Whimsicality, Inc. v. Rubie's Costumes Co., Inc.

• Decision Date: 11 September 1989
• Docket Number: No. CV 89-1720.,CV 89-1720.
• Citation: 721 F. Supp. 1566
• Parties: WHIMSICALITY, INC., Plaintiff, v. RUBIE'S COSTUMES CO., INC., Defendant.
• Court: U.S. District Court — Eastern District of New York

721 F. Supp. 1566

WHIMSICALITY, INC., Plaintiff, v. RUBIE'S COSTUMES CO., INC., Defendant.

No. CV 89-1720.

United States District Court, E.D. New York.

September 11, 1989.

COPYRIGHT MATERIAL OMITTED

Virginia R. Richard and Pamela Bradford, Kane, Dalsimer, Sullivan, Kurucz, Eisele and Richard, New York City, for plaintiff.

Andrew S. Langsam, Levisohn, Lerner & Berger, New York City, for defendant.

DEARIE, District Judge.

This matter is before the Court on plaintiff's application for a preliminary injunction. Plaintiff alleges that defendant's production and distribution of certain children's Halloween costumes infringe plaintiff's copyrighted "soft sculpture" designs. Plaintiff also alleges unfair competition in violation of section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a), and state law.

At the close of oral argument, there appearing to be no dispute as to the material facts bearing on the copyright claim, the Court indicated that it would consolidate the instant application with the merits of the case. See Fed.R.Civ.P. 65(a)(2). The parties thereafter submitted extensive additional legal memoranda, affidavits and documentary evidence. Defendant also cross-moved to dismiss the complaint.

As described in greater detail below, the Court has resolved the question in this case in favor of the defendant, and on August 18, 1989, issued an order denying plaintiff's application for injunctive relief and granting defendant's motion to dismiss the copyright infringement claim. The Court also directed the parties to proceed with discovery on the unfair competition claims and to appear for a status conference on October 6, 1989 at 9:30 A.M. This opinion sets forth the basis of the Court's decision. See Fed.R.Civ.P. 52(a).

FACTS

A. The Parties

Plaintiff Whimsicality, Inc. ("Whimsicality"), a Vermont corporation, is a young and to date thriving enterprise. Founded in 1978 by Pierre Couture, its current president, Whimsicality designs, manufactures and sells various home craft items, such as children's apparel, quilts, adult toys and novelties. Whimsicality promotes its products as home-styled and "made in Vermont." Defendant Rubie's Costume Co., Inc. ("Rubie's"), a New York corporation, for over thirty five (35) years has manufactured, designed and marketed a wide range of theatre-related items, including numerous costumes for children and adults, as well as Halloween novelty items, masks, theatre props, and make-up kits. Rubie's gross sales totalled over $30 million in 1988.

B. The Allegedly Infringed Items

Since 1985, Whimsicality has distributed a line of items designed by Mr. Couture, which it has described to this Court and to the United States Copyright Office as "soft sculptures." Since 1985, when it introduced the Jack O'Lantern (its first soft sculpture design and one of the six items allegedly infringed by defendant), Whimsicality has enjoyed great success with its soft sculptures. At present, the line consists of 66 different soft sculpture designs. The other five allegedly infringed by defendant are Hippo Ballerina, Spider, Tyrannosaurus Rex ("T-Rex"), Bee and Penguin.

Whimsicality's soft sculpture designs have received substantial publicity¹ and are sold nationwide through numerous catalogs, at trade shows, and in several upscale department and specialty stores. Sales of Whimsicality's soft sculpture designs exceeded $1.4 million in 1987 and $2.2 million in 1988. Approximately 80% of the sales of Whimsicality's sculptures occur between the months of March and August, when retailers and wholesalers place their orders for costumes for the upcoming Halloween season.

Whimsicality has secured copyright registrations on each of the six designs.² On each application form submitted to the Copyright Office, Whimsicality identified the "nature of the work" it sought to register as "soft sculpture." Similarly, in its papers submitted to this Court, Whimsicality has consistently used only the term soft sculpture, describing Mr. Couture's designs as "original soft sculptures executed in fabric" which are "adaptable for use as costumes, wall hangings or interior decorations." All other written materials mentioning the articles, however, describe them only as costumes. These materials include the numerous catalogues displaying the subject designs, as well as newspaper and trade journal articles profiling the subject designs, and Whimsicality's own promotional literature and order and price sheets.

C. The Alleged Infringement

During the 1989 National Halloween Show in Chicago, representatives of Whimsicality first discovered what they believed were infringing "knock-off" Halloween costumes — i.e., lower priced, lower quality imitations — of Whimsicality's soft sculpture designs being displayed and offered for sale by Rubie's. Rubie's also displayed and offered for sale the allegedly infringing knock-offs in its fall 1989 catalog. Immediately thereafter Whimsicality's counsel wrote Mr. Marc Beige, president of Rubie's, asserting Whimsicality's copyrights and demanding that Rubie's cease and desist marketing the knock-offs. Rubie's refused, arguing, as it continues to argue to this Court, that Whimsicality's designs are not properly copyrightable.³

DISCUSSION

I. The Copyright Infringement Claim

A prima facie case of copyright infringement is established by proof of (i) ownership of a valid copyright and (ii) copying by the alleged infringer. Eckes v. Card Prices Update, 736 F.2d 859, 861 (2d Cir. 1984); Zambito v. Paramount Pictures Corp., 613 F.Supp. 1107, 1108, n. 1 (E.D.N. Y.), aff'd 788 F.2d 2 (2d Cir.1985). See also 3 M. Nimmer, On Copyright, § 13.01 (1987).

A. Validity of Whimsicality's Copyrights

1. Introduction

Whimsicality's ownership of a copyright registration for each of the six designs at issue is prima facie evidence of the validity of each copyright and the facts stated in the certificates, including ownership. 17 U.S.C. § 410(c). The presumption of section 410(c), however, may be rebutted. If a copyright claimant failed to disclose fully the nature of its work to the Copyright Office, or if the Copyright Office otherwise lacked a full and fair opportunity to pass upon the question of the work's copyrightability, the copyright certificate's validity may be questioned. Past Pluto Productions Corp. v. Dana, 627 F.Supp. 1435, 1440 & n. 5 (S.D.N.Y.1986).

If the claimant's incomplete disclosure was in fact calculated to deceive the Copyright Office, a Court may refuse to enforce the certificate. As one court has stated,

the knowing failure to advise the Copyright Office of facts which might have occasioned a rejection of the application constitutes reason for holding the registration invalid and thus incapable of supporting an infringement action ..., or denying enforcement on the ground of unclean hands.

Russ Berrie & Co., Inc. v. Jerry Elsner Co., Inc., 482 F.Supp. 980, 988 (S.D.N.Y. 1980), cited with approval in Eckes v. Card Prices Update, 736 F.2d at 861-862. See also Sandwiches, Inc. v. Wendy's International, Inc., 654 F.Supp. 1066, 1071 (E.D.Wis.), appeal dismissed, 822 F.2d 707 (7th Cir.1987).

Rubie's argues that the copyright registrations in this case are invalid because what Whimsicality identifies to this Court and the Copyright Office as soft sculptures are nothing more than costumes, and therefore intrinsically utilitarian articles which are not copyrightable. Rubie's argues that Whimsicality defrauded the Copyright Office, having secured copyright registrations only because it misidentified the works to the Copyright Office as soft sculptures.⁴ Whimsicality's counsel conceded at oral argument that had Whimsicality identified its works as costumes, the Copyright Office would probably have rejected its applications. Whimsicality insists, however, that it has not defrauded the Copyright Office, maintaining that its designs are indeed soft sculptures which are simply adaptable and popular as costumes.

Although the parties disagree as to the proper classification of the articles in question, it is uncontested that in every single piece of promotional literature, Whimsicality describes these very same items only and always as costumes. The uncontroverted evidence also shows that 80% of the sales of the soft sculptures are attributable to demands for Halloween costumes. Thus, it is clear on this record that Whimsicality considers the items to be costumes, promotes them as costumes, and profits principally because consumers purchase them as costumes. Moreover, this Court cannot ignore the fact that the Copyright Office has rejected applications for copyright submitted by Rubie's for one of the allegedly infringing costumes (the Bee), as well as other Rubie's costumes in the past, on the ground that costumes are "wearing apparel" and thus not copyrightable.

In short, the evidence strongly suggests that Whimsicality has not been as forthright with the Copyright Office as it could have been, Its obviously calculated use of the term "soft sculpture," however, does not in this Court's view reach the level of dissembling that would constitute a fraud on the Copyright Office and without more preclude the present infringement claims. Possessed of at least an understandable bias about the uniqueness of its creations, Whimsicality could arguably justify describing them to the Copyright Office as something other than just costumes.

Indeed, the issue of copyright law presented in this case is a difficult one and has understandably sparked a war of words in which both parties have embraced certain nomenclature to press their respective points. Indeed, notwithstanding the abundance of tests and the masterful articulation of them by courts and the Copyright Office, reasonable persons may disagree about the copyrightability of costumes. See National Theme Productions, Inc. v. Jerry B. Beck, Inc., 696 F.Supp. 1348 (S.D.Cal.1988), discussed in detail infra at 1575. The Court therefore...