Games Workshop Limited v. Chapterhouse Studios LLC

Filing 333

MEMORANDUM OPINION AND ORDER signed by the Honorable Matthew F. Kennelly on 4/1/2013: As stated in this decision, the Court grants defendant's motion for reconsideration [docket no. 287] in part and denies it part, denies defendant's motion for summary judgment [docket no. 289], and grants plaintiff's motion for summary judgment [docket no. 291] in part and denies it in part. Additionally, the Court gives notice to plaintiff that it intends to grant summary judgment for defendant on certain claims based on preemption by the Copyright Act. Plaintiff must file any response opposing the Court's proposal by April 8, 2013. (mk)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION

GAMES WORKSHOP LIMITED,
Plaintiff,
vs.
CHAPTERHOUSE STUDIOS, LLC,
Defendant.

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Case No. 10 C 8103

MEMORANDUM OPINION AND ORDER
MATTHEW F. KENNELLY, District Judge:
Games Workshop (GW) has sued Chapterhouse Studios (Chapterhouse),
alleging copyright and trademark infringement and related state and federal claims. The
parties previously filed cross-motions for summary judgment, which the Court partly
granted and partly denied, leaving a good many of GW’s claims for trial. Games
Workshop Ltd. v. Chapterhouse Studios, LLC, No. 10 C 8301, 2012 WL 5949105 (N.D.
Ill. Nov. 27, 2012). The Court later granted GW leave to amend its complaint to add
similar claims that it had asserted in a second lawsuit against Chapterhouse.
Each side has again moved for summary judgment. In addition, Chapterhouse
has asked the Court to reconsider part of its prior summary judgment ruling and award
Chapterhouse costs that it incurred in obtaining previously undisclosed correspondence
between GW and the United States Copyright Office. For the reasons stated below, the
Court (1) partly grants and partly denies Chapterhouse’s motion for reconsideration, (2)

denies Chapterhouse’s motion for summary judgment, and (3) partly grants and partly
denies GW’s motion for summary judgment.
Background
The Court described the relevant factual background in its prior summary
judgment decision. The Court assumes familiarity with that decision.
In connection with this lawsuit, the parties have exchanged numerous requests
for documents. On September 9, 2011, Chapterhouse asked GW to produce “all
correspondence with any government agency or private copyright registration service”
concerning any work at issue in the case. Def.’s Mot. for Recons., Ex. 2 at 5. GW
responded that it believed it had disclosed all responsive documents but would provide
any additional responsive documents in its possession. Id., Ex. 3 at 2.
On November 2, 2012, counsel held a telephone conference to discuss the
parties’ contemplated motions in limine. According to Chapterhouse, its counsel
expressed concern to lead counsel for GW about not receiving any further
correspondence between GW and the Copyright Office. Although the parties dispute
how GW’s attorney reacted, it is undisputed that at some point soon after the telephone
conference, GW agreed to supplement its response to the discovery request.
Chapterhouse’s attorney states in an affidavit that in late October 2012,
Chapterhouse undertook its own investigation into correspondence between GW and
the Copyright Office, and on November 7, it requested documents directly from the
Copyright Office for two of GW’s copyright applications, including an application for
Assault Squad shoulder pads (implicated by entries 46–48 in GW’s second revised
claim chart). On December 12, 2012, approximately two weeks after the Court had

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issued its ruling on the motions for summary judgment, Chapterhouse received from the
Copyright Office correspondence regarding the Assault Squad shoulder pads
application, which revealed a number of communications between GW’s attorney and
the Copyright Office. GW did not produce any of this correspondence until January 4,
2013, together with its response to Chapterhouse’s first motion for reconsideration.1
Documents that Chapterhouse obtained from the Copyright Office reflect that
Robin Jones, a Copyright Registration Specialist, e-mailed GW’s attorney on June 7,
2012 in connection with GW’s application. Jones expressed a number of concerns,
many of which appear to be requests for clarification. In her e-mail, however, Jones
stated that “we cannot register the sculpture portion as it is too minimal.” Id., Ex. 5 at 3.
Approximately twenty days later, GW’s attorney responded, asking to speak with Jones
about the “question [she had] regarding the sculptural elements.” Id., Ex. 5 at 4.
Jones did not respond to the e-mail from GW’s attorney until November 7, 2012,
after GW’s attorney had called the Copyright Office to speak with her about the pending
application. In her response, Jones stated that “[t]he email stated that the ‘sculpture’
was to[o] minimal (it is basically an ‘X’) and could not be registered.” Id., Ex. 5 at 7.
GW’s attorney replied to Jones on December 7, noting that the Court’s summary
judgment decision “ruled that the basic shape of the Games Workshop shoulder pad is
copyrightable (even without surface ornamentation).” Id., Ex. 5 at 10. According to
correspondence produced by GW in January 2013, Jones responded to GW’s attorney
on December 11: “[T]his particular shoulder pad submitted is not copyrightable. [I]t is
1

The Court previously granted Chapterhouse’s first motion for reconsideration in part,
dismissing with prejudice GW’s claims for copyright infringement of products listed in entries
115–16 and 122 of the second revised claims chart. Chapterhouse withdrew the remainder of
its motion. See docket entry 273. Chapterhouse filed its second motion for reconsideration (the
current motion) on the same day that it filed its current motion for summary judgment.

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simply circular, with an x or plus sign on it.” Id., Ex. 6 at 2. In response, GW’s attorney
again brought up the Court’s previous ruling and discussed the evidence upon which
the Court had relied. On December 27, 2012, Carol Frenkel, a Supervisory Registration
Specialist, notified GW’s attorney that she had taken over the application and would
make a determination shortly.
On January 4, 2013, Frenkel wrote GW a letter stating that the Copyright Office
could not register the work. The letter laid out the basic standards for protection under
the federal copyright law and stated that the office had “determined that this particular
work will not support a claim to copyright for 2-Dimensional artwork or sculpture under
the standards described above.” Id., Ex. 7 at 1.
Discussion
I.

Chapterhouse’s motion for reconsideration and costs
Chapterhouse asks the Court to reconsider its earlier ruling on the

copyrightability of GW’s shoulder pads based on the Copyright Office’s decision to deny
registration of the Assault Squad shoulder pads. Chapterhouse argues that the Court
should defer to the Copyright Office’s finding. It also asks the Court to award
Chapterhouse the $1,039 it spent conducting an independent investigation into GW’s
correspondence with the Copyright Office.
A.

Motion for reconsideration

The Court’s earlier summary judgment ruling is interlocutory in nature and thus
may be reconsidered at any time. See, e.g., Morningware, Inc. v. Hearthware Home
Prods., Inc., No. 09 C 4348, 2011 WL 1376920, at *1 (N.D. Ill. Apr. 12, 2011). The
appropriate purpose of a motion for reconsideration is to correct manifest errors of law

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or fact, or to present newly discovered evidence. Hicks v. Midwest Transit, Inc., 531
F.3d 467, 474 (7th Cir. 2008). “Reconsideration is not an appropriate forum for
rehashing previously rejected arguments or arguing matters that could have been heard
during the pendency of the previous motion.” Caisse Nationale de Credit Agricole v.
CBI Indus., Inc., 90 F.3d 1264, 1270 (7th Cir. 1996).
Chapterhouse contends that the Copyright Office’s January 4, 2013 letter
rejecting GW’s application for copyright registration is newly discovered evidence and is
persuasive authority to which the Court should defer. Accordingly, Chapterhouse seeks
reconsideration with regard to the GW products identified in entries 4–7, 12–13, 19–22,
46–62, 64–65, 97–98,2 and 101–02 of GW’s second revised copyright claim chart. GW
argues that the Court should not give deference to the Copyright Office’s rejection of its
application because, among other things, the January 2013 letter does not constitute
final agency action.
Courts differ with regard to what level of deference, if any, should be given to a
rejection by the Copyright Office. Compare Norris Indus., Inc. v. Int’l Tel. & Tel. Corp.,
696 F.2d 918, 922 (11th Cir. 1983) (“The district court properly gave some deference to
the expertise of the Register in its decision.”), with Aqua Creations USA Inc. v. Hilton
Hotels Corp., No. 10 Civ. 246, 2011 WL 1239793, at *3 (S.D.N.Y. Mar. 28, 2011)
(“Where the Copyright Office denies registration, and the unsuccessful applicant
subsequently brings an infringement action, courts nonetheless make an independent
2

Chapterhouse also asks for reconsideration regarding products identified in entries 99–100
because GW’s claimed copyright in them is based solely on the size and shape of the shoulder
pads. In its previous decision, however, the Court noted that GW had dropped all copyright
claims implicated by products identified in entries 99 and 100 of the second revised claim chart.
Games Workshop, 2012 WL 5949105, at *4. To the extent GW maintains any copyright claims
for products in entries 99–100, the Court grants Chapterhouse’s motion and dismisses the
claims with prejudice.

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determination as to copyrightability.”). Further complicating the issue is the fact that the
Copyright Office itself does not consider correspondence to be “final agency action” until
the Review Board renders a decision after a second request for reconsideration, 37
C.F.R. § 202.5(g), and GW has not submitted its application for even a first
reconsideration. The Court need not resolve this issue, however, because even
assuming that the Copyright Office’s rejection is entitled to some deference, the Court
nonetheless concludes that GW’s shoulder pads are eligible for copyright protection.
Copyright Registration Specialist Jones denied GW’s copyright claim on the
basis that the sculpture portion of the shoulder pads is too minimal; she stated that it is
“simply circular, with an x or plus sign on it.” Def.’s Mot. for Recons., Ex. 6 at 2.
Jones’s initial response, however, indicated that GW may be able to obtain registration
for the two-dimensional “graphics of the pads . . . .” Id., Ex. 5 at 3. Based upon the
graphics included in entries 46–48 of the second revised claim chart, which the Court
assumes was the two-dimensional artwork submitted to the office, the Court does not
see any basis to extend copyright protection to one and not the other. To the contrary,
the graphic is by nature two-dimensional and appears more rudimentary and
commonplace than the three-dimensional shoulder pads that GW sells:

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At some point the Copyright Office changed its mind about the two-dimensional
artwork, and in the January 2013 letter that Supervisory Registration Specialist Frenkel
sent to GW, she concluded that both the two-dimensional artwork and the sculpture
were not copyrightable. Frenkel’s letter, however, contained no explanation for this
determination. The letter simply recited, in summary fashion, several basic copyright
law principles—the claimant must have independently created the work, the work must
possess at least a minimal amount of creativity, and copyright law does not protect
ideas or concepts—and it concluded, in a single sentence, that “[a]fter careful
consideration, we have determined that this particular work will not support a claim to
copyright for 2-Dimensional artwork or sculpture under the standards described above.”
Id., Ex. 7 at 1. This conclusory statement does not identify what standard or principle of
copyright law Frenkel relied upon in rejecting GW’s claim. Even assuming that Frenkel
concluded the item was not sufficiently creative, the letter gives no hint regarding why or
how she came to that conclusion.
In addition, the Court notes that in its previous summary judgment ruling, the
Court considered the context within which the shoulder pads exist. The Court noted
that the shoulder pads were unusually large as compared to the size of the Space
Marine’s head and that the proportional difference was sufficient to constitute a creative
addition sufficient to afford the shoulder pads copyright protection.
For these reasons, even were the Court to afford some deference to the
Copyright Office’s decision to deny GW’s claim, the Court still would conclude that GW
has crossed the modest threshold of creativity needed to obtain copyright protection.
See Feist Publ’ns, Inc. v. Rural Tel. Serv. Co., 499 U.S. 340, 345 (1991) (“To be sure,

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the requisite level of creativity is extremely low; even a slight amount will suffice.”). The
Court therefore denies Chapterhouse’s motion for reconsideration.
B.

Chapterhouse’s investigation costs

Chapterhouse has asked the Court to award it $1,039.00 in out-of-pocket costs
that it incurred investigating two of GW’s applications to and correspondence with the
Copyright Office as described earlier. In support of its motion, Chapterhouse has
attached as an exhibit an itemized invoice from Peerless Patents, Ltd., a document
retrieval service that Chapterhouse hired to request and obtain the documents from the
Copyright Office. Def.’s Mot. for Recons., Ex. 4. The invoice details the expenses that
Chapterhouse incurred, including: (a) $80 for certified copies of the two “Copyright
Application or Registration Correspondence File[s]”; (b) $50 for a “Rush Processing
Service Fee”; (c) $50 for transportation charges to and from the Copyright Office; (d)
$784 for copyright disbursements or fees, a figure that is broken down into
subcategories; (e) $35 for overnight delivery; and (f) a $40 administrative fee.
Federal Rule of Civil Procedure 26(e) imposes upon a party who has responded
to a request for production of documents a duty to supplement its response “in a timely
manner” once the party learns that the response is incorrect or incomplete. Fed. R. Civ.
P. 26(e)(1); see also Allen v. Bake-Line Prods., Inc., No. 98 C 1119, 2001 WL 883693,
at *1 (N.D. Ill. Aug. 6, 2001) (“The duty to supplement discovery requests lingers on
without solicitation by the requesting party.”). If a party fails to comply with Rule 26(e)’s
requirements, a court may order payment of reasonable expenses caused by the
failure, unless the failure “was substantially justified or is harmless.” Fed. R. Civ. P.
37(c)(1). “Courts generally have broad discretion in deciding the appropriate sanction

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for a party’s discovery violation, and the type of sanction administered generally
depends on the unique factual circumstances of the case.” Minuteman Int’l, Inc. v.
Nilfisk-Advance, No. 03 C 223, 2004 WL 2533626, at *3 (N.D. Ill. Sept. 28, 2004)
(internal quotation marks omitted).
In deciding whether to impose sanctions based on a party’s failure to comply with
the disclosure requirements of Rule 26(a), courts consider: (1) any prejudice or surprise
to the other party, (2) the party’s ability to cure that prejudice, (3) the likelihood of
disruption to the trial, and (4) evidence of bad faith or willfulness involved in not
disclosing the evidence earlier. David v. Caterpillar, Inc., 324 F.3d 851, 857 (7th Cir.
2003); see also Newman v. Metro. Pier & Exposition Auth., 962 F.2d 589, 591 (7th Cir.
1992) (sanctioning court should consider circumstances of failure and be guided by
proportionality).
Having considered these factors, the Court concludes that GW should pay the
expenses that Chapterhouse incurred in obtaining GW’s correspondence with the
Copyright Office. Beyond the duty to supplement that Rule 26(e) imposes,
Chapterhouse specifically asked GW to supplement its production of correspondence
with the Copyright Office. GW did not do so but instead withheld correspondence that it
knew Chapterhouse had not received, while attempting to contact the Copyright Office
for further clarification. GW’s lead counsel states in an affidavit that after opposing
counsel sent him Chapterhouse’s September 9, 2011 discovery requests, he “noticed
that the Copyright Office had never responded to [his] June 26 email concerning the
application for the Assault Squad Shoulder pad.” Pl.’s Resp. to Def.’s Mot. for Recons.,
Ex. 1 at 4. Rather than disclose the earlier e-mail exchange, however, GW pursued its

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dealings with the Copyright Office for nearly two more months before disclosing these
communications to Chapterhouse. Even if GW “assumed the matter was resolved”
when it did not receive a response from the Copyright Office in June 2012, it knew
otherwise on November 7, when Robin Jones sent GW’s attorney an e-mail indicating
for a second time that she was rejecting at least part of GW’s application. Id. at 5. And
if GW’s failure was originally due to oversight based on the large number of document
requests that it received from Chapterhouse, it surely was aware on November 2, when
Chapterhouse expressed concern over this particular production request, that
Chapterhouse’s attorneys had not received the correspondence in question from GW.
GW’s attorney stated, in an affidavit that he filed on January 4, 2013 in response
to Chapterhouse’s earlier motion to reconsider, that at the time in question, the
Copyright Office had not yet addressed the copyrightability of the shoulder pads “in any
substantive way.” Docket entry 270-1 at 1. In his more recent affidavit dated March 13,
2013, which GW’s attorney submitted with GW’s response to Chapterhouse’s second
motion for reconsideration, he again states that as of January 4, he “still had received
no substantive communication from the Copyright Office (only a promise to respond to
my June 26, 2012 email) . . . .” Id. at 1. This statement does not appear to be accurate.
Prior to Carol Frenkel’s January 4 letter denying GW’s application, GW’s attorney
received several e-mails from various Copyright Office personnel, most of which
commented on the copyrightability of the sculptured shoulder pad. Considering the
circumstances, there is a strong indication that GW’s failure to disclose its
correspondence with the Copyright Office was deliberate or at least reckless.

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The prejudice to Chapterhouse is evidenced by its filing of the first motion to
reconsider, in which it relied on the contents of the correspondence (Chapterhouse
withdrew the motion in part for reasons not relevant here). Though the motion was
unsuccessful, it was a legitimate and colorable motion, made after Chapterhouse
undertook its own investigation and uncovered documents that GW had an ongoing
responsibility to produce. The Court includes that it is appropriate to shift to GW the
$1,039 in expenses that Chapterhouse incurred as a result of GW’s failure to timely
supplement its document production.
II.

Chapterhouse’s motion for summary judgment
Chapterhouse has moved for summary judgment on nine products identified in

GW’s claim chart regarding newly accused products (the “new products claim chart”).
Specifically, Chapterhouse contends that the GW products identified in entries 146–48,
151–52, 155–57, and 163 on the new products claim chart are not entitled to protection
under copyright law. The only products that Chapterhouse contends are not
copyrightable in GW’s new claims, however, are various shoulder pads. The Court
addressed Chapterhouse’s arguments in detail in its previous decision and discussed
the copyrightability of the shoulder pads again in addressing Chapterhouse’s motion for
reconsideration. Chapterhouse has not made any additional arguments in support of its
position beyond those that the Court has already considered and rejected. Additionally,
the Court finds that Chapterhouse’s submission of a report by a new expert witness
does not warrant a different conclusion, given the low threshold of creativity needed to
warrant copyright protection. See FASA Corp. v. Playmates Toys, Inc., 912 F. Supp.
1124, 1147 (N.D. Ill. 1996) (evidence of prior similar works does not defeat author’s

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claim to copyright protection). The Court therefore denies Chapterhouse’s motion for
summary judgment.
III.

GW’s summary judgment motion
GW contends that it is entitled to partial summary judgment on three points.

First, GW contends that it is entitled to summary judgment regarding the question of its
ownership of the allegedly copied products. Second, GW contends that Chapterhouse
has admitted GW’s prior use of eighty-seven of its claimed trademarks and that as a
result, the Court should find that GW has established this element of trademark
infringement. Finally, GW argues that the Court should strike a number of the
affirmative defenses that Chapterhouse has asserted.
Summary judgment is proper when “the admissible evidence, construed in favor
of the non-movant, reveals no genuine issue as to any material facts and establishes
that the movant is entitled to judgment as a matter of law.” Berry v. Chi. Transit Auth.,
618 F.3d 688, 690–91 (7th Cir. 2010). A genuine issue of material fact exists if there is
sufficient evidence to allow a reasonable jury to find in favor of the non-movant.
Swearnigen-El v. Cook Cnty. Sheriff’s Dep’t, 602 F.3d 852, 859 (7th Cir. 2010). On a
motion for summary judgment, a court does not weigh evidence or determine the
credibility of any properly considered testimony. Berry, 618 F.3d at 691.
A.

GW’s ownership of copyrights

The Copyright Act provides a federal cause of action for “[t]he legal or beneficial
owner of an exclusive right under a copyright . . . .” 17 U.S.C. § 501(b). Ownership of a
valid copyright, therefore, is one of the elements a plaintiff must prove to prevail in a

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copyright infringement lawsuit. Feist Publ’ns, 499 U.S. at 361; HyperQuest, Inc. v.
N’Site Solutions, Inc., 632 F.3d 377, 385 (7th Cir. 2011).
In its response to GW’s motion for summary judgment, Chapterhouse concedes
that GW owns the exclusive rights for all but one of the works at issue in the litigation:
an illustration of a fictional “Lightning Claw” weapon. The illustration, created by Nick
Coleman, was included in a 1991 GW book on Warhammer 40,000 (entries 132 and
133 on the new products claim chart). Chapterhouse contended in its motion that GW
has never claimed Coleman as a current or former GW employee and had not produced
a confirmatory assignment documenting a previous assignment of rights in the
illustration. Chapterhouse appeared to agree, however, that a confirmatory assignment
from Coleman would resolve the issue of GW’s ownership of the “Lightning Claw”
illustration in entries 132 and 133. In its reply, GW stated that it did not yet have a
confirmatory assignment but expected to receive one within a matter of days. Pl.’s
Reply, Stevenson Decl. at 2. On March 29, GW filed a confirmatory assignment by
Coleman. See docket entry 330. This document confirms GW’s prior and continuing
ownership of the “Lightning Claw” illustration. GW is entitled to a finding in its favor on
the issue of its ownership of Coleman’s illustration as well as on the issue of its
ownership of copyrights for all of its other products still at issue in this litigation.
B.

GW’s prior use of trademarks

GW next contends that Chapterhouse has conceded that GW made prior use in
commerce of all the trademarks at issue in the case. GW relies on deposition testimony
by Nick Villacci, Chapterhouse’s principal owner and designated Rule 30(b)(6) witness,
regarding Chapterhouse’s prior use in commerce of the 107 claimed trademarks.

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Specifically, GW asked Villacci to look through all of the listed trademarks and identify
any marks for which “you think you created the name or the icon before Games
Workshop . . . .” Pl.’s Reply, Ex. A at 176. Villacci listed a number of items from the list,
and concluded, “[t]hat’s it.” Id., Ex. A at 179. GW argues that aside from the
trademarks that Villacci expressly mentioned,3 Chapterhouse has conceded GW’s prior
use in commerce of the listed trademarks.
GW’s alleged trademarks include both registered and unregistered trademarks.
See 15 U.S.C. §§ 1114(1) (cause of action for infringement of a registered mark) &
1125(a) (cause of action for infringement of rights in mark acquired by use). Under the
Lanham Act, registration is prima facie evidence of the claimant’s ownership of a valid
trademark. Id. § 1115(a); see Cent. Mfg., Inc. v. Brett, 492 F.3d 876, 881 (7th Cir.
2007); Packman v. Chi. Tribune Co., 267 F.3d 628, 638 (7th Cir. 2001). Chapterhouse
has offered no evidence suggesting that it used any of GW’s registered marks in U.S.
commerce before GW did so. GW is entitled to a finding that as to its registered marks,
this element of its Lanham Act claim has been established.
By contrast, when a plaintiff claims infringement of an unregistered trademark, it
bears the burden to establish both that the mark is protectable and that the plaintiff has
“engaged in prior use and ownership.” De Beers LV Trademark Ltd. v. DeBeers
Diamond Syndicate Inc., 440 F. Supp. 2d 249, 269 (S.D.N.Y. 2006) (internal quotation

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GW contends that Villacci identified twenty marks for which Chapterhouse contends it has
seniority of use in U.S. commerce. See Pl.’s Br. at 5 n.4. In fact, Villacci named twenty-five
marks in response to GW’s question quoted above. The Court notes that Villacci’s testimony is
not a model of clarity regarding whether he disputes GW’s prior use vis-à-vis Chapterhouse,
GW’s prior use as against the world, or the absence of any Chapterhouse product bearing the
mark. Because GW had the opportunity to clarify matters but did not do so, the Court will
construe any ambiguous testimony as indicating a dispute by Chapterhouse regarding GW’s
prior use.

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marks omitted) (citing Virgin Enters. Ltd. v. Nawab, 335 F.3d 141, 146 (2d Cir. 2003));
G. Heileman Brewing Co. v. Anheuser-Busch, Inc., 676 F. Supp. 1436, 1466 (E.D. Wis.
1987). Thus GW bears the burden of establishing its prior use vis-à-vis Chapterhouse
of all its claimed unregistered trademarks.
As the Court noted in its previous summary judgment decision, GW has
produced a detailed spreadsheet containing the names of each product bearing the
marks at issue and listing the annual amount of U.S. sales for the product from 2004
until the present. Chapterhouse did not begin to sell products of any kind until 2008,
four years later. That is sufficient to establish GW’s prior use of the marks. The only
evidence that Chapterhouse has submitted to rebut that evidence is Villacci’s testimony
at his deposition. Chapterhouse argues that GW failed to lay a proper foundation
regarding Villacci’s knowledge of GW’s prior use—he knows only when Chapterhouse
began selling products bearing any of the claimed marks—and that Villacci’s failure to
name other marks does not amount to an admission. Without Villacci’s testimony,
however, Chapterhouse has no evidence that gives rise to a genuine issue of material
fact regarding GW’s seniority of use of the marks. Thus the Court agrees that, except
for the marks for which Villacci disputed GW’s prior use, GW is entitled to a finding that
it has established prior use in commerce. The Court’s finding resolves this issue for all
but twenty-five of the trademarks. 4

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The trademarks for which GW still must establish prior use in commerce are: (1) Blood
Ravens, (2) Chaplain, (3) Exorcist, (4) Flesh Tearers, (5) Heresy Armour, (6) Horus Heresy, (7)
Howling Griffons, (8) Jetbike, (9) Jump Pack, (10) Lightning Claw, (11) Mycetic Spore, (12) Soul
Drinker, (13) Storm Shield, (14) Tervigon, (15) Tyranid Bonesword, (16) Tyranid Lashwhip, (17)
Ymgarl, (18) Blood Ravens Icon, (19) Celestial Lions Icon, (20) Dark Angels Winged Sword
Icon, (21) Exorcist Skull Icon, (22) Howling Griffons Icon, (23) Iron Snakes Icon, (24) Chaos
Space Marines Eight-Pointed Star Icon, and (25) Soul Drinkers Icon.

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GW also contends that it is entitled to summary judgment on the question of its
ownership of eight of the twenty-five marks at issue, based on a disclaimer that
Chapterhouse has posted on its website.5 Chapterhouse’s disclaimer lists a number of
products and trademarks—among them “Space Marine chapters” and “Space Marine
chapter logos”—that are registered, trademarked, or copyrighted by GW. It then
declares: “Used without permission. No challenge to their status intended. All Rights
Reserved to their respective owners.” See docket entry 213-9 at CHS 30. GW argues
that because these eight marks are Space Marine chapter logos, it is entitled to
summary judgment on the question of its ownership of trademark rights for the marks.
The Court disagrees. Chapterhouse’s disclaimer concedes that it does not claim
exclusive ownership (or ownership at all) of any marks for Space Marine chapters or
their logos. But the disclaimer does not confer upon GW the exclusive rights to those
marks. See Int’l Kennel Club of Chi. v. Mighty Star, Inc., 846 F.2d 1079, 1085–87 (7th
Cir. 1988) (analyzing protectability of unregistered mark without reference to
defendant’s disclaimer). Chapterhouse’s disclaimer does not mention these eight
products by name, and thus it is not sufficient to establish GW’s ownership of these
eight marks.
C.

Chapterhouse’s affirmative defenses

Finally, GW asks the Court to strike twenty-three of the twenty-four affirmative
defenses that Chapterhouse asserted in its answer to GW’s third amended complaint.
In response to GW’s motion for summary judgment, Chapterhouse has withdrawn
thirteen of its asserted defenses, including affirmative defenses 2, 8, 10–17, and 19–21.
5

Specifically, the eight marks include: (1) Blood Ravens Icon, (2) Celestial Lions Icon, (3) Dark
Angels Winged Sword Icon, (4) Exorcist Skull Icon, (5) Howling Griffons Icon, (6) Iron Snakes
Icon, (7) Chaos Space Marines Eight-Pointed Star Icon, and (8) Soul Drinkers Icon.

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Additionally, Chapterhouse acknowledges (and GW does not dispute in its reply) that
GW is not seeking statutory damages for any of its claims, and thus affirmative
defenses 22 and 23 are moot.
Chapterhouse concedes that affirmative defenses 5—that any copying was only
de minimis—and 6—that Chapterhouse independently created its products—are not
actually affirmative defenses at all, but rather involve the flip side of elements that GW
must establish to prevail on its copyright claims. Although Chapterhouse is free to
argue that GW has failed to meet its burden of proving copying and a sufficient degree
of copying to give rise to an infringement claim, these are not appropriate “affirmative”
defenses. Chapterhouse’s affirmative defense 3—that GW lacks standing to enforce its
alleged copyrights—is also not an affirmative defense, but rather a matter that a
copyright holder is required to establish. Perry v. Village of Arlington Heights, 186 F.3d
826, 829 (7th Cir. 1999) (citing Lujan v. Defenders of Wildlife, 504 U.S. 555, 561
(1992)). For these reasons, the Court strikes Chapterhouse’s affirmative defenses 2–3,
5–6, 8, 10–17, and 19–23. The Court also strikes affirmative defense 1, in which
Chapterhouse contends that GW has failed to state a cause of action, because the time
for filing a Rule 12(b)(6) motion has long since come and gone.
This ruling leaves affirmative defenses 4, 7, 9, 18, and 24. GW seeks to strike all
of these other than affirmative defense 18.
1.

Copyright fair use (defense 4)

Affirmative defense 4, which concerns GW’s copyright claims, is a defense of fair
use. As an initial matter, GW complains that Chapterhouse did not identify its products
that it contends are protected as a fair use of GW’s copyrights until after depositions

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had been concluded. As the Court noted in its previous decision, GW never moved for
sanctions on this basis, nor did it address the application of the standards for exclusion
of unproduced evidence under Federal Rule of Civil Procedure 37. Thus the Court will
not consider GW’s request to preclude Chapterhouse’s evidence of fair use in
connection with the summary judgment process.
Fair use of a copyrighted work is a defense to a claim of copyright infringement.
17 U.S.C. § 107. Section 107 lists four factors to be considered in determining whether
the defendant has made fair use of the copyrighted work:
(1) [T]he purpose and character of the use, including whether such use is
of a commercial nature or is for nonprofit educational purposes;
(2) the nature of the copyrighted work;
(3) the amount and substantiality of the portion used in relation to the
copyrighted work as a whole; and
(4) the effect of the use upon the potential market for or value of the
copyrighted work.
Id. These four factors are illustrative, rather than exhaustive, and they must be
“explored, and the results weighed together, in light of the purposes of copyright.”
Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569, 577–78 (1994); Ty, Inc. v. Publ’ns
Int’l Ltd., 292 F.3d 512, 522 (7th Cir. 2002). Fair use thus requires a fact-intensive
inquiry that often precludes a determination at summary judgment. See Coleman v.
ESPN, Inc., 764 F. Supp. 290, 294 (S.D.N.Y. 1991) (citing Maxtone-Graham v.
Burtchaell, 803 F.2d 1253, 1255 (2d Cir. 1986)).
The first statutory factor does not strongly favor one party over the other in this
case. Although the ultimate aim of Chapterhouse’s alleged copying was undoubtedly
for commercial sale, it has presented evidence from which a reasonable jury could

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conclude that in copying GW’s products, it added something new with a different
character—namely, that its products are “transformative.” See Campbell, 510 U.S. at
579. Specifically, Chapterhouse advertises a number of its products as items that can
“convert” one GW product or fictional character into another fictional character, and it
sells other products that present “alternative” designs to those sold by GW.
Factor three is similarly disputed. As discussed above and in the Court’s
previous decision, the Court has already determined that a jury reasonably could go
either way regarding the extent to which Chapterhouse’s products copy GW’s products.
Factor two tends to favor GW, although the extent to which this is so remains a
disputed factual question. This Court has concluded that GW’s products are sufficiently
original to warrant copyright protection. Additionally, GW’s products are all related to a
fictional post-apocalyptic universe, a tale that began twenty-five years ago with the
publication of Rogue Trader. Yet the characters that GW has created undoubtedly
share many of their traits with other fictional characters in science-fiction and fantasy
genres, and the Space Marines include traits and armor similar to those worn by real
soldiers throughout history. Thus although Warhammer 40K is undeniably fictional,
many components of GW’s products bear substantial similarly to items found throughout
history. Thus, the degree to which factor two favors GW is not clear.
Factor four tilts the most strongly in favor of GW. Although Chapterhouse
contends that its products only complement the existing GW market rather than
supersede it, the evidence submitted by both parties suggests that the core of
Chapterhouse’s business model is to attract GW customers and sell them “alternative”
figurine components at a lower cost.

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In sum, although some of the factors favor GW on the question of fair use, there
are factual disputes and issues regarding weight that make it inappropriate to enter
summary judgment in GW’s favor on this defense.
2.

Preemption (defense 7)

In its third amended complaint, GW asserts three state-law claims: (1) violation
of the Illinois Deceptive Trade Practices Act, 815 ILCS 510/3, (2) violation of the Illinois
Consumer Fraud and Deceptive Business Practices Act, 815 ILCS 505/10a, and (3) a
claim of common law unfair competition and trademark infringement. Chapterhouse
contends that to the extent GW’s state-law claims concern copyright infringement, they
are preempted by the Copyright Act. See 17 U.S.C. § 301. Chapterhouse agrees that
to the extent that GW’s state-law claims are limited to its allegations of trademark
infringement, they are not preempted. GW argues that the elements of its state-law
claims are sufficiently different from the elements of its claim under the Copyright Act to
make federal preemption inappropriate.
Section 301 of the Copyright Act provides that:
[A]ll legal or equitable rights that are equivalent to any of the exclusive
rights within the general scope of copyright as specified by section 106 in
works of authorship that are fixed in a tangible medium of expression and
come within the subject matter of copyright as specified by sections 102
and 103, whether created before or after that date and whether published
or unpublished, are governed exclusively by this title. Thereafter, no
person is entitled to any such right or equivalent right in any such work
under the common law or statutes of any State.
17 U.S.C. § 301(a). The Seventh Circuit has held that section 301 requires a court to
undertake a two-step analysis to determine whether a state-law claim is preempted.
First, a court should determine whether the work in which the right is asserted is fixed in
a tangible form and thus comes within the Copyright Act’s protection. Next, the court

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must analyze whether the state-law right is equivalent to the rights that fall within the
purview of the Copyright Act. Baltimore Orioles, Inc. v. Major League Baseball Players
Ass’n, 805 F.2d 663, 674 (7th Cir. 1986).
With regard to the products on which GW claims copyright infringement, it is
clear that the figurines and illustrations are fixed in a tangible form. See Defined Space,
Inc. v. Lakeshore East, LLC, 797 F. Supp. 2d 896, 902–03 (N.D. Ill. 2011) (“[I]t [is]
uncontroversial that the photographs at issue in this case fall within the subject matter of
the Copyright Act.”); Goes Lithography Co. v. Banta Corp., 26 F. Supp. 2d 1042, 1048
(N.D. Ill. 1998). Thus the first element of the preemption standard has been
established.
Turning to the second part of the analysis, to avoid preemption, the state-law
claim must incorporate an additional or different element such that the entire nature of
the claim is “qualitatively different from a copyright infringement claim.” Computer
Assocs. Int’l, Inc. v. Altai, Inc., 982 F.2d 693 (2d Cir. 1992); see also Goes Lithography,
26 F. Supp. 2d at 1048. The Second Circuit has determined that “[a]n action will not be
saved from preemption by elements such as awareness or intent, which alter the
action’s scope but not its nature. . . .” Computer Assocs. Int’l, 982 F.2d at 717. Based
on this rationale, a number of judges in this district have found the same types of statelaw claims that GW asserts to be preempted by the Copyright Act. See, e.g., Defined
Space, 797 F. Supp. 2d at 903 (“violations of state law prohibiting consumer fraud and
deceptive business and trade practices”); Cyber Websmith, Inc. v. Am. Dental Ass’n,
No. 09 C 6198, 2010 WL 3075726, at *2 (N.D. Ill. Aug. 4, 2010) (Lanham Act and Illinois
Uniform Deceptive Trade Practices Act); Natkin v. Winfrey, 111 F. Supp. 2d 1003,

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1013–14 (N.D. Ill. 2000) (Lanham Act, Illinois Consumer Fraud and Deceptive Business
Practices Act, Illinois Uniform Deceptive Trade Practices Act, and Illinois common-law
claim for unfair competition); Goes Lithography, 26 F. Supp. 2d at 1048 (Illinois
Deceptive Trade Practices Act).
GW has not offered any argument explaining why its claims against
Chapterhouse under Counts 4 through 6—insofar as they are based upon products for
which GW claims copyright infringement—involve violations of GW’s rights that are
qualitatively different from those protected by the Copyright Act. The Court therefore
denies GW’s request for summary judgment on this defense.
Chapterhouse has not asked the Court for summary judgment on the basis of
preemption. Federal Rule of Civil Procedure 56(f), however, provides that a court may
grant summary judgment for a nonmovant or on grounds not raised by a party, provided
that it gives the party against whom summary judgment will be entered notice and a
reasonable time to respond. Fed. R. Civ. P. 56(f); Lynch v. Ne. Reg’l Commuter R.R.
Corp., 700 F.3d 906, 910–11 (7th Cir. 2012) (“Rule 56(f) . . . allows a court to grant
summary judgment on grounds not raised by a party only after providing notice and a
reasonable time to respond.”). The Court now gives notice that it intends to grant
summary judgment for Chapterhouse on the ground that to the extent that any of GW’s
state-law claims concern copyright infringement, they are preempted by the Copyright
Act. If GW has some basis to preclude entry of summary judgment against it on this
basis on the copyright-related aspects of its state-law claims, it must file an objection
explaining its opposition by no later than April 8, 2013. In the alternative, GW may
withdraw its state-law claims insofar as they allege copyright infringement.

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3.

Implied license (defense 9)

GW seeks summary judgment on Chapterhouse’s affirmative defense that GW
impliedly licensed Chapterhouse’s uses of any protectable copyrights and trademarks.
Chapterhouse contends that a page on GW’s website, entitled “What you can and can’t
do with Games Workshop’s intellectual property,” has impliedly licensed
Chapterhouse’s use of GW’s intellectual property. The policy statement found on GW’s
website, however, expressly forbids “informal licensees” from using GW’s intellectual
property “in relation to any commercial activity . . . [including] selling non-Games
Workshop materials using our trademarks.” Def.’s Resp., Ex. S at 1. The GW policy
statement also expressly forbids “creat[ing] a production run of conversions for sale”
and “cast[ing] any materials that are based upon Games Workshop material.” Id., Ex. S
at 2. It is undisputed that Chapterhouse was selling its products commercially, and
several of the products Chapterhouse sells are named and described as “conversion
kits.” Chapterhouse has identified no other basis upon which GW impliedly licensed its
use of the claimed copyrights and trademarks. Because GW’s policy statement
expressly prohibits the kind of use Chapterhouse undertook in creating and selling its
products, the Court determines that no reasonable jury could find that GW impliedly
licensed Chapterhouse’s use. The Court thus grants GW’s motion for summary
judgment on affirmative defense 9.
4.

Fraud on the Copyright and Trademark Offices (defense 24)

Chapterhouse contends that GW committed fraud on the Copyright Office when it
“submitted the summary judgment decision entered by the Court, but withheld from the
Copyright Office the material fact that the Court had never been advised of the

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Copyright Office’s earlier decision that the ‘sculpture portion is too minimal’ to . . . qualify
for registration.” Def.’s Resp. at 6. The e-mail correspondence between GW’s attorney
and the Copyright Office regarding GW’s application for registration of its Assault Squad
shoulder pads indicates, however, that although the attorney attempted to send the
Court’s prior decision to the Copyright Office, the Office refused to receive or review the
decision. It is perhaps for this reason that Chapterhouse has stated that it does not
intend to assert affirmative defense 24 unless GW appeals the Copyright Office’s denial
of that particular registration.
Pursuant to 37 C.F.R. § 202.5(b)(3), GW must submit any request for
reconsideration within three months of the Copyright Office’s initial decision to refuse
registration. 37 C.F.R. § 202.5(b)(3). The Copyright Office denied registration in a
letter dated January 4, 2013, and thus GW will lose its ability to petition for
reconsideration on April 4. Although GW wrote the Copyright Office a letter stating that
it believed that it would be “more efficient simply to allow the Court to decide the
matter,” it denies that it has abandoned any right to pursue appellate review of the
denial. Thus the Court strikes affirmative defense 24 without prejudice and will allow
Chapterhouse to revive the defense if GW pursues further review of the Copyright
Office’s denial and Chapterhouse believes it has a good-faith basis for the defense.
Conclusion
For the reasons stated above, the Court grants Chapterhouse’s motion for
reconsideration [docket no. 287] in part and denies it part, denies Chapterhouse’s
motion for summary judgment [docket no. 289], and grants GW’s motion for summary
judgment [docket no. 291] in part and denies it in part. Additionally, the Court gives

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notice to GW that it intends to grant summary judgment for Chapterhouse on certain
claims based on preemption by the Copyright Act, as more fully described earlier. GW
must file any response opposing the Court’s proposal by April 8, 2013.

MATTHEW F. KENNELLY
United States District Judge
Date: April 1, 2013

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