Creations Unlimited, Inc. v. McCain

REVISED May 21, 1997
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 95-60408
CREATIONS UNLIMITED, INC. and
TINA SARTIN,
Plaintiffs-Appellants,
versus
ROBERT and WANDA MCCAIN,
Defendants-Appellees.
Appeal from the United States District Court
For the Southern District of Mississippi
Consolidated with:
No. 95-60501
CREATIONS UNLIMITED, INC. and
TINA SARTIN,
Plaintiffs-Appellees,
versus
ROBERT and WANDA MCCAIN,
Defendants-Appellants.
Appeal from the United States District Court
For the Southern District of Mississippi
May 2, 1997
Before GARWOOD, WIENER, and DeMOSS, Circuit Judges:
PER CURIAM:
Initial Plaintiffs-Appellants Creations Unlimited, Inc., and
one of its principals, Tina Sartin (collectively, Creations),
appeal from the district court’s grant of summary judgment
dismissing Creations’ copyright infringement action. Consolidated
with Creations’ appeal is the subsequent appeal of initial
Defendants-Appellees Robert and Wanda McCain (the McCains), who
complain of the district court’s denial of their motion for
attorneys’ fees. In both instances, we affirm.
I
FACTS AND PROCEEDINGS
Creations is in the business of designing artwork and then
printing that artwork on tee-shirts which are sold to the public at
craft fairs and festivals. In 1992 and 1993, Creations registered
the copyrights1 to a number of black and white line drawings, seven
of which they now claim were infringed by the McCains. Two are
drawings of watermelon slices bordered by geometric shapes; a third
is a drawing of three cotton bolls; a fourth is a stylized drawing
of a fish; a fifth is a stylized drawing of assorted fruit within
an outline of a rectangle with geometric shapes below; a sixth is
1
On May 18, 1992, Creations obtained copyright registration
No. 27093 for “ARTWORK” under the title of “Creations Unlimited
#1.” On October 6, 1993, Creations obtained copyright registration
No. 267749 for additional “ARTWORK” under the title of “Creations
Unlimited #3.”
a drawing of three hot air balloons on a rectangular background
with geometric shapes below; and a seventh is a drawing of three
magnolia blossoms.
During the spring of 1992, the McCains began to sell tee-
shirts at festivals and craft shows where Creations marketed its
shirts. According to Creations, many of the McCains’ tee-shirts
bore designs modeled on those copyrighted by Creations. The next
spring, Creations wrote to the McCains, stating that they were
infringing Creations’ copyrights and demanding that the McCains
cease and desist selling tee-shirts that copied Creations’ designs.
When the McCains continued to market the offending tee-shirts,
Creations sued for copyright infringement under 17 U.S.C. § 501(b).
The district court granted summary judgment in favor of the
McCains, dismissing Creations’ infringement claims. The court
stated that it had compared Creations’ copyrighted black and white
line drawings side-by-side with the McCains’ tee-shirts and
concluded that the works were not substantially similar. Creations
timely filed a notice of appeal.
After Creations perfected its appeal, the McCains submitted a
motion to the district court seeking attorney’s fees pursuant to 17
U.S.C. § 505. The district court denied that motion, and the
McCains timely filed their own appeal. Both appeals have been
consolidated for our review.
II
ANALYSIS
A. CREATIONS’ COPYRIGHT INFRINGEMENT CLAIMS
Creations argues that the district court should not have
3
dismissed its copyright infringement claims because the record
contains sufficient direct evidence for a factfinder2 to conclude
that the McCains “copied,” i.e., used, Creations’ original designs
as models for their own designs. We perceive no error in the
district court’s dismissal of Creations’ claims. Not all “factual”
copying constitutes legally actionable copyright infringement.3 To
determine whether an instance of copying is legally actionable, a
side-by-side comparison must be made between the original and the
copy to determine whether a layman would view the two works as
“substantially similar.”4 Although that question typically should
be left to the factfinder, we conclude that in the present setting
the district court did not reversibly err by deciding that, as a
matter of law, the McCains’ tee-shirts differed from Creations’
line drawings in too many respects for a layman to conclude that
the works were substantially similar.
Neither did the district court err in comparing the McCains’
tee-shirts to Creations’ registered black and white line drawings,
rather than to the ultimate rendition of those line drawings on
Creations’ tee-shirts.5 Although registration with the copyright
2
Before the district court granted summary judgment, the
parties had agreed to submit the case to a bench trial.
3
See Szabo v. Errisson, 68 F.3d 940, 944 (5th Cir.
1995)(citing Engineering Dynamics, Inc. v. Structural Software,
Inc., 26 F.3d 1335, 1340 (5th Cir. 1994)).
4
See Engineering Dynamics, 26 F.3d at 1341.
5
See Novak v. National Broadcasting Co., 716 F. Supp. 745,
750-51 (S.D.N.Y. 1989)(comparing the defendant’s allegedly
infringing television comedy sketch to the registered script for
the plaintiff’s original version, because the plaintiff had failed
4
office is not a prerequisite to copyright protection, it is a
prerequisite to maintaining an infringement lawsuit.6 Thus, before
proceeding to court, a plaintiff must register each copyright that
he seeks to enforce.
On the other hand, registration with the copyright office is
a jurisdictional prerequisite to filing a copyright infringement
suit;7 therefore, to the extent Creations’ complaint included any
claims for infringement of its tee-shirts (distinct from its line
drawings), the district court had no jurisdiction. Accordingly,
the district court’s judgment must be modified to make it a
dismissal for want of subject matter jurisdiction (and hence
without prejudice to the merits) instead of a dismissal on the
merits -- but only insofar as that judgment pertains to claims for
infringement of the tee-shirts themselves. In all other respects,
including the dismissal on the merits of the claims for
infringement of the line drawings, we affirm the judgment of the
district court.
B. ATTORNEY’S FEES
1. Subject Matter Jurisdiction
Creations insisted that the district court lacked jurisdiction
to register a copy of its televised performance).
6
See, e.g., Chuck Blore & Don Richman Inc. v. 20/20 Adver.
Inc., 674 F. Supp. 671, 673 n.1 (D.Minn. 1987); Dodd v. Forth Smith
Special Sch. Dist. No. 100, 666 F. Supp. 1278, 1282 (W.D. Ark.
1987); Sargent v. American Greetings Corp., 588 F. Supp. 912, 925
(N.D. Ohio 1984).
7
See, e.g., M.G.B. Homes, Inc. v. Ameron Homes, Inc., 903
F.2d 1486, 1488 (11th Cir. 1990); Dielsi v. Falk, 916 F. Supp. 985,
994 n.7 (C.D. Cal. 1996).
5
to rule on the McCains’ motion for attorneys’ fees. Creations
grounded its argument in the fact that it already had filed a
notice of appeal from the summary dismissal of the underlying case,
thereby divesting the court of jurisdiction.
As a general rule, “a district court is divested of
jurisdiction upon the filing of the notice of appeal with respect
to any matters involved in the appeal.”8 The district court,
noting that we have yet to state explicitly whether the general
rule applies to a motion for attorneys fees, relied on an opinion
from the Tenth Circuit in concluding that it had jurisdiction.9
Today we join the Tenth Circuit and explicitly bless what has long
been the practice in this circuit: A district court has
jurisdiction to rule on a motion for ancillary attorneys’ fees even
after the filing of a notice of appeal with respect to the
underlying claims.
2. The Merits
We review the district court’s refusal to award attorneys’
fees and costs under an abuse of discretion standard.10 In Fogerty
v. Fantasy, Inc.,11 the Supreme Court articulated the standard to
8
Taylor v. Sterrett, 640 F.2d 663, 667 (5th Cir. 1981).
9
City of Chanute v. Williams Natural Gas Co., 955 F.2d 641,
658 (10th Cir.) (“The law is well settled [that] the district judge
retains jurisdiction over the issue of attorneys’ fees even though
an appeal on the merits of the case is pending.”), cert. denied,
506 U.S. 831, 113 S. Ct. 96, 121 L. Ed. 2d 57 (1992).
10
17 U.S.C. § 505; McGaughey v. Twentieth Century Fox Film
Corp., 12 F.3d 62, 65 (5th Cir. 1994).
11
510 U.S. 517, 114 S. Ct. 1023, 127 L. Ed. 2d 455 (1994).
6
be applied by a district court when considering a motion for
attorneys’ fees and costs in a copyright action. The Court
rejected the “dual standard,” use of which favors awards to
plaintiffs over awards to defendants; but the Court also repudiated
the “British Rule” for automatic recovery of attorney’s fees by the
prevailing party. The Supreme Court emphasized that “attorney’s
fees are to be awarded to prevailing parties only as a matter of
the court’s discretion.”12 The Court then cited with approval a
nonexclusive list of factors to guide the district court’s
discretion in awarding attorneys’ fees. Those factors, originally
listed by the Third Circuit in Lieb v. Topstone Industries, Inc.,13
include “frivolousness, motivation, objective unreasonableness
(both in the factual and in the legal components of the case) and
the need in particular circumstances to advance considerations of
compensation and deterrence.”14
We see no abuse of discretion in the district court’s
rejection of the McCains’ motion for attorneys’ fees. The court
properly applied the Lieb factors and also “considered the
arguments put forth by the [McCains] in their memorandum brief”
before denying the McCain’s motion, and the McCains’ have offered
nothing on appeal to compel a conclusion that the district court
abused its discretion in so ruling.
III
12
Id. at 469.
13
788 F.2d 151, 156 (3d Cir. 1986).
14
Lieb, 788 F.2d at 156.
7
CONCLUSION
For the reasons set forth above, we affirm the district
court’s summary dismissal of Creations’ copyright infringement
claims, modified to reflect that the dismissal is without prejudice
to any rights Creations might have against the McCains for
infringement of Creations’ completed tee-shirts. We also affirm
the district court’s denial of the McCains’ motion for attorneys’
fees.
MODIFIED in part, and AFFIRMED as modified.
8