Bell v. Taylor

Decision Date01 July 2016
Docket Number15–3735,Nos. 15–2343,15–3731,s. 15–2343
Citation827 F.3d 699
PartiesRichard Bell, Plaintiff–Appellant, v. Cameron Taylor, et al., Defendants–Appellees.
CourtU.S. Court of Appeals — Seventh Circuit

Richard N. Bell, Bell Law Firm, McCordsville, IN, Pro Se.

John W. Nelson, Law Office of John Nelson, Carmel, IN, for DefendantsAppellees.

Before Flaum and Manion, Circuit Judges, and Alonso, District Judge.*

Flaum

, Circuit Judge.

Richard Bell sued several defendants for copyright infringement, alleging that they impermissibly displayed a photo belonging to Bell on websites promoting their respective businesses. Bell sought damages as well as injunctive and declaratory relief in federal district court. The district court granted summary judgment for defendants, first on damages and later on injunctive and declaratory relief. Bell also filed a second copyright infringement lawsuit against some of the defendants in the same court. The district court granted defendants' motion to dismiss the second case based on res judicata. Bell appeals the grant of summary judgment for defendants in the first case and the grant of defendants' motion to dismiss in the second case. For the reasons that follow, we affirm the judgment of the district court in both cases.

I. Background

Plaintiff Bell is the undisputed owner of the photograph at the center of this appeal, which depicts the Indianapolis skyline during the day (“the daytime photo”). Bell took the photo in March 2000, published it online in August 2000, and later registered the copyright, which became effective in August 2011. Bell sued defendants (as well as others who are no longer parties to this matter) on June 7, 2011, alleging federal copyright infringement and state law claims for conversion, misrepresentation, and unfair competition. After Bell amended his complaint three times, the district court severed the claims and grouped like defendants together. The case against the defendants described below commenced on May 15, 2013 (“the 2013 Case”).

Defendant Cameron Taylor operates a computer business, Taylor Computer Solutions, which he advertises on his website (www.taylorcomputersolutions.com). Bell alleged in his complaint that Taylor and Taylor Computer Solutions (collectively Taylor) used the daytime photo without authorization between January 2009 and April 2011. However, Bell later realized that Taylor never downloaded or displayed the daytime photo specified in the complaint; rather, Taylor's website displayed a different photo that Bell owned—one depicting Indianapolis's skyline at night (“the nighttime photo”). To correct his error, Bell sought to amend his complaint a fourth time on March 12, 2014—nearly eight months after the July 15, 2013 deadline for filing motions for leave to amend the pleadings. The district court denied his motion, citing undue delay and Bell's carelessness.

Defendant Fred O'Brien and his business, Insurance Concepts, operated a website for six to eight weeks in 2011. Bell alleged that this website displayed the daytime photo without authorization. The website had little to no traffic and generated no business, which led O'Brien to shut the website down in mid–2011.

Defendant Shanna Cheatham is a real estate agent who advertised her services on her website. Bell alleges that Cheatham's website infringed on his copyright of the daytime photo from June 2008 and June 2011. Cheatham's website was designed by Jessica Wilch, who downloaded the daytime photo from an unspecified website. Cheatham removed the photo on June 15, 2011, immediately after she was contacted by Bell. Cheatham has since changed employment and shut the website down.

During discovery, Bell moved to compel the production of defendants' tax returns for every year from 2000 to 2011. Bell hoped the tax returns would show an increase in defendants' profits during the periods of infringement, thus helping him prove his entitlement to indirect profits as damages. Bell also moved to compel the production of a spreadsheet created by Wilch showing Cheatham's website traffic before, during, and after infringement, along with Wilch's accompanying notes. The district court denied both motions.1

On August 26, 2014, the district court granted defendants' motion for summary judgment on the issue of damages and dismissed Bell's case with prejudice. The district court found that Taylor was entitled to summary judgment because Taylor never displayed the daytime photo as Bell alleged in his complaint. As for the other defendants, the court concluded that although Bell had established ownership of the photo, he had failed to prove damages: Bell had not demonstrated the photo's fair market value, nor had he shown that defendants profited from their use of his photo. Finally, the district court found that Bell's state law claims for conversion, misrepresentation, and unfair competition were preempted by federal copyright law.

That same day, the district court purported to enter a “final judgment” in favor of defendants. Bell appealed, and on June 29, 2015, we dismissed the appeal for lack of jurisdiction and remanded the case to the district court.

Bell v. Taylor , 791 F.3d 745, 746 (7th Cir. 2015)

. We explained that since the district court had not resolved Bell's claims for injunctive relief, the judgment was not final for purposes of appeal. Id. On remand, both parties moved for summary judgment on injunctive and declaratory relief. The district court granted summary judgment in favor of defendants and entered final judgment on December 4, 2015.

On April 7, 2014, while Bell's motion to file a fourth amended complaint was pending, Bell initiated a second lawsuit against Taylor (“the 2014 Case”), asserting the same copyright infringement and state law claims as the 2013 Case, but based on the photo Taylor actually posted: the nighttime photo. On June 12, 2015, the district court granted Taylor's motion to dismiss the 2014 Case based on res judicata. Following the remand of the 2013 Case, Bell moved to amend judgment of the 2014 Case, arguing that res judicata has been misapplied because there was no prior final judgment. The district court denied this motion on December 8, 2015.

Bell appeals, challenging the grant of summary judgment for defendants in the 2013 Case, the grant of defendants' motion to dismiss the 2014 Case based on res judicata, and the denial of various motions.

II. Discussion
A. Taylor and Taylor Solutions

We begin our analysis with a discussion of defendants Taylor and Taylor Solutions (collectively Taylor). Bell argues that the district court erred by granting summary judgment for Taylor in the 2013 Case, denying Bell's motion for leave to amend his complaint a fourth time, and dismissing the 2014 Case against Taylor based on res judicata.

1. Summary Judgment

We review de novo the district court's grant of summary judgment, construing all facts in the light most favorable to Bell, the nonmoving party, and drawing all reasonable inferences in Bell's favor. Williams v. Brooks , 809 F.3d 936, 941 (7th Cir. 2016)

. Summary judgment is proper when there is no genuine dispute of material fact and the movant is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a).

In the 2013 Case, Bell's third amended complaint accused Taylor of infringing on his copyright of the daytime photo. Taylor answered the complaint and denied posting the daytime photo on his website. The district court granted summary judgment for Taylor, stating that “Bell admits that [Taylor] did not use or infringe upon the copyright of the [daytime] Photo,” as alleged in the complaint. As explained above, Taylor had posted Bell's nighttime photo, not the daytime photo. On appeal, Bell argues that Taylor should have notified him that he identified the wrong photo in his complaint. Bell contends that Taylor did not comply with Federal Rule of Civil Procedure 8(b)

, which states that [i]n responding to a pleading, a party must ... state in short and plain terms its defenses to each claim asserted against it[.] Bell attempts to construe Taylor's argument that he never infringed on Bell's copyright of the daytime photo as an affirmative defense, and therefore contends that Taylor waived this “wrong photo defense” by not pleading it in his answer.

Bell misunderstands both the definition of “affirmative defense” and a defendant's obligations at the pleading stage of civil litigation. While Rule 8(c)

directs parties to raise affirmative defenses in the pleadings, Taylor did not assert an affirmative defense. An affirmative defense “limits or excuses a defendant's liability even if the plaintiff establishes a prima facie case.” Tober v. Graco Children's Prods., Inc. , 431 F.3d 572, 579 n. 9 (7th Cir. 2005)

. In other words, an affirmative defense is [a] defendant's assertion of facts and arguments that, if true, will defeat the plaintiff's ... claim, even if all the allegations in the complaint are true.” Defense , Black's Law Dictionary (10th ed. 2014); see also

Philadelphia Indem. Ins. Co. v. Chicago Title Ins. Co. , 771 F.3d 391, 401 (7th Cir. 2014). In this case, Bell did not establish a prima facie case against Taylor, and Taylor's answer did not assume that the allegations of Bell's complaint were true. Rather, Taylor stated in his answer that he did not do what Bell accuses him of doing. This is not an affirmative defense but simply a denial of Bell's allegations.

Additionally, Taylor fulfilled his duties under Rule 8(b)

by stating that he never used the photo alleged in the complaint. We have explained that [t]he purpose of a responsive pleading is to put everyone on notice of what the defendant admits and what [he] intends to contest.” Edelman v. Belco Title & Escrow, LLC , 754 F.3d 389, 395 (7th Cir. 2014). Here, Taylor gave Bell adequate notice that he had not used the daytime photo. Taylor was not required to do more to inform Bell of his own...

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