Crown Awards, Inc. V. Discount Trophy & Co., Inc.

Crown Awards, Inc. v. Discount Trophy & Co. , Inc. U. S. Court of Appeals, Second Circuit 2009 U. S. App. Lexis 8540 (2009) Material Facts of the Case: Crown Awards is a retailer of awards and trophies sold through mail order catalogs and via the Internet. Crown designed and sold a diamond-shaped spinning trophy for which it owned two copyright registrations. Discount Trophy is one of Crown’s competitors, and it sold a trophy that was substantially similar to Crown’s Spin Trophy.

Crown requested that Discount discontinue the sale of the alleged copy, and when Discount refused, Crown filed suit in the Southern District of New York. Legal and Ethical Issues of the Case: In order to prevail on a claim of copyright infringement, a plaintiff must demonstrate both ownership of a valid copyright and infringement. "To establish infringement, the copyright owner must demonstrate that (1) the defendant has actually copied the plaintiff's work; and (2) the copying is illegal because a substantial similarity exists between the defendant's work and the protectable elements of plaintiff's. Actual copying may be proved directly or indirectly. Indirect evidence of copying includes proof that the defendants had access to the copyrighted work and similarities that are probative of copying between the works. " Because direct proof of access is often impossible to adduce, the law permits a plaintiff to carry his burden on this point through evidence that "an alleged infringer had a 'reasonable possibility'" of access to the original work.

Notably, “a court may infer that the alleged infringer had a reasonable possibility of access if the author sent the copyrighted work to a third party intermediary who has a close relationship with the infringer. " Access through third parties connected to both a plaintiff and a defendant may be sufficient to prove a defendant's access to a plaintiff's work. If a plaintiff cannot demonstrate a reasonable possibility of access, its infringement claim will fail absent proof of a "striking" similarity between the original and infringing works. We have held that where the works in question are 'so strikingly similar as to preclude the possibility of independent creation, copying may be proved without a showing of access. '" In some cases, the similarities between the plaintiff's and defendant's work are so extensive and striking as, without more, both to justify an inference of copying and to prove improper appropriation.

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If a plaintiff demonstrates actual copying through proof of a reasonable possibility of access and similarities probative of copying, however, it can prevail on its infringement claim by demonstrating that defendant's work is "substantially similar to that which is original in the plaintiff's expression. " With "inexact copies," this assessment proceeds by a comparison of the "total concept and feel of the contested works" as "instructed by common sense. The court must "analyze the two works closely to figure out in what respects, if any, they are similar, and then determine whether these similarities are due to protected aesthetic expressions original to the allegedly infringed work, or whether the similarity is to something in the original that is free for the taking. " Rules and Rationale Utilized by the Court to Resolve the Dispute: The district court found that Crown owned a valid copyright in its diamond-shaped spinning trophy and that Discount had access to Crown's design through its receipt of Crown's 2006 catalog and its monitoring of Crown's products.

The district court found, however, that Crown had failed to demonstrate that Xiamen Xihua Arts and Craft, the manufacturer of the allegedly infringing trophy, also had access to Crown's design because there was no record evidence (1) that Discount asked Xiamen to manufacture a trophy that looked like Crown's copyrighted trophy, or (2) that Xiamen ever received a Crown catalog.

While acknowledging that Crown's design could be viewed on the Internet after January of 2006, the district court noted that "there is no evidence in the record about the Internet habits" of Xiamen's principal. The district court nevertheless inferred access on the part of Xiamen from the "striking" similarity between the diamond-shaped spinning trophies sold by Crown and Discount. The court further found that the two products were "substantially" similar and shared the same "total concept and feel.   The court further found that "the timing of the order from Discount is . . . suggestive of copying," insofar as "the first Discount trophies were ordered from Lin in the mid-summer of 2006, which is perfect timing if you worked forward from the publication of the Crown catalogs in 2006 and assumed that Xiamen got to work on fabricating a knockoff shortly thereafter. The district court concluded: "I find independent creation to be not only unlikely but absolutely impossible to believe. " Accordingly, it ruled in favor of Crown on its claim of infringement.

Court’s Conclusion: The judgments of the district court were affirmed in favor of the plaintiff. Defendant Discount appeals from the judgments of the district court, entered after a two-day bench trial, awarding plaintiff Crown $22,845. 18 in damages and $165,528. 01 in attorney’s fees and costs for Discount’s infringement of Crown’s copyrights in the design of the Spin Trophy. Ethical Impact Analysis: The decision in the court’s ruling emphasizes that copyright infringement is not only illegal, but considered unethical in our society.

Copyrights exist for a reason, and particularly against with a registered copyright, deliberate copying of a product for the purpose of making a profit is something that should definitely be challenged and awarded to the copyright owner. The theft of intellectual property, as illustrated in this case, is sometimes difficult to prove, but it seemed clear in this situation that Discount blatantly copied Crown’s spinning trophy. I’m glad to have seen that Crown was awarded not only in damages, but also for their legal fees.

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