IP Law Daily, COPYRIGHT—W.D. Pa.: Preliminary injunction granted to protect international artwork acquisition and licensing business, (Apr 22, 2025)

By Deirdre Kennedy, J.D.

The copyright holder sufficiently demonstrated that he was likely to succeed on the merits of his underlying claim for infringement.

The holder of a copyright for an artwork sufficiently demonstrated that he was likely to succeed on the merits of his infringement claim against retailers using the image to manufacture and sell products online (Zhang v. AAGGO, No. 2:25-cv-00085-WSS (W.D. Pa. Apr. 21, 2025)).

Plaintiff Dongyu Zhang, a citizen of the People's Republic of China, owns and operates an international artwork acquisition and licensing business. He owns the copyright to the copyrighted work at issue, which is a piece of artwork that has been identified as a "colorful pattern with a fox." The artwork was originally created by Russian artist Anna Guz on February 26, 2015, and Zhang acquired the copyright to the piece from Ms. Guz on December 6, 2024. Zhang has authorized online stores to use the Copyrighted Work in various product lines, especially for textiles and fabrics, which he expects to generate a considerable amount of revenue.

Defendants are individuals and business entities believed to reside and/or operate e-commerce stores in the People's Republic of China and other foreign jurisdictions. Zhang alleged that Defendants conducted business in the United States, via Amazon, Temu, and Walmart online marketplaces, by manufacturing, advertising, importation, and distribution of products that incorporate infringing versions of his Copyrighted Work. Zhang allegedly conducted this investigation via the worldwide anti-counterfeiting program he operates to regularly investigate suspicious e-commerce stores.

On January 17, 2025, Zhang filed a complaint and a motion for (1) a temporary restraining order (TRO); (2) a motion to expedite discovery; (3) a motion for leave to serve process through electronic means; and (4) a motion for leave to file excess pages. On January 22, 2025, the court entered a TRO granting Zhang preliminary relief, expedited discovery, and allowing him to serve Defendants by electronic means. The TRO was then extended and set to expire on February 19, 2025. Zhang served Defendants notice of the lawsuit via electronic means, and Defendants filed their Response in Opposition to Plaintiffs Motion for Entry of Preliminary Injunction on February 24, 2025. Zhang then filed his Reply to Defendants' Response in Opposition to Preliminary Injunction on March 12, 2025, and Defendants filed a Corrected Response in Opposition to Plaintiffs Motion for Entry of Preliminary Injunction on March 20, 2025.

After determining that it had jurisdiction over the Defendants, the court found that Zhang had sufficiently demonstrated that he was likely to succeed on the merits of his underlying claim for copyright infringement. The court noted that certificates of registration issued by the U.S. Copyright Office constitute prima facie evidence of the validity and ownership of that material. The Defendants argued that Zhang could not prove exclusive ownership of the copyright because he has failed to show that any legitimate rights were transferred to him from the original owner, Ms. Guz, in writing. However, Zhang's Certificate of copyright registration stated that the copyright was transferred to him from author Anna Guz by "written agreement." In addition, the court noted that Ms. Guz declared under oath that “on December 6, 2024, Dongyu Zhang acquired one hundred percent (100%) in and to all rights, title, and interests of the Asserted Work in the United States, throughout the world and throughout the universe, as well as all other rights... any and all causes of action for infringement of the same past, present and future.”

Unauthorized copying. The first prong of the preliminary injunction analysis is the showing of unauthorized copying. Since direct evidence of copying is rarely available, it may be inferentially proven by demonstrating that someone who had access to a copyrighted work used material substantially similar to the work in a manner that interferes with a copyright owner's rights afforded under 17 U.S.C. § 106. Here, prior to Zhang's acquisition of the Copyrighted Work, it was available on Shutterstock for close to nine years, allowing Defendants access to the Copyrighted Work via the internet.

The artwork used on Defendants' products is also “substantially similar” to Zhang's Copyrighted Work, the court found. In fact, looking at the Copyrighted Work and examples of Defendants' infringing listings side-by-side, the artwork is nearly identical.

And finally, the court found that through their “promoting, selling, offering for sale and distributing” of their products bearing the copyrighted artwork, the Defendants interfered with Zhang's exclusive rights to reproduce and distribute his Copyrighted Work as part of his copyright licensing business. Having met his burden pertaining to the first prong of the preliminary injunction analysis, the court found that Zhang was likely to succeed on the merits of his underlying copyright infringement claim.

Irreparable harm. Zhang also demonstrated that he would suffer irreparable harm absent the Court granting the requested preliminary injunction. Defendants had argued that their alleged acts of infringement occurred before the December 4, 2024, registration date of the asserted copyright, and that Zhang's failure to timely register his Copyrighted Work with the Copyright Office within three months after publication, or before the alleged infringement, bars his right to recover statutory damages. However, Zhang stated in his Complaint that he promptly registered the Copyrighted Work with the U.S. Copyright Office after purchasing the exclusive rights from Ms. Guz on December 6, 2024. Further, the Copyright Office rendered its official decision as to the copyright registration on December 7, 2024, establishing that Zhang moved quickly to register the copyright with only one day between this decision date and the date he purchased the exclusive rights from Ms. Guz. After he obtained the copyright registration, he conducted an internet inquiry and discovered that Defendants were selling products that displayed or consisted of his Copyrighted Work, despite having no license or authorization to do so. The court also found that Zhang timely filed his lawsuit.

Zhang not only met his burden by showing that he would not receive an adequate remedy at law, the court also found that the harm that Zhang would be subjected to absent the preliminary injunction would go beyond just the lost profits—the risk of irreparable harm to Zhang's reputation, value, business, and goodwill also could not be adequately remedied at law.

Balance of equities. The court found that the balance of hardships weighed in favor of Zhang. As the holder of a valid U.S. copyright, Zhang is afforded rights and protections upon registration which grant the copyright owner the exclusive rights to reproduce and distribute their work for sale. The harm that Defendants face consists of losing the revenue stream created by selling their infringing products bearing the artwork that is substantially similar to the Copyrighted Work. Defendants failed to demonstrate that they will be irreparably harmed by being enjoined from selling their products.

Public interest. Finally, the court held that the injunction would be in the public interest because the public has an interest in the protection of intellectual property. To not allow Zhang to enforce the protections he was granted upon his registration of the valid copyright would go against the public's interest and run afoul of the central purpose of copyright law.

Therefore, the court found that Zhang met his burden of demonstrating that he was entitled to the relief of a preliminary injunction.

The Case is No. 2:25-cv-00085-WSS.

Judge: Stickman, W.

Attorneys: Michael Mitchell (Whitewood Law PLLC) for Dongyu Zhang. Adam Edward Urbanczyk (Au LLC) for AAGGO.

Companies: AAGGO

Cases: Copyright PennsylvaniaNews