PIVOT POINT INTERN. v. CHARLENE PRODUCTS

• Decision Date: 10 March 1993
• Docket Number: No. 90 C 6933.,90 C 6933.
• Citation: 816 F. Supp. 1286
• Parties: PIVOT POINT INTERNATIONAL, INC., an Illinois corporation, Plaintiff, v. CHARLENE PRODUCTS, INC., an Illinois corporation, and Peter Yau, Defendants.
• Court: U.S. District Court — Northern District of Illinois

816 F. Supp. 1286

PIVOT POINT INTERNATIONAL, INC., an Illinois corporation, Plaintiff, v. CHARLENE PRODUCTS, INC., an Illinois corporation, and Peter Yau, Defendants.

No. 90 C 6933.

United States District Court, N.D. Illinois, E.D.

March 10, 1993.

Robert E. Browne, Mark D. Chapleau, Thomas C. McDonough, Jeannine M. Pisoni, Vedder, Price, Kaufman & Kammholz, Chicago, IL, for plaintiff.

Thomas J. Ring, Camille M. Miller, Potthast & Ring, Chicago, IL, for defendant.

MEMORANDUM OPINION AND ORDER

NORDBERG, District Judge.

This is a copyright dispute recently transferred to this Court. Plaintiff, Pivot Point International, Inc. ("Pivot Point") moves this Court to reconsider the decision of the previous district court, dated September 11, 1992 (the "September Order"), granting partial summary judgment to the defendants, Charlene Products, Inc. ("Charlene") and Peter Yau, Charlene's some officer. For the following reasons, the motion is granted and the September Order is vacated.

Pivot Point is an Illinois Corporation engaged in the business of hair styling, design education and the sale of products that relate to that business. One of Pivot Point's products is the "Mara Sculpture," a plastic female mannequin head. The Mara Sculpture is sold by Pivot Point as a teaching aid for beauty schools and salons. The Mara Sculpture was sculpted by an artist and then copyrighted as a bareheaded human head with no make-up or hair. The parties are in dispute over the uses of the Mara Sculpture. The plaintiffs claim that the Mara Sculpture is the equivalent of what might be called a hair stand. The sculptures are mass produced. Hair of various lengths and colors is implanted in the heads and then the entire product is sold to beauty shops for training hairstylists. The defendants claim that in addition to being a hairstand, the Mara Sculpture is used for displaying makeup, jewelry, and other ornamentation.

On November 29, 1990, Pivot Point filed a complaint against Charlene Products, Inc., an Illinois corporation in the business of hair styling and design education and the sale of products related to that business, ("CPI"), and Peter Yau, the President of CPI. Pivot Point alleges that CPI and Yau infringed upon Pivot Point's copyright on the Mara Sculpture by copying it and then marketing and displaying it as a slightly smaller mannequin head, commonly known as "Liza." Pivot Point's Complaint contains two counts. Count I alleges copyright infringement under 17 U.S.C. §§ 106 and 602. Count II alleges misappropriation. In the September Order, the previous district court granted defendants CPI and Yau summary judgment on Count I. Pivot Point moves for reconsideration of that decision.

A. The Timeliness of Service of Plaintiff's Motion

Plaintiffs initially moved for reconsideration pursuant to Rule 59(e) of the Federal Rules of Civil Procedure. Under that rule, a party seeking reconsideration of a final or appealable judgment has 10 days from the judgment in which to serve the opposing party.¹ Here plaintiff effected service within 11 days, missing proper service by less than one hour and fifteen minutes.² Having failed to properly serve the defendants pursuant to Rule 59(e), plaintiff now claims that its motion to reconsider is properly made pursuant to Rule 54(b). Under Rule 54(b) a court may reconsider any order not certified for appeal when the order in question did not resolve all the claims of all the parties in the action. Fed.R.Civ.P. 54(b).³

Motions to reconsider are governed by Rule 54(b) when such motions are filed after an interlocutory order and before the entry of a "final judgment." See Gridley v. Cleveland Pneumatic Co., 127 F.R.D. 102, 103 (M.D.Pa.1989). Motions to reconsider made after a final judgment or after a trial are governed by Rules 59(e) and 60(b). See id. The timeliness of plaintiffs motion to reconsider turns on whether the September 11, 1992 order by Judge Parsons granting partial summary judgment was a final judgment. If the order was final, the motion to reconsider is governed by Rule 59(e) and is thus untimely. In contrast, if the September 11 order was not a final judgment, then the motion is governed by Rule 54(b). Rule 54(b) motions to reconsider do not have express service or filing requirements. Such motions may be brought within a reasonable period after an interlocutory order during the pendency of the litigation. See A. Hollow Metal Warehouse, Inc. v. U.S. Fidelity and Guarantee Co., 700 F.Supp. 410, 411-12 (N.D.Ill.1988) (stating that a motion to reconsider an interlocutory order has no time constraints under the Federal Rules of Civil Procedure).

Judgment is defined for the purposes of the Federal Rules of Civil Procedure in Rule 54(a). That rule says:

"Judgment" as used in these rules includes a decree and any order from which an appeal lies. A judgment shall not contain a recital of pleadings, the report of a master, or the record of prior proceedings.

Fed.R.Civ.P. 54(a) (emphasis added). At issue is whether the September Order denying injunctive relief was appealable.

Here, Pivot Point sought relief in two counts, Count I of the complaint alleges copyright infringement, Count II of the complaint alleges misappropriation.⁴ The order granted summary judgment on the first of those counts. Defendants maintain that the partial summary judgment order is appealable under 28 U.S.C. § 1292(a). That section, in relevant part, says:

The courts of appeals shall have jurisdiction of appeals from:

(1) Interlocutory orders of the district courts of the United States, ... or the judges thereof, granting, continuing, modifying, refusing or dissolving injunctions, or refusing to dissolve or modify injunctions, ...

28 U.S.C. § 1292(a)(1). Although Judge Parson's refused to grant an injunction, section 1292(a)(1) does not apply to this case.

Before the Supreme Court's decision in Carson v. American Brands, Inc., 450 U.S. 79, 101 S.Ct. 993, 67 L.Ed.2d 59 (1981), almost any finding of summary judgment denying an injunction was appealable. See Brown v. Kerr-McGee Chemical Corp., 767 F.2d 1234, 1237 (7th Cir.1985). In Carson, the Supreme Court limited the scope of section 1292(a)(1) by requiring that an interlocutory summary judgment order have a "serious, perhaps irreparable, consequence" and that the order be "effectually challenged" only on immediate appeal. Carson, 450 U.S. at 84, 101 S.Ct. at 996; Brown v. KerrMcGee, 767 F.2d at 1238.

The Court of Appeals for the Seventh Circuit has endorsed two different applications of Carson. In Winterland Concessions Co. v. Trela, the Seventh Circuit read Carson to apply only to interlocutory orders "that did not reach the merits of appellants' claims or did not dispose of all requests for injunctive relief." Winterland Concessions Co. v. Trela, 735 F.2d 257, 260-61 (7th Cir.1984) (emphasis added); see also Brown v. KerrMcGee, 767 F.2d at 1238 (stating that the test in Winterland Concessions was the narrower, applying Carson less frequently, of two tests used in the Circuit courts). In contrast, in Southbend Consumers Club, Inc. v. United Consumers Club, Inc., 742 F.2d 392 (1984), the Seventh Circuit held that Carson is more broadly applicable and that it applies whether or not the district court addressed the merits of the appellant's claim.

Without deciding which test is appropriate, the Court, finding that the Carson case applies here under both rules, finds that the September Order is not yet appealable. Under the narrowest rule, stated in Winterland, a party seeking to appeal an interlocutory order denying an injunction must prove "serious, perhaps irreparable consequences" in either of two circumstances: (1) when the district court does not reach the merits of the claim, or (2) when the district court, having reached the merits of the claim, does not dispose of all requests for injunctive relief. The latter case applies here. Plaintiff made two claims under which the Court could grant injunctive relief. The September Order disposed of only one of these claims. Because plaintiffs still have a viable claim for injunctive relief, the September Order would be appealable only if doing so would avoid serious or irreparable harm. Since plaintiff did not move for summary judgment, it is apparent that plaintiff could have waited until trial to resolve this copyright dispute. If plaintiff had sought an appeal on the September Order, it would have been no better off, vis a vis the alleged ongoing infringement, than it is right now. Thus, the Court finds that an appeal could not prevent serious harm, even if such harm were currently occurring.

Accordingly, The Court finds that section 1292(a)(1) does not apply to this case. Therefore, the September Order was not appealable and thus not final. As a result, the motion to reconsider is governed by Rule 54(b). Service on the motion to reconsider was timely.

B. The Merits of the Motion to Reconsider

Pivot Point makes three arguments in its motion to reconsider. Each argument, however, turns on whether the previous district court properly applied the case of Carol Barnhart, Inc. v. Economy Cover Corp., 773 F.2d 411 (2d Cir.1985). This Court agrees with plaintiff that summary judgment is not warranted. In the opinion of the Court, the Carol Barnhart decision requires a different result than that ordered in September. At a minimum, the September Order makes an inappropriate finding of fact.

The applicable legal rules for this issue is neither difficult to state nor in dispute. The Copyright law protects pictorial, graphic, and sculptural works. 17 U.S.C. § 102(a)(5). Utilitarian articles fall within the scope of section 102(a)(5) when, and only so much as:

Such design incorporates pictorial, graphic, or sculptured features that can be identified separately from, and are capable of existing independently of, the utilitarian aspects of the article.

17 U.S.C. § 101. The separability rule may be satisfied...