The Sater Design Collection Inc v. Waccamaw Constr. Inc
| Decision Date | 14 February 2011 |
| Docket Number | Civil Action No.: 4:08-cv-4133-TLW-SVH |
| Court | U.S. District Court — District of South Carolina |
| Parties | The Sater Design Collection, Inc., Plaintiff, v. Waccamaw Construction, Inc., David Hostetler, Edith M. Neeves, Alexander Construction, Inc., Michael R. Alexander, Qwest Home Design, Inc., and Brad Odom, Defendants. |
On December 23, 2008, the plaintiff, Sater Design Collection, Inc. ("Sater" or "plaintiff), brought this civil action for copyright infringement of its "6804" architectural work. (Doc. # 1). Sater named Waccamaw Construction, Inc. ("Waccamaw"), David Hostetler ("Hostetler"), and Edith M. Neeves as defendants. (Doc. # 1). On February 2, 2009, Waccamaw and Hostetler filed an answer. (Doc. # 15). On April 17, 2009, Waccamaw and Hostetler filed an amended answer to the plaintiffs complaint, which included third-party claims against Alexander Construction, Inc. and Qwest Home Design, Inc. (Doc. #32). Sater filed an amended complaint on June 11, 2009, again alleging copyright infringement and naming Waccamaw Construction, Inc., David Hostetler, Edith M. Neeves, Alexander Construction, Inc., Michael R. Alexander, Qwest Home Design, Inc., and Brad Odom as defendants. (Doc. # 47). Sater alleges that the defendants infringed its copyrighted "6804" home plan by designing, constructing, and participating in the construction of a residence located at 840 Waterton Avenue, Myrtle Beach, South Carolina ("Waterton residence"). Waccamaw and Hostetler filed an answer to the amended complaint and cross-claimed against the other defendants.1 (Doc. # 58).
On April 12, 2010, Sater filed a motion for summary judgment. (Doc. # 98). Waccamaw and Hostetler filed a response on May 14, 2010 (Doc. # 106) to which Sater filed a reply. (Doc. # 107). On November 5, 2010, Waccamaw and Hostetler filed a motion in which they sought leave from the Court to replace the memorandum they had filed in response to Sater's summary judgment motion. (Doc. # 111). Sater filed a response in which it consented to the motion to amend/correct. (Doc. # 112). On December 2, 2010, this Court granted the motion to amend/correct (Doc. # 113), and Waccamaw and Hostetler filed their amended response to the motion for summary judgment on December 6, 2010. (Doc. # 114). Sater filed a reply on December 16, 2010. (Doc. # 116). Sater also filed three motions in limine on May 11, 2010. (Doc. # 105). A hearing on Sater's motion for summary judgment (Doc. # 98) and its motions in limine (Doc. # 105) was held via telephone on January 25, 2011. (Entry # 121). The Court has considered the applicable law, arguments of counsel, and memoranda submitted. These motions are now ripe for disposition.
The material facts in this case are not in dispute. Sater is an architectural design firm that creates and sells custom and pre-drawn building plans. One such building design is the 6804 plan, also known as the "Nicholas Park" design. Edith M. Neeves commissioned the construction of the Waterton residence for her and her husband, Mack Neeves, in 2006. Ms. Neeves originally consulted with Michael R. Alexander of Alexander Construction, Inc., who gave her and her husband the 6804 plan. According to Ms. Neeves, she believed that Alexander and Alexander Construction had legally acquired the plans and that Alexander Construction would be the contractor on the job. Subsequently, the 6804 plan was given to Brad Odom of Qwest Home Design, Inc. ("Qwest"). He made modifications to the plan based on the Neeves' requests. The plan was redrawn by Qwest with the requested modifications and labeled with the moniker "Qwest Home Design."
When it was time to build the Waterton residence, the Neeves' lender did not approve Alexander Construction to build the home. The Neeves turned to Waccamaw to build the residence, and the two parties entered into a contract. Hostetler, who is the sole owner and officer of Waccamaw Construction, Inc., was the signatory for Waccamaw Construction. Mr. and Mrs. Neeves gave Waccamaw the set of plans, which had the Qwest moniker on it ("Qwest plan" or "Qwest design"). There is no evidence showing that Waccamaw knew this plan was based on Sater's 6804 design. Waccamaw made no inquiry of Qwest regarding the origin of the plan. Waccamaw began construction of the residence based on this set of plans and made significant progress toward completion. However, Waccamaw did not complete the residence because the Neeves' lender ceased funding for the project. Sater later discovered the Waterton residence and filed this civil action.
Pursuant to Federal Rule of Civil Procedure 56(a), the moving party is entitled to summary judgment if the pleadings, responses to discovery, and the record reveal "there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." A genuine dispute of material fact exists "if the evidence is such that a reasonable jurycould return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). As the party seeking summary judgment, the plaintiff bears the initial responsibility of informing this Court of the basis for its motion. See Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). This requires that the plaintiff identify those portions of the "pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, " which it believes demonstrate the absence of a genuine dispute of material fact. Celotex, 477 U.S. at 323; see also Anderson, 477 U.S. at 249.
Though the plaintiff bears this initial responsibility, the defendants, as the nonmoving party, must then produce "specific facts showing that there is a genuine issue for trial." Fed R. Civ. P. 56(e); see Celotex, 477 U.S. at 324; Adickes v. S.H. Kress & Co., 398 U.S. 144, 159-61 (1970). In satisfying this burden, the defendants must offer more than a mere "scintilla of evidence" that a genuine dispute of material fact exists, Anderson, 477 U.S. at 252, or that there is "some metaphysical doubt" as to material facts. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986). Rather, the defendants must produce evidence on which a jury could reasonably find in their favor. See Matsushita, 475 U.S. at 587.
In considering the plaintiffs motion for summary judgment, this Court construes all facts and reasonable inferences in the light most favorable to the defendants as the nonmoving party. See Miltier v. Beorn, 896 F.2d 848, 852 (4th Cir. 1990). Summary judgment is proper "[w]here the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there [being] no genuine issue for trial." Matsushita, 475 U.S. at 587 (1986) (internal quotations omitted). Conversely, "[s]ummary judgment in favor of the party with the burden of persuasion... is inappropriate when the evidence is susceptible of different interpretations or inferences by the trier of fact." Hunt v. Cromartie, 526 U.S. 541, 553 (1999).
Sater alleges that Waccamaw and Hostetler infringed its copyright when they constructed the Waterton residence based on the 6804 design. "Architectural works" are included among the copyrightable works of authorship listed in the Copyright Act. See 17 U.S.C. § 102(a)(8). "To establish infringement, two elements must be proven: (1) ownership of a valid copyright, and (2) copying of constituent elements of the work that are original." Feist Publ'n, Inc. v. Rural Tel. Serv. Co., 499 U.S. 340, 361 (1991) ("Feist"). Each of these elements is, in turn, composed of various sub-parts.
There are several aspects to the element of ownership of a valid copyright. Most obvious is the question of whether the claimed copyright is valid. Also included within this element is the issue of originality. See 4-13 Melville B. Nimmer & David Nimmer, Nimmer on Copyright § 13.01[A]; see also Custom Dynamics, L.L.C. v. Radiantz LED Lighting, Inc., 535 F. Supp. 2d 542, 551 (E.D.N.C. 2008) (). "Originality is a constitutional requirement" that must exist in order for a work to qualify for copyright protection. Feist, 499 U.S. at 346; see U.S. Const. art. I, § 8, cl. 8. Congress made this explicit through 17 U.S.C. § 102(a), which provides that only "original works of authorship" may receive copyright protection.
The issuance of a certificate of registration by the United States Copyright Office has an important effect on the first element of a copyright infringement case. Under 17 U.S.C. § 410(c), a "certificate of a registration made before or within five years after first publication of the work shall constitute prima facie evidence of the validity of the copyright and of the facts stated in thecertificate." In applying the language of 17 U.S.C. § 410(c), The Fourth Circuit Court of Appeals has held that a certificate of copyright granted by the Copyright Office "is prima facie proof of the validity of plaintiffs copyright, including the existence of the elements of originality and fixation." M. Kramer Mfg. Co. v. Andrews, 783 F.2d 421, 434 (4th Cir. 1986). Furthermore, the Fourth Circuit has held that defendants who argue that a plaintiff's work is not copyrightable or lacks originality "have the burden of overcoming the presumption arising out of the granting of the copyright by the Copyright Office." Id; see also Universal Furniture Int'l, Inc. v. Collezione Europa USA, Inc., 618 F.3d 417, 428 (4th Cir. 2010) (); see generally 3-12 Nimmer on Copyright § 12.11[B] (...
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