IP Law Daily, COPYRIGHT—S.D.N.Y.: Lace designer’s infringement claims against Saks, Badgley Mischka dismissed, (Oct 5, 2022)

By Jonathan Anderson

A leading producer of lace for use on garments failed to adequately allege direct and indirect copyright infringement.

A federal district court in New York City has dismissed copyright infringement claims against Saks and Badgley Mischka. The court concluded that the plaintiff, a lace designer, failed to adequately allege actual copying in a direct copyright infringement claim and did not provide an adequate factual foundation to plead indirect infringement. The court granted a motion to dismiss sought by Saks and Badgley Mischka, but also gave the plaintiff an opportunity to file a second amended complaint (Klauber Brothers, Inc. v. M.J.C.L.K, LLC, October 4, 2022, Gardephe, P.).

Background. Klauber Brothers, Inc., which owns copyrights of multiple lace fabric and garment designs, filed direct and indirect infringement claims against Badgley Mischka, LLC; Saks Inc.; and ten Doe defendants. The complaint alleges that the defendants created and sold fabric and other products that included artwork identical or substantially similar to Klauber’s designs (the subject designs). Arguing that Klauber had failed to state a claim for copyright infringement, Badgley Mischka and Saks moved to dismiss the complaint, while Klauber sought leave to amend if defendants’ motion was granted.

Direct copyright infringement. First, the court held that Klauber did not adequately allege access or striking similarity and thus failed to plead the first element of a direct copyright infringement claim: actual copying.

The court found that Klauber did not sufficiently allege that defendants had access to the subject designs. Klauber failed to substantiate its allegations of widespread dissemination or otherwise provide an adequate link between the distribution of the subject designs and defendants, according to the court. Klauber argued that before the alleged infringement, the company had sampled and sold more than 23,881 yards of lace bearing the subject design to numerous parties in retail and apparel industries. However, the court wrote that Klauber “has not pled sufficient facts to plausibly show a link between the distributed lace and Defendants. Indeed, Klauber does not specify to whom the lace was distributed, much less any connection between Defendants and known recipients of the lace.” Similar allegations have been rejected as insufficient in other copyright actions involving Klauber’s lace designs (Klauber Brothers, Inc. v. QVC, Inc., S.D.N.Y., November 30, 2020.; Klauber Brothers, Inc. v. Jenny Yoo Collection, Inc., S.D.N.Y., July 18, 2017).

The court also held that Klauber did not satisfy the heightened standard of striking similarity, and that “defendants have shown the works reflect several significant differences with respect to elements, arrangement, and overall layout.”

Indirect copyright infringement. Second, the court found that Klauber did not adequately plead indirect infringement. The company’s allegations of indirect infringement lump together the named defendants and the Doe defendants, and “lack an adequate factual foundation to establish the elements of an indirect copyright infringement claim.” The court also wrote that Klauber’s claims for contributory and vicarious liability also failed because Klauber did not adequately allege primary infringement by defendants or any third party.

Leave to amend. The court granted Klauber leave to amend. Any motion for leave to file a second amended complaint must be submitted by October 17, 2022.

The Case is No. 1:21-cv-04523-PGG.

Attorneys: Laura Maria Zaharia (Doniger/Burroughs) for Klauber Brothers, Inc. David Edward Leit (Lowenstein Sandler LLP) for Saks Inc. Andrew Lane Dubin (Lowenstein Sandler LLP) for M.J.C.L.K., LLC d/b/a Badgley Mischka.

Companies: Klauber Brothers, Inc.; Saks Inc.; M.J.C.L.K., LLC d/b/a Badgley Mischka

Cases: Copyright NewYorkNews