Buc Intern. Corp. v. International Yacht Council

• Decision Date: 21 June 2007
• Docket Number: No. 04-13653.,04-13653.
• Citation: 489 F.3d 1129
• Parties: BUC INTERNATIONAL CORP., a Florida corporation, Plaintiff-Counter-Defendant-Appellee, v. INTERNATIONAL YACHT COUNCIL LIMITED, a foreign corporation, Defendant-Appellant, MLS Solutions, Inc., a Florida corporation, Defendant-Counter-Claimant-Appellant.
• Court: U.S. Court of Appeals — Eleventh Circuit

489 F.3d 1129

BUC INTERNATIONAL CORP., a Florida corporation, Plaintiff-Counter-Defendant-Appellee, v. INTERNATIONAL YACHT COUNCIL LIMITED, a foreign corporation, Defendant-Appellant MLS Solutions, Inc., a Florida corporation, Defendant-Counter-Claimant-Appellant.

No. 04-13653.

United States Court of Appeals, Eleventh Circuit.

June 21, 2007.

Michael T. Moore, Moore & Co., P.A., Coral Gables, FL, Suzanne R. Eschrich, G. Donovan Conwell, Jr., Gayle Wrede Kirkpatrick, Conwell, Sukhia & Kirkpatrick, P.A., Ceci Culpepper Berman, Hala A. Sandridge, Fowler, White, Gillen, Boggs, Villareal & Banker, P.A., Tampa, FL, for Defendant-Appellant.

Philip D. Parrish, Philip D. Parrish, P.A., South Miami, FL, for BUC Intern. Corp.

Appeals from the United States District Court for the Southern District of Florida.

Before TJOFLAT and BARKETT, Circuit Judges, and FULLER,^* District Judge.

TJOFLAT, Circuit Judge:

In this copyright infringement case, the plaintiff claimed copyright protection of a factual compilation — specifically, the selection, order, and arrangement of information about yachts listed for sale — vis a vis the defendants' competing factual compilation, which came onto the scene after the plaintiff had obtained certificates of copyright registration. The case was tried to a jury, which found for the plaintiff. The defendants now appeal.¹ They raise several issues, among them whether the court erred in instructing the jury that it could find copyright infringement if there were "substantial similarities" between the original elements of the plaintiff's compilation and corresponding elements of the defendants' compilation. According to the defendants, the court should have required the plaintiff to prove that the allegedly infringing elements were "virtually identical" to the plaintiff's original elements.

We find no error in the district court's "substantial similarities" instructions or in any of the other issues the defendants raise. We therefore affirm the district court's judgment.

I.

A.

BUC International Corporation ("BUC")² was founded in 1961 and publishes the BUC Used Boat Price Guide. The BUC Used Boat Price Guide lists recreational boats and yachts along with their market values. Walter Sullivan ("Sullivan"), the President of BUC, joined the company shortly after it was founded and became its President in 1971.³ By the mid-1980s, BUC developed a computer network and software application called BUC Marine Sales & Charter Network ("BUCNET Service" or "BUCNET").

BUCNET Service was designed to create a centralized directory of yacht listings so that brokers could more easily access industry information. Before BUCNET Service came along, yacht brokers and boat dealers with central listing agreements⁴ typically shared information with other brokers by mailing or faxing descriptions of their listings to each other. There was no uniformity in these listings; the yacht brokers prepared them according to their own individual methods and tastes. With the advent of BUCNET Service, brokers could share, compare, search and track the status of vessel listings on a computer, in lieu of sending listings to fellow brokers. Brokers gained access to BUCNET Service by entering into a license agreement with BUC.⁵ When licensed, a broker obtained BUCNET software and a password that enabled the broker to log on to BUC's database and view, print, search and copy its listings. The vessel listings in the BUCNET database were not available to the public; only BUCNET licensees had access to these compilations. BUCNET was thus a broker-to-broker multiple listing service⁶ ("MLS"), as opposed to a primarily retail-based website available to the public at large.

BUC's success with BUCNET Service was not instantaneous. It took three to four years for BUC to develop the first version of the BUCNET program and to reach a "critical mass"⁷ of licensed brokers and vessel listings. To facilitate the presentation of information on BUCNET, Sullivan developed the "Standard Listing Form and Format." A licensed broker used this schema in submitting information about a yacht unless some other arrangement would better portray the vessel at hand, in which case the broker would modify the BUCNET format. Of the thousands of vessels BUCNET listed when this case came to trial, more than ninety-eight percent were listed under the Standard Listing Form and Format.

Sullivan selected and arranged the format's section headings that appeared on the computer screen.⁸ In 1997, he registered in BUC's name a copyright in the "compilation, selection and organization of [the BUCNET] database," i.e., the centralized directory of yacht listings, and obtained a Certificate of Copyright Registration from the Register of Copyrights. Sullivan thereafter renewed BUC's copyright registration in the BUCNET database annually. In some years, BUC obtained or renewed several certificates of registration. In 2002, the words "and text of vessel listings" were appended to the words "compilation, selection and organization of [the BUCNET] database." BUC placed a copyright notice on each of the vessel listings appearing on BUCNET.⁹

In June of 2000, Florida Yacht Brokers Association ("FYBA") and several other professional yacht broker associations collaborated to form International Yacht Council Limited ("IYC").¹⁰ One of the associations' objectives in forming IYC was the creation of an online MLS for yacht listings. The associations felt a need for a MLS in addition to BUCNET because, as one of IYC's principal organizers explained, vessel listings were "scattered all over the internet with no single reference resource to search all availabilities and central listings."

In February of 2000, FYBA, acting for the associations that would form IYC, published a "Request for Proposal" soliciting third parties to submit plans for developing and operating (for IYC) a yacht-based MLS.¹¹ On March 7, 2001, after considering several proposals, IYC entered into a contract with MLS Solutions, Inc. ("MLS Solutions"),¹² to develop and manage IYC's web-based MLS.¹³

MLS Solutions developed a web-based MLS for IYC, somewhat similar to that of BUCNET, that displayed a database of vessel listings. The IYC site was designed as a two part system: one part included the MLS database as a private site for brokerage business, and the other part operated as a public website.¹⁴ Vessel listings were placed on the IYC website by MLS Solutions. MLS Solutions received the listings from the brokers via email or fax. Many of these brokers were BUCNET licensees. In sending listings to MLS Solutions, these BUCNET licensees would simply copy the listings they had submitted to BUC, and MLS Solutions would, in turn, place them on the IYC website.¹⁵ By January 2002, brokers and salesmen numbering nearly 700 had listed over 4,100 boats on IYC's MLS. Approximately 2,700 of those listings were derived from BUCNET listings. Some of these were furnished by BUCNET licensees. Others were obtained by MLS Solutions' staff who had acquired BUCNET passwords from BUC licensees. When BUC realized how MLS Solutions was acquiring the listings it was posting on IYC's website, BUC started placing "markers," a series of symbols and letters, in the middle of each listing. BUC had programmed BUCNET to enable it to determine the identity of the licensee who owned the password and when (i.e., the exact time) the password-holder accessed BUCNET and viewed a listing. When the listing later appeared on IYC's MLS, BUC could locate the marker and identify the owner of the password. Using these markers BUC discovered that IYC's MLS presented over 4,400 listings which replicated BUCNET listings.¹⁶ These IYC listings bore not only the BUCNET markers, but many also contained BUC's copyright notice.

B.

On June 5, 2002, BUC brought this lawsuit against IYC, MLS Solutions, and MLS Solutions' president, William Pazos, for copyright infringement, seeking injunctive relief and damages.¹⁷ BUC promptly moved the district court for a preliminary injunction, and on July 1, 2002, the court held an evidentiary hearing on the motion. Four days later, the court ruled on the motion. Buc Int'l Corp. v. Int'l Yacht Council Ltd., No. 02-60772-CIV, 2002 WL 31399604 (S.D.Fla. July 5, 2002) (order granting in part mot. for prelim. inj.).

First, addressing the likelihood that BUC would prevail on the merits, the court found that BUC had valid copyrights in the compilation of the BUCNET Service database to the extent that listings in the database used "descriptive words," and that the defendants had copied original elements of the compilation. Id. at *2-4. Second, the court found that absent an injunction, BUC would likely sustain irreparable injury. Id. at *4. Third, balancing the equities, the court concluded that the injury BUC would sustain if the defendants were not enjoined outweighed the harm an injunction would cause the defendants. Id. Fourth, the court found that an injunction would not be contrary to the public interest. Id. The court therefore enjoined the defendants from "copying descriptive expressions" from BUC's MLS listings and ordered the defendants to remove them from the IYC website. Id.

After this injunctive order, the parties engaged in exhaustive discovery and amended their pleadings. The claims subsequently tried to a jury were framed as follows: three counts against IYC for direct, vicarious, and contributory copyright infringement, respectively; one count against MLS Solutions for contributory copyright infringement; and one count against Pazos for contributory copyright infringement. The defendants admitted that BUC had obtained certificates of registration for the copyrights described in the complaint but denied the validity of those copyrights on the ground that nothing in the compilation, selection and organization of the database constituted an original work of authorship. The defendants also relied on several affirmative...