Antioch Co. v. Scrapbook Borders, Inc.

• Decision Date: 05 September 2003
• Docket Number: Civ. No. 02100 (RLE).
• Citation: 291 F.Supp.2d 980
• Parties: The ANTIOCH CO., Plaintiff, v. SCRAPBOOK BORDERS, INC., Lisa DeBonoPaula a/k/a Lisa dePaula, and Luis DeBonoPaula d/b/a Solrac Enterprises, Defendants.
• Court: U.S. District Court — District of Minnesota

291 F.Supp.2d 980

The ANTIOCH CO., Plaintiff, v. SCRAPBOOK BORDERS, INC., Lisa DeBonoPaula a/k/a Lisa dePaula, and Luis DeBonoPaula d/b/a Solrac Enterprises, Defendants.

Civ. No. 02100 (RLE).

United States District Court, D. Minnesota.

September 5, 2003.

COPYRIGHT MATERIAL OMITTED

Robert William Gutenkauf, Gina M Tiefenthaler, Adam M. Nathe, Gray Plant Mooty Mooty & Bennett, Minneapolis, MN, for Plaintiff.

Christopher Knoll Sandberg, Lockridge Grindal Nauen, Minneapolis, MN, Scrapbook Borders, Inc., pro se, Lisa DeBonoPaula, pro se, Luis DeBonoPaula, pro se, Shalimar, FL, for Defendant.

ORDER

ERICKSON, United States Magistrate Judge.

I. Introduction

This matter came before the undersigned Magistrate Judge pursuant to the consent of the parties, made in accordance with Title 28 U.S.C. § 636(c), upon the Plaintiff's Motions for Partial Summary Judgment, in which it seeks Judgment, as a matter of law, that the Defendants are liable on the Plaintiff's claim of copyright infringement, and also seeks Judgment on three of the Defendants' Counterclaims. A Hearing on the Motion was conducted on June 13, 2002, at which time, the Plaintiff appeared by Gina M. Tiefenthaler, Esq., and the Defendants Lisa DeBonoPaula ("DeBonoPaula"), Luis DeBonoPaula, and Scrapbook Borders, Inc. ("Scrapbook"), appeared by Christopher K. Sandberg, Esq.

For reasons which follow, we grant the Plaintiff's Motion for Summary Judgment on the issue of copyright infringement liability, except to the extent that the Motion seeks the entry of a Permanent Injunction, which we deny, but without prejudice. We also grant, in its entirety, the Plaintiff's Motion for Summary Judgment on the Defendants' First, Second, and Fourth Counterclaims.

II. Factual and Procedural History

In this action, the Plaintiff brought claims against the Defendants for copyright infringement, unfair competition, and deceptive trade practices, and against DeBonoPaula and Scrapbook, for business disparagement. The claims arise from allegations that certain "Idea Books," and CD-ROM products, which were published and sold by the Defendants, contained stickers which had been copyrighted by the Plaintiff, thereby infringing upon the Plaintiff's protected rights. In addition, the Complaint alleges that the Defendants engaged in unfair competition by their unauthorized use of trademarked materials, and that DeBonoPaula, under her own name, and under the name of Scrapbook, disparaged the Plaintiff's business by posting false and misleading representations of fact, concerning the Plaintiff, on Scrapbook's website, and in Internet chat rooms. The Defendants have denied any wrongdoing, and have asserted Counterclaims, against the Plaintiff, for abuse of copyright, for the violation of Minnesota antitrust and consumer fraud laws, and for violation of labor laws concerning the payment of commissions to sales persons.

III. Discussion

Summary Judgment is not an acceptable means of resolving triable issues, nor is it a disfavored procedural shortcut when there are no issues which require the unique proficiencies of a Jury in weighing the evidence, and in rendering credibility determinations. See, Celotex Corp. v. Catrett, 477 U.S. 317, 327, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); Duffy v. Wolle, 123 F.3d 1026, 1040 (8th Cir.1997), cert. denied, 523 U.S. 1137, 118 S.Ct. 1839, 140 L.Ed.2d 1090 (1998). Summary Judgment is appropriate when we have viewed the facts, and the inferences drawn therefrom, in a light most favorable to the nonmoving party, and have found no triable issue. See, Eide v. Grey Fox Technical Servs. Corp., 329 F.3d 600, 604 (8th Cir.2003); Philip v. Ford Motor Co., 328 F.3d 1020, 1023 (8th Cir.2003); United Fire & Casualty Ins. Co. v. Garvey, 328 F.3d 411, 413 (8th Cir.2003). For these purposes, a disputed fact is "material," if it must inevitably be resolved and the resolution will determine the outcome of the case, while a dispute is "genuine," if the evidence is such that a reasonable Jury could return a Verdict for the nonmoving party. See, Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); Fenney v. Dakota, Minnesota & Eastern R.R. Co., 327 F.3d 707, 711 (8th Cir.2003); Jenkins v. Southern Farm Bureau Casualty, 307 F.3d 741, 744 (8th Cir. 2002); Herring v. Canada Life Assurance Co., 207 F.3d 1026 (8th Cir.2000).

As Rule 56(e) makes clear, once the moving party files a properly supported Motion, the burden shifts to the nonmoving party to demonstrate the existence of a genuine dispute. In sustaining that burden, "an adverse party may not rest upon the mere allegations or denials of the adverse party's pleading, but the adverse party's response, by affidavits or as otherwise provided in this rule, must set forth specific facts showing that there is a genuine issue for trial." Rule 56(e), Federal Rules of Civil Procedure; see also, Anderson v. Liberty Lobby, Inc., supra at 256, 106 S.Ct. 2505; Eddings v. City of Hot Springs, Ark., 323 F.3d 596, 602 (8th Cir.2003). Moreover, the movant is entitled to Summary Judgment where the nonmoving party has failed "to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex Corp. v. Catrett, supra at 322, 106 S.Ct. 2548; see also, Mercer v. City of Cedar Rapids, 308 F.3d 840, 843 (8th Cir.2002); Hammond v. Northland Counseling Center, Inc., 218 F.3d 886, 891 (8th Cir.2000). No genuine issue of fact exists in such a case because "a complete failure of proof concerning an essential element of the nonmoving party's case necessarily renders all other facts immaterial." Celotex Corp. v. Catrett, supra at 323, 106 S.Ct. 2548; see also, Bell Lumber and Pole Co. v. United States Fire Ins. Co., 60 F.3d 437, 441 (8th Cir.1995); McLaughlin v. Esselte Pendaflex Corp., 50 F.3d 507, 510 (8th Cir.1995); Settle v. Ross, 992 F.2d 162, 163 (8th Cir.1993).

A. The Plaintiff's Motion for Partial Summary Judgment on the Issue of Copyright Infringement Liability.

The Plaintiff seeks a Judgment that, as a matter of law, the Defendants are liable for copyright infringement. Based on such a finding, it also seeks an Order that permanently enjoins the Defendants from further publishing, importing, distributing, or selling, any of their products which display the Plaintiff's original sticker designs. Notably, however, the Plaintiff's Motion seeks Summary Judgment only as to the issue of liability for copyright infringement, and not as to the issue of damages or willfulness, as the Plaintiff wishes to reserve those issues for a Jury Trial.¹ In response, the Defendants claim that granting Summary Judgment on anything less than a whole claim is procedurally improper. Additionally, the Defendants assert that, even if it were proper to award Summary Judgment on less than the whole of a claim, they are entitled to Summary Judgment, even though they filed no such Motion, because of the fair use exception to copyright liability.² We first address the procedural propriety of the Plaintiff's Motion, and then, after finding no impropriety, we proceed to the merits of the Motion.

1. Whether the Plaintiff's Motion for a Partial Summary Judgment Motion is Procedurally Proper.

In support of its contention, that granting Summary Judgment solely on the liability issue is procedurally proper, the Plaintiff points first to Rule 56(c), Federal Rules of Civil Procedure, which provides, in pertinent part, that "[a] summary judgment, interlocutory in character, may be rendered on the issue of liability alone although there is a genuine issue as to the amount of damages." The Plaintiff contends that the plain language of Rule 56 contemplates the type of Summary Judgment Motion that it has filed. The Plaintiff also points to our Court of Appeals' holding, in Cass County Music Co. v. C.H.L.R., Inc., 88 F.3d 635 (8th Cir.1996), where the District Court granted Summary Judgment in favor of the copyright holding plaintiff, and awarded statutory damages.

There, on appeal, the defendant did not dispute the finding of liability, but asserted that there remained a question of material fact as to the willfulness of the infringement, which precluded the statutory damages award, and that it was entitled to a Jury Trial on that factual issue. While finding that there were no material questions of fact as to willfulness, the Court of Appeals, nevertheless, found that it was error for the District Court to strike the defendant's Jury demand, because the remedy for statutory damages was legal, rather than equitable in nature and, as such, "either party in a copyright infringement suit is entitled under the Seventh Amendment to a jury trial on demand." Id. at 644. As a consequence, the Court remanded the action for "a new trial, with jury, on the * * * claim for statutory damages." Id.

The Defendants have offered nothing to counter the Plaintiff's arguments, apart from an enigmatic suggestion that it would be more expeditious to resolve the liability issue at Trial, than by way of a dispositive Motion, even though the Defendants also seek a Summary Judgment, in their favor, on the copyright liability issue. We find no merit to the Defendants' invitation, that we not consider the Plaintiff's Motion, because it would be more efficient to resolve that issue at Trial. Both parties concede that there are no genuine issues of material fact which would preclude a finding of liability, as a matter of law — at least in their respective favor — making that issue ripe for summary resolution.

Accordingly, we concur with the Plaintiff, that a less than full adjudication is permissible, and especially so, on the issue of liability, while leaving the issue of damages for Trial. Rule 56 plainly contemplates such a course of action. We also agree that, under the guarantees of Seventh Amendment to the Constitution, the Plaintiff is entitled to a Jury Trial on the issue of...