Carell v. Shubert Organization
104 F.Supp.2d 236 (S.D.N.Y. 2000)
Schwartz, J.
FACTS: Plaintiff Candace Carell was the make-up designer for the New York production of the musical Cats. In August 1982, Carell and John Napier (“Napierâ€), the musical’s set and costume designer, began collaborating on the make-up designs. Napier provided ideas for the make-up for at lest two of the Cats characters, and each design contained numerous elements and extensive layering application.
After the critical and financial success of Cats, Carell hired an attorney to assist with copyrighting her make-up designs. On April 8, 1991, Carell’s Certificate of Registration was granted solely in her name. Carell also drafted a proposal for three books related to the make-up designs, and received authorization from an agent of the Really Useful Group, Ltd. (RUG) and The Cats Company (TCC), both defendants in the suit, to proceed with the books.
On June 30, 1992, Carell received a letter from TCC stating that it “had heard that…you are preparing a coloring book or other such book on the Cats facial designs and make-up†and that the “drawings and designs of the Cats faces have been duly registered for copyright in the United States Copyright Office by Really Useful Group, Ltd.†The letter continued by informing Carell that use of the designs would constitute actionable infringement. However, neither TCC nor RUG had filed for copyright registration for the make-up designs. In August 1992, TCC, RUG, and Napier petitioned the Copyright Office requesting cancellation of Carell’s make-up design copyright. Napier claimed that he, and not Carell, was the creator of the designs. The Copyright Office declined to cancel Carell’s registration.
Between 1995 and 1998, TCC and RUG produced and distributed for worldwide sale an “Official Cats Coloring and Activity Book,†the video version of Cats, which originally aired on PBS television network, and the “Face Painting Kit,†a do-it-yourself Cats make-up kit. Carell was not credited or paid royalties on any of the items. Further, Carell’s credit as make-up designer was removed in Playbills, similar theatrical programs, and published press releases, and others were credited for the designs.
PROCEDURE: Carell brought action on July 12, 1999 in the Southern District of New York, against eighteen (18) defendants, including TCC, RUG, and Napier, seeking monetary damages, and declaratory and injunctive relief. On December 1, 1999 defendants filed a 12(b)(6) motion to dismiss.
ISSUE(S):
(i) Whether plaintiff is the sole owner of the Make-up Design copyright and has the right to commercially exploit the designs, as well as receive damages and injunctive relief.
(ii) Whether defendants infringed Carell’s copyright in the Make-up Designs during the three-year period prior to the filed claim.
(iii) Whether the copyright infringement claim was stated.
(iv) Whether defendant’s prevented Carell from exploiting her make-up design copyright, in violation of § 1 of the Sherman Act.
(v) Whether the court has personal jurisdiction over several foreign corporations listed as defendants.
(vi) Whether Carell sufficiently pleads claims against the individual defendants Schoenfeld, Webber, Mackintosh, and Geffen.
HOLDING(S):
(i) Undecided. Carell’s ownership claim was barred by the statute of limitations.
(ii) Yes. Carell could proceed with her infringement claim despite barred ownership claim.
(iii) Yes. Carell’s copyright infringement claim was sufficiently stated.
(iv) No. Carell’s Sherman Act claim was insufficiently stated.
(v) No. The Southern District of New York lacked personal jurisdiction over English located companies.
(vi) The Court did have jurisdiction of Webber, who controlled several of the defendant corporations, but not over the remaining individual defendants.
ANALYSIS:
(i) The court first states the elements of copyrightable material: that a work be “an original work of authorship,†that is “fixed in a tangible form.†The court rules the make-up designs meet both elements. The Court notes that, although there is a disagreement as to authorship, the defendants’ arguments that Carell’s copyright is not valid because the numerous designs were registered as “one work†is invalid because the Copyright Act permits a single registration for a group of “related works.†However, the highlights that under § 507(b) of the Copyright Act, a plaintiff seeking a declaration of copyright ownership must commence an action within three years of the accrual of the claim. Further, copyright claims begin to accrue when the plaintiff “knows or should have known of the injury on which the claim is premised.†The court determined, at the latest, Carell was afforded notice of the facts giving rise to her ownership claims by July 1993, which was more than three years before she filed suit. Thus the court ruled Carell’s ownership claim was barred by the statute of limitations.
(ii) The court stated that to withstand a motion to dismiss, a complaint for copyright infringement must allege: (1) which original works are the subject of the copyright claim, (2) that the plaintiff owns he copyrights in those works, (3) that the copyrights have been registered in accordance with the statute, and (4) “by what acts during that time†the defendant infringed the copyright. The court found Carell specifically identified the 28 make-up designs as the works at issue, despite the authorship uncertainty, that she owned the copyright of those designs, and that the copyrights were registered according to the statute, which satisfied the first three elements. As to the fourth element, the alleged infringement pleaded by Carell includes international violations. The court concluded that it had jurisdiction over foreign copyright infringement claims and relies on its own ruling in Armstrong v. Virgin Records that “If the plaintiff has a valid cause of action under the copyright laws of a foreign country, and if personal jurisdiction of the defendant can be obtained in an American court, it is arguable that an action may be brought in such court for infringement of a foreign copyright law.†The court found Carell sufficiently pleaded violations of specific foreign copyright laws within the required time and, thus, could proceed with her infringement claim, despite the barred ownership claim.
(iii) Carell’s third claim was that defendants “reversed passed off†her copyright in violation of § 43(a) of the Lanham Act. The court noted a successful reverse passing off claim requires that the plaintiff establish (1) that the work at issue originated with the plaintiff; (2) that the origin of the work was falsely designated by the defendant; (3) that the false designation of origin was likely to cause consumer confusion; and (4) that the plaintiff was harmed by the defendant’s false designation of origin.
Defendants argued that Carell’s claim was: (1) barred by the statute of limitations, which under the Lanham Act accrues at the time the plaintiff “discovered the fraud, or could with reasonable diligence have discovered it,†and that (2) plaintiff’s time-barred ownership claim bars her assertion of a Lanham Act claim. The court found that only one of the pleaded alleged infringements, the failure to credit and/or false representations on Cats Playbills, fell outside of the six-year period created by the statute of limitations, and, thus, dismissed that component of the Lanham Act claim. The court also rejects defendants’ second grounds for dismissal and cites Maurizio v. Goldsmith for the principal that the dismissal of an ownership claim as time-barred does not mean that the court cannot consider the issue of ownership as part of a Lanham Act claim. The court found that Carell met the Lanham Act pleading requirements by showing that she was the originator of the work, that defendants falsely designated the designs’ origin in the video, and aforementioned books, that the false designation would certainly confuse consumers as to who designed the Cats make-up, and that plaintiff was harmed by the false designation. Thus, the court ruled Carell’s copyright infringement claim was sufficiently stated.
(iv) The court stated “as a prerequisite to any antitrust claim, the plaintiff must allege a relevant product market in which the anti-competitive effects of the challenged activity can be assessed.†The court further defines “ a relevant product market†as one that “includes all products reasonably interchangeable, determination of which requires consideration of cross-elasticity of demand.â€
Here, Carell defined the relevant product market as the market for licensing the Make-up Designs and other Cats-related intellectual property “for uses that range from merchandise and promotion to theatrical productions and filmed versions.†However, the court cited Theater Party Associates, Inc. v. Shubert Org., Inc. for the principal that an antitrust claiming plaintiff must allege a plausible basis for finding that the commodities are a “market unto themselves.†The court found that there were substitutes for licensing the Cats Make-up Designs, and that Carell pleaded nothing to explain why Cats products are not reasonably interchangeable with products of other Broadway shows. Thus, the court dismissed Carell’s Sherman Act claim for failure to sufficiently plead a relevant product market.
(v) The court used the “doing business†test to determine whether it had personal jurisdiction over the foreign corporations. Since Carell did not allege that any of the foreign corporations regularly “do business†in New York, the court dismissed several of the foreign corporations.
(vi) Similarly, Carell failed to identify actionable conduct committed by the defendants Gerald Schoenfeld, Cameron Mackintosh, and David Geffen, but did find actionable conduct as to Andrew Lloyd Webber, as the “sole or majority owner of the Really Useful business entities . . . who authorized or licensed many of the infringing uses of the Make-up Designs.â€
104 F.Supp.2d 236 (S.D.N.Y. 2000)
Schwartz, J.
FACTS: Plaintiff Candace Carell was the make-up designer for the New York production of the musical Cats. In August 1982, Carell and John Napier (“Napierâ€), the musical’s set and costume designer, began collaborating on the make-up designs. Napier provided ideas for the make-up for at lest two of the Cats characters, and each design contained numerous elements and extensive layering application.
After the critical and financial success of Cats, Carell hired an attorney to assist with copyrighting her make-up designs. On April 8, 1991, Carell’s Certificate of Registration was granted solely in her name. Carell also drafted a proposal for three books related to the make-up designs, and received authorization from an agent of the Really Useful Group, Ltd. (RUG) and The Cats Company (TCC), both defendants in the suit, to proceed with the books.
On June 30, 1992, Carell received a letter from TCC stating that it “had heard that…you are preparing a coloring book or other such book on the Cats facial designs and make-up†and that the “drawings and designs of the Cats faces have been duly registered for copyright in the United States Copyright Office by Really Useful Group, Ltd.†The letter continued by informing Carell that use of the designs would constitute actionable infringement. However, neither TCC nor RUG had filed for copyright registration for the make-up designs. In August 1992, TCC, RUG, and Napier petitioned the Copyright Office requesting cancellation of Carell’s make-up design copyright. Napier claimed that he, and not Carell, was the creator of the designs. The Copyright Office declined to cancel Carell’s registration.
Between 1995 and 1998, TCC and RUG produced and distributed for worldwide sale an “Official Cats Coloring and Activity Book,†the video version of Cats, which originally aired on PBS television network, and the “Face Painting Kit,†a do-it-yourself Cats make-up kit. Carell was not credited or paid royalties on any of the items. Further, Carell’s credit as make-up designer was removed in Playbills, similar theatrical programs, and published press releases, and others were credited for the designs.
PROCEDURE: Carell brought action on July 12, 1999 in the Southern District of New York, against eighteen (18) defendants, including TCC, RUG, and Napier, seeking monetary damages, and declaratory and injunctive relief. On December 1, 1999 defendants filed a 12(b)(6) motion to dismiss.
ISSUE(S):
(i) Whether plaintiff is the sole owner of the Make-up Design copyright and has the right to commercially exploit the designs, as well as receive damages and injunctive relief.
(ii) Whether defendants infringed Carell’s copyright in the Make-up Designs during the three-year period prior to the filed claim.
(iii) Whether the copyright infringement claim was stated.
(iv) Whether defendant’s prevented Carell from exploiting her make-up design copyright, in violation of § 1 of the Sherman Act.
(v) Whether the court has personal jurisdiction over several foreign corporations listed as defendants.
(vi) Whether Carell sufficiently pleads claims against the individual defendants Schoenfeld, Webber, Mackintosh, and Geffen.
HOLDING(S):
(i) Undecided. Carell’s ownership claim was barred by the statute of limitations.
(ii) Yes. Carell could proceed with her infringement claim despite barred ownership claim.
(iii) Yes. Carell’s copyright infringement claim was sufficiently stated.
(iv) No. Carell’s Sherman Act claim was insufficiently stated.
(v) No. The Southern District of New York lacked personal jurisdiction over English located companies.
(vi) The Court did have jurisdiction of Webber, who controlled several of the defendant corporations, but not over the remaining individual defendants.
ANALYSIS:
(i) The court first states the elements of copyrightable material: that a work be “an original work of authorship,†that is “fixed in a tangible form.†The court rules the make-up designs meet both elements. The Court notes that, although there is a disagreement as to authorship, the defendants’ arguments that Carell’s copyright is not valid because the numerous designs were registered as “one work†is invalid because the Copyright Act permits a single registration for a group of “related works.†However, the highlights that under § 507(b) of the Copyright Act, a plaintiff seeking a declaration of copyright ownership must commence an action within three years of the accrual of the claim. Further, copyright claims begin to accrue when the plaintiff “knows or should have known of the injury on which the claim is premised.†The court determined, at the latest, Carell was afforded notice of the facts giving rise to her ownership claims by July 1993, which was more than three years before she filed suit. Thus the court ruled Carell’s ownership claim was barred by the statute of limitations.
(ii) The court stated that to withstand a motion to dismiss, a complaint for copyright infringement must allege: (1) which original works are the subject of the copyright claim, (2) that the plaintiff owns he copyrights in those works, (3) that the copyrights have been registered in accordance with the statute, and (4) “by what acts during that time†the defendant infringed the copyright. The court found Carell specifically identified the 28 make-up designs as the works at issue, despite the authorship uncertainty, that she owned the copyright of those designs, and that the copyrights were registered according to the statute, which satisfied the first three elements. As to the fourth element, the alleged infringement pleaded by Carell includes international violations. The court concluded that it had jurisdiction over foreign copyright infringement claims and relies on its own ruling in Armstrong v. Virgin Records that “If the plaintiff has a valid cause of action under the copyright laws of a foreign country, and if personal jurisdiction of the defendant can be obtained in an American court, it is arguable that an action may be brought in such court for infringement of a foreign copyright law.†The court found Carell sufficiently pleaded violations of specific foreign copyright laws within the required time and, thus, could proceed with her infringement claim, despite the barred ownership claim.
(iii) Carell’s third claim was that defendants “reversed passed off†her copyright in violation of § 43(a) of the Lanham Act. The court noted a successful reverse passing off claim requires that the plaintiff establish (1) that the work at issue originated with the plaintiff; (2) that the origin of the work was falsely designated by the defendant; (3) that the false designation of origin was likely to cause consumer confusion; and (4) that the plaintiff was harmed by the defendant’s false designation of origin.
Defendants argued that Carell’s claim was: (1) barred by the statute of limitations, which under the Lanham Act accrues at the time the plaintiff “discovered the fraud, or could with reasonable diligence have discovered it,†and that (2) plaintiff’s time-barred ownership claim bars her assertion of a Lanham Act claim. The court found that only one of the pleaded alleged infringements, the failure to credit and/or false representations on Cats Playbills, fell outside of the six-year period created by the statute of limitations, and, thus, dismissed that component of the Lanham Act claim. The court also rejects defendants’ second grounds for dismissal and cites Maurizio v. Goldsmith for the principal that the dismissal of an ownership claim as time-barred does not mean that the court cannot consider the issue of ownership as part of a Lanham Act claim. The court found that Carell met the Lanham Act pleading requirements by showing that she was the originator of the work, that defendants falsely designated the designs’ origin in the video, and aforementioned books, that the false designation would certainly confuse consumers as to who designed the Cats make-up, and that plaintiff was harmed by the false designation. Thus, the court ruled Carell’s copyright infringement claim was sufficiently stated.
(iv) The court stated “as a prerequisite to any antitrust claim, the plaintiff must allege a relevant product market in which the anti-competitive effects of the challenged activity can be assessed.†The court further defines “ a relevant product market†as one that “includes all products reasonably interchangeable, determination of which requires consideration of cross-elasticity of demand.â€
Here, Carell defined the relevant product market as the market for licensing the Make-up Designs and other Cats-related intellectual property “for uses that range from merchandise and promotion to theatrical productions and filmed versions.†However, the court cited Theater Party Associates, Inc. v. Shubert Org., Inc. for the principal that an antitrust claiming plaintiff must allege a plausible basis for finding that the commodities are a “market unto themselves.†The court found that there were substitutes for licensing the Cats Make-up Designs, and that Carell pleaded nothing to explain why Cats products are not reasonably interchangeable with products of other Broadway shows. Thus, the court dismissed Carell’s Sherman Act claim for failure to sufficiently plead a relevant product market.
(v) The court used the “doing business†test to determine whether it had personal jurisdiction over the foreign corporations. Since Carell did not allege that any of the foreign corporations regularly “do business†in New York, the court dismissed several of the foreign corporations.
(vi) Similarly, Carell failed to identify actionable conduct committed by the defendants Gerald Schoenfeld, Cameron Mackintosh, and David Geffen, but did find actionable conduct as to Andrew Lloyd Webber, as the “sole or majority owner of the Really Useful business entities . . . who authorized or licensed many of the infringing uses of the Make-up Designs.â€