Court: Court of Appeals for the Second Circuit; April 21, 2009; Federal Appellate Court
Defendant Discount Trophy Co. Inc. appeals a district court judgment that awarded plaintiff Crown Awards, Inc. $22,845.18 in damages and $165,528.01 in attorney’s fees for copyright infringement related to a diamond-shaped spinning trophy design. To prove copyright infringement, a plaintiff must establish ownership of a valid copyright and demonstrate that the defendant copied their work illegally, which involves showing both that the defendant had access to the copyrighted work and that there is substantial similarity between the works.
Direct evidence of copying is rare; therefore, indirect evidence, such as the defendant's access to the work and notable similarities, can suffice. A reasonable possibility of access can be inferred if the copyrighted work was sent to an intermediary closely connected to the alleged infringer. If the plaintiff fails to show reasonable access, the infringement claim may still succeed if the works are strikingly similar, making independent creation unlikely.
Proof of actual copying entails demonstrating a reasonable possibility of access and substantial similarity. In assessing similarity, the court compares the overall concept and feel of the contested works, determining if any similarities arise from protected expressions of the original work or from elements available for public use.
On appeal from a copyright infringement case, the district court's fact findings are reviewed for clear error, while legal conclusions are reviewed de novo. The court determined that Crown held a valid copyright for its diamond-shaped spinning trophy, and that Discount had access to this design via Crown's 2006 catalog. However, the court found no evidence that Xia-men Xihua Arts and Crafts, the manufacturer of the allegedly infringing trophy, had access to Crown’s design, as there was no indication that Discount requested a similar trophy or that Xiamen received the catalog. Although Crown's design was available online post-January 2006, the court noted a lack of evidence regarding Xiamen's principal's internet usage. The court inferred access based on the notable similarity between the two products and found them to be substantially similar in concept and feel. Discount’s defense of independent creation was rejected due to the principal's lack of credibility, as the court doubted the likelihood of Mr. Lin, who lacked the capability for plastic production, independently creating a similar trophy. The timing of Discount's orders further suggested copying. Ultimately, the court ruled in favor of Crown, concluding that independent creation was implausible. On appeal, Discount mainly contested the findings of similarity, while Crown maintained that proof of Xiamen's access did not require direct evidence of viewing the design, advocating for a standard of "reasonable possibility" of access alongside substantial similarities. The appellate court agreed with Crown regarding the proof standard and its fulfillment.
Crown was not obligated to demonstrate actual access by Xiamen to its trophy design to prove infringement, as established in precedent. The district court's factual findings indicated a 'reasonable possibility' that Xiamen had access, based on the nature of Xiamen’s business, the timing of its orders, and Mr. Lin’s implausible claims of independent creation. These findings suggested that Xiamen likely coordinated with Discount prior to creating the infringing product, especially since Discount had direct access to Crown’s design through its receipt of the Crown catalog.
The court concurred with the district court's determination that Crown had established actual copying, despite the design comprising unprotectable elements, because copyright protects the original selection and arrangement of those elements. The comparison of Crown’s copyrighted trophy and Discount’s product showed that the latter mimicked Crown’s protectable aesthetic decisions, resulting in similar 'total concept and feel.'
The court affirmed the judgments of the district court, rejecting Discount’s additional arguments as meritless. The consolidated appeal focused solely on the award of attorney’s fees and costs under 17 U.S.C. § 505, with Discount relying on the same arguments from the lead appeal regarding copyright infringement.
Discount argues that Crown did not assert in the district court that a reasonable possibility of access by Xiamen could be inferred from the business relationship between Discount and Xiamen. Crown claimed that Xiamen had the same access to the design as Discount because it was publicly available on the internet since January 2006. Even though Crown has highlighted the business relationship as a basis for inferring access, the prudential waiver doctrine allows consideration of such arguments, especially when no further fact-finding is necessary. It is noted that courts can affirm a district court's judgment on any basis present in the record, regardless of the reasoning used by the lower court. Discount accepts that a court may infer access if a copyrighted work is sent to a third party with a close relationship to the alleged infringer but argues that its relationship with Xiamen is not sufficiently close to support this inference. However, the court concludes that the district court's factual findings about the creation of the infringing product by Xiamen indicate a reasonable possibility that Xiamen had access to Crown's design.
