Yurman Design, Inc. v. Paj, Inc.

• Citation: 93 F.Supp.2d 449
• Decision Date: 11 April 2000
• Docket Number: No. 98 CIV. 8697 RWS.,98 CIV. 8697 RWS.
• Parties: YURMAN DESIGN, INC., Plaintiff, v. PAJ, INC., d/b/a Art & Jewel, Defendant.
• Court: U.S. District Court — Southern District of New York

93 F.Supp.2d 449

YURMAN DESIGN, INC., Plaintiff, v. PAJ, INC., d/b/a Art & Jewel, Defendant.

No. 98 CIV. 8697 RWS.

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

April 11, 2000.

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Pryor Cashman Sherman & Flynn, New York, NY (Maxim H. Waldbaum, Xuan-Thao N. Nguyen, Lori D. Greendorfer, Of Counsel), for Plaintiff.

Strasburger & Price, Dallas, TX (Molly Buck Richard, Elizann Carroll, Of Counsel), Corbin & Gittes, New York, NY (Peter T. Cobrin, Oren J. Warshavsky, Clyde A. Shuman, Of Counsel), for Defendant.

OPINION

SWEET, District Judge.

On November 1, 1999, a jury found defendant PAJ, Inc. ("PAJ") liable for copyright infringement, trade dress infringement under the Lanham Act, and common law unfair competition. In separate motions, PAJ has moved (1) to set aside the jury's verdict concerning damages or, alternatively, for a new trial or remittitur of damages; and (2) for judgment as a matter of law on certain of plaintiff Yurman Design, Inc.'s ("Yurman Design") claims, or alternatively for a new trial. In its post-trial submissions, Yurman Design has also pressed, inter alia, for the issuance of a permanent injunction, the levying of pre-judgment interest, and the imposition of attorney's fees and enhanced damages. Yurman Design has also asserted its entitlement to an accounting of PAJ's profits in connection with its Lanham Act claim.

Also before the Court is Yurman Design's motion, submitted prior to trial, for sanctions in connection with PAJ's deposition of Sybil Yurman.

For the reasons set forth below, these motions are granted in part and denied in part.

Facts and Prior Proceedings

On December 8, 1998, Yurman Design filed its complaint in this action. A designer and manufacturer of fine jewelry, well known within design and retail circles for its signature "cable" creations, Yurman Design contended that PAJ had intentionally copied certain of its copyrighted jewelry pieces, and that other PAJ designs improperly infringed upon Yurman's distinctive "trade dress." The artistic force behind Yurman Design, David Yurman, is a well regarded designer of creative American jewelry.

After several bouts of contentious motion practice, Yurman's case was tried to a jury. Submitted to the jury were Yurman's claims of copyright infringement, trade dress infringement, and unfair competition under New York law.

On November 1, 1999, after seven days of trial, the jury rendered its verdict in this case, finding for Yurman on all counts. More specifically, the jury by special verdict annexed hereto as appendix A found that, with respect to Yurman's copyright claims: (1) Yurman was the owner of valid copyrights concerning the following jewelry designs: B4973 (Copyright Registration No. VA 643-194); B4977 (Copyright Registration No. VA 785-335); E4973 (Copyright Registration No. VA 785-334); E4395 (Copyright Registration No. VA 785-336); and B4809 (Copyright Registration No. VAu 254-365); (2) the following PAJ jewelry designs infringed upon Yurman's copyrighted designs: 65-0676-9700 (infringing upon B4973 and B4977); 68-4106-98 (infringing upon B4973 and B4977); 66-3584-9700 (infringing upon E4973); and 65-0679-1300 (infringing upon B4809), and that as to all of these infringing jewelry PAJ's infringement was willful.¹

With respect to Yurman's Lanham Act claims, the jury found (1) that Yurman's jewelry designs were "inherently distinctive"; (2) that Yurman Design had established that its trade dress had become distinctive through evidence of secondary meaning; (3) that PAJ had used Yurman Design's trade dress, and that such use was likely to cause confusion as to source; and (4) that Yurman had not abandoned its trade dress. More specifically, the jury found that the following PAJ jewelry designs infringed upon Yurman's trade dress: 65-0676-9700; 65-0679-1300; 66-3584-9700; 66-3520-9800; 68-4106-98; 65-0730-3500; 65-0729-1400; 65-0725-9800; 65-0678-2700; 65-0677-4500; 68-4107-13; 68-4108-98; 68-4596-19; 68-4491-16; 68-4492-15; 68-4493-14; 65-0689-9700; 66-3639-1300; 66-3638-1600; and 66-3521-1300.² As to all of these infringing jewelry pieces, the jury found that PAJ's infringement was willful, and that PAJ had not rebutted any presumption of customer confusion raised by that willful infringement.

Finally, because the jury's findings with respect to PAJ's willful infringement of Yurman Design's trade dress could also give rise to liability under New York's common law of unfair competition, the jury found PAJ liable for unfair competition.

With respect to damages, the jury awarded Yurman Design (1) statutory damages in the amount of $275,000 for PAJ's copyright infringement, and (2) $800,000 in punitive damages on Yurman Design's unfair competition claim. As to Yurman's Lanham Act claim, the jury awarded Yurman Design no damages.

After allowing ample opportunity for the parties to exchange briefing salvos, oral argument was heard on January 19, 2000, at which time the motions were deemed fully submitted.

Also considered in the present opinion is a request by Yurman for costs in connection with the deposition of Sybil Yurman. Submitted in letter form, and treated by the court as a motion, final resolution of this motion was delayed until after trial.

Discussion

The parties' lengthy briefing in this case provides some indication of the vigorous manner in which this action has been litigated.

In its post-trial motions, PAJ contends that it is entitled to judgment as a matter of law because (a) the works registered in Copyright Registration No. VAu 254-365 are not sufficiently related to qualify for single registration; (b) Yurman's copyrights were not infringed as a matter of law, given Yurman Design's failure to show "substantial similarity" between PAJ jewelry designs and the protectable elements of Yurman Design's pieces; (c) the "merger" doctrine precludes Yurman Design's recovery for copyright infringement, as allowing such recovery would impermissibly monopolize basic designs that are already in the public domain; (d) Yurman Design failed to articulate the trade dress for which it sought protection; and (e) Yurman Design's claimed trade dress cannot act as a source identifier. PAJ claims that, notwithstanding its entitlement to judgment as a matter of law, it is entitled to a new trial because (a) Yurman Design's copyrights are invalid for want of originality; (b) Yurman Design's trade dress is neither inherently distinctive nor has it acquired secondary meaning; (c) Yurman's use of side-by-side comparisons in presenting its trade dress claims to the jury was improper; and (d) the Court improperly admitted testimony from third party lay witnesses. PAJ also asserts its entitlement to a new trial because the jury's finding of willful infringement was against the weight of the evidence, and presses that Yurman Design's claim for unfair competition fails because PAJ failed to demonstrate actual confusion on the part of consumers.

With respect to damages, PAJ presses that (1) the jury's award of statutory damages on Yurman Design's copyright claims was improper, as such damages were not reasonably related to the harm visited upon Yurman Design; (2) the jury's award of punitive damages was inappropriate, given that the jury was not aware of any actual damages in this case; (3) that the jury's award of punitive damages must be reversed or reduced under the doctrine of preemption; and (4) that even if the punitive damages award is allowed to stand, it should be reduced given its excessive nature.

In addition to seeking a permanent injunction, Yurman Design has pressed its entitlement to (1) costs and attorney's fees under the Copyright Act, 17 U.S.C. § 505; (2) pre-judgment interest from the date of first infringement under the Copyright Act; (3) both an accounting of PAJ's profits and enhanced damages under the Lanham Act, 15 U.S.C. § 1117; (4) attorney's fees in connection with its trade dress claims under the Lanham Act; and (5) attorney's fees under New York's unfair competition law.

I. The Standards Governing PAJ's Post-Trial Motions

Pursuant to Rule 50, Fed.R.Civ. P., a party that has made a motion for judgment as a matter of law at trial may renew that motion after the jury returns a verdict. See Braun Inc. v. Optiva Corp., No. 98 Civ. 4070(RCC), 2000 WL 223840, at *1 (S.D.N.Y. Feb. 25, 2000). The standard for post-verdict judgment as a matter of law is analogous to the standard applicable to a judgment at the close of the opposition's case. See Continental Ore Co. v. Union Carbide & Carbon Corp., 370 U.S. 690, 696, 82 S.Ct. 1404, 8 L.Ed.2d 777 (1962); Diebold v. Moore McCormack Bulk Transport Lines, Inc., 805 F.2d 55, 57 (2d Cir.1986). Explaining the standard, the Court of Appeals has stated that the guiding principle is whether:

viewed in the light most favorable to the non-moving party, the evidence is such that, without weighing the credibility of the witnesses or otherwise considering the weight of the evidence, there can be but one conclusion as to the verdict that reasonable men could have reached.

Sir Speedy, Inc. v. L & P Graphics, Inc., 957 F.2d 1033, 1038-39 (2d Cir.1992) (citations omitted). A motion for judgment as a matter of law may therefore be granted only where either: "(1) there is such a complete absence of evidence supporting the verdict that the jury's finding could only have been the result of sheer surmise and conjecture; or (2) there is such an overwhelming amount of evidence in favor of the movant that reasonable and fair minded persons could not arrive at a verdict against it." Braun, 2000 WL 223840, at *1 (citing Samuels v. Air Transport Local 504, 992 F.2d 12, 14 (2d Cir.1993); Alvarez v. Abreau, 54 F.Supp.2d 335, 344 (S.D.N.Y.1999)). In considering whether a defendant is entitled to judgment as a matter of law, a court must consider all of the evidence in the light most favorable to the nonmovant, and cannot...