Hi-Tech Video v. Capital Cities/ABC

• Decision Date: 18 May 1992
• Docket Number: No. 1:90-CV-1015.,1:90-CV-1015.
• Citation: 804 F. Supp. 950
• Parties: HI-TECH VIDEO PRODUCTIONS, INC., Plaintiff, v. CAPITAL CITIES/ABC, INC., Defendant.
• Court: U.S. District Court — Western District of Michigan

804 F. Supp. 950

HI-TECH VIDEO PRODUCTIONS, INC., Plaintiff, v. CAPITAL CITIES/ABC, INC., Defendant.

No. 1:90-CV-1015.

United States District Court, W.D. Michigan, S.D.

May 18, 1992.

COPYRIGHT MATERIAL OMITTED

James M. Hunt, Graff & Hunt, Traverse City, Mich., for plaintiff.

Herschel P. Fink, Mark J. Ringes, Honigman, Miller, Schwartz & Cohn, Detroit, Mich., for defendant.

OPINION

ROBERT HOLMES BELL, District Judge.

This is a copyright infringement action. Plaintiff, Hi-Tech Video Productions, Inc. ("Hi-Tech"), alleges that defendant, Capital Cities/ABC, Inc. ("ABC"), committed a willful infringement by using, without permission, portions of Hi-Tech's copyrighted video in ABC's "Good Morning America" ("GMA") program on June 8, 1990. In response, ABC does not dispute the unauthorized use. Rather, it advances two contentions: (1) that its use was privileged under the "fair use" doctrine and (2) alternatively, that its use merely amounted to "innocent infringement." This Court, having jurisdiction over the action pursuant to 28 U.S.C. § 1338, held a bench trial on November 27, 1991 and December 12, 1991 to settle the contentions. The following opinion contains the findings of fact and conclusions of law required by Fed.R.Civ.P. 52(a).

I.

A.

Hi-Tech, based in Traverse City, Michigan, is an independent video production company. It is solely owned by Stan Akey ("Akey"), who has been in charge of its video productions since the birth of the company three years ago. Hi-Tech produces, among other things, travelogue videos, called "video postcards," of various regions of Michigan. These videos highlight some of the tourists attractions in the State. They are distributed to various outlets in northern Michigan for sale as souvenirs.

ABC is a major television network. Headquartered in New York City, it is a "for-profit" corporation. ABC produces a myriad of commercial programs, which it broadcasts through its network affiliates across the country. One of these programs is `Good Morning America' ("GMA"). It is a news and information program shown on the ABC stations each weekday morning. GMA has a variety of segments, including feature/weather reports. These feature/weather reports sometimes originate from far-flung locations.

B.

In May 1990, Hi-Tech produced a travelogue video, entitled "Mackinac Island, Michigan: The Video" (the "video"). Akey and his production crew produced the video. At trial, Akey testified that they worked many days to produce the video.

The video attempts to capture the essence of Mackinac Island. According to its certificate of copyright registration, the video depicts "the legend, lore, histories, and present day life of Mackinac Island." The video conveys the message that visiting the Island is a unique experience. It is about 18 minutes long.

The video is packaged in a colorful, plastic video container. At the back side of the container, the following printed words appear: "For information on other videos please call or write: Hi-Tech Video Productions/1126 East Eighth Street/Traverse City, MI 49684/(616) 929-2323." There is, however, no copyright notice on the container. Nor is there such a notice on the cassette itself; nevertheless, the cassette does have a printed label, which reads as follows: "A Video Postcard/MACKINAC ISLAND/MICHIGAN/Hi-tech Video Productions."

The videotape begins with an introduction informing its viewers that the video is presented by "Hi-Tech Video Productions, Inc." No copyright notice follows immediately. A familiar copyright notice mark¹ does, however, appear at the "tail credits" portion of the tape. It reads as follows:

A Hi-Tech Video Productions Presentation. All materials copyrighted c 1990. All rights reserved.

On or about May 20, 1990, Hi-Tech began distributing the copies of the video to various commercial outlets in northern Michigan. Subsequently, Hi-Tech obtained its copyright registration, effective August 3, 1990.

C.

In the meantime, GMA decided to send Spencer Christian, the program's weather reporter, on assignment to Mackinac Island on June 8, 1990. He would cover the Island's 41st Lilac Festival. He would also report weather from the Island.

In preparation, Donna Vislocky, then senior associate producer of GMA, was assigned to produce a short, pre-taped background video piece on the Island. The background piece would provide an introduction to Christian's live coverage.

Vislocky contacted various sources to gather materials for her background piece. Most important, she inquired about scenic video footages of the Island, which she could obtain and incorporate into her piece. Two days before the scheduled broadcast date, however, Vislocky had not obtained sufficient amount of quality footages to produce her piece. Concerned, she began to telephone a number of people for assistance. One of them was Sarah Bolger, executive director of the Mackinac Island Chamber of Commerce. Bolger was Vislocky's "contact person" on the Island.

What followed immediately thereafter is in dispute. According to Vislocky's deposition transcript, she told Bolger of her predicament. Bolger then told her: (1) that there were two videos on Mackinac Island, including Hi-Tech's video, that the Chamber of Commerce had commissioned; and (2) that Bolger could send her these videos for GMA's use.

Bolger's trial testimony, which is more credible,² was to the contrary. Bolger did not recall having any discussion with Vislocky regarding the shortage of background footages. Nor did Bolger believe that she had told Vislocky: (1) that Hi-Tech's video, which Bolger knew as an independent, commercial production, was commissioned by the Chamber of Commerce; and (2) that GMA could or could not use Hi-Tech's video, without first obtaining permission from Hi-Tech, for GMA's background piece.

Bolger did, however, send her some printed materials and the videos via overnight mail. She did not enclose any cover letter or explanatory note in the mail package. Bolger testified that when she sent the package, she believed that GMA would use the videos, as well as other enclosed materials, to prompt questions for the guest who would appear with Christian on GMA.

Upon receipt of the materials, Vislocky quickly reviewed the videos. After screening the first 10-12 minutes of Hi-Tech's 18-minute video, she found that certain portions of the video would be helpful to her background piece. She wanted to incorporate those portions to her piece. Vislocky then stopped reviewing the Hi-Tech's video, even though a complete, routine review, at a fast forward speed, would have taken less than a minute. She therefore did not see Hi-Tech's copyright notice at the "tail credits" portion of the tape.

Next morning, at about 7:45 a.m., Christian told the GMA audience that he was reporting from Mackinac Island. The background piece, as produced by Vislocky, ran for about 65 seconds, with Christian narrating. Not unlike the video, the background piece capsulized the essence of Mackinac Island. After the background piece, Christian explained that the Island was celebrating its 41st Lilac Festival. He then conducted a live interview with Bolger about the Festival.

D.

At trial, the parties agreed that approximately 38 seconds of the visual part of the background piece, which aired on June 8, 1990, had been taken from Hi-Tech's copyrighted, 18-minute video without permission (about 3.5 percent of the video). To put it somewhat differently, nine out of 172 separate scenes or shots from the video were taken by GMA (about 5 percent).

Hi-Tech also acknowledged that it sustained no actual damages resulting from GMA's unauthorized use. On the other hand, ABC saved, at most, about $1,140 by using Hi-Tech's video excerpts. According to Vislocky's deposition transcript, without Hi-Tech's excerpts, ABC would have had to spend approximately that amount to buy 38 seconds of the background stock footage of Mackinac Island from National Geographic Film Library (at the $30 per second standard footage rate for United States television). Hi-Tech offered no similar estimate.

II.

At trial, ABC did not dispute its unauthorized use of Hi-Tech's video on June 8, 1990. Rather, ABC advanced two principal arguments: that its use was privileged under the "fair use" defense; and that, alternatively, its use constituted an "innocent infringement." Upon consideration of all the evidence and appraisal of the demeanor of the witnesses, the Court finds that ABC has failed to sustain both arguments.

A.

The Court begins with the fair use defense. Fair use is an exception to copyright law. It confers a "privilege in others than the owner of a copyright to use the copyrighted material in a reasonable manner without his consent, notwithstanding the monopoly granted to the owner." Rosemont Enterprises, Inc. v. Random House, Inc., 366 F.2d 303, 306 (2d Cir.1966), cert. denied, 385 U.S. 1009, 87 S.Ct. 714, 17 L.Ed.2d 546 (1967). Courts developed the doctrine to "resolve tensions between the ends of copyright law, public enjoyment of creative works, and the means chosen under copyright law, the conferral of economic benefits upon creators of original works." Pacific & Southern Co. v. Duncan, 744 F.2d 1490, 1495 (11th Cir.1984), cert. denied, 471 U.S. 1004, 105 S.Ct. 1867, 85 L.Ed.2d 161 (1985). It permits "courts to avoid rigid application of the copyright statute when, on occasion, it would stifle the very creativity which that law is designed to foster." Iowa State University Research Foundation, Inc. v. American Broadcasting Cos., 621 F.2d 57, 60 (2d Cir.1980).

The fair use doctrine is now codified in 17 U.S.C. § 107. It has two parts. The first section, the preamble, sets forth a number of examples of what could constitute fair use: "Notwithstanding the provisions of section 106 ..., the fair use of a copyrighted work ... for purposes such as criticism, comment, or news reporting, ... is not an infringement of copyright."...