1) the owner of Lambert had seen videos that showed that clothing bearing the LBJC Skull was displayed at a trade show “through at least 2012” and (2) the defendants’ website had displayed the LBJC Skull “long after” the filing date of Lambert’s lawsuit. According to the court, that evidence was sufficient to create a genuine dispute of material fact regarding the defendants’ willfulness. Summary judgment based on a lack of willfulness was therefore denied.

Unfair Competition

The court noted that: (1) common law claims for unfair competition were “substantially congruent” to claims for unfair competition under California’s Unfair Competition Law (UCL) and (2) claims for unfair competition under the UCL and the Lanham Act were “substantially congruent” to trademark infringement claims under the Lanham Act. In light of the congruency of those claims, the court denied the parties’ cross motions for summary judgment on Lambert’s unfair competition claims—under the Lanham Act and the UCL—for substantially the same reasons that it had denied summary judgment on Lambert’s trademark claim under the Lanham Act.

The case is No. 2:13-cv-00778-CAS(JCGx).

Attorneys: Jeffrey A. Kobulnick (Ezra Brutzkus Gubner LLP) for Lambert Corp. Cindy W. Chan (Blakely Law Group) for LBJC Inc.

Companies: Lambert Corp.; LBJC Inc.

Cases: Copyright Trademark CaliforniaNews