Sumner Co. v. Jordan
| Decision Date | 22 February 2023 |
| Docket Number | 3:21-cv-0127-HRH |
| Parties | SUMNER COMPANY, Plaintiff, v. NICK JORDAN, et al., Defendants. |
| Court | U.S. District Court — District of Alaska |
Defendant Nick Jordan moves for partial summary judgment.[1] This motion is opposed by plaintiff Sumner Company (“Sumner”).[2] Oral argument was not requested and is not deemed necessary.
In the spring of 2020, Jordan contacted Sumner about the possibility of Sumner building a house for him. Jordan was familiar with Sumner's work because Sumner had built a house for Jordan's parents. Jordan selected a Sumner design known as the Sanford. Jordan then provided ideas to Sumner of changes he would like to make to the plan, with a final modified plan being completed on April 11, 2020. Both the original Sanford plan and the modified Sanford plan were copyrighted by Sumner.
Sometime in late April/early May of 2020, some difficulties with the financial arrangements arose, and Jordan did not move forward with the Sumner build. Instead, Jordan's realtor set him up with another builder, co-defendants Alaska Custom Homebuilders, LLC; and Agim Delolli (collectively referred to herein as “Delolli”). Jordan gave Delolli a copy of the modified Sanford plan. Jordan testified that he “discussed with [Delolli] that this was kind of the generic layout that we were looking for.”[3] Jordan stated that Delolli “informed me that he would not build someone else's plan out of legal considerations of course, but also out of respect for that builder[.]”[4] Jordan stated that he and Delolli reached a “conclusion ... that we needed to change the existing plan by 25% in order to make it acceptable to use.”[5]
Delolli began constructing a house for Jordan in June 2020. The house was completed in February of 2021.
Sumner became aware of the Delolli plan for Jordan's house in April 2020. Mr. Sumner testified that another builder saw a copy of the Delolli plan “on the desk of a lumber salesman and immediately recognized it as our plan.”[6] The other builder took a photo of the Delolli plan and sent it to Mr. Sumner.[7]
On May 26, 2021, Sumner commenced this action. In its first amended complaint, Sumner asserts three claims against Jordan: 1) copyright infringement, 2) trade secret misappropriation, and 3) breach of an implied-in-fact contract.
Jordan now moves for summary judgment on all of plaintiff's claims asserted against him.
Summary judgment is appropriate when there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a). The initial burden is on the moving party to show that there is an absence of genuine issues of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986). If the moving party meets its initial burden, then the non-moving party must set forth specific facts showing that there is a genuine issue for trial. Anderson v. Liberty Lobby, Inc., 477 U.S 242, 247-48 (1986). In deciding a motion for summary judgment, the court views the evidence of the non-movant in the light most favorable to that party, and all justifiable inferences are also to be drawn in its favor. Id. at 255. “‘[T]he court's ultimate inquiry is to determine whether the ‘specific facts' set forth by the nonmoving party, coupled with undisputed background or contextual facts, are such that a rational or reasonable jury might return a verdict in its favor based on that evidence.'” Arandell Corp. v. Centerpoint Energy Services, Inc., 900 F.3d 623, 628-29 (9th Cir. 2018) (quoting T.W. Elec. Service, Inc. v. Pacific Elec. Contractors Ass'n, 809 F.2d 626, 631 (9th Cir. 1987)).
As an initial matter, Sumner concedes that Jordan is entitled to summary judgment on the trade secret misappropriation claim and the breach of the implied-in-fact contract claim.[8]Jordan's motion for summary judgment on these claims is granted.
Turning then to the copyright infringement claim, Sumner alleges that Jordan infringed its copyright for the modified Sanford plan. “‘To establish [copyright] infringement, two elements must be proven: (1) ownership of a valid copyright, and (2) copying of constituent elements of the work that are original.'” Gray v. Hudson, 28 F.4th 87, 96 (9th Cir. 2022) (quoting Feist Publications, Inc. v. Rural Telephone Service Co., 499 U.S. 340, 361 (1991)).
Jordan does not argue that Sumner cannot meet the first element, presumably because a copyright registration “‘constitute[s] prima facie evidence of the validity of the copyright and of the facts stated in the certificate.'” Desire, LLC v. Manna Textiles, Inc., 986 F.3d 1253, 1259 (9th Cir. 2021) (quoting 17 U.S.C. § 410(c)). As set out above, Sumner has a copyright registration for the modified Sanford plan.
Jordan does argue that Sumner cannot meet the second element of a copyright infringement claim, the copying element. “A plaintiff may establish copying through direct or circumstantial evidence.” Moement, Inc. v. Groomore, Inc., Case No. 2:22-cv-02871-MWF (JEMx), 2022 WL 18284405, at *7 (C.D. Cal. Nov. 29, 2022).
Jordan argues that this is a circumstantial evidence case. In such a case, the plaintiff “can establish copying by showing (1) that the defendant had access to the plaintiff's work and (2) that the two works are substantially similar.” Folkens v. Wyland Worldwide, LLC, 882 F.3d 768, 774 (9th Cir. 2018). “Summary judgment is ‘not highly favored' on questions of substantial similarity, but it is appropriate if” the court can “conclude that ‘no reasonable juror could find substantial similarity of ideas and expression.'” Id. (quoting Shaw v. Lindheim, 919 F.2d 1353, 1355 (9th Cir. 1990)).
There is no dispute that Jordan had access to the modified Sanford plan, and he may have even had a high degree of access, as Sumner contends. If Jordan had a high degree of access, Sumner argues that means that the “inverse ratio rule” applies here. Three Boys Music Corp. v. Bolton, 212 F.3d 477, 485 (9th Cir. 2000). Under this rule, the court “require[s] a lower standard of proof of substantial similarity when a high degree of access is shown.” Id. (citation omitted). However, the Ninth Circuit has abrogated the inverse ratio rule. See Skidmore as Trustee for Randy Craig Wolfe Trust v. Led Zeppelin, 952 F.3d 1051, 1069 (9th Cir. 2020) ([a]lthough we are cautious in overruling precedent-as we should be-the constellation of problems and inconsistencies in the application of the inverse ratio rule prompts us to abrogate the rule”). While Jordan may have had a high degree of access to the modified Sanford plan, that access has no bearing on the question of whether the Delolli plan was substantially similar to the modified Sanford plan.
Courts in the Ninth Circuit “use a two-part test to determine whether the defendant's work is substantially similar to the plaintiff's copyrighted work.” Id. at 1064. This two-part test has “extrinsic and intrinsic components.” Gray, 28 F.4th at 96 (citation omitted). But, “[o]n summary judgment,” the court “consider[s] only the extrinsic test....” Folkens, 882 F.3d at 774.
The extrinsic test requires a three-step analysis: (1) the plaintiff identifies similarities between the copyrighted work and the accused work; (2) of those similarities, the court disregards any that are based on unprotectable material or authorized use; and (3) the court must determine the scope of protection (“thick” or “thin”) to which the remainder is entitled “as a whole.”
Corbello v. Valli, 974 F.3d 965, 974 (9th Cir. 2020) (quoting Apple Computer, Inc. v. Microsoft Corp., 35 F.3d 1435, 1443 (9th Cir. 1994)).
Sumner has identified the following similarities between the modified Sanford plan and the Delolli plan:
[The] overall form and arrangement and composition of the spaces and elements in the design are identical. Including design notes and structural elements, room arrangement, roof form, garage door sizes, window sizes and locations, etc. Of particular note is the beam callouts and a structural beam that is unnecessary for the building of the house that is present in both designs.[9]
At his deposition, when asked to identify the similarities, Mr. Sumner testified that the “overall plan is the same or very similar” and that “if you put one plan next to the other, it's pretty obvious that ... one was based on the other.”[10] In other words, Sumner contends that the overall form and composition of the modified Sanford plan is substantially similar to the overall form and composition of the Delolli plan.
The second prong of the extrinsic test requires the court “to distinguish between the protected and unprotected material in a plaintiff's work.'” Skidmore, 952 F.3d at 1064 (quoting Swirsky v. Carey, 376 F.3d 841, 845 (9th Cir. 2004)). More specifically, the court must determine whether any of the similarities identified by the plaintiff are based on “unprotectable material or authorized use.” Corbello, 974 F.3d at 974. “Similarity only as to unprotected aspects of a work does not result in liability for copyright infringement.” Id. “So, ‘[t]o determine whether similarities result from unprotectable expression, analytic dissection of similarities may be performed.'” Id. (quoting Data E. USA, Inc. v. Epyx, Inc., 862 F.2d 204, 208 (9th Cir. 1988)). “An analytical dissection ... requires breaking the works down into their constituent elements, and comparing those elements for proof of copying as measured by ‘substantial similarity.'” Williams v. Gaye, 895 F.3d 1106, 1119 (9th Cir. 2018) (citation omitted). The court may rely on expert testimony at this stage of the analysis. Id.
“Well-recognized precepts guide the process of analytic dissection.” Apple...
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