Balsley v. LFP, Inc.

• Decision Date: 16 August 2012
• Docket Number: No. 11–3445.,11–3445.
• Citation: 2012 Copr.L.Dec. P 30302,40 Media L. Rep. 2313,691 F.3d 747,103 U.S.P.Q.2d 1879
• Parties: Catherine BALSLEY, a/k/a Catherine Bosley; Richard Brown, Plaintiffs–Appellees, v. LFP, INC., Defendant–Appellant.
• Court: U.S. Court of Appeals — Sixth Circuit

691 F.3d 747

2012 Copr.L.Dec. P 30,302

103 U.S.P.Q.2d 1879

40 Media L. Rep. 2313

Catherine BALSLEY, a/k/a Catherine Bosley; Richard Brown, Plaintiffs–Appellees,

v.LFP, INC., Defendant–Appellant.

No. 11–3445.

United States Court of Appeals, Sixth Circuit.

Argued: July 17, 2012.

Decided and Filed: Aug. 16, 2012.

ARGUED:Timothy P. Murphy, Lipsitz Green Scime Cambria, LLP, Buffalo, New York, for Appellant. Richard C. Haber, Haber Polk Kabat LLP, Cleveland, Ohio, for Appellees. ON BRIEF:Timothy P. Murphy, Lipsitz Green Scime Cambria, LLP, Buffalo, New York, for Appellant. Andrew A. Kabat, Haber Polk Kabat LLP, Cleveland, Ohio, for Appellees.

Before: GUY and CLAY, Circuit Judges; HOOD, District Judge. ^*

OPINION

CLAY, Circuit Judge.

Defendant LFP, Inc. (a.k.a. Larry Flynt Publications), publisher of Hustler magazine, appeals multiple orders of the district court, following a jury verdict in favor of Plaintiffs Catherine Balsley (a.k.a. Catherine Bosley) and her husband Richard Brown in their action for direct copyright infringement, filed under 17 U.S.C. §§ 101 et seq. Defendant appeals the district court's denial of its Rule 50(b) motion for judgment as a matter of law, its Rule 59 motion for a new trial, and its motion for attorney's fees. For the reasons set forth below, we AFFIRM the district court's orders.

BACKGROUND

A. Hustler Magazine's “Hot News Babes” Contest

Defendant LFP owns and publishes Hustler magazine, a monthly magazine that “contains graphic images and stories about sex.” The magazine publishes extremely illicit photographs, both real and fabricated. Relevant to this case is a section of the magazine called “Bits & Pieces,” which has a recurring “Hot News Babes” piece. The “Hot News Babes” piece is a “contest” that has been a part of the magazine since 2005 and is listed in each issue's Table of Contents. The contest invites Hustler readers to nominate young, attractive female news reporters; Hustler editors then review the submissions and feature one reporter's picture in each edition. The reader who nominates the chosen reporter receives a “prize pack.” Hustler's Editorial Director Bruce David, Managing Editor N. Morgan Hagen, and “Bits & Pieces” Editor Keith Valcourt agreed that the contest was created to encourage reader participation and interest in the magazine and to generate magazine sales.

B. Bosley's Photographs

In March 2003, Bosley was a 37–year–old news anchor for a CBS television affiliate in Ohio. While on vacation in Florida, Bosley entered a “wet t-shirt” contest at a bar and ultimately danced nude. An amateur photographer named Gontran Durocher was in attendance and took pictures of Bosley in various states of undress, without Bosley's knowledge. Durocher published the photographs of Bosley on lenshead.com from May to June 2003. Durocher included a visual copyright notice with each photo and provided a general warning that the photographs were the property of lenshead.com and could not be reproduced in part or whole. A few months later, Bosley lost her position as anchor when the story was publicly reported.

Plaintiffs sought ownership of the photographs so that they would have a legal means of ending the photographs' dissemination. They negotiated with Durocher, who sold, transferred, and assigned all rights, title, and interest in the copyright to the photographs to Plaintiffs. Plaintiffs then registered their acquired copyright with the United States Copyright Office on August 25, 2004. As public interest in the photographs diminished in 2004, Bosley was employed as a television reporter in another city.

C. Hustler's Use of Bosley's Photograph

One of Hustler's readers, Ken Blazina, was aware of Hustler's “Hot News Babes” contest and decided to nominate Bosley as a “hot news babe” several years after the Florida incident. Blazina wrote to Hustler on August 5, 2005 and described Bosley as the “HOTTEST babe ever.” He did not include a photograph, but he did explain that nude photographs of Bosley were available online. Blazina also mentioned that Bosley lost her job because of the lenshead.com publication of the photographs. Blazina's submission was received by Valcourt and given to David, who asked Hustler's art department to locate pictures of Bosley. David received three pictures in response: a professional head shot of Bosley and two pictures taken of Bosley during the “wet t-shirt” contest, one where Bosley was completely nude and another where she had partially exposed her breast while being sprayed with a hose. The latter image was one of the photographs taken by Durocher and copyrighted by Plaintiffs (hereinafter “the Bosley photograph”).

Defendant's editors were aware that the Bosley photograph was copyrighted, but did not know who the owner was. David allegedly sent the Bosley photograph to Mark Johnson, Hustler's Research Director, and asked Johnson to locate the copyright owner. David contended that Johnson attempted to locate the photograph's copyright owner but was unable to do so. Johnson, however, testified that no one asked him to find the copyright owner and that he never attempted to do so. Having failed to locate the copyright owner, Defendant asked its retained counsel, William Feigenbaum at Lipsitz, Green, Scime, Cambria, LLP, whether it could publish the Bosley photograph in Hustler without obtaining a license from the copyright owner. Defendant did not provide any information to its counsel regarding where or how the photograph would be used. Feigenbaum concluded that Defendant could publish the photograph as “fair use” without the need for permission.

Defendant ultimately published the Bosley photograph in the February 2006 issue of Hustler, designating Bosley as the “Hot News Babe” of that month. Next to the picture, Defendant included a short description of Bosley and a description of the “Hot News Babe” contest:

This month's eye candy is Catherine Bosley from Cleveland's WOIO Channel 19. The anchorwoman not only looks good, but apparently also likes to party. Previously, while at WKBN in Youngstown, Ohio, she tendered her resignation after topless shots of the fetching blonde at a Florida wet T-shirt contest surfaced all over the Internet. Thanks to K.B. for an excellent submission.

Remember, to nominate a local news babe, provide the hottie's full name, station and channel (include a picture if possible). Should your favorite be chosen as an issue's “Tasty Talking Head,” you'll receive a HUSTLER prize pack. Send your pick to HUSTLER's “Hot News Babes,” c/o Bits & Pieces, 8484 Wilshire Blvd., Suite 900, Beverly Hills, CA 902111.

The three-sentence portion describing Bosley was reworded using the information in Blazina's contest submission letter. Ultimately, 380,000 copies of the February 2006 issue of Hustler were published and 180,474 were sold, with gross sales in excess of one million dollars.

D. Plaintiffs' Civil Action

Plaintiffs eventually discovered that their copyrighted photograph was published by Hustler. In February 2008, they filed a complaint against Defendant in the district court asserting (1) direct copyright infringement, in violation of 17 U.S.C. §§ 101 et seq.; (2) contributory copyright infringement, in violation of 17 U.S.C. §§ 101 et seq.; (3) vicarious copyright infringement, allegedly in violation of 17 U.S.C. § 106(1), (3), and (5); (4) violation of the Ohio common law right of privacy; (5) violation of the Ohio Revised Code (ORC) §§ 2741.01 et seq. right of publicity; (6) violation of the Ohio Deceptive Trade Practices Act (ODTPA), ORC §§ 4165.01 et seq.; and (7) liability under respondeat superior. Prior to trial, the parties jointly and voluntarily stipulated to dismissal of counts (2) and (3) for contributory and vicarious copyright. The district court dismissed count (6) for the ODTPA violation and count (7) for respondeat superior due to failure to state a claim under Federal Rule of Civil Procedure 12(b)(6). Later, the court granted summary judgment to Defendant under Federal Rule of Civil Procedure 56 on counts (4) and (5) for violation of the Ohio right to privacy and right of publicity. Finally, a jury trial was held on the only remaining claim, count (1) for direct copyright infringement.

At trial, the parties provided several stipulations:

1. Defendant LFP, Inc. published a photograph of Catherine Bosley in the February, 2006 issue of Hustler magazine identified as “# 40 Bosley with Hose.”

2. Plaintiffs owned the copyright to photograph “# 40 Bosley with Hose” when it was published by Defendant LFP in the February 2006 issue of Hustler magazine.

3. Defendant LFP did not receive the permission of Plaintiffs to utilize photograph “# 40 Bosley with Hose” in the February 2006 issue of Hustler magazine.

Although Defendant admitted the elements of direct copyright infringement, it raised the affirmative defense of the fair use doctrine and argued that its conduct was not willful in light of its reliance on counsel's advice. To support its fair use defense, Defendant called several of LFP's employees, as well as Feigenbaum, as witnesses. Defendant also called Renee Howdeshell as an expert witness on the issue of profits. Defendant submitted that the total sales for the February 2006 issue was $832,000, with an additional $316,000 in advertising revenue. Howdeshell testified that even though Defendant profited from the February 2006 edition, none of the profits could be attributed to Plaintiffs' photograph, because the magazine is usually sold in shrinkwrap and because there was no reference to the photograph on the magazine's cover. Plaintiffs argued that Defendant had profited from the photograph and suggested that the profit amounted to $265,000.

Following the presentation of the evidence, Defendant moved for judgment as a matter of law under Rule 50(a) on the basis that its actions were covered by the “fair use” doctrine, and thus it could not be liable for direct copyright infringement. The district court...