Rita Mulcahy v. Cheetah Learning LLC Jeff Schurrer
Docket: 03-3112
Court: Court of Appeals for the Eighth Circuit; October 19, 2004; Federal Appellate Court
This case involves a copyright dispute between Rita Mulcahy and Cheetah Learning LLC, along with instructor Jeff Schurrer, regarding the alleged infringement of Mulcahy's copyrighted work, "PMP Exam Prep," which is designed to help students pass the Project Management Professional (PMP) Exam administered by the Project Management Institute (PMI). The district court had granted Mulcahy partial summary judgment and a permanent injunction, concluding that Cheetah and Schurrer infringed on her copyright. However, the Eighth Circuit Court found that there are genuine issues of material fact concerning whether the PMP Exam Prep infringes PMI's copyright regarding derivative works and whether it constitutes fair use. Consequently, the appellate court reversed the partial summary judgment and vacated the permanent injunction.
PMI, established in 1969, serves over 100,000 members globally and offers a PMP certification exam that has relied on the "Project Management Body of Knowledge" (PMBOK) since its first publication in 1987. The PMBOK is considered a foundational reference for project management training, and PMI's copyright notice states that reproduction of any part of the work requires prior written permission. Despite the market for PMP exam preparatory materials, the summary judgment record lacks testimony from PMI representatives regarding whether PMI has copyrighted its PMP exam materials. The court noted the difficulty for vendors to create successful courses without using or plagiarizing the PMBOK, highlighting the complexities of copyright in educational contexts.
Mulcahy, a project management expert, created and copyrighted the PMP Exam Prep to assist students in passing the PMP exam, incorporating unique preparatory materials that do not exist in the PMBOK, such as exam overviews and study strategies. However, a significant portion of the book mirrors the PMBOK's structure and content, leading to a dispute over whether Mulcahy had the authorization to use PMBOK excerpts. Cheetah, founded by Michelle LaBrosse, developed its own PMP exam preparation course using PMBOK as a reference, but faced allegations of substantial similarities between its materials and Mulcahy's book. Following comparisons and revisions, Mulcahy filed a lawsuit. The district court ruled in favor of Mulcahy, affirming the validity of her copyright and determining that Cheetah's materials infringed upon it. The court issued a broad injunction against Cheetah regarding specific materials and any substantially similar works. Although copyright damage issues remain, the court's ruling on the permanent injunction is under review. The discussion indicates that to prove copyright infringement, one must establish ownership and copying of original work elements; however, the court acknowledged potential error in ruling that PMP Exam Prep was not an unauthorized derivative of the PMBOK or that its use constituted "fair use."
Unauthorized derivative works infringe on the exclusive rights of copyright owners, specifically the right to prepare derivative works as outlined in 17 U.S.C. 106(2). A derivative work involves adaptations of preexisting works, including translations and adaptations, per 17 U.S.C. 101. An infringer violates the copyright owner's rights, making the derivative work potentially copyrightable only for its original features, as established in Pickett v. Prince and Stewart v. Abend. The creator of a derivative work must have permission for using the underlying work, as noted in Dam Things from Denmark v. Russ Berrie Co. and Gracen v. Bradford Exchange.
In this case, if PMP Exam Prep is deemed an unauthorized derivative of PMBOK, Mulcahy’s copyrights would be invalid. The district court ruled that PMP Exam Prep did not infringe PMI's copyright, concluding that although the works share substantive details, they are not substantially similar in terms of substance, purpose, presentation, and functionality. This ruling was based on a two-part test for substantial similarity used in previous cases. However, the critical issue is whether Mulcahy's book qualifies as a derivative work. A work is not considered derivative unless it substantially copies from the original, with the determination of "substantial" depending on the context of the derivative inquiry, as stated in Nimmer on Copyright and Litchfield v. Spielberg.
PMI has created and copyrighted the PMBOK, which serves as the foundational material for its PMP certification exam. While educators can legally use the PMBOK for instructional purposes without infringing copyright, Mulcahy's PMP Exam Prep allegedly reproduces and adapts substantial portions of the PMBOK, which she admits is a source for her work. The legal question is whether this constitutes an infringement of PMI's exclusive right to create derivative works under 17 U.S.C. 106(2). It is suggested that infringement may not hinge solely on the percentage copied but rather on whether the qualitative essence of the PMBOK has been appropriated, indicating that a work can be deemed derivative despite having a different overall concept or feel.
Mulcahy contends that the PMBOK deserves limited protection as it is a compilation of common project management concepts, referencing the Supreme Court's view on the thinness of copyright protection for factual compilations. However, PMI's materials imply that the PMBOK may possess original elements that enhance its protectability. The determination of whether the PMBOK is merely a compilation or an original work is fact-intensive and unsuitable for resolution at the summary judgment stage.
Additionally, regarding the fair use doctrine, which is governed by the four factors outlined in 17 U.S.C. 107, the district court ruled that Mulcahy's work qualifies as fair use. It argued that her introduction indicates that both the PMBOK and her book are necessary for exam preparation, suggesting her work may positively impact the market for the PMBOK. However, the significance of the fourth fair use factor, which assesses the market impact, is emphasized as critical in fair use determinations. Consequently, it was concluded that the district court erred in determining that Mulcahy's PMP Exam Prep is not a derivative work as a matter of law.
Mulcahy's use of the PMBOK in PMP Exam Prep raises complex issues regarding fair use and copyright. Students may rely on PMP Exam Prep's effective adaptation, potentially diminishing the necessity to study the PMBOK. PMI has established a for-profit education market centered around its certification exam, and by basing this exam on the PMBOK, PMI has created a licensing market for the PMBOK itself. The risk of undermining this market through widespread unauthorized use of the PMBOK suggests that fair use may not apply, as outlined in Harper & Row. Furthermore, Mulcahy's work may limit PMI's ability to control licensing, which complicates the fair use assessment, as it involves both legal and factual considerations.
A finding of fair use regarding PMP Exam Prep would influence the validity of Mulcahy’s copyrights, as protection only extends to original contributions, not the underlying work. The court must disregard non-protected elements in PMP Exam Prep when evaluating potential copyright infringement by Cheetah. The court ultimately reversed a prior injunction against defendants, indicating that broad prohibitions against lawful conduct are generally not favored. Issues such as the enforceability of Mulcahy's copyrights and whether PMI ratified her use by inaction remain unresolved and warrant further trial proceedings.
