IP Law Daily, COPYRIGHT—D. Del.: Dismissal denied in website copying claim against Target, (May 16, 2023)

By Kevin M. Finson, J.D.

The nursery design company plausibly alleged its ownership of the copyright and actual copying by Target.

An owner of a website that allowed users to design custom nurseries stated plausible claims against Target for copyright infringement and breach of contract, the U.S. District Court in Wilmington has held. The websites were similar enough to support a claim of actual copying, at least at the motion to dismiss stage (Design With Friends, Inc. v. Target Corp., May 12, 2023, Bibas, S.).

Design with Friends, Inc. and Design with Friends, Ltd. (collectively, Design) were the owners of an online nursery-planning tool that consisted of a website which allowed users to add and arrange furniture and decorations, then follow links to buy the items. Target Corp. (Target) offered a similar tool on its website. Design brought suit against Target for unlawful copying of its website and breach of contract. Target moved to dismiss.

Copyright infringement. Target argued that the website contained many elements which were uncopyrightable as ideas or functions. The court noted that while many elements of the website were undoubtedly not subject to copyright, the “selection, coordination, and/or arrangement” of those elements could be subject to copyright if sufficiently creative. The complaint alleged ownership of a valid copyright with as much specificity as was required at this stage. Target also argued that there was no allegation of actual copying or that the works were substantially similar. The court compared the works and held that, considering this was a very fact-intensive inquiry not usually determinable at the motion to dismiss stage, Design had plausibly alleged some act of infringement. The court noted, however, that Design would need to hone its position and further specify the exact infringement as the case proceeded.

Breach of contract. Target argued that it had no contract with Design because it never agreed to the terms of use on Design’s website. Noting that “browsewrap” contract can be formed either by actual notice or inquiry notice, the court held that Design’s allegations that its terms had been accessed by a user at Target’s domestic IP address and by Target’s software engineers in India stated a claim for actual notice, and Design’s allegation that the link to terms appeared in reasonably sized white text against a black bar stated a claim for inquiry notice. The court again pointed out the fact-sensitive nature of these questions and, while expressing doubt that the inquiry notice claim especially would be supported by the evidence, reminded the parties that on the motion to dismiss stage the question was only whether claims had been plausibly alleged.

Preemption. Target argued that the breach of contract claim was preempted by the Copyright Act. The court held that while the Copyright Act preempts state law claims for acts that would be covered by the Copyright Act, the contract at issue did not just forbid copying but also other non-copyright issues such as stress testing, decompiling, and modifying, and Design had alleged that at least some of these provisions were violated.

In closing, the court reiterated its admonition to Design that while it had successfully stated claims, it would need to narrow and provide evidence in support of the allegations in order to survive the later phases of litigation.

The Case is No. 1:21-cv-01376-SB.

Attorneys: Douglas D. Herrmann (Troutman Pepper Hamilton Sanders LLP) for Design With Friends, Inc. Martina Tyreus Hufnal (Fish & Richardson PC) for Target Corp.

Companies: Design With Friends, Inc.; Target Corp.

Cases: Copyright DelawareNews