Opinion
Case No. 1:03-CV-62TC
September 4, 2003
ORDER GRANTING LIFETIME PRODUCTS, INC.'S MOTION FOR PRELIMINARY INJUNCTION
Plaintiff Lifetime Products, Inc. ("Lifetime") brings this lawsuit against GSC Technology Corporation ("GSC") alleging, among other claims, patent and copyright infringement. Specifically, Lifetime alleges that GSC's "Enduro Personal Table" infringes three design patents — United States Patent Nos. D470,352, D469,994, and D469,996 (collectively, the "patents-in-suit") — that Lifetime has on its "Lifetime Personal Table." Lifetime also alleges that certain labels affixed to the Enduro Personal Table infringe Lifetime's copyrights on (1) the Lifetime Personal Table product label, including the label's text and photographic images; (2) Lifetime Personal Table warning labels; and (3) the Lifetime Personal Table setup drawing. Last, Lifetime brings causes of action for trade dress infringement, federal unfair competition, and state law unfair competition. The court's jurisdiction is proper under 28 U.S.C. § 1338(a) and (b) (2002), 28 U.S.C. § 1331, and 28 U.S.C. § 1332(a)(2).
This matter is before the court on Lifetime's motion for a preliminary injunction to enjoin the alleged infringement of United States Patent Nos. D470,352 (the "'352 patent") and D469,994 (the "'994 patent"). See Fed.R.Civ.P. 65. The parties presented evidence at a hearing on Lifetime's motion on July 14 and 21, 2003. For the reasons set forth below, Lifetime's motion is GRANTED.
DISCUSSION
An application for preliminary injunction predicated on copyright infringement follows the law of the regional circuit in which the district court sits. See United States v. One (1) 1979 Cadillac Coupe de Ville, 833 F.2d 994 (Fed. Cir. 1987) (stating that the Federal Circuit "ha[s] applied the law of the appropriate regional circuit in deciding such issues as the propriety of a preliminary injunction in a copyright infringement case").
"The decision to grant a preliminary injunction is within the discretion of the district court." Purdue Pharma L.P. v. Boehringer Ingelheim GMBH. 237 F.3d 1359, 1363 (Fed. Cir. 2001). "As the moving party, [Lifetime is] required to establish its right to a preliminary injunction in light of four factors: (1) a reasonable likelihood of success on the merits; (2) irreparable harm if the injunction were not granted; (3) the balance of the hardships and (4) the impact of the injunction on the public interest." Purdue Pharma. 237 F.3d at 1363 (internal quotations omitted); see also Amazon.com. Inc. v. Barnesandnoble.com. Inc., 239 F.3d 1343, 1350 (Fed. Cir. 2001). "These factors, taken individually, are not dispositive; rather, the district court must weigh and measure each factor against the other factors and against the form and magnitude of the relief requested." Amazon.com. 239 F.3d at 1350 (quoting Hybritech Inc. v. Abbott Labs., 849 F.2d 1446, 1451 (Fed. Cir. 1988)).
I. Has Lifetime Established a Likelihood of Success on the Merits on the Issues of Infringement and Validity of Its Patents?
In order to demonstrate a likelihood of success on the merits, Lifetime must show (1) that Lifetime will likely prove that the Enduro Personal Table infringes the `352 and `994 Patents, and (2) that Lifetime's infringement claim likely will withstand GSC's challenges to the validity and enforceability of these design patents. Amazon.com. 239 F.3d at 1350. "If [a defendant] raises a substantial question concerning either infringement or validity, i.e., asserts an infringement or invalidity defense that the patentee cannot prove `lacks substantial merit,' the preliminary injunction should not issue." Id. (quoting Genetech, Inc. v. Novo Nordisk. A/S. 108 F.3d 1361, 1364 (Fed. Cir. 1997)).
A. Claim Construction
Before addressing the issue of infringement, the court must construe the claims of Lifetime's design patents. For purposes of a preliminary injunction, the court may issue a preliminary interpretation of the claims and need not issue a conclusive interpretation of the claims.Sofamor Danek Group, Inc. v. Depuy-Motech, Inc., 74 F.3d 1216, 1221 (Fed. Cir. 1996). The interpretation here offered is preliminary in nature and not final.
The first step in claim interpretation of a design patent requires identification of the "points of novelty" of the claimed design, which are the novel design features that distinguish the claimed design from the prior art. See Winner Int'l Corp. v. Wolo Mfg. Corp., 905 F.2d 375, 376 (Fed. Cir. 1990). This typically is accomplished by comparing the claimed design to the prior art. Litton Sys., Inc. v. Whirlpool Corp., 728 F.2d 1423, 1444 (Fed. Cir. 1984), overruled in part on other grounds by Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763 (1992). The second step in claim interpretation of a design patent is to determine which of the points of novelty previously identified are ornamental and non-functional. See Oddzon Products, Inc. v. Just Toys, Inc., 122 F.3d 1396, 1404-05 (Fed. Cir. 1997).
The Federal Circuit has defined "prior art" as "actual or presumed public knowledge." Lamb-Weston, Inc. v. McCain Foods, Ltd., 78 F.3d 540, 548-49 (Fed. Cir. 1996).
A design of a useful article is deemed to be functional, that is, non-ornamental, only "when the appearance of the claimed design is dictated by the use or purpose of the article." L.A. Gear, Inc. v. Thorn McAn Shoe Co., 988 F.2d 1117, 1123 (Fed. Cir. 1993) (internal quotation omitted). "[T]he fact that the article of manufacture serves a function is a prerequisite of design patentability, not a defeat thereof." Hupp v. Siroflex of America, Inc., 122 F.3d 1456, 1460 (Fed. Cir. 1997). "When there are several ways to achieve the function of an article of manufacture, the design of the article is more likely to serve a primarily ornamental purpose." L.A. Gear. Inc., 988 F.2d at 1123.
1. The `352 Patent
a. Points of Novelty
As noted above, points of novelty are determined by comparing the claimed design to the prior art. Figures 1 through 15 of the `352 patent illustrate the appearance of the design claimed in the `352 patent. (See U.S. Design Patent No. D470,352 (issued Feb. 18, 2003), attached as Ex. A to Amended Compl.) The underside of the table top claimed in the `352 patent is shown in Fig. 3 of the `352 patent. The design features that Lifetime claims are novel are labeled in the drawing below:
The labels represent the following features: (1) the perimeter; (2) the adjustment channels; (3) gripping members with multiple fingers; (4) a channel perpendicular to the adjustment channels; (5) the fixed channel; (6) cavity 1; (7) cavity 2; (8) cavity 3; and (9) the raised area in cavity 1. GSC has not shown any of the features of Figure 3 to be known in the prior art. See 35 U.S.C. § 282 (providing that "[t]he burden of establishing invalidity of a patent or any claim thereof shall rest on the party asserting such invalidity"). Accordingly, all of the labeled features shown above represent points of novelty in the `352 design.
The `352 patent also shows a cutout, or port, in the sidewall on one end of the table. This port is illustrated in Figures 2 and 4 of the `352 patent, which are reproduced below:
GSC likewise has not shown the port feature to be present in the prior art, and the court finds that the port feature is a point of novelty of the `352 design.
The appearance of the upper surface of the `352 table top is generally rectangular, with a slight radius of curvature along the length and width of the table top, as shown in Figures 1, 2, and 6. These views also show a "wide" bevel along one side of the upper side of the table top. The following drawing, taken from Figure 1 of the `352 patent, illustrates these features:
GSC contends that the "wide" bevel and the curved sides of the upper surface of the table top constitute points of novelty. It is not clear that the bevels and curved sides are points of novelty. (Cf. U.S. D353,286, Fig. 1, found as part of Exhibit D to the Jensen Decl.) For purposes of this Order, however, the court assumes, without deciding, that the "wide" bevel along the front edge of the table top is a point of novelty and that the curved sides are also points of novelty. b. Ornamentality
GSC argues that the drawings also show a "narrow" bevel at the junction of the upper surface of the table top and the side wall on the sides of the upper surface that do not include the "wide" bevel, and at the junction of the bottom surface of the table top and the side wall. The drawings of the side view of the table top show that the claimed "narrow" bevel arguably is a radius, not a bevel. (See Figs. 4, 5, 7, 8 of the `352 patent.) Regardless of whether the feature in question is a "narrow" bevel or a radius, neither feature constitutes a point of novelty, as such features are well known for table top edges.
As noted above, the next step in a claim construction is to determine which of the points of novelty are primarily ornamental. Where the appearance of a feature is not dictated solely by function, that is, where there are structures having a different appearance that can perform the same function, the design is more likely ornamental. See L.A. Gear, Inc. v. Thorn McAn Shoe Co., 988 F.2d 1117, 1123 (Fed. Cir. 1993) (stating that "[w]hen there are several ways to achieve the function of an article of manufacture, the design of the article is more likely to serve a primarily ornamental purpose"); Hupp v. Siroflex of America, Inc., 122 F.3d 1456, 1460 (Fed. Cir. 1997) (stating that "[i]n determining whether the statutory requirement is met that the design is `ornamental,' it is relevant whether functional considerations demand only this particular design or whether other designs could be used, such that the choice of design is made for primarily aesthetic, non-functional purposes")
In the present case, none of the points of novelty identified above for the `352 patent are functional. The functions performed by all of the points of novelty features identified on the underside of the `352 patent can be performed by features having a very different appearance. By way of illustration, Lifetime has developed another personal table that performs exactly the same functions as the fixed channel (retaining the stationary leg on the bottom of the table) and adjustment channels (allowing for adjustment of the height of the table) but has a different appearance. This alternative is depicted below:
Next, the port in the sidewall of the table allows a user to collapse and stack the tables. This same function could be performed by structures having a completely different appearance. For example, instead of the port occupying only a small portion of the side wall, the entire side wall could be removed and clips could be attached to the bottom surface of the table. Alternatively, the legs could be folded so that they are flush with the bottom of the table. Last, neither party contends that the wide bevel or the curved sides of the upper surface are functional, and the court finds that they are not.
In sum, none of the points of novelty of the `352 patent are functional. All are primarily ornamental, as that concept has been defined by the Federal Circuit.
2. The `994 Patent
a. Points of Novelty
The appearance of the design claimed in United States Patent No. D469,994 is shown in Figures 1 through 7 of the `994 patent. (See U.S. Design Patent No. D469,994 (issued Feb. 11, 2003), attached as Ex. B to Amended Compl.) Lifetime asserts that the points of novelty of the `994 design consist of the features that are labeled in the following drawings:
The labels in drawings from Figures 1 and 2 of the `994 patent refer to the following features: (1) the curved radius; (2) the round tubing for legs; (3) the location of the pivot point; (4) the space between paired members of legs at the top; (5) the space between paired members of legs at the middle; (6) the space between paired members of legs at the middle bottom; and (7) the nesting of one set of curved legs within the other set of curved legs. GSC argues that the features identified above are not novel, relying on (1) the design patent to Pagnon, et al., U.S. Patent No. D416,148, (the "Pagnon reference") cited during the prosecution history, (see U.S. Design Patent No. D416,148 (issued Nov. 9, 1999), attached in Ex. C to Jensen Decl.), and on (2) GSC Exhibits L through Q, which GSC submitted during the July 14, 2003 hearing.
Counsel for Lifetime has declared that the Pagnon reference was considered during patent prosecution and the `994 patent was nevertheless allowed. (See Jensen Decl. ¶ 5); see also Zb Indus, v. Conagra, Inc., No. CV 99-4145-GHK (RCX), available at, 2000 WL 1863561, at *6-9; 56 U.S.P.Q.2d (BNA) 1739 (C.D. Cal. 2000) (finding patents valid where none of the prior art in the record contained the claimed points of novelty). Further, as Lifetime contends, not every point of novelty of the `994 patent is shown in the Pagnon patent. Specifically, Lifetime emphasizes the following distinctions: (1) the legs of the Pagnon patent are not round, but are flattened; (2) the Pagnon legs have a much more splayed appearance than the appearance of the `994 patent; (3) the width of the space between the Pagnon legs is greater relative to the width of the table top in Pagnon, than the space between the `994 legs relative to the width of the `994 table top; (4) the spread between the Pagnon legs is almost as wide as the table, while the corresponding spread of the `994 legs is not; and (5) the legs of the Pagnon table are centered on the table, while the `994 legs are offset from center. (See U.S. Design Patent No. D416,148 (issued Nov. 9, 1999), attached in Ex. C to Jensen Decl.) Given these distinctions, the Pagnon reference does not defeat the above identified points of novelty.
Next, GSC has not proven that any of GSC Exhibits L through Q, which were presented for the first time at the hearing on July 14, 2003, are prior art. As an initial matter, the dates on Exhibits L through P are all July 2003, which would not qualify them as prior art. Even if they were entitled to consideration, however, the legs shown in Exhibits L through P are all square or rectangular in cross section, unlike the `994 patent, and are straight, not curved like the `994 patent.
Whether a particular reference constitutes prior art is governed by35U.S.C. § 102. Prior art status, like all invalidity issues, must be established by the party asserting invalidity by clear and convincing evidence. See 35 U.S.C. § 282. GSC has not established the prior art status of any of the references it relies upon by any standard.
Exhibit Q, an advertisement for the "Homz Laundry Ultimate Ironing Table," has a copyright date of 2001. The fact that a copyright notice of 2001 appears on the advertisement, however, does not establish that the design of the device depicted in that advertisement is in fact prior art. Further, the legs in Exhibit Q are very different from those in the `994 patent. The legs in Exhibit Q are curved only near the bottom, and are straight at the top. The legs in Exhibit Q are also larger in diameter and longer than the legs shown in the `994 patent and have a platform extending from them toward the front of the ironing board. In sum, the legs of Exhibits L-Q differ significantly from those in the `994 patent and do not defeat the points of novelty identified above. b. Ornamentality
GSC has not argued that the points of novelty identified above in connection with the `994 patent are functional, and the court finds that they are not. There are many ways to make legs for an adjustable table that do not include the appearance of the legs shown in the `994 patent.
B. Has Lifetime Established a Likelihood of Success on the Issue of Infringement?
A two-step analysis governs claims of infringement of a design patent. First, it must be determined whether the accused design incorporates substantially the same points of novelty as the claimed design. Goodyear Tire Rubber Co. v. Hercules Tire Rubber Co., 162 F.3d 1113, 1118 (Fed. Cir. 1998). Second, the fact-finder must "determine whether the patented design as a whole is substantially similar in appearance to the accused design." Oddzon Products, Inc. v. Just Toys, Inc., 122 F.3d 1396, 1405 (Fed. Cir. 1997).
1. `352 Patent
Before the hearing on July 14, 2003, GSC was selling a version of its table that is the subject of the present lawsuit. At the hearing, GSC stated its intent to sell a second version of its table, which will be referred to as the "Enduro 2" table. This Order discusses only the first Enduro table. As explained below, the Enduro table, under the points of novelty and ordinary observer tests, infringes the `352 patent.
a. Points of Novelty
The inclusion of points of novelty in the accused device need not be complete; all that is required is that substantially the same points of novelty be found in the accused device. See Goodyear. 162 F.3d at 1118-19. Lifetime has established that substantially the same points of novelty found in the `352 patent are found in the accused GSC tables. Specifically, the underside of the Enduro table is a virtual copy of the underside of the table top shown in Figure 3 of the `352 patent. As seen in the drawings below, the `352 patent's adjustment channels (feature #2), fixed channel (feature #5), perpendicular channel (feature #4), gripping members (feature #3), and cavities 1-3 (features 6-8) are present in the same configuration in the Enduro table.
GSC argues that cavity 3 (feature #8) and the raised area in cavity 1 (feature #9) in the `352 patent are shaped differently than the corresponding features in the Enduro table. GSC further argues that there is a slightly raised area in the sidewall port of the `352 patent that is not present in the Enduro table. These claimed differences, however, go at most to the mere dimensions of the respective tables' subparts. If anything, the claimed differences highlight the fact that underside of the Enduro table incorporates almost every point of novelty that is found in the `352 patent.
With respect to the points of novelty on the upper side of the claimed table top, the Enduro table includes curved sides on the long sides of the table. Assuming the curved aspect of the short sides of the table and the wide bevel on the `352 patent are points of novelty, and further assuming that they are absent from the Enduro table, the Enduro table still incorporates substantially the same points of novelty as claimed in the `352 patent.
b. Ordinary Observer
"[I]f in the eye of an ordinary observer, giving such attention as a purchaser usually gives, two designs are substantially the same, if the resemblance is such as to deceive such an observer, inducing him to purchase one supposing it to be another, the first one patented is infringed by the other." Gorham Co. v. White, 81 U.S. 511, 528 (14 Wall.) (1871). "The patented and accused designs do not have to be identical in order for design patent infringement to be found. . . . It is the appearance of the design as a whole which is controlling in determining infringement." Oddzon, 122 F.3d at 1405 (internal citations omitted).
An ordinary observer viewing the Enduro table top as a whole would be deceived by the ornamental features of that table top into purchasing the Enduro table believing it to be the `352 table top. While a side by side comparison of the claimed and accused table tops is a more stringent test than that required by the Federal Circuit, such a comparison demonstrates the substantial similarity between the Enduro 1 table top and the claimed table top:
The court's own observation of the Enduro table top and the claimed table top leads the court to conclude that an ordinary observer could not help but confuse the Enduro and claimed table tops. Such an observer would be deceived into purchasing the Enduro table believing it to be the claimed table top. And the ordinary observer would confused by the ornamental features of the Enduro 1 table top.
The likelihood of confusion between the Enduro table top and the `352 patent exists despite several differences between the tables' respective sub-parts. At the hearing, GSC emphasized the following "big ticket" differences between the Enduro table top and the `352: (1) the straight sides of the Enduro table differ from the curved sides on the `352 patent; (2) the Enduro table does not contain a "wide bevel" on one side of the tabletop; (3) the ornamental features on the respective tables' sidewall ports differ; (4) the triangular raised areas in what has been labeled cavity 1 (feature #9) have different dimensions and shapes; and (5) the location of certain blow holes used in manufacturing the respective tables differ. These differences are very minor, especially given the overall similarity between the respective designs as a whole. "[M]inor differences between a patented design and an accused article's design cannot, and shall not, prevent a finding of infringement." Litton Sys., Inc. v. Whirlpool Corp., 728 F.2d 1423, 1444 (Fed. Cir. 1984). overruled in part on other grounds by TwoPesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, (1992); see also Payless Shoesource, Inc. v. Reebok Int'l Ltd., 998 F.2d 985, 991 (Fed. Cir. 1993) (quoting Litton, 728 F.2d at 1444); Hoop v. Hoop. 279 F.3d 1004, 1007 (Fed. Cir. 2002) (stating that "[m]inor differences between the prior art and the new claim will not suffice"). Moreover, when "conducting a design patent infringement analysis, `the patented design is viewed in its entirety, as it is claimed. . . . [T]he ultimate question requires determining whether the effect of the whole design [is] substantially the same.'" Payless Shoesource. 998 F.2d at 990-91 (quoting L.A. Gear, Inc. v. Thorn McAnn Shoe Co.. 988 F.2d 1117, 1125 (Fed. Cir. 1993) (further internal quotations omitted)). When the ornamental appearance of the claimed table top is properly compared to the accused table top as a whole, GSC infringes.
GSC also argues that the characteristics of what has been labeled cavity 3, or Feature #8, differ on the Euduro and Lifetime tables. (See GSC's Mem. Opp'n to Lifetime's Motion for TRO and Preliminary Injunction ("GSC's Opp'n Mem.") at 20.) The court, however, does not discern any notable differences between the tables' respective cavity 3's.
2. The `994 Patent
a. Points of Novelty
A proper comparison of points of novelty is between the patent claim and the accused device. Where there is no significant distinction between the patent drawings and a physical embodiment, however, it is proper to make comparisons to the physical embodiment as well as to the claims.Braun, Inc. v. Dynamics Corp. of America. 975 F.2d 815, 820 n. 8 (Fed. Cir. 1992).
In the present case, the Lifetime table legs embody the patented design. A comparison between the Lifetime table legs and the Enduro legs therefore is appropriate. See id. There is no dispute that the Enduro table legs include all of the points of novelty identified above in connection with the Lifetime legs. In fact, Lifetime demonstrated at the hearing that the Enduro legs are so close to the claimed legs that they fit in the Lifetime table tops and function just as the Lifetime table legs function.
b. Ordinary Observer
The only difference GSC has identified between the `994 patent and the GSC table legs is the presence of two plates of metal (the "plates"), approximately seven inches long, that GSC has welded between the table legs below the pivot point. The plates are generally trapezoidal in shape and fill the space between the separated legs. The plates are opaque, rigid, and interrupt the field of vision through the legs.
Lifetime contends that the additional plates are "a gimmick" to distinguish the parties' respective products. (Lifetime's Reply Mem. at 13.) It appears to the court that an ordinary observer, giving such attention as such an observer ordinarily would, probably would notice the additional plates when putting the table together or taking it apart. But, given the fact that in all other respects, the GSC and the `994 legs are identical, the court concludes that an ordinary observer would not be deceived into purchasing the Enduro table legs believing them to be the legs of the `994 patent.
C. Has Lifetime Established a Likelihood of Success on the Merits of the Validity Issue?
1. `352 Patent
The Federal Circuit has stated that "a patent is presumed valid, and this presumption exists at every stage of the litigation. . . . [W]here the challenger fails to identify any persuasive evidence of invalidity, the very existence of the patent satisfies the patentee's burden on the validity issue." Canon Computer Sys., Inc. v. Nu-Kote Int'l, Inc., 134 F.3d 1085, 1088 (Fed. Cir. 1998) (internal citations omitted). GSC does not argue that the `352 patent is invalid in light of prior art. GSC instead contends that the `352 patent may be indefinite. (See GSC's Opp'n Mem. at 24.) Specifically, GSC argues that Figure 6 of the `352 patent shows two bevels — namely, the "wide" bevel and a narrower bevel at the lower edge of the "wide" bevel — but that the other drawings do not show both bevels, and as a result the claim is indefinite.
Lifetime asserts that the second bevel identified by GSC is not really a bevel at all, but instead is a transition between the wide bevel and the side wall. Even if the claimed inconsistencies actually exist among the `352 patent drawings, GSC has not raised a substantial issue as to the validity of the `352 patent. Lifetime therefore has established a likelihood of success on the merits.
2. `994 Patent
GSC also argues that the `994 patent is invalid because it has no points of novelty. GSC relies on the Pagnon reference and GSC Exhibits L through Q. The `994 patent was already allowed over the Pagnon reference. The allowance of the `994 patent over the Pagnon reference gives rise to an inference that the `994 claim includes points of novelty not disclosed in Pagnon. Pagnon therefore does not raise a substantial issue of patentability.
With respect to GSC Exhibits L through Q, GSC has not established the necessary foundation establishing that those references are prior art, and consequently has not raised a substantial issue of patentability. Further, as detailed above, the features of the `994 claim are distinct from those of Exhibits L through Q. GSC has not raised a substantial issue of validity with respect to the `994 patent.
In sum, the presumption of validity on the `994 patent "exists at every stage of the litigation." Canon, 134 F.3d at 1088. Because Lifetime has "fail[ed] to identify any persuasive evidence of invalidity, the very existence of the patent satisfies [Lifetime's] burden on the validity issue." Id. Lifetime therefore has established a likelihood of success on the validity of the `994 patent.
II. Copyright
Copyright infringement cases require a two-step analysis. The movant must show (1) ownership of a valid copyright and (2) that constituent elements of the original work have been copied. Jacobsen v. Deseret Book Co., 287 F.3d 936, 942 (10th Cir. 2002); see also Feist Publ'ns, Inc. v. Rural Tel. Serv. Co., 499 U.S. 340,361 (1991).
A. Has Lifetime Established Ownership of Valid Copyrights?
Copyright ownership is established by showing that the "material is original, the material can be copyrighted, and compliance with all statutory formalities." Geoscan, Inc. v. Geotrace Techs., Inc., 226 F.3d 387, 393 (5th Cir. 2000). "[A] plaintiff has complied with all statutory formalities for copyright registration when the Copyright office receives the plaintiffs application for registration, fee, and deposit." Id. Attached to the Amended Complaint are six copyright registrations owned by and issued to Lifetime. Lifetime clearly owns the copyrights in question.
GSC has argued that the Lifetime copyrights do not cover copyrightable subject matter based on the scenes a faire and merger doctrines. See Proctor Gamble Co. v. Colgate-Palmolive Co., 96 Civ. 9123 (RPP),available at 1998 U.S. Dist. Lexis 17773, at *121-23 (S.D.N.Y. Nov. 5, 1998) (discussing the scenes a faire doctrine). "Under the scenes a faire doctrine, similarities in sequences of events and settings that necessarily follow from a common theme, or that are standard in the treatment of a given topic or idea, are not entitled to copyright protection." Id. at *122. Courts have found that "[t]he scenes a faire doctrine . . . encompasses genres of advertising," Id.; see also Reed-Union Corp. v. Turtle Wax, Inc., 77 F.3d 909, 913 (7th Cir. 1996). Under the similar merger doctrine, "copyright protection is denied to expression that is inseparable from or merged with the ideas, processes, or discoveries underlying the expression. . . . The merger doctrine is applied as a prophylactic device to ensure that courts do not unwittingly grant protection to an idea by granting exclusive rights to the only, or one of only a few, means of expressing that idea." Gates Rubber Co. v. Bando Chem. Indus., Ltd., 9 F.3d 823, 838 (10th Cir. 1993) (internal citations omitted).
GSC argues that the text and graphics of Lifetime's product and warning labels are a few of a very limited number of ways to express the ideas conveyed, and therefore cannot be the subject of a copyright registration. On the first day of the hearing of Lifetime's motion, however, GSC produced new product labels and warnings, all of which used different text and different layouts to express the same ideas expressed in the Lifetime product and warning labels. GSC's own revised labels demonstrate that the scenes a faire and merger doctrines do not apply here, because in the few weeks since Lifetime filed its motion, GSC has found new ways to express its ideas other than the way in which Lifetime expressed those same ideas in its labels.
B. Has Lifetime Established Access and Substantial Similarity?
1. Does Proof of Access Exist?
The Seventh Circuit has stated that "[p]roof of copying is crucial to any claim of copyright infringement because no matter how similar the two works may be (even to the point of identity), if the defendant did not copy the accused work, there is no infringement." Selle v. Gibb, 741 F.2d 896, 901 (7th Cir. 1984). "However, because direct evidence of copying is rarely available, the plaintiff can rely upon circumstantial evidence to prove this essential element, and the most important component of this sort of circumstantial evidence is proof of access."Id. Accordingly, Lifetime must show that GSC had access to the copyrighted work and that the copyrighted and accused works share substantial similarities.
Given the difficulty in proving access, courts have stated that a party may establish an inference of access
circumstantially by proof of similarity which is so striking that the possibilities of independent creation, coincidence and prior common source are, as a practical matter, precluded. If the plaintiff presents evidence of striking similarity sufficient to raise an inference of access, then copying is presumably proved simultaneously, although the fourth element (substantial similarity) still requires proof that the defendant copied a substantial amount of the complaining work.Selle. 741 F.2d at 901. "Some case law indicates that the stronger the similarity between the two works in question, the less compelling the proof of access needs to be." Ellis v. Diffie, 177 F.3d 503, 507 (6th Cir. 1999).
The near identity of the GSC labels to the copyrighted labels is striking. The similarities demonstrate that GSC had access to the Lifetime copyrighted material. Further, although Lifetime charged GSC with copying, and GSC's president submitted a long declaration addressing a wide variety of topics, neither he nor GSC has denied copying. The similarity of the labels and the failure of GSC to deny copying create a very strong inference that GSC had access to and copied Lifetime's product and warning labels. Lifetime has established a likelihood of success on the issue of access.
2. Are the Parties' Labels Substantially Similar?
"In order to prove copying of legally protectible material, a plaintiff must typically show substantial similarity between legally protectible elements of the original work and the allegedly infringing work."Jacobsen. 287 F.3d at 942-43 (citing Country Kids `N City Slicks, Inc. v. Sheen. 77 F.3d 1280, 1284 (10th Cir. 1996)). In determining whether two works are substantially similar one must ask "whether the accused work is so similar to the plaintiff's work that an ordinary reasonable person would conclude that the defendant unlawfully appropriated the plaintiff's protectible expression by taking material of substance and value." Id. (internal quotations omitted). The requisite degree of similarity between the copyrighted material and the accused material varies depending on the circumstances. Specifically, a "supersubstantial" similarity measure applies for for less creative, or "thin," works while "significant[ly] creative" works require a mere showing of standard "substantial similarity." Id. at 943.
As seen below, a comparison of GSC and Lifetime's respective product labels, (see Copyright Registration No. VA 1-170-065 directed to the Lifetime personal table product label), leaves no doubt that GSC has infringed Lifetime's product label copyright:
Both product labels have a blue banner, oriented horizontally, located in the upper left hand corner of the product label, and which is longer in the horizontal direction than the vertical direction. Both banners have identical text, except for the company name. Both labels have a large perspective photograph of the personal table in the lower left hand corner of the label, and both photographs use phantom images and identical text and graphics to show adjustability. Both labels use three smaller photographs of the table in various use contexts. These smaller photographs are stacked vertically on the right hand edge of the label. Between the small and large photographs, both labels insert a box proclaiming the features of the tables. GSC copied Lifetime's features text verbatim.
Both GSC and Lifetime's product labels include images of a man eating while apparently watching a sporting event and a woman using a laptop while sitting on a bed.
As seen below, on the back of the product label GSC further copied Lifetime's instructions for use text verbatim. GSC also used an identical graphic, which Lifetime has separately copyrighted, to show setup of the table.
The infringement of Lifetime's Certificate of Registration No. VA 1-170-064, which protects the pen and ink drawing on the back of Lifetime's product label and on its warning label, is equally clear. The GSC drawing and the text that accompanies it are identical, verbatim copies of the Lifetime copyrighted materials. Again, there are many ways to depict setting up of the table. GSC, for example, could have prepared a pen and ink drawing representing its own table or used an actual photograph. Instead, as seen below, GSC simply copied Lifetime's drawing and likewise copied the accompanying text.
The Court is aware that Lifetime has six copyright registrations. In light of the strong showings of validity and infringement on these two registrations, the Court need not address the remaining four registrations.
Lifetime has established ownership of copyrightable subject matter, validly issued copyright certificates, access, and supersubstantial similarity. Lifetime therefore has established a likelihood of success on the merits of its copyright infringement claims.
III. Irreparable Harm
A. Has Lifetime Established Irreparable on Its Claim for Patent Infringement?
Lifetime must next establish that Lifetime will suffer irreparable harm if the court does not grant a preliminary injunction. See Purdue Pharma L.P. v. Boehringer Ingelheim GMBH, 237 F.3d 1359, 1363 (Fed. Cir. 2001). "Irreparable harm is presumed when a clear showing of patent validity and infringement has been made." Amazon.com. Inc. v. Barnesandnoble.com. Inc., 239 F.3d 1343. 1350 (Fed. Cir. 2001). "This presumption derives in part from the finite term of the patent grant, for patent expiration is not suspended during litigation, and the passage of time can work irremediable harm." Id. (internal quotation omitted). Moreover, "[i]t is well-settled that, because the principal value of a patent is its statutory right to exclude, the nature of the patent grant weighs against holding that monetary damages will always suffice to make the patentee whole."Hybritech Inc. v. Abbott Labs., 849 F.2d 1446, 1456-57 (Fed. Cir. 1988). Lifetime has made a strong showing that it is likely to succeed on the merits of its patent and copyright infringement claims and is entitled to a presumption of irreparable harm.
In addition to the presumption of irreparable harm, the Federal Circuit has recognized that price erosion is a form of irreparable harm that justifies a preliminary injunction. See Purdue Pharma. 237 F.3d at 1368 (finding that "[g]iven the testimony of the likelihood of price erosion and loss of market position without corresponding market expansion from the introduction of [an infringing] product, we see no deficiency in the district court's finding of irreparable harm"); Polymer Techs., Inc. v. Bridwell 103 F.3d 970, 975-76 (Fed. Cir. 1996) (stating that "[r]equiring purchasers to pay higher prices after years of paying lower prices to infringers is not a reliable business option"). Courts have also recognized that loss of market share and good will can cause the patent owner to "suffer immeasurable damages." Stein Indus., Inc. v. Jarco Indus., Inc., 934 F. Supp. 55, 58 (E.D.N.Y. 1996). Loss of market share and damage to company good will represent harms that are difficult to measure, thus courts tend to view them as irreparable. See id.: see also Genentech. Inc. v. Novo Nordisk A/S, 935 F. Supp. 260, 280-281 (S.D.N.Y. 1996), vacated on other grounds, 108 F.3d 1361, 1368 (Fed. Cir. 1997).
The GSC Enduro tables compete directly with the patented Lifetime personal folding tables, which are sold through a number of retailers including Sam's Club, Wal-Mart, and Costco. In January of this year, Staples, a long-time major retail account for Lifetime's tables, informed Lifetime that it was considering switching from Lifetime's tables to an undisclosed alternative. Lifetime later learned that the infringing alternatives were being offered by GSC at a lower price. Staples in fact switched suppliers.
GSC argues that Lifetime's presumption of irreparable harm is defeated because Lifetime knew about the infringing tables in February 2003 but delayed until June 2003 to seek injunctive relief. GSC bases this claim on the allegation that Lifetime saw the infringing tables in Mexico in late February 2003. The patents at issue in connection with this motion, however, are United States patents, not Mexican patents. Lifetime could not bring an action on a United States patent in a United States district court based on conduct that occurred only in a foreign country. See Rotec Indus., Inc. v. Mitsubishi Corp., 215 F.3d 1246, 1251 (Fed. Cir. 2000) (stating that "the right conferred by a patent under our law is confined to the United States and its territories, and infringement of this right cannot be predicated on acts wholly done in a foreign country" (quoting Dowagiac Mfg. Co. v. Minnesota Moline Plow Co., 235 U.S. 641, 650 (1915))). Lifetime asserts, and the court finds, that Lifetime did not know that GSC was selling the infringing tables in the United States or in Utah until June 4, 2003. GSC's allegation of delay therefore is unpersuasive.
In sum, given the presumption of irreparable harm due to Lifetime's showing of patent validity and infringement and the proof of loss of at least one Lifetime account due to the GSC table, the court finds that Lifetime has established irreparable harm on its claim for patent infringement.
B. Has Lifetime Established Irreparable Harm on Its Claim for Copyright Infringement?
Where ownership and substantial similarity are proven in a copyright case, irreparable harm is presumed. See Autoskill Inc. v. Nat'l Educ. Support Sys., 994 F.2d 1476, 1498 (10th Cir. 1993) (stating that under what has been described the "prevailing" view, "a showing of a prima facie case of copyright infringement or of a reasonable likelihood of success on the merits usually raises a presumption of irreparable harm for preliminary injunction purposes"); see also Jacobsen v. Deseret Book Co., 287 F.3d 936, 942-43 (10th Cir. 2002) (describing elements of a claim for copyright infringement). Both ownership and substantial similarity have been shown in this case.
The connection between the infringement of Lifetime's copyrights and the irreparable harm being suffered by Lifetime is real and substantial. The labels in question appear on the top surface of every infringing GSC table, in stores where they are sold, the infringing labels are prominently displayed at the point of purchase. Consumers seeing the infringing GSC labels will believe that the tables are Lifetime tables because the labels are nearly identical and the tables shown in several of the photos appear identical to the Lifetime tables.
GSC argues that it has changed its products and its product labels, and that any harm to Lifetime can be compensated in money damages. Money damages some time in the future, however, will not restore Lifetime's eroded prices, return its lost customers, or repair its damaged reputation.
GSC further contends that there is no irreparable harm because the copyrighted work is not a competing product. See American Direct Mktg., Inc. v. Azad Int'l Inc., 783 F. Supp. 84, 96 (E.D.N.Y. 1992) (stating that the presumption of irreparable harm in copyright cases "assumes that the market for the allegedly infringed work is being injured by the allegedly infringing work"). As explained above, however, the infringing labels are sold with and are attached to the infringing tables. Further, GSC's tables compete with Lifetime's. The court finds that the infringing labels are clearly linked to Lifetime's irreparable harm.
IV. Public Interest
The court next considers whether granting a preliminary injunction in Lifetime's favor would positively impact the public interest. See Hybritech Inc. v. Abbott Labs., 849 F.2d 1446, 1451 (Fed. Cir. 1988) (listing requirements for a patent infringement case). The public-interest factor in patent infringement cases "often favors the patentee, given the public's interest in maintaining the integrity of the patent system." Odetics, Inc. v. Storage Tech. Corp., 14 F. Supp.2d 785, 795 (E.D.Va. 1998):
see also Hybritech, 849 F.2d at 1458. As such, "[i]t is generally held that `protecting patents from would-be infringers is always acting in the public interest,'" particularly where a likelihood of infringement has been shown. Schneider (Europe) AG v. Scimed Life Sys., Inc., 852 F. Supp. 813, 861 (D. Minn. 1994) (quoting Pittway v. Black Decker. 667 F. Supp. 585, 593 (N.D. Ill. 1987)).
"Typically, . . . although there exists a public interest in protecting rights secured by valid patents, the focus of the district court's public interest analysis should be whether there exists some critical public interest that would be injured by the grant of preliminary relief."Hybritech, 849 F.2d at 1458 (footnote omitted). In rare instances, for example, courts have denied injunctive relief for patent infringement when the public health was at stake. Rite-Hite Corp. v. Kelley Co., 56 F.3d 1538, 1547-48 (Fed. Cir. 1995) (en banc) (listing cases).
Infringement of Lifetime's patented designs for personal blow-molded folding tables does not invoke issues related to public health, and there is no public policy served by allowing GSC to continue to infringe valid patents. GSC can import and sell non-infringing products. Similarly, with regard to GSC's infringement of Lifetime's copyrighted product and warning labels, issuance of an injunction against GSC will uphold the rights of the copyright holder and thereby serve the public interest in upholding the law.
V. Balance of Hardship
The balance of hardships is a factor to be considered by a district court in determining whether to issue a preliminary injunction.Hybritech. 849 F.2d 1451. However, the Federal Circuit has never required, "as a prerequisite to awarding preliminary injunctive relief, that the district court expressly find the existence of this factor."Id. at 1457.
Nevertheless, the balance of hardships in this case favors Lifetime. A patent holder who is denied an injunction suffers "serious delay in the exercise of the limited-in-time property right to exclude," which constitutes a severe hardship. Illinois Tool Works, Inc. v. Grip-Pak, Inc., 906 F.2d 679, 683 (Fed. Cir. 1990). This harm is amplified by the fact that GSC is infringing Lifetime's design patent, given the fourteen-year term for design patents. See 35 U.S.C. § 173.
Further, any losses GSC may claim "merit little equitable consideration and [are] insufficient to outweigh the continued wrongful infringement" of Lifetime's products.Autoskill Inc. v. Nat'l Educ. Support Sys., 994 F.2d 1476, 1498 (10th Cir. 1993) (internal quotation omitted). Therefore, the harm sustained by Lifetime outweighs the potential harm to GSC. This is particularly true where it is clear that GSC has copied the Lifetime design and product and warning labels. As such, the balance of hardships weighs in favor of Lifetime and GSC is properly enjoined from continuing its sale of the infringing GSC personal table.
VI. Bond
Rule 65 provides that no injunction shall issue without security. Fed.R.Civ.P. 65(c). "[T]he trial court has `wide discretion' in setting the amount of the preliminary injunction bond. See Dominion Video Satellite, Inc. v. EchoStar Satellite Corp., 269 F.3d 1149, 1158 (10th Cir. 2001) (quoting Continental Oil Co. v. Frontier Refining Co., 338 F.2d 780, 782 (10th Cir. 1964)). Logically, it is the enjoined party who must establish the proper amount of that security. "[I]f there is an absence of proof [asserted by the Defendant] showing a likelihood of harm, certainly no bond is necessary." Continental Oil. 338 F.2d at 782. Requiring a nominal bond is not an abuse of discretion where the defendant fails to present evidence on the proper amount of a bond. See Equifax Servs., Inc. v. Hitz, 905 F.2d 1355, 1362 (10th Cir. 1990) (affirming the district court's order that a prevailing plaintiff post $10,000 in security where the "defendant presented no evidence on the extent to which he would be harmed by an injunction").
GSC has not put forth any evidence on the appropriate amount of security. The court therefore imposes a nominal bond amount of $20,000, but grants GSC leave to seek modification of the bond amount. The bond may be posted in the form of cash, an irrevocable letter of credit, a bond through an insurance or bonding company, or in some other form approved by the court.
VII. Scope of the Injunction
Lifetime has requested that the injunction in this case require the recall of infringing products and labels that have already been sold and delivered by GSC to third parties. GSC responds that it no longer holds title to such goods and that the court cannot enjoin third parties not before the court. 35 U.S.C. § 283 provides that courts "may grant injunctions in accordance with the principles of equity to prevent the violation of any right secured by patent, on such terms as the court deems reasonable." 35 U.S.C. § 283. Section 503(a) of the Copyright Act provides remedies for infringement, which include the impounding of the infringing articles, "[a]t any time while an action under this title is pending . . ., on such terms as [the court] may deem reasonable, of all copies . . . claimed to have been made or used in violation of the copyright owner's exclusive rights." 17 U.S.C. § 503(a). "The scope of an injunction is left to the sound discretion of the court and may include an appropriate recall of infringing goods." Boehringer Ingelheim Vetmedica, Inc. v. Schering-Plough Corp., 106 F. Supp.2d 696, 709 (D.NJ. 2000).
In considering a recall order, a district court "must consider the likely burden and expense of a recall to the defendant, and balance the burden against the benefit that would accrue to the plaintiff." Benham Jewelry Corp. v. Aron Basha Corp., No. 97 Civ. 3841(RWS), available at 1997 WL 639037, at *19 (S.D.N.Y. 1997) (citing Perfect Fit Indus., Inc. v. Acme Quilting Co., 646 F.2d 800, 805 (2d Cir. 1981)). To require a defendant to recall existing stock ordered by other businesses need not be unduly burdensome, particularly where a defendant "need only write a letter to its wholesale customers and pay the cost of the return for customers who comply." Id. Such a "recall of wholesale orders would significantly benefit [the copyright owner]," where the copyright owner "risks losing customers if the [infringing product] is disseminated in the general marketplace." Id. (citing Eve of Milady v. Impression Bridal, Inc., 957 F. Supp. 484,491 (S.D.N.Y. 1997).
The purpose of injunctive relief is to do equity. In the present case, GSC has copied both the tables and the product and warning labels. Whether the court's injunction directly enjoins third parties like Staples and others to whom GSC has sold infringing tables and labels is a question of whether those parties are in active concert and participation with GSC, a question that has not yet been resolved. What is clear, however, is that the court can order GSC to take all steps possible to undo the wrong it has done. Specifically, the court finds that it is just and equitable at this stage in the case (1) to require GSC to provide all wholesale purchasers of the infringing Enduro tables with a copy of the court's injunction, and (2) to require GSC to offer to purchase the infringing tables in its customers' inventories at the price at which they were sold, plus shipping and handling charges. GSC will also be required to inform its customers of the issuance of the injunction and of the fact that if the court does not change the preliminary finding of infringement at the time of trial, they will be direct infringers. Other related terms are found in the injunction order itself, attached hereto as Exhibit A.
ORDER
For the foregoing reasons, Lifetime's motion for a preliminary injunction is GRANTED.