Carol Wilson Fine Arts, Inc. v. Qian, No. 3:2014cv00587 - Document 39 (D. Or. 2014)

Court Description: OPINION AND ORDER: Plaintiff's first motion for summary judgment regarding its declaratory judgment claim 9 is GRANTED. Plaintiff's second motion for summary judgment concerning its copyright infringement claim 15 is DENIED. Defendant's cross-motion for summary judgment 18 is also DENIED. Plaintiff's requests for oral argument are DENIED as unnecessary. The Court orders the parties to renew their settlement negotiations with a United States Magistrate or Di strict Court Judge. Within 60 days of the date of this opinion, the parties must provide a joint status report regarding their settlement efforts. If necessary, the Court will then set a status conference to discuss further management of this case. See formal Opinion and Order. Copy of Opinion and Order sent to Pro Se Defendant. Signed on 12/3/2014 by Chief Judge Ann L. Aiken. (rh)

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Carol Wilson Fine Arts, Inc. v. Qian Doc. 39 IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF OREGON CAROL WILSON FINE ARTS, INC., an Oregon corporation, Case No. 3:14-cv-00587-AA OPINION AND ORDER Plaintiff, v. ZIFEN QIAN, an individual, Defendant. Stephen J. Joncus Norman A. Sfeir Klarquist Sparkman, LLP 121 S.W. Salmon Street, Suite 1600 Portland, Oregon 97204 Attorneys for plaintiff Zifen Qian 2811 Beacon Hill Drive West Linn, Oregon 97068 Pro se defendant Page 1 - OPINION AND ORDER Dockets.Justia.com AIKEN, Chief Judge: Plaintiff Carol motions for Wilson summary Fine Arts, judgment, the Inc. filed first two pertaining partial to its declaratory judgment claim and the second relating to its copyright infringement claim, pursuant to Fed. R. Civ. R. 56(a). Defendant Zifen Qian cross-moved for summary judgment. For the reasons set forth below, plaintiff's first motion is granted and the parties' remaining motions are denied. BACKGROUND Plaintiff designing, is an marketing, Oregon corporation in the business of and selling stationary and greeting cards that incorporate original paintings and illustrations created by its in-house artists or independent contractors. In 1992, plaintiff hired defendant and the parties entered into a written employment agreement. Defendant's initial job title was "Artist," although he was later promoted to "Senior Artist." In September 2013, plaintiff terminated defendant's employment, at which time the parties executed a severance agreement. During the course of his 21 years of employment, created numerous original plaintiff's products. consist of 21 artworks The designs different floral at that issue were in the defendant utilized in case at bar watercolor paintings ("Works"), sixteen of which are registered to plaintiff with the United States Page 2 - OPINION AND ORDER Copyright office. 1 After his employment ceased, defendant began displaying the Works on his personal website. Plaintiff became aware of defendant's actions in January 2014. In February 2014, plaintiff's counsel sent defendant a cease-anddesist letter, amicably. expressing Defendant a responded desire to resolve immediately, this refusing dispute to remove images of the Works from his website. In March 2014, plaintiff sent defendant another letter, providing additional authorities and again requesting that defendant stop engaging in any conduct that infringed on plaintiff's copyrights. Later that month, defendant notified plaintiff that he owned rights to the Works and therefore did have to curtail his usage now or in the future. On April 9, 2014, plaintiff filed a complaint in this Court, alleging claims infringement. for As relief, declaratory judgment and copyright plaintiff seeks a declaration that the Works were "made for hire" under the Copyright Act, a Court order permanently enjoining future infringement and requiring the return of any original Works in defendant's possession, statutory damages in the minimum amount of $750 per copyrighted work, and impoundment of the infringing copies. On June 27, 2014, plaintiff moved for summary judgment on its declaratory judgment claim. 2 On August 7, 1 The five uncopyrighted Works "were not used in products, and therefore were not registered." First Spector Decl. 6. 2 On July 21, 2014, defendant filed a surreply to plaintiff's first partial motion for summary judgment without Page 3 - OPINION AND ORDER 2014, plaintiff moved for infringement claim. summary judgment disputed Works. summary judgment as to its copyright That same day, on the basis Accordingly, defendant filed a motion for that he defendant owns copyrights requests a in Court the order indicating that he "owns copyrights of all such paintings" and requiring plaintiff to "withdraw immediately its unlawful registrations of copyrights," as well as "[a]n award of One Million Dollars ($1,000,000)." Def.'s Cross-Mot. Summ. J. 6-7. 3 On September 24, 2014, the parties tried unsuccessfully, via judicial settlement, to resolve their dispute. On September 26, 2014, defendant filed a supplemental brief, without leave from the Court, in which he reiterated his previous arguments and requested an additional $5,000,000 in damages as "unpaid compensation from the sales of [his] paintings published on [plaintiff's] greeting cards and other paper publications during the 21 years." Def.'s Supplemental Br. 2. STANDARD Summary judgment is appropriate if the pleadings, depositions, affidavits, answers to interrogatories, and admissions on file, if obtaining leave from the Court. Ordinarily, the Court would disregard this document. See LR 7-1(e) (3). Nevertheless, in order to provide the most complete review of this dispute, and in light of his prose status, the Court considers defendant's surreply, especially because it does not alter the outcome of this case. 3 Defendant did not numeralize his motion or briefs, such that the Court refers to the page numbers assigned in the docket when citing thereto. Page 4 - OPINION AND ORDER any, show "that there is no genuine dispute as to any material fact and the [moving party] is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). Substantive law on an issue determines the materiality of a fact. T. W. Elec. Servs., Contractors Ass'n, 809 F.2d 626, 630 Inc. v. Pac. Elec. (9th Cir. 1987). Whether the evidence is such that a reasonable jury could return a verdict for the nonmoving party determines the authenticity of Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 a dispute. (1986). The moving party has the burden of establishing the absence of a genuine issue of material fact. U.S. 317, 323 (1986). Celotex Corp. v. Catrett, 477 If the moving party shows the absence of a genuine issue of material fact, the nonmoving party must go beyond the pleadings and identify facts which show a genuine issue for trial. Id. at 324. Special rules of construction apply when evaluating a summary judgment motion: (1) all reasonable doubts as to the existence of genuine issues of material fact moving party; and (2) all should be resolved against the inferences to be drawn from the underlying facts must be viewed in the light most favorable to the nonmoving party. T.W. Elec., 809 F.2d at 630. DISCUSSION Plaintiff argues that summary judgment is warranted because defendant created the Works as an employee and within the scope of his employment, and then publicly displayed them via his personal Page 5 - OPINION AND ORDER website. Conversely, defendant maintains that he owns the exclusive copyrights to the Works because: job duty in the written paintings (1) was not part of employment during the 21 agreement"; years [of and (2) his employment with plaintiff] were independently created without any other person's control and direction because those are representations of his own style, philosophy, spirit, emotion and philosophy," as evidenced by his and signature being published on [plaintiff's] greeting cards and other publications." Def.'s Cross-Mot. Summ. J. 1-3. I. Declaratory Judgement Claim Plaintiff's seeks a declaration that it is the sole owner of any copyrights to the Works. See 28 U.S.C. Copyright Act, §§ ownership vests initially in the author or authors of the work, which is generally the creator of the copyrighted work." U.S. Auto Parts Network, LLC, 692 F.3d 1009, 1015 quotations omitted) . An works made omitted). for 2201, 2202. Under the hire." (9th Cir. 2012) Inc. v. Parts Geek, (citation and internal exception" exists, however, Id. ( citation and internal the case of a work made for hire, quotations the employer or other person for whom the work was prepared is considered the author and, unless the parties have expressly agreed otherwise in a written instrument signed by them, owns all of the rights comprised in the copyright." 17 U.S.C. for hire" is defined, in relevant part, as Page 6 - OPINION AND ORDER § 201(b). made work prepared by an employee within the scope of his or her employment." 17 U.S.C. § 101. "The creator of a work made for hire does not have a legal or beneficial interest in the copyright and therefore does not have standing to sue for infringement." Mostowfi v. i2 Telecom Int'l, Inc., 269 Fed.Appx. 621, 623 (9th Cir. 2008) (citing Warren v. Fox Family Worldwide, Inc., 328 F.3d 1136, 1142-43 (9th Cir. 2003)). Generally, "'when one person engages another . a work of an artistic nature, contractual reservation of [and] the to produce in the absence of an express copyright in the artist, the presumption arises that the mutual intent of the parties is that the title to the copyright shall be in the person at whose instance and expense the work is done.'" Twentieth Century Fox Film Corp. v. Entm't Distrib., 429 F.3d 869, 877 548 U.S. Gertler, 919 352 (2006) (quoting F.2d 298, 300 (9th Cir. 2005), cert. denied, Lin-Brook (9th Cir. Builders 1965)). absence of an agreement to the contrary, As Hardware such, v. in the an employee's conduct falls within the scope of employment if: "'(a) it is of the kind he is employed to perform; (b) it occurs substantially within the authorized time and space limits; [and] least in part, by a purpose to serve the (c) it is actuated, at [employer].'" U.S. Auto Parts, 692 F.3d at 1015 (quoting Restatement (Second) of Agency§ 228)); see also Cmty. for Creative Non-Violence v. Reid, 730, 751-52 490 U.S. (1989). Concerning the first prong, Page 7 - OPINION AND ORDER despite his allegations to the contrary, the uncontroverted evidence of record demonstrates that defendant was plaintiff's employment employed greeting and to cards severance create and original artwork stationary. agreement define Notably, B, Ex. Although the at 1; see parties' also First employment Decl. contract does defendant's job title or specific duties, in the as the A, at 1; 3, Ex. Spector use both plaintiff "Employer" and defendant as the "Employee." Compl. Compl. for 5, not 8. define it does stipulate that "[t]he Employee agrees to perform the work desired by Employer in a workmanlike manner" and "shall, at all times, provide services to Employer under Employer's control and direction." Compl. Ex. A, at 1-2. Further, defendant recognizes he was paid an hourly wage to create original artwork for plaintiff's products and that his job title was "Artist" or "Senior Artist." First Spector Decl. Second Spector Decl. 7; Answer 31; see also Def.'s Resp. 4; to First Partial Mot. Summ. J. 2-3. As such, Gary Spector, plaintiff's President and Co- Founder, testified that defendant was "employed by [plaintiff] as a professional artist for the purpose of creating original paintings that could be used in [plaintiff's] products." 4 First Spector Decl. 1, 4; Second Spector Decl. 4 4, 7; see also Under these circumstances, the fact that some of the Works were signed by defendant is immaterial. The "made for hire" exception does not hinge on whether the artist signed or was given credit for the work, especially where, as here, the owner of the copyright prominently displays its copyright notice alongside the artist's signature on the product. See Second Spector Decl. Exs. 1-16. Page 8 - OPINION AND ORDER First Spector Decl. Exs. 3-12. Turning to the second prong, defendant created the Works within the authorized time and space limits of his employment with plaintiff. The employment agreement states that "Employer agrees to supply the Employee with all necessary material with which the Employer desires the Employee to work." Compl. Ex. A, at 1. Accordingly, plaintiff supplied defendant with an on-site office, which contained a computer, a desk, enabling him to do his work" and a drafting table; "tools such as "brushes, paper"; and other incidental materials, and other storage, "reference paint, and art including art flat files color corrected lighting, bookshelves, props, materials and books to inspire production equipment. First Spector Decl. new ideas," and 7, 10. Defendant was "not permitted to work for [plaintiff] from home" and "required to maintain regular hours in the office that matched the company's business hours." Id. at 1-2. In exchange, 7-8; see also First Spector Decl. Exs. defendant received an hourly rate for his services, occasional yearly bonuses and retirement contributions, health insurance benefits, and paid vacation and sick leave. First Spector Decl. 8-9; see also First Spector Decl. Exs. 1-2, 14; Compl. Ex. A, at 4. Finally, regarding the third prong, defendant's creation of the Works was actuated by a purpose to serve plaintiff's business of generating aesthetically-pleasing Page 9 - OPINION AND ORDER paper products featuring original artwork. In fact, that was the primary purpose defendant's employment with plaintiff. See First Spector Decl. Second Spector Decl. of 4; 4, 7. As a result, plaintiff had "control and direction" over defendant's designs and artistic creations. First Spector Decl. defendant's [his] 5-8; Compl. supervisors Ex. A., "were active at 1. Significantly, in reviewing and managing work so that the original art he created could be used in [plaintiff's] products." First Spector Decl. 6; First Spector Decl. Exs. 3-12. For instance, when asked by Spector for a "mockup" of a painting of roses, defendant replied "[h]ere is the side by side . I am painting the detailed one now, but if you want to change something, I have to start over." First Spector Decl. Ex. 6. Thus, no genuine issue of material fact exists as to whether the Works were "made for hire" within the meaning of the Copyright Act. Although defendant makes conclusory statements regarding his ownership of the Works or the types of tasks he was employed to perform, he failed to provide any evidence or cite to any precedent in support of these assertions and the parties did not execute a written agreement governing these matters. Resp. to First Partial Mot. Partial Mot. Summ. Summ. J.; See generally Def. 's Def. 's Sur reply to First J.; Def.'s Resp. to Second Partial Mot. Summ. J.; Def.'s Cross-Mot. Summ. J.; Def.'s Reply to Cross-Mot. Summ. J.; see also Van Dyke v. Lions Gate Entm't, Inc., 2013 WL 3878974m *3 (C.D.Cal. July 24, 2013) Page 10 - OPINION AND ORDER ("if Van Dyke were an employee at the time the Film was made, then absent an agreement to the contrary, his employer would be the owner of the copyright in the Film"); Hernandez v. 2003) Spacelabs Med. ("conclusory Inc., 343 F.3d 1107, unsupported allegations, 1116 by (9th Cir. facts, insufficient to survive a motion for summary judgment") are ( citation omitted) . In sum, the undisputed record establishes plaintiff owns copyrights in the Works because they were created by defendant during work hours, on plaintiff's premises and at its expense, under plaintiff's direction and control, and while being paid an hourly wage. Plaintiff's motion is granted and defendant's motion is denied as to this claim. II. Copyright Infringement Claim A prima facie case of copyright infringement consists of two elements: "(1) ownership of the copyright; and (2) infringementthat the defendant copied protected elements of the plaintiff's work." Three Boys Music Corp. v. Bolton, 212 F.3d 477, Cir. 2000), cert. denied, 531 U.S. 1126 (2001) 481 (9th (citations omitted). It is well-established that a certificate of copyright registration made within five years of publication entitles its holder to a presumption of valid copyright ownership. See 17 U.S.C. Micro Star v. Formgen, Inc., 154 F.3d 1107, I, plaintiff § 410 (c); 1109-10 (9th Cir. is owner 1998) . As discussed in section Page 11 - OPINION AND ORDER the of copyrights to the Works. This conclusion is further bolstered by the fact that plaintiff registered sixteen of the Works with the United States Copyright office within the requisite time frame. See Second Spector Decl. Houghton Mifflin 2, 5, 11-26; see also Alaska Stock, LLC v. Harcourt Publ' g, 747 F. 3d 67 3, 68 5 (9th Cir. 2014). Significantly, all sixteen registrations reflect that the Works were "made for hire." Second Spector Decl. Exs. 1-16. Nonetheless, the Court finds the record insufficient to make a summary judgment determination regarding plaintiff's copyright infringement claim. It is undisputed that defendant posted the Works on his website. Defendant, however, is not selling the Works over the internet or making them available for commercial purposes. Rather, defendant's webpage, arguments, as well as the content of his indicate that he is displaying non-scale images of the Works as part of his artist's portfolio or for academic purposes. See, e.g., Decl. Ex. Def.'s Cross-Mot. 17. Summ. J. 6; see also Second Spector Plaintiff has not cited to, and the Court is not aware of, any authority from within the Ninth Circuit establishing that displaying images in this manner violates the copyright owner's exclusive rights under the Copyright Act. See Pl.'s Mem. in Supp. of Second Partial Mot. Transfiguration Monastery, Summ. Inc. v. J. 5 Gregory, (citing Soc' y of Holy 689 F.3d 29, 55 (1st Cir. 2012)). In fact, although the parties' motions and briefs are silent concerning whether defendant's conduct constitutes fair use, Page 12 - OPINION AND ORDER the Copyright circumstances, Act contemplates v. Acuff-Rose Music, doctrine in certain limited a registered work may be used publicly by a non- owner without infringement. use that, thus 5 Inc., permits See 17 U.S.C. 510 U.S. and 569, requires § 107; see also Campbell 577 (1994) courts to (" [t]he fair avoid application of the copyright statute when, on occasion, rigid it would stifle the very creativity which that law is designed to foster") (citation and internal quotations and brackets omitted). Essentially, granting defendant's motion would preclude artists, even those producing work made for hire, from representing themselves as the creator of such work, even in a non-commercial or academic context. The Court is troubled by the implications of such a decision, especially given the potentially far-reaching consequences, the significance of the relief requested, the nature of defendant's utilization of the Works, and the fact that he is not represented by counsel, without further argument and evidence from the parties. See Blaisdell v. (9th Cir. 2013) Frappiea, 729 F.3d 1237, 1241 ("[c]ourts in this circuit have an obligation to give a liberal construction to the filings of pro se litigants . . . [t]his rule relieves prose litigants from the strict application of procedural rules and demands that courts not hold missing or 5 The Court is mindful of the fact that the defendant bears the burden of proof in regard to the fair use doctrine, but only after the plaintiff has met its initial burden of establishing a prima facie case of copyright infringement. Perfect 10, Inc. v. Amazon.com, Inc., 508 F.3d 1146, 1158-59 (9th Cir. 2007) Page 13 - OPINION AND ORDER inaccurate them") legal terminology or muddled draftsmanship against (citations omitted). Accordingly, the parties' motions are denied as to plaintiff's copyright infringement claim. CONCLUSION Plaintiff's first motion for summary judgment regarding its declaratory judgment claim (doc. 9) is GRANTED. Plaintiff's second motion for summary judgment concerning its copyright infringement claim (doc. judgment is DENIED. 15) (doc. 18) Defendant's cross-motion for summary is also DENIED. Plaintiff's requests for oral argument are DENIED as unnecessary. The Court orders the parties to renew their settlement negotiations with a United States Magistrate or District Court Judge. Within 60 days of the date of this opinion, the parties must provide a joint status report regarding their settlement efforts. If necessary, the Court will then set a status conference to discuss further management of this case. IT IS SO ORDERED. Dated ' ___ day of Ann Aiken United States District Judge Page 14 - OPINION AND ORDER

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