AITKEN, HAZEN, HOFFMAN, ETC. v. Empire Const. Co.

• Decision Date: 13 May 1982
• Docket Number: No. CV80-L-156.,CV80-L-156.
• Citation: 542 F. Supp. 252
• Parties: AITKEN, HAZEN, HOFFMAN, MILLER, P. C., a professional corporation, Plaintiff, v. EMPIRE CONSTRUCTION COMPANY, et al., Defendants.
• Court: U.S. District Court — District of Nebraska

542 F. Supp. 252

AITKEN, HAZEN, HOFFMAN, MILLER, P. C., a professional corporation, Plaintiff, v. EMPIRE CONSTRUCTION COMPANY, et al., Defendants.

No. CV80-L-156.

United States District Court, D. Nebraska.

May 13, 1982.

Harold D. Robertson, Lincoln, Neb., for plaintiff.

Perry, Perry, Witthoff, Guthery, Haase & Gessford, Lincoln, Neb., for defendants Empire and Belmont.

Johnston, Barber & Wherry, Lincoln, Neb., for defendant King.

Robert R. Miller, Lincoln, Neb., for defendant Lincoln Lumber.

MEMORANDUM OF DECISION

URBOM, Chief Judge.

This is an action for damages brought by Aitken, Hazen, Hoffman, Miller, P. C., a professional architectural and engineering firm, against Empire Construction Company, Belmont Construction Company, Lincoln Lumber Company, and William R. King, a professional engineer, alleging infringement of the plaintiff's copyright in a set of architectural drawings which had been used in the construction of an apartment complex at 1820-22 Knox Street, Lincoln, Nebraska, by the defendants' copying the drawings and using the copies in the construction of an apartment complex at 1830-32 Knox Street. Jurisdiction of the court is conferred by 28 U.S.C. § 1338(a). Trial was held February 8, 9, 10 and 11, 1981, at Lincoln, Nebraska.

A summary of facts as found by the court follows; the facts will be discussed in greater detail in the text of this memorandum opinion.

Belmont is and since approximately 1954 has been engaged in the construction business in the Lincoln, Nebraska, area. Empire is a land developer in Lincoln. Karl Witt, the sole owner of Empire, is also the major stockholder and president of Belmont.

In 1962, Empire purchased a tract of land located at 1800 to 1900 Knox Street in Lincoln. Empire wished to develop this tract by subdividing it and building apartment complexes on the subdivided parcels. Thus, in November of 1977, Empire employed Belmont to construct a multi-unit apartment complex on the Knox Street property. In this same month, Mr. Witt, acting on behalf of Empire and Belmont, engaged the plaintiff to provide architectural services in developing the apartment complex. Belmont had contracted with the plaintiff in connection with previous projects, sometimes from the initial design stage and other times only to approve final design plans prepared by Belmont's draftsmen. In connection with the Knox Street project, Belmont decided to engage the plaintiff to design the apartment complex from the initial through the final design stages. The parties' agreement was entirely oral, and there was no discussion as to copyright ownership of the plans to be created.

It was decided in late November or early December that the apartment complex to be designed by the plaintiff would be located on parcel No. 3 of the subdivision, or by street address, 1820-22 Knox Street. Parcels numbered 1, 2 and 4 were to remain vacant for the time being. However, it was contemplated that another apartment complex would be built on parcel No. 2 (1830-32 Knox Street) in the future, and a common driveway for these two complexes was to be included in the plaintiff's design plans.

During the development of the architectural plans by the plaintiff there were several meetings between the parties to discuss the design of the complex. At the initial meetings Belmont communicated to the plaintiff through sketches and verbal descriptions its general ideas as to the type of apartment complex it intended to build, indicating that the complex should have a brick exterior, entrance by balconies rather than interior corridors, and a fireplace in each unit. It was also indicated that the design features of the apartment complex, and specifically the balconies, fireplaces and chimneys, should be similar to those in certain other apartment complexes designed and built by Belmont. Belmont supplied the plaintiff with the necessary information as to the brand and type of plumbing fixtures, kitchen cabinets, windows, and fireplace liners which it intended to use in the apartment complex. As a result of these discussions, the preliminary drawings for the roof, floor system and footings were revised.

The preliminary plans for the apartment complex, consisting of twenty sheets, were completed in early February of 1978 and reproduced by the plaintiff in a set of blueprints. Eighteen sets of the blueprints were delivered to Belmont; the plaintiff, in accord with its normal practice, retained possession of the original drawings. At the time the blueprints were delivered to Belmont, the plaintiff had not registered its copyright in the architectural plans and none of the sheets contained a "copyright," "c," or other notation of the copyright ownership of the plaintiff.

On February 10, 1978, two sets of blueprints were filed with the City of Lincoln Code Administration Department, and a building permit was later issued to Belmont for the construction of a 22-unit apartment complex at 1820-22 Knox Street. Using the plans prepared by the plaintiff, Belmont completed construction of the complex at this site in 1979. Empire paid Belmont for the construction and then sold the 22-unit complex to Amwest Properties, Inc., a Washington State corporation.

The total amount paid by Belmont for the preparation of the architectural plans by the plaintiff was $13,440.93. The bills for the plaintiff's architectural services were on an hourly rate basis and were paid by Belmont beginning in December, 1977, and continuing to late 1978.

In 1979 Empire employed Belmont to construct an apartment complex on parcel No. 2, 1830-32 Knox Street. Belmont, without the permission or knowledge of the plaintiff, copied the architectural plans prepared by the plaintiff for the 1820-22 Knox Street apartment complex to produce architectural plans for the construction of an apartment complex at 1830-32 Knox Street. These copies were taken to Lincoln Lumber Company, who had offered as a customer service to Belmont to have the plans reviewed and approved by a licensed engineer. Lincoln Lumber hired and paid William R. King to review the plans and place his seal on them. The copies were then returned to Belmont.

In December, 1979, Belmont delivered copies of the plans to the City of Lincoln Code Administration Department and obtained a building permit for construction of an apartment complex at 1830-32 Knox Street. Construction of the complex was completed in 1980 and thereafter Empire sold the land and the buildings at 1830-32 Knox Street, again, to Amwest Properties, Inc.

In early March, 1980, the plaintiff discovered that Belmont had copied the architectural plans for the 1820-22 Knox Street apartment complex to produce the architectural plans for the 1830-32 Knox Street apartment complex, and on March 29, 1980, the plaintiff hand-delivered to Belmont and Empire a bill in the amount of $35,973.00 for the plaintiff's "services rendered in connection with apartments at 1830 and 1832 Knox." Both Belmont and Empire denied any liability for the claimed services, and the plaintiff filed a mechanic's lien against the real estate at 1830-32 Knox Street in the same amount as the bill. The plaintiff's action in state court on the lien was dismissed for failure to establish an express or implied contract for the provision of services in connection with the 1830-32 project.

On April 25, 1980, the plaintiff placed notice of its copyright on the originals of the plans it had prepared. Prior to that date such notice had not appeared on those plans or any copy of them. On April 26, 1980, the plaintiff submitted its application for registration of copyright in the architectural plans for the 1820-22 Knox Street to the United States Copyright Office, and on April 29, 1980, the registration became effective. The plaintiff had not publicly asserted its copyright claim in the plans prior to April 26, 1980.

By letter dated May 12, 1980, the plaintiff notified each of the defendants and the city's code administration department of the plaintiff's copyright in the 1820-22 Knox Street apartment complex plans, and by a letter dated June 10, 1980, the plaintiff notified each of the defendants that it was infringing upon the plaintiff's copyright in the plans by "reproduction of derivative of same" without consent of the plaintiff.

On June 18, 1980, the plaintiff initiated this lawsuit under the Copyright Act of 1976, seeking damages for copyright infringement. The plaintiff has elected to seek statutory damages against the defendant King and actual damages and profits against the other defendants. The plaintiff also seeks costs, attorney's fees, and treble damages.

Prior to trial the plaintiff moved for summary judgment on its claim that Belmont infringed upon the plaintiff's copyright in the architectural plans for the 1820-22 Knox Street apartment complex. I concluded in a memorandum and order dated January 26, 1982, filing 69, that the Copyright Act of 1976, rather than the Copyright Act of 1909, governs disposition of the plaintiff's statutory copyright claims, that the architectural plans in question are copyrightable, that the plans are not a commissioned work within the definition of a "work made for hire," that the plaintiff did not transfer copyright ownership in the plans by transferring copies of the plans to the defendants, and that the 1830-32 Knox Street plans are a reproduction of the 1820-22 Knox Street plans. To the extent that these issues are again raised by Belmont or any of the other defendants, I affirm my holdings as set forth in that memorandum and order.

The plaintiff contends that the defendants infringed upon the plaintiff's copyright by reproducing the architectural plans for the 1820-22 Knox Street apartment complex by preparing or assisting in preparing a derivative work from those plans and by reproducing copies of this derivative work, by distributing copies of the derivative works to subcontractors and building material suppliers, and by...