Gamma Audio & Video, Inc. v. Ean-Chea

• Decision Date: 07 October 1993
• Docket Number: EAN-CHEA,93-1504 and 93-1518,Nos. 92-2016,92-2132,s. 92-2016
• Citation: 11 F.3d 1106,29 USPQ2d 1257
• Parties: 1994 Copr.L.Dec. P 27,188, 29 U.S.P.Q.2d 1257 GAMMA AUDIO & VIDEO, INC., et al., Plaintiffs, Appellees, Cross-Appellants, v.d/b/a Overseas Video, et al., Defendant, Appellant, Cross-Appellees. . Heard
• Court: U.S. Court of Appeals — First Circuit

Page 1106

11 F.3d 1106

1994 Copr.L.Dec. P 27,188, 29 U.S.P.Q.2d 1257

GAMMA AUDIO & VIDEO, INC., et al., Plaintiffs, Appellees Cross-Appellants, v. EAN-CHEA d/b/a Overseas Video, et al., Defendant, Appellant Cross-Appellees.

Nos. 92-2016, 92-2132, 93-1504 and 93-1518.

United States Court of Appeals First Circuit.

Heard Oct. 7, 1993.

Decided Dec. 22, 1993.

William F. Spallina, Newton, MA, on brief, for defendant, appellant/cross-appellee Ean-Chea, d/b/a Overseas Video.

Philip S. Shaw, with whom Rafferty, Polich & Shaw, Cambridge, MA, was on brief, for plaintiffs, appellees/cross-appellants Taing Tao, Meng I. Ung and Chen V. Ung and Marvin Feldman and Tetel & Feldman, P.C., New York City, on brief, for plaintiff, appellee/cross-appellant Gamma Audio & Video, Inc.

Before TORRUELLA, Circuit Judge, BOWNES, Senior Circuit Judge, and CYR, Circuit Judge.

BOWNES, Senior Circuit Judge.

These cross-appeals involve claims of copyright infringement under the Copyright Act of 1976, 17 U.S.C. Sec. 101, et seq. After a bench trial, judgment was entered in favor of plaintiffs, Gamma Audio & Video, Inc., Taing Tao, Meng I. Ung and Cheng K. Ung (collectively "Gamma"), on their claim that defendant, Ean-Chea, unlawfully distributed two videotapes containing four episodes of the Cambodian language version of Jade Fox, a popular Chinese language soap opera. In addition to obtaining a permanent injunction against Ean-Chea, Gamma was awarded $2,500 in statutory damages, as well as costs and attorney's fees. Both parties appeal from various aspects of the final judgment entered below and seek to recover appellate attorney's fees. We affirm the district court on all issues except one; we reverse the district court's finding that the four episodes of Jade Fox constitute one "work" for purposes of computing statutory damages. Because we hold that four works were infringed, we vacate the district court's judgment ordering Ean-Chea to pay Gamma $2,500 for the infringement of only one work, and remand for a redetermination of damages.

I. BACKGROUND

Television Broadcasts Ltd. ("TVB") is a producer of Chinese language television programs Through a series of four recorded licensing agreements, Gamma obtained three exclusive rights with respect to TVB's programs. Gamma obtained the right to dub TVB videotapes into Cambodian, to duplicate the dubbed versions, and to distribute by rental the Cambodian versions in thirty-seven states including Massachusetts. Gamma assigned all copyrights in the dubbed works to its licensor, Telefeature, Inc. At the time this action was commenced, neither Gamma nor anyone else had registered the copyrights in the derivative works created by Gamma.

                and videotapes of those programs.  The two programs at issue are Jade Fox and Hunters Prey.   They consist, respectively, of twenty-four and twenty one-hour episodes.  Both are Chinese language "Kung Fu"-type serials created by TVB in Hong Kong and originally broadcast there.  Although considerably more violent, the programs are of the same genre as American soap operas.  It is unclear whether the episodes were originally broadcast daily or weekly.  TVB holds a valid United States copyright in each of the programs
                

Shortly thereafter, Gamma entered into an exclusive licensing agreement with Taing Tao and his partners, the other individual plaintiffs. The agreement gave them the exclusive right to distribute, by rental to the public, the Cambodian language videotapes created by Gamma, in six states including Massachusetts. Ean-Chea owns and operates two video rental stores in Lowell, Massachusetts. The stores are named Overseas Video and Overseas Video II. Ean-Chea was the authorized distributor of the Cambodian versions of TVB's programs in Massachusetts for Gamma's predecessor.

On February 9, 1991, Chea Sokhoeun, acting on Gamma's behalf, went to Overseas Video and rented tapes four through eleven of the Cambodian Jade Fox series. Because each tape contained two episodes, the rented tapes covered episodes seven through twenty-two.

On June 13, 1991 Gamma commenced this action in the United States District Court for the District of Massachusetts. The complaint contained six causes of action. Gamma alleged violations of the Copyright Act of 1976, 17 U.S.C. Sec. 101, et seq. (the "Copyright Act") and the Lanham Act, 15 U.S.C. Sec. 1051 et seq. It also alleged four state-law claims: unfair competition, conversion, tortious interference with advantageous business relations and a constructive trust. Gamma alleged that Ean-Chea was behind a massive pirating scheme, and requested millions of dollars in relief.

Together with the complaint, Gamma submitted a one page document entitled "Motion For Seizure and Impoundment." By this motion, Gamma sought an ex parte order allowing it "to seize and impound any and all video tapes which are owned or under the control of the defendants and which are Cambodian language versions of the TVB programs, produced under the authority of plaintiff Gamma Audio & Video, Inc. including any and all such videotapes on the premises of the respective stores of defendants." Simultaneously, Gamma moved for a temporary restraining order and preliminary injunction enjoining Ean-Chea from further acts of infringement and from disposing any potentially "incriminating" materials such as business records and advertising materials. This motion also asked that Ean-Chea

deliver up ... to be impounded during the pendency of this action, all copies of the Gamma TVB Programs and all negatives, prints, matrices, master tapes, all business records relating to the sale and/or rental of video tapes of the Gamma TVB Programs, and all other materials including video recorders, automatic video tape rewinders, and television monitors (collectively "machines") used in the making of such infringing copies and all advertising and materials used in the promotion thereof.

Gamma was authorized to visit Ean-Chea's video stores, in the company of a U.S. Marshal or Deputy Sheriff, "for the purposes of inspection, inventorying, and photographing materials alleged to infringe," and to carry out the impoundment.

District Judge Mazzone granted the motion for seizure and impoundment and a T.R.O. and ordered Gamma to post a bond in the amount of $2,500. On June 24, 1991 In the meantime, on June 14, the individual plaintiffs and their attorneys, accompanied by a local deputy sheriff, went to Overseas Video to carry out the seizure and impoundment. The raid yielded nine videotapes containing episodes three through twenty of Hunters Prey, which were found in a cardboard box behind the front counter, three high-speed commercial videotape duplicating machines, and a notebook containing business records of Overseas Video that reflected the shipment to Montreal of an unauthorized copy of a program called Serpentine Romance.

District Judge Zobel, to whom the case was assigned, heard argument on Gamma's motion for a preliminary injunction and granted it.

Six months later, on December 13, 1991, Ean-Chea moved for an order compelling Gamma to return the impounded video equipment and tapes. On January 13, 1992, Judge Zobel granted the motion, to which no opposition had been submitted. On January 17, however, Gamma moved for reconsideration; and on February 26 Judge Zobel granted Gamma's motion for reconsideration and then denied Ean-Chea's motion for return of the impounded material.

On April 28, Gamma elected to recover statutory as opposed to actual damages, on its claim of copyright infringement. The next day it voluntarily dismissed counts two through six of its complaint, leaving only the copyright claim to be tried. By this time, Gamma realized that the copyrights in all but four episodes of Jade Fox, numbers thirteen through sixteen, as well as the copyright in Serpentine Romance had not been registered prior to the commencement of the lawsuit, and therefore could not support an action seeking statutory damages. These episodes therefore dropped out of the case, leaving only the four episodes of Jade Fox and the seized videotapes of Hunters Prey, as subjects of this litigation.

On May 11, 1992, at the close of a four-day bench trial, the trial judge stated her findings of fact. In sum, the court found that Gamma had established infringement with respect to episodes thirteen through sixteen of Jade Fox, but had failed to carry its burden of proving infringement with respect to the seized Hunters Prey tapes.

The court then requested additional submissions by counsel for both parties on two issues. First, whether Ean-Chea's unauthorized distribution of the Cambodian version of four episodes of Jade Fox could support a judgment for statutory damages. Second, whether each of the four infringed episodes entitled Gamma to a separate award of statutory damages. The court held that Ean-Chea had wilfully infringed upon Gamma's exclusive right to distribute the video images of the Chinese language version of Jade Fox in Massachusetts, and that Gamma could therefore recover statutory damages. It then found that Gamma could recover only one award of statutory damages for the infringement.

Meanwhile, on June 8, 1992, Ean-Chea had moved for the return of its high-speed duplicating machines and notebook, and for payment of the $2,500 bond posted by Gamma. On July 3 the court ordered that the materials be returned, but declined to order payment of the bond. ¹ On July 15 Gamma moved for costs under the Copyright Act, including attorney's fees, and on December 12, 1992, Ean-Chea cross-moved for attorney's fees.

In an opinion dated April 2, 1993, the district court ruled upon Gamma's motion for costs and attorney's fees, and Ean-Chea's cross-motion for attorney's fees. The court awarded Gamma its costs and determined that Gamma, as the "prevailing party," was eligible for an award of attorney's fees. It also found that Gamma was entitled to a fee award because Ean-Chea was a...