Videotronics, Inc. v. Bend Electronics

• Decision Date: 26 April 1984
• Docket Number: CV-R-83-310-ECR.
• Parties: VIDEOTRONICS, INC., a Nevada corporation, Plaintiff, v. BEND ELECTRONICS, an Oregon corporation, Videotronics of Oregon, Inc., an Oregon corporation, and Video Horizons, Inc., an Oregon corporation, Defendants.
• Court: U.S. District Court — District of Nevada

586 F. Supp. 478

VIDEOTRONICS, INC., a Nevada corporation, Plaintiff, v. BEND ELECTRONICS, an Oregon corporation, Videotronics of Oregon, Inc., an Oregon corporation, and Video Horizons, Inc., an Oregon corporation, Defendants.

CV-R-83-310-ECR.

United States District Court, D. Nevada.

April 26, 1984.

Ken McKenna, Reno, Nev., for plaintiff.

William A. Birdwell, Portland, Or., and Gordon H. Depaoli by Suellen Fulstone, Reno, Nev., for defendants.

ORDER

EDWARD C. REED, Jr., District Judge.

BACKGROUND

Plaintiff seeks a preliminary injunction enjoining defendants from infringing upon computer programs allegedly protected by copyright. These programs are known as "Joker Poker" and "Keno Keypad" and are used to operate gambling and amusement games. The Joker Poker game is also known as Wild Poker, and defendants have manufactured (or caused to be manufactured), sold, and distributed an almost identical game (with a virtually identical computer program), known as "Triple Up Poker."

The Programs

Plaintiff manufactured a so-called "two board"¹ Joker Poker program from late 1981 until late February, 1983. The two-board version of Joker Poker was not programmed to display a copyright notice as required by 17 U.S.C. § 401. The preponderance of the evidence is that plaintiff sold 28 of these non-complying programs to defendants who in turn distributed them. There is no evidence that plaintiff has made any effort to have a copyright notice incorporated into the 28 two-board Joker Poker programs which were sold as a part of two-board games.

Early in March of 1982, plaintiff converted the two-board version of Joker Poker to a one-board version, and from that time on plaintiff manufactured and sold only one-board programs. A copyright notice was incorporated in all of the one-board Joker Poker programs. The notice is programmed to appear on the game's video screen on a random basis about once in every five to ten games played. In addition, it always appears when the game's reset button is pushed to put the game in operation, or to restart it after repairs. This reset button, however, would rarely if ever be used by the game-playing public. Except for the insertion of the copyright notice, no change was made in the Joker Poker program at the time that it was converted to a one-board system. The most credible evidence is that between 250 and 300 one-board Joker Poker games, programmed to display a copyright notice, were manufactured by plaintiff, and sold to defendants for distribution.

We also find that, in contrast to Joker Poker, the Keno Keypad program has always contained a copyright notice, and that that notice is programmed to be on display throughout the period that the game is in operation. Finally, since a perfect circle could not be created on a video screen, the copyright notice for both games consists of a "C" surrounded by a hexagonal figure.

The Present Dispute

Prior to the present dispute plaintiff manufactured Joker Poker and Keno Keypad games, among others, and defendants distributed them for plaintiff. The dispute arose over money owed to plaintiff by defendants and the failure of plaintiff to continue to supply games to defendants in accordance with a distribution contract then in effect between the parties. Since the onset of the present dispute, defendants have not paid plaintiff and plaintiff has discontinued the supply of the games to defendants. In addition, defendants copied plaintiff's computer programs for Joker Poker and Keno Keypad. Plaintiff did not give them permission to make these conversions. Defendants contracted with one Walt Fraley to manufacture the games (including the computer programs),² and they now sell the games directly.

Previous Litigation

In Videotronics, Inc., v. Bend Electronics, 564 F.Supp. 1471 (D.Nev.1983)³ ("Videotronics I"), plaintiff alleged that the defendants had misappropriated one of its video games⁴ but did not make a claim of copyright infringement. We denied relief, noting that "a property which is subject to protection under federal patent or copyright law cannot also obtain the benefit of protection under either state unfair competition or misappropriation law...." Id. at 1476.

Shortly after our decision in Videotronics I, plaintiff applied for federal copyright protection. However, the spaces on the Copyright Office's application forms in which plaintiff was to provide information relating to the "Date and Nation of First Publication," were left blank. See Exhs. 7 & 8 to Defendants' Exh. U.⁵

ANALYSIS

"Co-Authorship"

Defendants claim that through contributions of their employees, they are co-authors or co-creators of the programs in question, or that their creation was a joint work of plaintiff and defendants. There is no credible evidence to support these claims. Defendants simply copied plaintiff's programs and are using them for their own benefit and profit. The programs in question were created by and are the property of plaintiff. Nor is there credible evidence of a joint enterprise between plaintiff and defendants which resulted in the creation of the subject programs. Finally, defendants did not adduce any credible evidence to support their claim of estoppel.

Adequacy of Copyright Notice

The next issue to be addressed by the Court is whether the programs contain the required copyright notice.

Form of Notice

The copyright notices that are displayed in both the Keno Keypad and Joker Poker games are adequate in terms of form. The fact that the letter "C" is surrounded by a hexagonal shape rather than a circle does not make the notice any less recognizable. Defendants' attempt to place this hexagonal figure in the same category as a set of parentheses (i.e., a "(C)") — a symbol that they claim has been rejected by the Copyright Office — is without merit. It is obvious that the hexagonal figure completely surrounds the letter "C," while parentheses would only partially surround it. Furthermore, from a relatively short distance the hexagonal figure closely resembles a circle.

Frequency of Notice

Defendants contend that the copyright notice on the Joker Poker game appears too infrequently to be valid. The statute governing this issue is 17 U.S.C. § 401(c), which provides

The notice of copyright shall be affixed to the copies in such manner and location as to give reasonable notice of the claim of copyright. The Register of Copyrights shall prescribe by regulation, as examples, specific methods of affixation and positions of the notice on various types of works that will satisfy this requirement, but these specifications shall not be considered exhaustive.

On December 1, 1981, the Copyright Office issued a regulation specifying "examples of methods of affixation and positions of the copyright notice on various types of works that will satisfy the notice requirement of section 401(c) ...." 37 C.F.R. § 201.20(a). Pursuant to the statute, the examples are not intended to be exhaustive. Id. However,

in all cases dealt with in this section, the acceptability of a notice depends upon its being permanently legible to an ordinary user of the work under normal conditions of use, and affixed to the copies in such manner and position that, when affixed, it is not concealed from view upon reasonable examination.

Id. 201.20(c).

In the present case, plaintiff's work "cannot ordinarily be visually perceived except with the aid of a machine or device." Id. § 201.20(g). For such work, the Copyright Office offers these examples of "acceptable methods of affixation and position of notice":

— A notice that is displayed at the user's terminal at sign on;

— A notice that is continuously on terminal display;

Id.

Section 401(c) and its accompanying regulation have significantly liberalized the standards by which adequate affixation and positioning of notice is judged. As such, they require a greater effort on the part of one "who is looking for the truth and who desires to avoid infringement."⁶ However, the standards have not been relaxed so far as to permit approval of Joker Poker's copyright notice, which appears on a random and infrequent basis.⁷ Such an appearance does not meet the requirement of permanent legibility to "an ordinary user of the work under normal conditions of use."⁸ Likewise, the fact that the notice is displayed when the reset button is pushed does not provide adequate notice, since this means of display is in effect "concealed" from the view of those who do not have access to the reset button — a group which would include most members of the public.⁹ 37 C.F.R. § 201.20(c).

Are the Omissions Excused?

Plaintiff's failure to incorporate an adequate copyright notice in the Joker Poker program does not invalidate its copyright if:

(1) the notice has been omitted from no more than a relatively small number of copies or phonorecords distributed to the public; or

(2) registration for the work has been made before or is made within five years after the publication without notice, and a reasonable effort is made to add notice to all copies or phonorecords that are distributed to the public in the United States after the omission has been discovered.

17 U.S.C. § 405(a).

Since we have found that the copyright notice that was eventually incorporated into the single-board Joker Poker program is inadequate, we are forced to conclude that more than a "relatively small number of copies" of the Joker Poker game lack the required notice. Therefore, plaintiff cannot claim protection under § 405(a)(1).

Section 405(a)(2) excuses the omission of a copyright notice if a "reasonable effort" is made to add it. Plaintiff admits that no effort was made to add notice to the double-board Joker Poker programs. Mr. Kent, an employee of plaintiff, testified that at the time it was learned that a copyright notice should be added, a conversion from the double-board version to a single version was scheduled, and that it was decided that it would be cheaper to...