Olan Mills, Inc. v. Linn Photo Co.

• Decision Date: 10 October 1991
• Docket Number: No. C89-0004.,C89-0004.
• Citation: 795 F. Supp. 1423
• Parties: OLAN MILLS, INC. and Professional Photographers of America, Inc., Plaintiffs/Counterclaim Defendants, v. LINN PHOTO CO., Defendant/Counterclaim Plaintiff.
• Court: U.S. District Court — Northern District of Iowa

795 F. Supp. 1423

OLAN MILLS, INC. and Professional Photographers of America, Inc., Plaintiffs/Counterclaim Defendants, v. LINN PHOTO CO., Defendant/Counterclaim Plaintiff.

No. C89-0004.

United States District Court, N.D. Iowa, Cedar Rapids Division.

October 10, 1991.

COPYRIGHT MATERIAL OMITTED

James C. Nemmers, Cedar Rapids, Iowa, David Ladd, David E. Leibowitz, Thomas W. Kirby, and Bruce G. Joseph, Wiley, Rein & Fielding, Washington, D.C., for plaintiffs.

Richard M. Calkins, Des Moines, Iowa and Kelly R. Baier, Steven D. Nelson, Cedar Rapids, Iowa, for Linn Photo Co.

ORDER

HANSEN, District Judge.

This matter is before the court on defendant's resisted motion for summary judgment, filed November 7, 1990; plaintiffs' resisted motion to limit jury demand, filed February 4, 1991; plaintiffs' resisted cross-motion for partial summary judgment, filed February 4, 1991; defendant's resisted motion to strike certain matters filed by plaintiffs in connection with their resistance to motion for summary judgment, filed February 15, 1991; defendant's conditionally resisted motion for leave to file supplemental reply brief, filed May 29, 1991; and plaintiffs' cross-motion for leave to file sur-reply to supplemental reply brief, filed June 11, 1991. The motions for leave to file reply briefs will be granted.

Motion to Strike

Defendant asks the court to strike certain matters filed with plaintiffs' resistance to defendant's motion for summary judgment, filed February 4, 1991, specifically: (1) the partial transcript of the proceeding in Professional Photographers of America v. 1240 Camera Co.; (2) the document entitled "defendant's memorandum in opposition to plaintiffs' motion for summary judgment," filed in Olan Mills, Inc. v. Eckerd Drug of Texas, Inc.; and (3) plaintiffs' Local Rule 14(h) statement of uncontested facts.

Defendant requests the court to strike the first two documents on the basis that there is no verification as to the authenticity of these documents and that they, therefore, are not admissible. The court declines to strike these documents from the file. If the court decides to utilize these materials in the following discussion, the court will carefully consider the weight, if any, to be given them.

With respect to the plaintiffs' statement of uncontested facts, defendant argues that that statement differs materially from the stipulated facts included in the final pretrial order, filed March 8, 1991. The court will view the stipulated facts contained in the final pretrial order as uncontested. With respect to any other fact which one party asserts is uncontested, the court will determine if that fact is material and in dispute as is necessary for the resolution of the pending summary judgment motions.

Motions for Summary Judgment

1. Standard

A motion for summary judgment may be granted only if, after examining all of the evidence in the light most favorable to the nonmoving party, the court finds that no genuine issues of material fact exist and that the moving party is entitled to judgment as a matter of law. Kegel v. Runnels, 793 F.2d 924, 926 (8th Cir.1986). Once the movant has properly supported its motion, the nonmovant "may not rest upon the mere allegations or denials of its pleading, but ... must set forth specific facts showing that there is a genuine issue for trial." Fed.R.Civ.P. 56(e). "To preclude the entry of summary judgment, the nonmovant must show that, on an element essential to its case and on which it will bear the burden of proof at trial, there are genuine issues of material fact." Noll v. Petrovsky, 828 F.2d 461, 462 (8th Cir.1987) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986)). Although "direct proof is not required to create a jury question, ... to avoid summary judgment, `the facts and circumstances relied upon must attain the dignity of substantial evidence and must not be such as merely to create a suspicion.'" Metge v. Baehler, 762 F.2d 621, 625 (8th Cir.1985), cert. denied, 474 U.S. 1057, 106 S.Ct. 798, 88 L.Ed.2d 774 (1986) (quoting Impro Products, Inc. v. Herrick, 715 F.2d 1267, 1272 (8th Cir.1983), cert. denied, 465 U.S. 1026, 104 S.Ct. 1282, 79 L.Ed.2d 686 (1984)). In applying these standards, the court must give the nonmoving party the benefit of all reasonable inferences to be drawn from the evidence. Krause v. Perryman, 827 F.2d 346, 350 (8th Cir.1987).

The pending motions for summary judgment involve plaintiffs' claims of copyright infringement, see plaintiffs' complaints, filed February 16, 1988, and defendant's counterclaim for breach of indemnity or hold harmless agreement. See amended answer and counterclaims, filed March 12, 1991, at 26. The summary judgment motions do not involve defendant's counterclaims for combination and conspiracy, unlawful restraint of trade, unlawful restraint of competition, fraud, and abuse of process. See id. at 11-25.

2. Facts

The stipulated facts, from the final pretrial order, filed March 8, 1991, are generally as follows. Plaintiff Olan Mills, Inc. (Olan Mills) operates more than 1,000 portrait studios around the country. Plaintiff Professional Photographers of America, Inc. (PPA) is a professional society of photographers. Defendant Linn Photo Company (Linn Photo) is in the business of selling photographic equipment and supplies, developing print and slide film, and reproducing photographs. In mid-1986, David Phillips, Esq., general counsel for Olan Mills, informed Linn Photo that Olan Mills believed that Linn Photo was violating Olan Mills' copyrights. In 1987, Olan Mills took a number of photographs of Olan Mills' employees and their families. Olan Mills registered its copyright in the four photographs involved in this case with the United States Copyright Office. Those registration numbers are VA 282-385, VA 282-387, VA 282-388, and VA 282-389. In late 1987, David A. Leibowitz, Esq., an attorney for plaintiffs, hired a private investigator, Michael C. Williams of Williams Investigation and Security, Cedar Rapids, Iowa, to conduct an investigation for Olan Mills and PPA. Mr. Leibowitz forwarded five photographs, a memorandum entitled "General Instructions For Investigator," a "Sample In-Store Affidavit," and photocopies of affidavits prepared by an investigator in Florida to Mr. Williams. Each photograph had an Olan Mills' copyright notice on the front and back.

On December 29, 1987, Mr. Williams visited the Linn Photo store at 105 1st Avenue, S.E., Cedar Rapids, Iowa, and requested a 5" by 7" enlargement of the photo registered as VA 282-387. On January 9, 1988, Mr. Williams visited the Linn Photo store at 2405 Westdale Drive, S.W., Cedar Rapids, Iowa, and requested a 5" by 7" enlargement of the photo registered as VA 282-389. Also on January 9, 1988, Mr. Williams went to the Drug Town store located at 1440 32nd Street, N.E., Cedar Rapids, Iowa, and ordered an enlargement of the photo registered as VA 282-385. He also went to a Drug Town store located at 24 Wilson Avenue, S.W., Cedar Rapids, Iowa, and ordered an enlargement of the photo registered as VA 282-388. Drug Town forwards its photographic enlargement orders to Linn Photo for processing. Mr. Williams subsequently picked up and paid for the enlargements of each of these photos from the respective stores.

It is undisputed that with respect to the three photos submitted by Mr. Williams for enlargement on January 9, 1988, Mr. Williams signed a "Permission to Copy Agreement" which reads as follows:

THIS IS TO STATE THAT I AM THE OWNER OF THIS PHOTOGRAPH AND HAVE NOT GIVEN ANY ONE ELSE PERMISSION TO COPYRIGHT THIS PHOTOGRAPH. I AM SUBMITTING IT TO LINN PHOTO COMPANY FOR A COPY AT MY REQUEST. THIS COPY IS FOR MY PERSONAL USE, AND I AGREE TO HOLD HARMLESS, LINN PHOTO COMPANY OR ANY OF ITS AGENTS, FROM ANY LIABILITY ARISING FROM THE COPYING OF THIS PHOTOGRAPH.

It is disputed as to whether Mr. Williams signed a similar form with respect to the photograph submitted to Linn Photo on December 29, 1987. No copy of such a signed agreement has been found. However, the December 29, 1987 order envelope bears a code indicating that such an agreement was obtained. It is Linn Photo's practice to retain such agreements when obtained. The "Permission to Copy Agreement" was drafted by the president of Linn Photo, Robert Priborsky, in 1985. The Linn Photo forms were signed by Mr. Williams pursuant to plaintiffs' express written instructions.

The motions for summary judgment raise several issues. The court will address each in turn.

3. Does PPA Have Standing in This Matter?

On June 27, 1988, this court denied defendant Hy-Vee Foodstores, Inc.'s March 8, 1988 motion to dismiss plaintiff PPA.¹ The court concluded that PPA has associational standing to participate in this suit, reasoning as follows:

The requirements for associational standing have been clearly set forth by the Supreme Court.

An association has standing to bring suit on behalf of its members when: (a) its members would otherwise have standing to sue in their own right; (b) the interests it seeks to protect are germane to the organization's purpose; and (c) neither the claim asserted nor the relief requested requires the participation of individual members in the lawsuit.

Hunt v. Washington Apple Advertising Comm'n, 432 U.S. 333, 343 97 S.Ct. 2434, 2441, 53 L.Ed.2d 383 (1976). The court finds that the requirements set out in Apple have been met by plaintiff PPA. In short, PPA members who own the copyrights to their photographic works would have standing to sue in their own right; the interest PPA seeks to protect, the value of members' copyrights in photographic works, is germane to PPA's purpose, which presumably is to represent the best interests of its members; and PPA does not assert a claim or request relief which requires the participation in this lawsuit of PPA's individual members. Cases cited by the parties to the effect that only copyright owners or

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