John Wiley & Sons, Inc., v. DRK Photo
OPINION AND ORDER re: 73 MOTION for Partial Summary Judgment filed by DRK Photo, 52 MOTION for Summary Judgment filed by John Wiley & Sons, Inc.: For the foregoing reasons, DRK's motion for partial summary judgment is denied as to the DRK Su mmary Judgment Instances except the Three Bean Instances, and DRK's claims as to those instances are dismissed; DRK's motion for partial summary judgment as to the Three Bean Instances is granted; Wiley's motion for summary judgment di smissing the non-Bean and non-French DRK Counterclaim Instances is granted, and DRK's claims as to those instances are dismissed; Wiley's motion for summary judgment for declaratory relief of non-infringement is denied; and its claims for d eclaratory relief as to the Wiley Non-Infringement Instances are dismissed except for the French and Bean instances at lines 3, 117, 120, 137, 140, 149, 150, 160, 163, 192, 210, 213, 224, 225, 233, 236, 247, 248, 265, 287, 290, 313, and 314 of Wiley& #039;s Chart. The Clerk of Court is directed to terminate Docket Entries 52 and 73. A pretrial conference will be held on March 21, 2014, at 2:30 p.m. to discuss scheduling trial in this matter. (Pretrial Conference set for 3/21/2014 at 02:30 PM before Judge Katherine Polk Failla.) (Signed by Judge Katherine Polk Failla on 2/21/2014) (tn)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
JOHN WILEY & SONS, INC.,
DOC #: _________________
DATE FILED: February 21, 2014
11 Civ. 5454 (KPF)
OPINION AND ORDER
KATHERINE POLK FAILLA, District Judge:
On August 5, 2011, Plaintiff/Counter-Defendant John Wiley & Sons, Inc.
(“Plaintiff” or “Wiley”), commenced this action against Defendant/CounterPlaintiff DRK Photo (“Defendant” or “DRK”) under the Declaratory Judgment
Act, 28 U.S.C. § 2201, seeking a declaration that Wiley had not infringed the
copyrights on certain stock photographs that DRK had previously licensed to
Wiley. In response, on May 31, 2012, DRK counterclaimed against Wiley for
infringement under the Copyright Act of 1976, 17 U.S.C. §§ 101-810, as to a
subset of these photographs.
The parties have filed cross-motions for summary judgment. For the
reasons set forth in the remainder of this Opinion, Wiley’s motion for summary
judgment is granted in part and denied in part; DRK’s motion for partial
summary judgment is also granted in part and denied in part.
DRK’s Stock Photography Business
DRK is a stock photography agency that licenses photographic images to
publishers. (DRK 56.1 Statement ¶ 1). Daniel Krasemann has owned DRK as
a sole proprietorship since 1981. (D. Krasemann Decl. ¶ 1). Rather than
employ photographers, DRK executes agreements with photographers
pursuant to which the photographers grant DRK the right to include certain of
the photographers’ works in DRK’s collection of stock photographs. (DRK’s
Counterstatement ¶¶ 3-4). Once the photographers’ images are included in
Rule 56.1 of the Local Civil Rules of the United States District Courts for the Southern
and Eastern Districts of New York (the “Local Rules”) requires a party moving for
summary judgment to submit a “separate, short and concise statement, in numbered
paragraphs, of the material facts as to which the moving party contends there is no
genuine issue to be tried.” Local Rule 56.1(a). The movant’s asserted facts are deemed
to be admitted unless specifically controverted by the statement served by the opposing
party. Local Rule 56.1(c).
The parties have submitted a considerable record in support of their cross-motions.
The facts in this Opinion are drawn from Wiley’s Statement of Undisputed Material
Facts (“Wiley’s 56.1 Statement”) (Dkt. #55), DRK’s Response to Wiley’s Statement of
Allegedly Undisputed Material Facts (“DRK’s 56.1 Counterstatement”) (Dkt. #70),
Wiley’s Reply Statement of Undisputed Material Facts (“Wiley’s 56.1 Reply Statement”)
(Dkt. #82), DRK’s Separate Statement of Facts in Support of Its Motion for Partial
Summary Judgment (“DRK’s 56.1 Statement”) (Dkt. #77), Wiley’s Response to DRK’s
Separate Statement of Facts in Support of Its Motion for Partial Summary Judgment
(“Wiley’s 56.1 Counterstatement”) (Dkt. #90), DRK’s Reply on Separate Statement of
Facts in Support of Its Motion for Partial Summary Judgment (“DRK’s 56.1 Reply
Statement”) (Dkt. #94), and various declarations, which are identified using the
convention “[Name] Decl.,” as well as exhibits thereto (Dkt. #54, 67-69, 75, 76, 84, 91,
92, 95, 96).
The Court will refer to the parties’ memoranda of law as follows: Wiley’s Memorandum
of Law in Support of Its Motion for Summary Judgment as “Pl. Br.” (Dkt. #53); DRK’s
Opposition to Plaintiff John Wiley & Sons, Inc.’s Motion for Summary Judgment as
“Def. Opp.” (Dkt. #66); Wiley’s Reply Memorandum of Law in Support of Its Motion for
Summary Judgment as “Pl. Reply” (Dkt. #83); DRK’s Memorandum of Law in Support of
Its Motion for Partial Summary Judgment as “Counter-Pl. Br.” (Dkt. #74); Wiley’s
Memorandum of Law in Opposition to DRK’s Motion for Partial Summary Judgment as
“Counter-Def. Opp.” (Dkt. #89); and DRK’s Reply Brief in Support of Its Motion for
Partial Summary Judgment as “Counter-Pl. Reply” (Dkt. #99).
DRK’s collection, DRK offers to license those images to publishers, like Wiley,
and other users of photographs. (Id. at 4).
DRK employs an internal numbering system to track the images that
DRK includes in its collection. (D. Krasemann Decl. ¶ 7). Using this system,
DRK assigns each image an internal number when that image is received from
a photographer and added into DRK’s collection. (Id.). The images are
numbered sequentially from the date on which the image was received. (Id.).
This number allows DRK to identify when the image was first released into its
collection, and consequently, when the image is deemed published under
copyright law. (Id.; Penchina Decl., Exh. 31 at 66).
This procedure was applied to all images at issue in this case, except for
certain images received from Stephen Krasemann, a photographer and Daniel
Krasemann’s brother. (See D. Krasemann Decl. ¶ 8). Although internal
numbers were assigned to Stephen Krasemann’s images at the time DRK
received them, the images were often not simultaneously released into DRK’s
collection. Instead, the images were released, and thus published at later
dates. (Id.). 2 Consequently, according to DRK, the internal numbers assigned
to Stephen Krasemann’s photographs may not reliably indicate the date on
which the image was released for publication. (Id. at ¶ 9).
DRK followed a different procedure for these images for various reasons, including the
facts that (i) Stephen Krasemann would sometimes send images to DRK for storage
purposes while traveling, which images he would then review and approve for
publication upon his return; (ii) he may have requested first publication rights in
certain images; and (iii) he may have previously promised the rights to the image to
another publisher. (D. Krasemann Decl. ¶ 8).
DRK’s Agreements with Photographers
DRK entered into a form representation agreement (the “Representation
Agreement”) with each photographer for whom DRK maintained images in its
collection. (D. Krasemann Decl. ¶ 3, Exh. 1). Pursuant to the Representation
Agreements for all images at issue, except those by photographers Tom Bean
(“Bean”) and Peter French (“French”), DRK would serve as the photographers’
“agent with  respect to the sale or leasing of the photographs or
transparencies which [the photographer had] delivered to [DRK] and shall
deliver to [DRK] in the future.” (Id.). In contrast, under the Bean and French
Representation Agreements, DRK agreed to act as Bean’s and French’s “sole
and exclusive agent with respect to the sale or leasing of the photographs or
transparencies which [Bean or French had] delivered to [DRK] and shall deliver
to [DRK] in the future.” (Id. (emphasis added)).
The Representation Agreements also provided, in relevant part:
I understand that the best possible care will be taken of my
material and agree that you assume no liability for any loss or
damage to the items so delivered to you. In the event that any
transparency is lost, destroyed or damaged by others, then I give
you full and complete authority to make claim or bring suit for
redress or compromise said claim without my permission.
I understand that there will be a 50/50 split between DRK PHOTO
and myself regarding all sales made and received. Payment is to be
made within ninety (90) days of receipt. DRK PHOTO shall notify
me on a regular monthly basis if any sales activity occurred during
I understand that the terms and compensation of the sales or
leasing of my photographs or transparencies shall be solely in your
In the event of termination of this agreement DRK PHOTO retains
the right to its normal commission on all sales which might arise
from a user who has made duplicates of those transparencies,
photographs, or other materials submitted to it during the terms of
this agreement and then, after term hereof, the user wishes to
utilize such duplicate materials. DRK PHOTO shall have the right
to grant such usage and collect 50% of the net sale from usage.
DRK PHOTO shall also retain the right to collect 50% of the net
sale from all subsequent pick-ups or reprints on photos that were
originally placed with the client during the term of this agreement,
and then reprinted or picked-up after expiration of this agreement.
(Id.). Although DRK contends otherwise, the record before the Court
conclusively establishes that all Representation Agreements, except those with
Bean and French, granted DRK nonexclusive rights for the photographers’
images in DRK’s collection. (See, e.g., Penchina Decl., Exh. 3, 30 at 166-67, 33
at 21). 3
The Representation Agreement is not the only operative agreement
between DRK and the photographers whose images are at issue here. In 2008,
Wiley has submitted testimonial and documentary evidence to support its statement
that “[a]ll of the photographers whose works are identified in Exhibit 1 to DRK’s
Counterclaims, with the exception of Tom Bean and Peter French, granted only nonexclusive rights to DRK.” (Wiley 56.1 Statement ¶ 6). DRK has offered no conflicting
testimonial or documentary evidence, but rather offers (i) a conclusory statement that
the Representation Agreements and other assignment agreements that it had with
photographers granted DRK “exclusive rights as recognized by the Copyright Act,”
coupled with (ii) an argument (ultimately unpersuasive, see infra) that “Wiley is
confusing ‘exclusive ownership’ with ‘exclusive rights.’” (DRK 56.1 Counterstatement
¶ 6). Because Wiley has supported its statement with testimonial and documentary
evidence, and DRK has not submitted conflicting evidence, the Court accepts Wiley’s
statement as true. See S.D.N.Y. Local Rule 56.1(c) (“Each numbered paragraph in the
statement of material facts set forth in the statement required to be served by the
moving party will be deemed to be admitted for purposes of the motion unless
specifically controverted by a corresponding numbered paragraph in the statement
required to be served by the opposing party.”); id. at 56.1(d) (“Each statement by the
movant or opponent … controverting any statement of material fact must be followed
by citation to evidence which would be admissible, set forth as required by Fed. R. Civ.
DRK initiated a program to register copyrights for the photographs in its
collection. (Wiley 56.1 Statement ¶ 20). To that end, beginning in June 2008,
DRK asked photographers to sign a form agreement, pursuant to which the
photographers would grant DRK the right to assert copyright infringement
claims for those photographs in its collection (the “Assignment Agreement”).
(Id. at ¶¶ 21, 24). The Assignment Agreement, entitled “Copyright Assignment,
Registration, and Accrued Causes of Action Agreement,” provided:
The undersigned photographer, the sole owner of the copyrights in
this undersigned’s images, (the “Images”) selected by DRK PHOTO
(“DRK”) and included in DRK’s collection, hereby grants to DRK all
copyrights and complete legal title in the Images. DRK agrees to
reassign all copyrights and complete legal title back to the
undersigned immediately upon completion of the registration of the
Images, as evidenced by DRK’s receipt of a Certificate of
Registration from the United States Copyright Office for such
Images, and resolution of infringement claims brought by DRK
relating to the Images.
The undersigned agrees and fully transfers all right, title and
interest in any accrued or later accrued claims, causes of action,
choses in action — which is the personal right to bring a case — or
lawsuits, brought to enforce copyrights in the Images, appointing
and permitting DRK to prosecute said accrued or later accrued
claims, causes of action, choses in action or lawsuits, as if it were
Any proceeds obtained by settlement or judgment for said claims
shall, after deducting all costs, expenses and attorney’s fees, be
divided and paid 50% for the undersigned and 50% for DRK.
(Id. at ¶ 22). 4
All Assignment Agreements at issue in this case contain this language except for the
second assignment agreement executed between DRK and Stephen Krasemann (the
“Stephen Krasemann Second Assignment Agreement”), which was executed to cover
certain images that Stephen Krasemann had already registered with the Copyright
Office. (DRK 56.1 Counterstatement ¶ 22; D. Krasemann Decl., Exh. 2). The Court,
The purpose of the Assignment Agreement was to allow DRK to register
photographs with the United States Copyright Office “as the copyright holder
by assignment” so that DRK would have — at least as DRK understood it —
“legal standing with the courts to pursue would be infringers.” (Wiley 56.1
Statement ¶ 27). Indeed, when transmitting the Assignment Agreement to
photographers, DRK informed them that the purpose of the agreement was for
DRK to register the photographers’ images in its collection with the United
States Copyright Office so that DRK would be “in a much stronger position with
much more leverage for settling copyright infringement claims.” (Penchina
Decl., Exh. 4). In those e-mails to photographers, DRK confirmed that the
Assignment Agreement was “not a permanent assignment.” (Id.). Rather, and
as provided for in the Assignment Agreement, DRK “agree[d] to reassign all
copyrights and complete legal title back” to the photographers “immediately
upon completion of the registration of the images, as evidenced by DRK’s
receipt of a Certificate of Registration from the United Stated Copyright Office
however, may not consider the Stephen Krasemann Second Assignment Agreement
because it was not produced by DRK during discovery. Instead, it was produced to
Wiley for the first time in response to Wiley’s motion for summary judgment. See Melie
v. EVCI/TCI Coll. Admin., No. 08 Civ. 5226 (HB), 2009 WL 1404325, at *1 n.4 (S.D.N.Y.
May 20, 2009) (“Plaintiff may not rely on this document [in] his opposition to summary
judgment, as he did not provide a copy of it to Defendants in discovery.”), aff’d, 374 F.
App’x 150 (2d Cir. 2010) (summary order); see also Stengel v. Black, No. 03 Civ. 0495
(GEL), 2004 WL 1933612, at *4 (S.D.N.Y. Aug. 30, 2004) (“These documents, however,
are not part of the evidentiary record, and may not be considered by the Court.”); Fed.
R. Civ. P. 37(c) (“If a party fails to provide information … as required by Rule 26(a) or (e),
the party is not allowed to use that information … to supply evidence on a motion, at a
hearing, or at a trial, unless the failure was substantially justified or is harmless.”). The
Court notes that consideration of the Stephen Krasemann Second Assignment
Agreement would not alter the outcome reached herein.
for such images, and resolution of infringement claims brought by DRK relating
to the images.” (Id.). When one photographer expressed his concern in signing
the agreement, based on his unwillingness to allow the copyright registration to
his image to be in DRK’s name, DRK “assure[d]” the photographer that there
was “no rights grab going on here. We simply want to register our
website/database of images so the images are protected under copyright law,
and so we can pursue infringers.” (Id. at Exh. 9). In another e-mail exchange,
one photographer, upon realizing how many images that DRK had registered
with the Copyright Office, e-mailed DRK to clarify: “I have not assigned
copyright to any of these images other than temporarily to DRK Photo in order
for you to pursue your infringement lawsuit. I have however sold non-exclusive
rights to some of these pictures. I expect re-assignment of full copyright in the
very near future when your lawsuit is concluded.” (Id. at Exh. 12).
DRK’s Relationship with Wiley
Wiley is a publisher of textbooks and other educational materials. (Wiley
56.1 Statement ¶ 1). Beginning around 1992, DRK began licensing
photographs to Wiley for inclusion in textbooks and related products published
by Wiley. (Id. at ¶ 9). In general, Wiley would submit a letter to DRK for each
transaction that would identify which particular stock photographs from DRK’s
collection Wiley desired to use. (Id. at ¶ 10). Wiley would also inform DRK
which textbook or publication the photographs would be included in, and the
number of print runs that Wiley intended to complete. (Id.).
Once Wiley’s request was approved, DRK would issue an invoice to Wiley
that set forth the terms applicable to Wiley’s use of the licensed photographs.
(Wiley 56.1 Statement ¶ 11). For example, the invoices specified the terms of
the “Media Usage and Type Allowed” as follows:
One-time, non-exclusive, North American, English language
reproduction and distribution rights for publication inside the
print version of the copyright 1997 John Wiley’s & Sons, Inc.
COLLEGE LEVEL TEXTBOOK publication titled THE SCIENCE,
2ND EDITION, by Trefil; the total number of copies to be printed is
not to exceed 20,000. No other rights granted or implied. No
electronic publishing rights granted.
(Second D. Krasemann Decl., Exh. 2-A, 2-B). The invoices also
contained standard form language under the heading “Rights Granted”
One-time, non exclusive reproduction rights to the photographs
listed below, solely for the uses and specifications indicated and
limited to the individual edition, volume series, show event or the
like contemplated for this specific transaction (unless otherwise
indicated in writing).
(Id.). 5 Invoices that used a revised standardized form also included
additional restrictions on the use of the images beyond the terms of the
If [Wiley] desires to reuse an image or extend previous usage, then
Recipient must request and pay for additional rights prior to
publication. [Wiley] agrees not to make, authorize or permit any
use of an image or its derivative … except as authorized by the
invoice. In the event [Wiley] use[s] an image for any use other than
Two invoices do not include this language, but those documents appear to be
anomalies. This is purportedly because when they were produced during discovery,
they were not produced on DRK’s standardized form that included the “Rights Granted”
language. (Second Krasemann Decl. ¶ 12, Exh. 2-A). This variance in language is
immaterial to the Court’s analysis.
that indicated on the invoice, including but not limited to the
number of uses, the publication using, or the size of reproduction,
DRK PHOTO agrees to forego its rights to sue for copyright
infringement and breach of contract if [Wiley] pay[s], as liquidated
damages, a sum equal to ten (10) times the maximum price [DRK]
would have charged for such use, within 10 (ten) days of [DRK]
billing such fee.
(Second Krasemann Decl., Exh. 2-B, Invoices 8795 and 9243).
In addition to the aforementioned agreements, for the period 2000
through 2001, DRK and Wiley entered into a separate pricing agreement that
set forth the prices that DRK would charge Wiley for use of photos licensed by
DRK (the “Pricing Agreement”). (See Wiley 56.1 Statement ¶¶ 13-14).
Pursuant to the Pricing Agreement, “DRK charged Wiley $170 for the right to
print and distribute in North America (with up to 10% of the distribution
permitted to be sent abroad) up to 40,000 copies of a book (printed in the
English language) in which DRK’s photos comprised up to half a page; and
DRK charged an additional 10% [(i.e., $17)] to increase the permitted print run
up to 80,000 copies.” (Id. at ¶ 14).
The Alleged Instances of Copyright Infringement
Background and Nomenclature
At issue in this case are a number of photographs, and an even greater
number of alleged instances of copyright infringement with respect to those
photographs. Certain photographs are the subject of multiple instances of
alleged infringement. Consequently, when referring to “instances” of alleged
infringement, the Court is not necessarily referring to different photographs.
Rather, the Court is identifying particular uses of a photograph by Wiley as to
which DRK has claimed copyright infringement.
To capture the instances of alleged infringement, the parties have
submitted three summary charts, included as exhibits to the parties’
submissions; these charts detail information about each instance, such as the
photograph used by Wiley and the publication in which it appeared. When
referring to an instance of alleged infringement, the Court has adopted the
parties’ convention of referring to a line on one of the summary charts where
the instance is identified. There are a total of 316 instances of alleged
copyright infringement for which Wiley seeks a declaration of non-infringement
(the “Wiley Non-Infringement Instances”). These Instances are set forth in
Exhibit A to Wiley’s amended complaint (“Wiley’s Chart”). (Dkt. #23). 6
In its counterclaims against Wiley for copyright infringement, DRK
isolated 295 of the 316 Wiley Non-Infringement Instances, and listed them in
Exhibit 1 to DRK’s counterclaims. (Dkt. #26-1). 7 For clarity, the Court will
refer to these instances as the “DRK Counterclaim Instances.” In DRK’s
pending motion, it has further narrowed the scope of instances of alleged
Exhibit A does not include the alleged instances of infringement related to certain
Stephen Krasemann’s photographs listed at lines 230 and 253 of Exhibit 1 to DRK’s
Counterclaim. (Dkt. #26-1). It is clear from Wiley’s complaint, however, that these
instances of alleged infringement were inadvertently excluded from Wiley’s Chart
because Wiley moves for a declaratory judgment as to all “316 instances of infringement
alleged by DRK” (Compl. ¶¶ 21-22), which necessarily includes these instances of
alleged infringement. For this reason, the Court incorporates by reference lines 230
and 253 of Exhibit 1 to DRK’s counterclaims into Wiley’s Chart.
DRK’s Counterclaim Instances are also identified at lines 1-292, 295, 297, and 298 of
infringement as to which DRK seeks summary judgment in its favor, identifying
only 88 instances (the “DRK Summary Judgment Instances”). The DRK
Summary Judgment Instances are identified in Exhibit A to the Second
Declaration of Autumn Witt Boyd (“DRK’s Chart”). (Dkt. #76-1).
The Stephen Krasemann Photographs
There are six photographs by Stephen Krasemann as to which the
parties raise specific issues. The images are covered by two registrations that
Stephen Krasemann personally obtained. (Wiley 56.1 Statement ¶ 35). The
first registration, Registration No. VAu 175-200, has an effective date of
February 1, 1990. (Id. at ¶ 56). The second registration, Registration No. VAu
516-002, has an effective registration date of March 13, 2001. (Id. at ¶ 44).
The specific images at issue include the following: (i) Masai Livestock Tanzania,
image number 902499; (ii) Wind Generators and Mountains Gorgonio Pass,
California, image number 905268; (iii) Red Fox in winter leaping after mouse,
image number 902839; (iv) Aerial view Cape Cod and surf, image number
904674; (v) Lunch Creek Waterfall, Montana, image number 905367; (vi) Aerial
Permafrost Polygons, image number 901854 (collectively, the “Krasemann
Images”); as well as (v) image numbers 127141 to 134177; and (vi) image
numbers 100001 to 112610. (See id. at ¶¶ 45-57). 8
The parties dispute the exact date of publication for most of Stephen Krasemann’s
photographs. The Court need not address this dispute in order to resolve the pending
The Tom Bean and Peter French Photographs
Separately, there are 43 instances of alleged infringement related to
photographs by Tom Bean (the “Bean Instances”), and one instance related to a
photograph by Peter French (the “French Instance”). DRK seeks summary
judgment as to only 16 of the Bean Instances, and thus only those 16 are listed
among the DRK Summary Judgment Instances. 9 The parties do not dispute
that, unlike the other photographs at issue in this case, DRK held an exclusive
license to the photographs by Bean and French. (See Wiley 56.1 Statement
¶ 6). The parties agree that all 16 Bean Instances were published, sold, or
distributed prior to August 5, 2008, except for those instances at lines 6, 7,
and 75 of DRK’s Chart. (Counter-Def. Opp. 8-9; Counter-Pl. Reply 12).
The Instant Litigation
On August 5, 2011, Wiley filed suit against DRK seeking a declaratory
judgment of non-infringement for any use by Wiley of any image that DRK had
licensed to Wiley; these potential instances of infringement are referred to
herein as the Wiley Non-Infringement Instances. (Dkt. #1). Wiley alleged that
(i) it was entitled to a declaration of non-infringement because DRK lacked
copyright ownership or a valid copyright registration; (ii) many of Wiley’s NonInfringement Instances occurred outside of the applicable statute of limitations;
The 16 Bean Instances on which DRK moves for partial summary judgment are
identified at lines 29, 30, 39, 41, 43, 45, 46, 53, 54, 57, 73, 76, 85, 86, 111, and 278 of
Wiley’s Chart. The other instances of infringement related to Bean and French
photographs are identified at lines 3, 10, 12, 13, 17, 38, 117, 120, 137, 140, 149, 150,
160, 163, 192, 210, 213, 224, 225, 233, 236, 247, 248, 265, 278, 287, 290, 298, 313,
and 314 of Wiley’s Chart.
and (iii) the Wiley Non-Infringement Instances involved the re-use of the same
images that DRK had licensed to Wiley to use in a later edition or revised
version of the work. (Id.). Wiley also sought a declaration that it was not liable
to DRK for any claim sounding in fraud. (Id.).
A few weeks after Wiley commenced suit in this District, DRK filed a
mirror-image action against Wiley in the United States District Court for the
District of Arizona (the “Arizona Action”). (Dkt. #22). The Wiley NonInfringement Instances were first identified by DRK in its complaint in the
Arizona Action. (Dkt. #23 at ¶ 21). On August 26, 2011, DRK moved to
dismiss the complaint in this action, citing both alleged deficiencies in pleading
and the existence of the Arizona Action. (Dkt. #4, 5).
By order dated October 13, 2011, the Honorable George B. Daniels, the
District Judge then presiding over this case, dismissed Wiley’s request for
declaratory relief as to any fraud claim, and any copyright infringement claims
prior to June 18, 1997, because those claims were subject to arbitration; he
also dismissed Wiley’s claims for declaratory relief as to alleged instances of
infringement occurring after June 18, 1997, because Wiley had failed to put
DRK on notice of the photographs at issue. (Dkt. #16, 22). Judge Daniels then
denied DRK’s cross-motion to dismiss the complaint in favor of the Arizona
Action pursuant to the “first filed” rule, under which a district court may
dismiss an action in favor of a previously filed lawsuit “concerning the same
parties and issues.” (Dkt. #22). 10 At the same time, the Court granted Wiley
leave to amend its complaint. (Dkt. #16).
On May 14, 2012, Wiley filed an amended complaint in which it sought a
declaratory judgment as to the Wiley Non-Infringement Instances that were
implicated by the Arizona Action. (Dkt. #23). Specifically, Wiley sought an
order declaring that:
(i) for each of the instances in which Wiley’s alleged infringement
occurred more than three years prior to August 2011, declarations
that DRK’s claim is barred by the statute of limitations and Wiley
is not liable to DRK for copyright infringement;
(ii) for each of the instances in which DRK lacks copyright
ownership or a valid copyright registration for the photograph at
issue in DRK’s claim, declarations that DRK lacks standing and
Wiley is not liable to DRK for copyright infringement; and
(iii) for each of the instances in which Wiley simply included the
same photograph in a later edition or revised version of a work for
which DRK originally licensed Wiley to use the photograph,
declarations that such inclusion was permissible under Section
201(c) of the Copyright Act and Wiley is not liable to DRK for
(Id.). Attached to the amended complaint was Wiley’s Chart, a summary chart
that identified the 316 instances of alleged copyright infringement. (Id.).
On May 31, 2012, DRK filed an answer and asserted counterclaims for
copyright infringement, contributory infringement, and vicarious infringement
as to the DRK Counterclaim Instances that DRK had identified in Exhibit 1 to
its Answer and Counterclaim. (Dkt. #26, 26-1). DRK further sought an order
On June 11, 2012, the Arizona Action was transferred to the Southern District of New
York, and remains pending before the Court as a related case. See DRK Photo, a sole
proprietorship v. John Wiley & Sons, Inc. and John Doe Printers 1-10, No. 12 Civ. 4538
declaring that any use of DRK’s photographs by Wiley beyond the limits of the
parties’ applicable license agreement constituted copyright infringement. (Id.).
Having concluded with discovery, the parties have filed the pending
cross-motions for summary judgment. Wiley filed its motion for summary
judgment on May 23, 2013, requesting that the Court (i) dismiss all of DRK’s
counterclaims for copyright infringement (except for those claims relating to
photographs by Bean and French); and (ii) issue a declaration of noninfringement for the Wiley Non-Infringement Instances. (Dkt. #52). 11 DRK filed
its opposition on June 24, 2013 (Dkt. #66), and on July 11, 2013, the motion
was fully submitted when Wiley filed its reply (Dkt. #83).
On June 28, 2013, DRK moved for partial summary judgment,
requesting that the Court enter judgment of liability for copyright infringement
against Wiley as to the DRK Summary Judgment Instances. (Dkt. #73). Wiley
filed its opposition on July 26, 2013 (Dkt. #89), and on August 9, 2013, the
motion was fully submitted when DRK filed its reply (Dkt. #93-2). Between
August 18, 2013, and January 28, 2014, the parties submitted supplemental
authority in support of their respective motions. (See Dkt. #98, 100-02, 105).
Although Wiley styles its motion as one for “summary judgment,” it seeks less than full
relief from the Court.
Under Federal Rule of Civil Procedure 56(c), summary judgment may be
granted only if all the submissions taken together “show that there is no
genuine issue as to any material fact and that the moving party is entitled to
judgment as a matter of law.” See Celotex Corp. v. Catrett, 477 U.S. 317, 322
(1986); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247 (1986). The moving
party bears the initial burden of demonstrating “the absence of a genuine issue
of material fact.” Celotex, 477 U.S. at 323. A fact is “material” if it “might
affect the outcome of the suit under the governing law,” and is genuinely in
dispute “if the evidence is such that a reasonable jury could return a verdict for
the nonmoving party.” Anderson, 477 U.S. at 248; see also Jeffreys v. City of
New York, 426 F.3d 549, 553 (2d Cir. 2005) (citing Anderson). The movant
may discharge this burden by showing that the nonmoving party has “fail[ed]
to make a showing sufficient to establish the existence of an element essential
to that party’s case, and on which that party will bear the burden of proof at
trial.” Celotex, 477 U.S. at 322; see also Selevan v. N.Y. Thruway Auth., 711
F.3d 253, 256 (2d Cir. 2013) (finding summary judgment appropriate where the
non-moving party fails to “come forth with evidence sufficient to permit a
reasonable juror to return a verdict in his or her favor on an essential element
of a claim” (internal quotation marks omitted)).
If the moving party meets this burden, the nonmoving party must “set
forth specific facts showing a genuine issue for trial” using affidavits or
otherwise, and cannot rely on the “mere allegations or denials” contained in the
pleadings. Anderson, 477 U.S. at 248; see also Celotex, 477 U.S. at 323-24;
Wright v. Goord, 554 F.3d 255, 266 (2d Cir. 2009). The nonmoving party “must
do more than simply show that there is some metaphysical doubt as to the
material facts,” Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574,
586 (1986) (internal quotation marks omitted), and cannot rely on “mere
speculation or conjecture as to the true nature of the facts to overcome a
motion for summary judgment,” Knight v. U.S. Fire Ins. Co., 804 F.2d 9, 12 (2d
Cir. 1986) (quoting Quarles v. Gen. Motors Corp., 758 F.2d 839, 840 (2d Cir.
The standard used to decide cross-motions for summary judgment, such
as the motions pending before the Court, “is the same as that for individual
summary judgment motions[,] and a court must consider each motion
independent of the other.” Worldwide Home Products, Inc. v. Time Inc., No. 11
Civ. 3633 (LTS) (MHD), 2013 WL 5477480, at *6 (S.D.N.Y. Sept. 30, 2013)
(internal quotation marks omitted); Auscape Intern. v. Nat’l Geographic Soc.,
409 F. Supp. 2d 235, 238 (S.D.N.Y. 2004) (“A court faced with cross-motions
for summary judgment need not ‘grant judgment as a matter of law for one side
or the other,’ but ‘must evaluate each party’s motion on its own merits, taking
care in each instance to draw all reasonable inferences against the party whose
motion is under consideration.’” (quoting Heublein, Inc. v. United States, 996
F.2d 1455, 1461 (2d Cir. 1993)).
DRK’s Motion for Partial Summary Judgment and the Issue
DRK moves the Court to enter a judgment of liability for copyright
infringement against Wiley on Count I of its Counterclaims — which, as noted,
pertain to the 88 DRK Summary Judgment Instances listed in DRK’s Chart.
Included within the DRK Summary Judgment Instances are 16 Bean Instances
for which, as discussed above, DRK was granted an exclusive license. DRK
does not move with respect to the remaining 207 instances of alleged copyright
infringement that it alleges in its counterclaims. Accordingly, the Court need
not address those instances at the present time.
Wiley contends that DRK’s motion should be denied for three reasons:
(i) the record presents a genuine issue of material fact as to whether Wiley
exceeded the scope of its licenses relating to the DRK Summary Judgment
Instances; (ii) DRK lacks standing to assert any copyright infringement claims;
and (iii) DRK’s claims are barred by the statute of limitations. (Counter-Def.
Br. 4-9). Because resolution of whether DRK has standing is dispositive of
nearly all instances of infringement, except the Bean Instances, and because
“federal courts are under an independent obligation to examine their own
jurisdiction,” including whether standing is established, the Court will first
focus on whether DRK has standing to bring its claims against Wiley. Cf.
United States v. Hayes, 515 U.S. 737, 742 (1995) (“The federal courts are under
an independent obligation to examine their own jurisdiction, and standing ‘is
perhaps the most important of the jurisdictional doctrines.’” (quoting FW/PBS,
Inc. v. Dallas, 493 U.S. 215, 230-31 (1990)). 12
DRK Does Not Have Standing to Assert Copyright
Infringement Claims for the Non-Bean Instances 13
“Copyright … is a creature of statute, and the only rights that exit under
copyright law are those granted by statute.” Silvers v. Sony Picture Entm’t, Inc.,
402 F.3d 881, 883-84 (9th Cir. 2005); accord Stone v. Williams, 970 F.2d 1043,
1051 (2d Cir. 1992). This general tenet was acknowledged by the Supreme
Court over 180 years ago, and remains true today. Wheaten v. Peters, 33 U.S.
591, 663-64 (1834) (“This right [in copyright] … does not exist at common
law — it originated, if at all, under the acts of congress. No one can deny that
In this regard, while using the term “standing” throughout this Opinion, the Court
agrees with the following standing analysis offered by the Seventh Circuit:
The Copyright Act restricts the set of people who are entitled to
bring a civil action for infringement to those who qualify as “[t]he
legal or beneficial owner of an exclusive right under a copyright....”
17 U.S.C. § 501(b). Some courts (including this one in years past)
have seen this as a limitation derived from Article III’s standing
requirement . . . , but we believe that it is preferable to be more
precise in our language. . . . [O]ne could keep it simple and say
that the Copyright Act spells out who has enforceable rights under
the statute; someone who does may sue, and someone who does
not has failed to state a claim upon which relief may be granted.
Our understanding of the law as it now stands, particularly in light
of the Supreme Court’s decision in Reed Elsevier, Inc. v. Muchnick,
[559 U.S. 154] (2010), is that [this approach] is the correct one.
HyperQuest, Inc. v. N’Site Solutions, Inc., 632 F.3d 377, 381 (7th Cir. 2011)
(internal citations omitted).
The Court’s discussion excludes reference to the French Instance because DRK did not
move for summary judgment with respect to that instance of alleged infringement.
when the legislature are about to vest an exclusive right in an author or an
inventor, they have the power to prescribe the conditions on which such right
shall be enjoyed.”); Stewart v. Abend, 495 U.S. 207, 251 (1990) (“Since
copyright is a creature of statute and since the statute gives the author only a
contingent estate, with the widow, widower, or children as remaindermen, the
author has only an expectancy to assign for the second term.” (internal
quotation marks omitted)).
Section 501(b) of the Copyright Act establishes who may sue for
infringement of a copyright, authorizing:
The legal or beneficial owner of an exclusive right under a
copyright … to institute an action for any infringement of that
particular right committed while he or she is the owner of it.
17 U.S.C. § 501(b) (emphasis added); see also Russian Entm’t Wholesale, Inc. v.
Close-Up Intern., Inc., 482 F. App’x 602, 604 (2d Cir. 2012) (“[T]he legal or
beneficial owner of an exclusive right under a copyright is entitled … to
institute an action for any infringement of that particular right committed while
he or she is the owner of it.” (emphasis in original)) (summary order).
As it must, the Second Circuit enforces Section 501(b) by holding that
“[t]he Copyright Act authorizes only two types of claimants to sue for copyright
infringement: [i] owners of copyrights, and [ii] persons who have been granted
exclusive licenses by owners of copyrights.” Eden Toys, Inc. v. Florelee
Undergarment Co., Inc., 697 F.2d 27, 32 (2d Cir. 1982), superseded on other
grounds by Fed. R. Civ. P. 52(a). The “exclusive rights” referenced in Section
501(b) are set out in Section 106 of the Copyright Act, and include, as
pertinent to the pending claims:
the exclusive rights to do and to authorize any of the following:
(1) to reproduce the copyrighted work in copies or phonorecords;
(2) to prepare derivative works based upon the copyrighted work;
(3) to distribute copies of phonorecords of the copyrighted work to
the public by sale or other transfer of ownership, or by rental,
lease, or lending … [and] (5) in the case of … pictorial … works …
to display the copyrighted work publicly.
17 U.S.C. § 106; Davis v. Blige, 505 F.3d 90, 98 (2d Cir. 2007) (“These rights
include ‘reproducing,’ ‘preparing derivative works,’ ‘distributing,’ ‘performing,’
or ‘displaying’ a creative work.” (quoting 17 U.S.C. § 106)). Although “[t]he
right to prosecute an accrued cause of action for infringement is also an
incident of copyright ownership,” Davis, 505 F.3d at 99, it is “not an exclusive
right under § 106,” Silvers, 402 F.3d at 884.
As discussed below, the record conclusively demonstrates that DRK is
neither an owner of the copyrights at issue nor an entity that has been granted
an exclusive license by the owners. For that reason, DRK does not have
standing to sue for copyright infringement for the DRK Summary Judgment
Instances, except for the Bean Instances. Accordingly, DRK’s motion for
summary judgment as to the Non-Bean Instances is denied.
The Representation Agreements Do Not Confer
Standing on DRK
DRK contends that the Representation Agreements between it and the
photographers transferred co-ownership to DRK of three Section 106 exclusive
rights, namely the rights to authorize others to reproduce, distribute, and
display photographs. (Def. Opp. 10). From this premise, DRK argues that
because it is the owner of those exclusive rights (even though it is not the
exclusive owner of any one of those rights), it is entitled to sue Wiley for
copyright infringement. (Id. at 10-11). DRK further argues that it qualifies as
a beneficial owner because, under the Representation Agreement, it receives
one-half of the proceeds from the licenses it issues. (Id. at 12). Wiley takes the
opposite position, contending that the Representation Agreements establish
that DRK is neither an “owner” nor a “beneficial owner” under the Copyright
Act. (Pl. Br. 7).
Owners may grant a license to others to exercise Section 106 rights or
assign those rights to others. Davis, 505 F.3d at 98. Two general categories of
licenses are granted: nonexclusive licenses and exclusive licenses. Id. at 99. A
nonexclusive license “permit[s] licensees to use the copyrighted material and
may be granted to multiple licensees.” Id. In contrast, an exclusive license
“grant[s] to the licensee the exclusive right — superior even to the copyright
owners’ rights — to use the copyrighted material in a manner as specified by
the license agreement.” Id. “A valid license of either sort immunizes the
licensee from a charge of copyright infringement, provided that the licensee
uses the copyright as agreed with the licensor.” Id. at 100; see also Graham v.
James, 144 F.3d 229, 236 (2d Cir. 1998) (“A copyright owner who grants a
nonexclusive license to use his copyrighted material waives his right to sue the
licensee for copyright infringement.”).
A key distinction between the rights granted by nonexclusive and
exclusive licenses — and one that is critical to the claims pending before this
Court — is that “[a nonexclusive] license conveys no ownership interest, and
the holder of a nonexclusive license may not sue others for infringement.”
Davis, 505 F.3d at 100; see Broadcast Music, Inc. v. CBS Inc., No. 83 Civ. 5004CSH, 1983 WL 1136, at *5 (S.D.N.Y. July 20, 1983) (holding that plaintiff, as a
nonexclusive licensee of the works at issue, lacked standing to bring claims
against defendant for copyright infringement); see also Sybersound Records,
Inc. v. UAV Corp., 517 F.3d 1137, 1146 (9th Cir. 2008) (“We hold that because
[Plaintiff] is neither an exclusive licensee nor a co-owner in the nine copyrights,
it lacks standing to bring the copyright infringement claims alleged in the FAC,
and, thus, its copyright infringement claims fail.”); I.A.E., Inc. v. Shaver, 74
F.3d 768, 775 (7th Cir. 1996) (“[A] person holding a nonexclusive license has
no standing to sue for copyright infringement.”); Eden Toys, 697 F.2d at 32
(“The Copyright Act authorizes only two types of claimants to sue for copyright
infringement: [i] owners of copyrights, and [ii] persons who have been granted
exclusive licenses by owners of copyrights.”). On the other hand, an exclusive
license “conveys an ownership interest.” Davis, 505 F.3d at 100.
The record provides uncontroverted proof that the Representation
Agreements are nonexclusive licenses. (See, e.g., Penchina Decl., Exhs 3, 30 at
166, 33 at 21). For starters, DRK admitted that the Representation
Agreements were nonexclusive licenses. (Id., Exh. 30 at 135 (“It is a
nonexclusive arrangement.”)). This is in addition to the fact that the
Representation Agreement itself does not indicate that it grants DRK any
exclusive rights. Considering the preeminence of exclusive rights in copyright
cases, it is axiomatic that if the Representation Agreement did not specify that
exclusive rights were being transferred, no such rights were in fact transferred.
To further underscore this point, one need only look to the Representation
Agreements with Bean and French, which were the only ones that authorized
DRK to “act as [Bean’s or French’s] sole and exclusive agent.” (D. Krasemann
Decl., Exh. 1 (emphasis added)).
DRK’s contention that the Representation Agreements transferred
exclusive rights to it fails not only as a factual matter, but also as a legal
matter. Section 101 of the Copyright Act makes clear that transfer of
ownership of an exclusive right cannot be accomplished by a nonexclusive
license. This section defines “transfer of copyright ownership” as an “an
assignment, mortgage, exclusive license, or any other conveyance, alienation,
or hypothecation of a copyright or of any of the exclusive rights comprised in a
copyright, whether or not it is limited in time or place of effect, but not including
a nonexclusive license.” 17 U.S.C. § 101 (emphasis added). Moreover, as Wiley
notes, “DRK has not cited, and there is not, a single case finding standing
based on a non-exclusive representation agreement.” (Pl. Reply 1). Not
surprisingly, when presented with a similar representation agreement between
Wiley and another stock photography agency, a district court in the Northern
District of California rejected the agency’s argument that the nonexclusive
representation agreement in that case conferred standing on the plaintiff.
Minden Pictures, Inc. v. John Wiley & Sons, Inc. (“Minden I”), No. C-12-4601
EMC, 2014 WL 295854, at *5 (N.D. Cal. Jan. 27, 2014) (“Because the agency
agreements do not make Minden a legal or beneficial owner of any exclusive
right under the Copyright Act, Minden lacks standing to pursue this action.”).
The Representation Agreements here granted DRK a nonexclusive license to
engage in certain exclusive rights granted to the photographers under the
Copyright Act; they did not — indeed, they could not have, by dint of their
nonexclusivity — grant DRK ownership of exclusive rights under Section 106,
as DRK contends, or the copyrights at issue. Sybersound Records, 517 F.3d at
1146 (“Although the [Copyright Act] permits exclusive rights to be chopped up
and owned separately, to be effective, the assignment or other type of alienation
permitted … must be exclusive.” (emphases in original)). 14 Execution of the
Assignment Agreements is itself further indication that the parties did not
consider the Representation Agreements to be a conveyance of any ownership
interest in the copyrights at issue. See Minden I, 2014 WL 295854, at *9
(recognizing that the execution of analogous assignment agreements
underscored the conclusion that the agency agreements did not convey an
DRK acknowledged as much when it relied exclusively on the Assignment Agreements
to argue that it had standing in a related arbitration (Supplemental Penchina Decl.,
Exh. A), while maintaining that the Representation Agreements were not “relevant to the
issues in [that arbitration]” (id. at Exh. M).
ownership interest in the photographs at issue so as to confer standing on the
DRK argues that even if it is not the legal owner of the copyrights at
issue, it is the “beneficial owner” because, under the Representation
Agreements, it is entitled to one-half of the proceeds under the licenses. (Def.
Br. 12). This argument is equally unavailing, and the cases on which DRK
relies in support do not prove otherwise. See, e.g., Hearn v. Meyer, 664 F.
Supp. 832, 844 (S.D.N.Y. 1987) (recognizing that a beneficial owner could be
an author, i.e., a current or former owner of the copyright, and “one who
retained a present financial interest in exploitation of [the author’s] work”).
Cortner v. Israel, on which DRK also relies, is distinguishable on its facts.
There, the court held that “[a] beneficial owner … would include, for example,
an author who had parted with legal title to the copyright in exchange for
percentage royalties based on sales or license fees.” 732 F.2d 267, 271 (2d Cir.
1984). In stark contrast, DRK never “possessed legal title in the first place,”
and therefore, does not qualify as a beneficial owner entitled to sue. Poindexter
v. EMI Record Grp., Inc., No. 11 Civ. 559 (LTS) (JLC), 2012 WL 1027639, at *3
(S.D.N.Y. Mar. 27, 2012) (“Plaintiff advances three arguments in support of his
claim that he has standing to sue based on the infringement of the Thin Line
sound recording: [i] he has ownership rights in the master by virtue of his role
as co-producer; [ii] his continued entitlement to royalties makes him a
beneficial owner; and [iii] the 2011 Agreement grants him the right to sue for
copyright infringements of the musical composition and the master. None of
these arguments is availing.”).
The Representation Agreements make clear that DRK is a nonexclusive
licensing agent for the photographers. In that capacity, and having never
owned the copyrights, DRK does not have standing to maintain a copyright
infringement action for the DRK Summary Judgment Instances, except the
Bean Instances. See Bourne Co. v. Hunter Country Club, Inc., 990 F.2d 934,
937 (7th Cir. 1993) (“A licensing agent is neither the legal nor beneficial owner
of the copyright and has no interest in the copyright.”); Ctr. City Music v.
Kisner, 23 F.3d 400, 1994 WL 159769, at *4 (4th Cir. 1994) (same) (per curiam
table decision); Minden I, 2014 WL 295854, at *8 (“[A] number of courts have
found that licensing agents are neither legal nor beneficial owners of a
copyright.” (collecting cases)); id. at 11 (holding that plaintiff “is not a
‘beneficial owner’ in the images since it is not nor has it been a legal owner of
the copyrighted works”); cf. Psihoyos v. Pearson Educ., Inc., 855 F. Supp. 2d
103, 114 (S.D.N.Y. 2012) (acknowledging that a plaintiff may be a beneficial
owner where it retained exclusive rights and was entitled to receive a majority
of the license fees and any awards or judgments for infringements); Silberman
v. Innovation Luggage, Inc., No. 01 Civ. 7109 (GEL), 2003 WL 1787123, at *7
n.5 (S.D.N.Y. Apr. 3, 2003) (noting that plaintiff could sue as a beneficial owner
where plaintiff had transferred ownership of the exclusive right at issue “based
on royalties received or other indicia of control”).
The Assignment Agreements Do Not Confer
Standing on DRK
DRK alternatively argues that the Assignment Agreements convey both
ownership interest in the copyright and the sole right to bring and resolve
accrued, and later-accruing, claims relating to the photographs at issue. (Def.
Opp. 13). Wiley responds that the Assignment Agreements are “sham”
agreements that cannot confer standing because those agreements do not
convey ownership, but rather only the bare right to sue. (Pl. Br. 7-8).
The Second Circuit rejected the exact argument DRK advances here in
Eden Toys. The Court in Eden Toys indicated that the Copyright Act does not
permit “holders of rights under copyrights to choose third parties to bring suits
on their behalf.” 697 F.2d at 32 n.3. This principle has been followed in
numerous subsequent decisions in the Second Circuit and courts throughout
this Circuit. See, e.g., ABKCO Music, Inc. v. Harrisongs Music, Ltd., 944 F.2d
971, 980 (2d Cir. 1991) (“[T]he Copyright Act does not permit copyright holders
to choose third parties to bring suits on their behalf.”); Plunket v. Doyle, No. 99
Civ. 11066 (KMW), 2001 WL 175252, at *5 (S.D.N.Y. Feb. 22, 2001) (“The Eden
Court noted that it did not believe that the Copyright Act permits holders of
rights under copyrights to choose third parties to bring suits on their behalf.”
(internal quotation marks omitted)); Yong Ki Hong v. KBS Am., Inc., 951 F.
Supp. 2d 402, 430 (E.D.N.Y. 2013) (“Eden Toys makes clear that a copyright
owner cannot, by contract or otherwise, grant a non-exclusive licensee the right
to sue for copyright infringement.”). Consequently, DRK’s claim that it has
standing because the photographers, by execution of the Assignment
Agreements, authorized DRK to bring suit on their behalf, fails as a matter of
law. See Eden Toys, 697 F.2d at 32 n.3 (rejecting plaintiff’s argument that a
“third basis for standing under the Copyright Act existed, namely authorization
by the copyright holder of suit by a person other than an exclusive licensee”
(emphasis in original)); see also ABKCO Music, Inc., 944 F.2d at 980; Fed.
Treasury Enter. Sojuzplodoimport v. SPI Spirits Ltd., 726 F.3d 62, 84 (2d Cir.
2013) (“While Federal Rule of Civil Procedure 17(a) ordinarily permits the real
party in interest to ratify a suit brought by another party, the Copyright Law is
quite specific in stating that only the owner or an exclusive right under a
copyright may bring suit.” (internal quotation marks omitted)); Wu v. Pearson
Educ., Inc., 377 F.R.D. 255, 266 (S.D.N.Y. 2011) (“To the extent that the
licensing agreements or the contracts between the photo bureaus and the
photographers specifies that only the photo bureaus may bring suit, they are
DRK’s parallel argument that the Assignment Agreements confer
standing on DRK because they transfer to it ownership in the copyrights, albeit
temporary, is also meritless. Although there is no case in this Circuit directly
on point, courts in other Circuits have held in analogous circumstances that
similar — indeed, nearly identical — agreements did not confer standing. The
Court finds these decisions analytically sound, and adopts their reasoning
When determining whether an agreement confers standing, courts look
to “the substance of the agreement, not the labels it uses.” HyperQuest, 632
F.3d at 383; Righthaven LLC v. Hoehn, 716 F.3d 1166, 1169 (9th Cir. 2013)
(“When determining whether a contract has transferred exclusive rights, we
look not just at the labels parties use but also at the substance and effect of
the contract.”). Where, as here, an agreement transfers “nothing more than a
bare right to sue … [it] cannot be the basis for standing under the Copyright
Act.” Minden Pictures, Inc. v. John Wiley & Sons, Inc. (“Minden II”), No. C-124601 EMC, 2013 WL 1995208, at *7 (N.D. Cal. May 13, 2013); see Silvers, 402
F.3d at 890 (“The bare assignment of an accrued cause of action is
impermissible under 17 U.S.C. § 501(b).”); see also Righthaven, 716 F.3d at
1169 (holding that plaintiff did not have standing to sue where the substance
of the parties’ agreement transferred only the right to sue); Russian Entm’t
Wholesale, Inc. v. Close-Up Intern., 767 F. Supp. 2d 392, 401 n.13 (E.D.N.Y.
2011) (noting that a license between the parties that purported to give one
party the right to sue, but did not provide the party with the right to reproduce
or distribute copies of the work, was “not a valid licensing agreement because a
party cannot assign exclusive rights solely for the purpose of having the
licensee bring suit”), aff’d, 482 F. App’x 602 (2d Cir. 2012) (summary order).
DRK’s argument that the Assignment Agreement transfers the copyrights at
issue is obviated by the rationale of these decisions and the factual record
before this Court.
Minden Pictures, Inc. v. Pearson Educ., Inc. (“Pearson”), is particularly
instructive. 929 F. Supp. 2d 962 (N.D. Cal. 2013). In that case, the plaintiff, a
stock photography agency, alleged that the defendant had breached its license
agreement, thereby engaging in copyright infringement. Id. at 963. Like DRK,
the plaintiff in Pearson argued that its assignment agreements, containing
nearly identical language as the Assignment Agreement before the Court,
conferred standing. Id. at 968. The court held that “[w]hen the contract is
viewed as a whole, the clear and unambiguous intent of the parties was to
assign to [plaintiff] the bare right to sue. ‘Co-ownership’ was merely a label
intended to disguise the assignment of the cause of action as something else.”
Support for this holding was found in the agreement itself, which
(i) granted a license to “bring suit and divvy up any return,” and (ii) did not
include any duration of the license, but rather specified that it would terminate
automatically upon conclusion of any litigation. Id. at 969. The court
reasoned that if transfer of ownership had truly been contemplated by the
agreement, plaintiff would have been granted “co-ownership in perpetuity
[even] if it failed to bring suit.” Id. In short, the court recognized that “the
contracting parties intended for [plaintiff] to bring the instant suit and not for it
to be a genuine, potentially-permanent owner of any exclusive rights under
Section 501(b).” Id. The court also relied on e-mails submitted by the parties
in which the plaintiff stated to photographers, in regard to the assignment
What this amendment does is assign [plaintiff] co-ownership of
copyrights of images we represent solely for actions or lawsuits
brought by [plaintiff] to address unauthorized image use by our
clients. My understanding is this is the sole purpose this
assignment of co-ownership may be used for.
929 F. Supp. 2d at 970 (emphasis in original). All of this led the court to
conclude that the agreements were nothing “more than disguised assignments
of the bare right to sue” that did not provide the plaintiff with standing to sue
on behalf of the individual photographers. Id. 15
The present case is substantively indistinct from Pearson. Except for the
reference to “co-owners,” the agreements in both cases contain identical text
and, just like the plaintiff in Pearson, DRK assured its photographers that the
sole basis for entering into the Assignment Agreements was to allow DRK to
bring suit on the photographers’ behalf. DRK’s e-mails to the photographers
confirm that the Assignment Agreements transferred nothing more than a
blanket right for DRK to pursue copyright infringement claims. Indeed, Dan
Krasemann, the sole proprietor of DRK, assured one photographer that there
In a related case, where plaintiff sought to rely on the same assignment agreements, the
court agreed with the earlier court’s decision in Pearson, stating:
In the alternative, even if collateral estoppel does not apply as to these
four photographers, this Court finds Judge Alsup’s reasoning [in
Pearson] on the effect of these agreements persuasive, and follows
Pearson in finding that these agreements convey nothing more than a
bare right to sue, and thus cannot be the basis for standing under the
Minden II, 2013 WL 1995208, at *7.
was “no rights grab going on here. We simply want to register our
website/database of images so the images are protected under copyright law,
and so we can pursue infringers.” (Penchina Decl., Exh. 9). 16
The Ninth Circuit’s decision in Righthaven provides still further support
for the Court’s conclusion that the Assignment Agreement does not confer
standing. 716 F.3d at 1166. The assignment agreement at issue in Righthaven
stated that Plaintiff received “all copyrights requisite to have [Plaintiff]
recognized as the copyright owner of the Work for purposes of [Plaintiff] being
able to claim ownership as well as the right to seek redress for past, present,
and future infringements of the copyright … in and to the Work.” Id. at 1168.
The Court held that describing plaintiff as the “owner” of the copyright did not
prove that plaintiff actually owned any exclusive rights, as required to bring a
lawsuit. Id. at 1170. A substantive review of the arrangement between the
parties showed that the assignment agreement granted only the “bare right to
sue” because, under the terms of the agreement, the transferor retained all
exclusive rights as to the copyright. Id. 17
It is for this reason that the district court’s decision in Alaska Stock, LLC v. Pearson
Educ., Inc., No. 12-cv-01927-WHO, 2013 WL 5496788, at *5-7 (D. Alaska Sept. 11,
2013), offered by DRK, does not alter the Court’s decision. In that case, the court
recognized that standing would not be established “where the assignor labels an
assignment a transfer of ownership, but expressly reserves the exclusive rights in the
copyright to itself.” This is exactly what DRK sought to achieve, as evidenced by the
terms of the proffered agreements and its correspondence with photographers.
Courts in cases related to Righthaven interpreting the same assignment agreement have
similarly held that such agreements did not confer standing. See, e.g., Righthaven LLC
v. Eiser, No. 2:10-cv-3075-RMG-JDA, 2012 WL 527571, at *6 (D.S.C. Jan. 13, 2012)
(holding that plaintiff did not have standing to bring a claim for copyright infringement
where the substance of the agreement only granted plaintiff a bare right to sue);
Righthaven LLC v. Hush-Hush Entm’t, Inc., No. 2:10-cv-01404-LRH, 2012 WL 688429, at
The same is unquestionably true here. DRK embarked on a campaign to
register its photographers’ copyrights for the simple reason that copyrights
need to be registered to bring suit. Section 411(a) of the Copyright Act makes
this clear: “no civil action for infringement of the copyright in any United States
work shall be instituted until preregistration or registration of the copyright
claim has been made in accordance with this title.” 17 U.S.C. § 411(a).
Indeed, “[t]he absence of a valid copyright registration … would bar a plaintiff
from bringing a viable copyright infringement action.” L.A. Printex Indus., Inc.
v. Le Chateau, Inc., No. 11 Civ. 4248 (LTS), 2012 WL 987590, at *3 (S.D.N.Y.
Mar. 23, 2012); see also Reed Elsevier, Inc. v. Muchnick, 559 U.S. 154, 157
(2010) (“[Section 411(a)] establishes a condition — copyright registration — that
plaintiff ordinarily must satisfy before filing an infringement claim and invoking
the Act’s remedial provisions.”). DRK proceeded under the belief, albeit a
misguided one, that if it registered the photographers’ copyrights, it would have
standing to sue. The record before the Court is clear: the sole purpose of the
Assignment Agreement was to grant DRK the right to bring suit. This
conclusion is further solidified by e-mails between DRK and the photographers,
such as the e-mail from one photographer who made clear that:
*2-3 (D. Nev. Mar. 1, 2012) (“This court concurs with these well-reasoned decisions”
that hold that the agreement “does not confer [plaintiff] standing to sue for copyright
infringement because the [agreement] deprives [plaintiff] of any of the rights normally
associated with ownership of an exclusive right and grants [plaintiff] only the bare right
to sue.”); Righthaven LLC v. Computer Servs. One LLC, No. 2:11-cv-00721-LRH-PAL,
2012 WL 694468, at *2 (D. Nev. Mar. 1, 2012) (same).
I have not assigned copyright to any of these images other than
temporarily to DRK Photo in order for you to pursue your
infringement lawsuit. I have however sold non-exclusive rights to
some of these pictures. I expect re-assignment of full copyright in
the very near future when your lawsuit is concluded.
(Id. at Exh. 12).
DRK directs the Court to the decision in the parallel arbitration
proceeding, in which the arbitrator held that DRK had standing to sue because
the Assignment Agreements did not only confer the bare right to sue. (Boyd
Decl., Exh. 1). As an initial matter, the arbitrator’s decision is not binding
authority on the Court. Yet even if it were, the arbitrator expressly left open
the potential for the Court to come to the opposite conclusion:
Nevertheless, nothing in this Final Award should be construed to
bar Wiley from attempting to develop a more complete factual
record in the copyright infringement litigation between the parties
currently pending in the Southern District of New York and to
argue there that the assignments are a sham under Righthaven. I
conclude only that the assignments are not rendered a sham
under Righthaven given the record presented here, particularly in
view of my hesitancy as an arbitrator to extend existing copyright
law, a task which more appropriately should be within the domain
of the federal courts with full appellate review.
(Id. at 3).
The arbitrator’s determination that Righthaven was inapplicable was
premised on the view that critical to the decision in Righthaven was “the fact
that the assignee had no real ability to monetize the copyrights except through
copyright infringement actions.” (Boyd Decl., Exh. 1 at 2). The arbitrator
reasoned that the same was not true with respect to DRK, because DRK had
the right to license the copyrighted images to publishers without seeking the
photographers’ permission. (Id.). The Court does not read Righthaven so
narrowly, but rather heeds the Ninth Circuit’s admonition that courts should
“consider the substance of the transaction” to determine if any exclusive rights
were granted to the licensee. Righthaven, 716 F.3d at 1170. As the Court has
already held, no exclusive rights could have been granted to DRK because the
photographers, except for Bean and French, had only granted DRK a
nonexclusive license. The arbitrator did not explore whether DRK had been
granted exclusive rights, but rather left this, and the standing issue, to the
Court to adjudicate more fully. 18 Just like the plaintiff in Righthaven, DRK,
equipped with nothing more than a nonexclusive license, cannot obtain
standing to sue under the Assignment Agreements that, in substance, convey
nothing more than a bare right to sue.
In short, DRK’s Assignment Agreements are “no more than disguised
assignments of the bare right to sue” that cannot confer standing. A contrary
holding would be inconsistent with the standing limitation first recognized in
Eden Toys and subsequently adopted throughout this Circuit, because such a
decision would enable parties to circumvent the prohibition against allowing
“holders of rights under copyrights to choose third parties to bring suits on
An arbitrator in a similar case against Wiley, Visuals Unlimited, Inc. v. John Wiley and
Sons, Inc., Case No. 11 143 Y 00658 13, came to the opposite conclusion, holding that
the claimant in that case did not have standing pursuant to an assignment agreement
that contained nearly identical language to the Assignment Agreement before the Court.
(Dkt. #98). The arbitrator, relying on Pearson, held that the agreement was
“insufficient, alone or in combination with non-exclusive Representation Agreements, to
establish that [the claimant] is a co-owner of an exclusive right for purposes of standing
under Section 501(b) of the Copyright Act.” (Id.).
their behalf.” Eden Toys, 697 F.2d at 32 n.3. Put somewhat differently,
authorizing DRK to use the Assignment Agreement to establish standing in this
case would endorse a practice incongruous with Second Circuit precedent —
something this Court cannot condone. Accordingly, DRK’s summary judgment
motion as to the DRK Summary Judgment Instances, except the Bean
Instances, is denied, and its counterclaims as to those instances are dismissed.
Claims Involving the Instances Contained at Lines 8 to
56, 87, and 88 of DRK’s Chart Are Barred by the Statute
An additional basis for denying DRK’s partial summary judgment motion
(at least as to a majority of the DRK Summary Judgment Instances) is that
claims involving those Instances are barred by the statute of limitations. Wiley
makes just this argument with respect to the instances at lines 8 to 56, 87,
and 88 of DRK’s Chart. (Counter-Def. Br. 8). This subset of the DRK
Summary Judgment Instances includes instances that the Court has already
dismissed on standing grounds, as well as additional Bean Instances.
A civil action under the Copyright Act must be “commenced within three
years after the claim accrued.” 17 U.S.C. § 507(b) (“No civil action shall be
maintained under the provisions of this title unless it is commenced within
three years after the claim accrued.”). The parties dispute whether the Court
should apply an “injury rule,” under which “a claim accrued at the time of each
act of infringement, regardless of the copyright holder’s knowledge of the
infringement,” Urbont v. Sony Music Entm’t, 863 F. Supp. 2d 279, 281 (S.D.N.Y.
2012), or the “discovery rule,” under which “a claim for copyright infringement
does not accrue until the aggrieved party knows or has reason to know of the
injury that forms the basis of the claim,” id. Wiley argues that the injury rule
applies, and that because each work identified at lines 8 to 56, 87, and 88 of
DRK’s Chart was published prior to August 3, 2008 (i.e., three years before
DRK instituted the present action), those claims are barred by the statute of
limitations. (Counter-Def. Br. 8-9). In the alternative, Wiley maintains that
even if the discovery rule applied, the claims are either barred, or at minimum,
an issue of fact is raised so as to foreclose summary judgment. (Id. at 9).
Conversely, DRK contends that the discovery rule applies, and that under this
rule, its claims were timely filed. (Counter-Pl. Reply 7).
“Neither the Supreme Court nor the Second Circuit has ruled on the
appropriate accrual rule for federal copyright infringement claims.” Urbont,
863 F. Supp. 2d at 282; see also TufAmerica, Inc. v. Diamond, No. 12 Civ. 3529
(AJN), 2013 WL 4830954, at *17 (S.D.N.Y. Sept. 10, 2013) (same). The
majority of the courts in this Circuit had initially applied the discovery rule in
infringement cases based on their interpretation of the Second Circuit’s
holdings in Stone v. Williams, 970 F.2d 1043, 1048 (2d Cir. 1992), and
Merchant v. Levy, 92 F.3d 51, 56 (2d Cir. 1996). See Muench Photography, Inc.
v. Houghton Mifflin Hardcourt Pub. Co., No. 09 Civ. 2669 (LAP), 2013 WL
4464002, at *5 (S.D.N.Y. Aug. 21, 2013) (recounting history). But, beginning
with the Supreme Court’s decision in TRW Inc. v. Andrews, 534 U.S. 19 (2001),
and particularly after Judge Lewis A. Kaplan’s decision in Auscape Int’l v. Nat’l
Geographic Soc’y, 409 F. Supp. 2d 235 (S.D.N.Y. 2004), the pendulum has
swung in the other direction. A “majority of courts” in this District now apply
the injury rule to infringement claims. TuftAmerica, Inc., 2013 WL 4830954, at
*17 (“Since Auscape, a growing majority of the courts in the Southern District
of New York to address this question have followed Judge Kaplan’s lead and
applied the injury rule to infringement claims.” (collecting cases)).
In TRW, the Supreme Court, in determining the accrual of claims under
the Fair Credit Reporting Act (“FCRA”), made clear that the discovery rule had
limited application. It did so by identifying that it had recognized the discovery
rule only in “two contexts, latent disease and medical malpractice cases ‘where
the cry for such a rule is loudest.’” TRW, 534 U.S. at 27 (quoting Rotella v.
Wood, 528 U.S. 549, 555 (2000)). In Auscape, Judge Kaplan began by
In light of these considerations, two things are clear in the
aftermath of TRW. First, it is uncertain whether Stone and
Merchant remain good law even in the co-ownership context, as
both were premised upon the automatic application of the
discovery rule that the Supreme Court rejected in TRW. Second,
regardless of whether Stone and Merchant continue to govern in
the co-ownership context, TRW demonstrates that uncritical
extension of those cases to the infringement context would be
unwarranted. Instead, TRW requires examination of the statutory
structure and legislative history in determining whether a
discovery or injury rule should apply where, as here, the statute
itself is silent on the issue.
409 F. Supp. 2d at 244. He then proceeded to elucidate how subsequent
courts had neglected to account for two critical distinctions present in Stone
and Merchant. First, Judge Kaplan noted, those two cases had “rest[ed]
entirely on then prevalent views regarding the accrual of federal claims
generally,” pursuant to which “federal courts long applied a discovery rule, in
absence of any authority to the contrary, in determining when claims under a
plethora of federal statutes accrued.” Id. at 243-44. Second, he observed,
Stone and Merchant had involved copyright ownership rather than infringement
claims. Id. After (i) considering the limitations of Stone and Merchant, and how
TRW had “altered [the] landscape”; (ii) holding that the discovery rule was not
the default accrual rule; and (iii) conducting a comprehensive examination of
the limitations period under the Copyright Act, Judge Kaplan held that
infringement claims under the Copyright Act should be governed by the injury
rule. Id. at 244-48.
The Supreme Court’s subsequent decision in Merck & Co. v. Reynolds,
559 U.S. 633 (2010), would appear to confirm the correctness of Judge
Kaplan’s decision. In Merck, the Court stated that the discovery rule is “an
exception to the general limitations rule that a cause of action accrues once a
plaintiff has a complete and present cause of action.” Id. at 644 (internal
quotation marks omitted). The Court went on to explain that the genesis of the
discovery rule was found in fraud cases, acknowledging that the “Court long
ago recognized that something different was needed in the case of fraud, where
a defendant’s deceptive conduct may prevent a plaintiff from even knowing that
he or she has been defrauded.” Id. (emphasis in original). The Second Circuit,
in turn, has recognized that “[a]s a general matter, [the discovery rule] does not
govern the accrual of most claims because most claims do not involve conduct
that is inherently self-concealing.” SEC v. Gabelli, 653 F.3d 49, 59 (2d Cir.
2011), rev’d on other grounds, 133 S. Ct. 1216 (2013).
In sum, Auscape and other decisions following TRW make clear that the
Court should follow the majority rule in this District, and apply the injury rule
to DRK’s infringement claims. Doing so requires that DRK’s claims as to the
instances of alleged infringement at lines 8 to 56, 87, and 88 of DRK’s Chart be
dismissed as untimely filed. 19 Indeed, DRK concedes that application of the
injury rule bars these instances of alleged infringement. (Counter-Pl.
Reply 12). As for DRK’s argument that Stone and Merchant are binding
precedent (Counter-Pl. Reply 8), the succeeding decisions outlined earlier in
this section thoroughly undercut DRK’s position. Similarly, DRK’s argument
that this case necessitates application of the discovery rule because Wiley’s
alleged infringements were concealed is unavailing. (Counter-Pl. Reply 11).
DRK has not established that it could not uncover, or that it would be very
difficult for it to uncover, the alleged instances of infringement, such that this
Court should recognize an exception to the principle, articulated by the
Supreme Court and endorsed by the Second Circuit, that the discovery rule is
applied to limited cases sounding in fraud. As the legislative history of the
Copyright Act confirms, “Congress was well aware that the statute of
Because the Court holds that the injury rule applies, it need not assess whether DRK’s
claims would likewise be barred under the discovery rule.
limitations it was enacting would not necessarily allow a remedy for every
wrong. It at least implicitly acknowledged ‘that the passage of time must leave
some wrongs without a remedy.’” Auscape, 409 F. Supp. 2d at 246 (quoting
Pearl v. City of Long Beach, 296 F.3d 76, 77 (2d Cir. 2002)).
Accordingly, DRK’s motion for partial summary judgment as to the
instances of alleged infringement at lines 8 to 56, 87, and 88 in DRK’s Chart is
denied, and those claims are dismissed, with the non-Bean Instances already
dismissed on standing grounds dismissed on this alternate basis.
Wiley Infringed on the Bean Instances at Lines 6, 7, and
75 of DRK’s Chart
Having dismissed claims for the majority of the DRK Summary Judgment
Instances on standing or timeliness grounds, the Court is left to determine
whether DRK is entitled to summary judgment on the Bean Instances identified
at lines 6, 7, and 75 of DRK’s Chart (the “Three Bean Instances”). DRK
contends that its licenses with Wiley for the images at issue in these instances
were limited in scope in terms of the print run, media, and/or geographic
distribution, and that Wiley violated the license terms by printing more units
than authorized, selling the photographs beyond the licensed geographic
distribution areas, and/or using the photographs electronically without
permission. (Counter-Pl. Br. 12-14). 20 Wiley responds that summary
DRK advances these arguments as to all of the DRK Summary Judgment Instances.
Having dismissed all other DRK Summary Judgment Instances, however, the Court
need only address whether DRK has established that there is no genuine issue of
material fact as to whether Wiley engaged in copyright infringement with respect to the
Three Bean Instances.
judgment cannot be granted in DRK’s favor because there are material issues
of fact as to whether Wiley exceeded the scope of its licenses as to the Three
Bean Instances. (Counter-Def. Br. 4-5). Here, Wiley raises only one potential
issue of material of fact: Wiley argues that it did not exceed the print run for
the alleged instance of infringement at line 75 of DRK’s Chart because
pursuant to the Pricing Agreement, Wiley had the right to print up to 40,000
copies at the price paid, and it printed fewer than this amount. (Id. at 6).
“To establish an infringement of a copyright, a plaintiff must show both
ownership of a copyright and that defendant copied the protected material
without authorization.” Rogers v. Koons, 960 F.2d 301, 306 (2d Cir. 1992);
Hamil Am. Inc. v. GFI, 193 F.3d 92, 98 (2d Cir. 1999); TechnoMarine SA v. Jacob
Time, Inc., No. 12 Civ. 790 (KBF), 2013 WL 5231471, at *7 (S.D.N.Y. July 16,
2013). The Court need not address the first element for proving copyright
infringement because Wiley does not dispute that DRK owns a valid copyright
as to the Bean photographs pursuant to the exclusive license granted to DRK.
Turning to the second element, the Court finds that no issue of material fact
“It is black-letter law that a claim for copyright infringement lies when a
party’s use of copyrighted material exceeds the scope of its license.” Harrell v.
Van der Plas, No. 08 Civ. 8252 (GEL), 2009 WL 3756327, at *2 (S.D.N.Y. Nov.
9, 2009); see Bean v. John Wiley & Sons, Inc., No. CV 11-08028-PCT-FJM,
2012 WL 1078662, at *2 (D. Ariz. Mar. 30, 2012) (“A licensee can infringe a
copyright by exceeding the scope of a license.”); see also E. Broadcasting Am.
Corp. v. Universal Video, Inc., No. 04 Civ. 5654 (DGT), 2006 WL 767871, at *2
(E.D.N.Y. Mar. 24, 2006) (finding that where a party uses copyrighted material
in a way that exceeds the duration or scope of a previously-granted license, the
resulting claim is for copyright infringement, not breach of contract); Marshall
v. New Kids on the Block P’ship, 780 F. Supp. 1005, 1008 (S.D.N.Y. 1991)
(finding that existence of a prior license is no bar to copyright claim because a
copyright licensee can make itself a “stranger” to the licensor by exceeding the
duration or scope of the license).
The license for the Bean Instances at lines 6 and 7 is dated January 6,
1999; it limits Wiley’s use of the Bean photographs to use in “one (1) print
version of the copyright 1999 John Wiley & Sons, Inc. TEXTBOOK publication
titled BLUE PLANET, 2ND EDITION, by Skinner; the total number of copies to
be printed is not to exceed 30,000 copies,” and specifies that “[n]o other rights
known or unknown to mankind are granted or implied,” and that “[n]o
electronic publishing rights [are] granted.” (Second Krasemann Decl., Exh. 2A). The invoice for the Bean Instance at line 75, dated March 27, 2003,
contains the same language with respect to Wiley’s use of the image in a
different textbook publication. (Id. at Exh. 2-B). Wiley does not dispute that it
exceeded the scope of the licenses governing the Three Bean Instances.
(Counter-Def. Br. 5-6). Instead, Wiley takes issue with only the Bean Instance
at line 75, arguing that under the Pricing Agreement it was allowed to print up
to 40,000 copies, which Wiley did not exceed. (Id. at 6 n.6).
“[D]etermining whether a defendant’s activities fall within the scope of an
existing license essentially involves a question of contract interpretation.”
Reinhardt v. Wal-Mart Stores, Inc., 547 F. Supp. 2d 346, 352 (S.D.N.Y. 2008);
see also Bourne v. Walt Disney Co., 68 F.3d 621, 631 (2d Cir. 1995). “If the
contract language is unambiguous and conveys a definite meaning, its
interpretation is a question of law for the court.” Reinhardt, 547 F. Supp. 2d at
352. The language of the relevant licenses is clear and unambiguous. As DRK
argues, and the record supports, the Pricing Agreement was in place from July
1, 2000, to July 1, 2001, and consequently could not govern the Bean Instance
at line 75. Wiley has not submitted evidence to refute the limited temporal
application of the Pricing Agreement. Indeed, Wiley conceded this much when
it submitted that “[p]ursuant to the pricing agreement in place during 2000 and
2001, DRK charged Wiley $170 for the right to print and distribute in North
America … up to 40,000 copies.” (Wiley 56.1 Statement ¶ 14 (emphasis
The record establishes that Wiley infringed on DRK’s copyrights for the
Three Bean Instances. See Gilliam v. Am. Broadcasting Co., Inc., 538 F.2d 14,
21 (2d Cir. 1976) (“We find, therefore, that unauthorized editing of the
underlying work, if proven, would constitute an infringement of the copyright
in that work similar to any other use of a work that exceeded the license
granted by the proprietor of the copyright.”); J.S. Nicol, Inc. v. Peking
Handicraft, Inc., No. 03 Civ. 1548 (GBD) (AJP), 2008 WL 4613752, at *7 n.25
(S.D.N.Y. Oct. 17, 2008) (“Neither party contests the basic tenet that use of J.S.
Nicol’s copyrighted works would constitute copyright infringement if used in
violation of the License Agreement.”); Leutwyler v. Royal Hashemite Court of
Jordan, 184 F. Supp. 2d 303, 306 (S.D.N.Y. 2001) (“[A] copyright owner may
bring a claim for infringement against a licensee whose actions exceed the
scope of the license.... The question thus reduces to an interpretation of the
license that [plaintiff] concedes was granted.” (internal citation omitted)); Wood
v. Houghton Mifflin Harcourt Publ’g Co., 589 F. Supp. 2d 1230, 1241 (D. Colo.
2008) (granting partial summary judgment where licensee used copyright
beyond the scope of the license); Bean, 2012 WL 1078662, at *2 (same).
Because Wiley has failed to raise any issue of material fact as to whether
it exceeded the scope of its license for the Three Bean Instances, summary
judgment is granted in DRK’s favor for these instances.
Wiley’s Motion for Summary Judgment
Turning now to Wiley’s motion for summary judgment, the company
advances three principal grounds for relief. First, Wiley seeks an order
dismissing with prejudice all the DRK Counterclaim Instances, except the Bean
and French Instances, on the ground that DRK lacks standing. Wiley also
requests that DRK’s claims as to the Krasemann Images be dismissed because
DRK lacks valid copyright registrations for these images. Second, Wiley seeks
a declaratory judgment of non-infringement as to the Wiley Non-Infringement
Instances (other than the Bean and French Instances) on the ground that DRK
lacks standing. With respect to the 21 Wiley Non-Infringement Instances as to
which DRK did not assert counterclaims, Wiley argues in the alternative that a
declaration of non-infringement should issue precisely because DRK did not
counterclaim. Finally, Wiley also requests declaratory relief as to the
Krasemann Images on the same ground that it requests dismissal, viz., that
DRK lacks a valid copyright registration.
DRK Does Not Have Standing to Maintain Its
Counterclaims as to the Non-Bean and Non-French
As an initial matter, DRK seeks to voluntarily dismiss its claims for the
instances of alleged infringement that were previously resolved in arbitration,
as well as claims related to photographs by Michael Collier that are included in
the DRK Counterclaim Instances. (Counter-Pl. Reply 1). These instances are
identified at lines 1, 32, 33, 48, 49, 73, and 79 of DRK’s Chart. Voluntary
dismissal of these claims, however, “is improper at this stage of the
proceedings.” Muench Photography, Inc., 2013 WL 4464002, at *4; Fed. R. Civ.
Proc. 41. Accordingly, Wiley’s motion for summary judgment as to these
instances is granted. See Muench Photography, Inc., 2013 WL 4464002, at *4
(granting summary judgment in the defendant’s favor where plaintiff sought to
voluntarily withdraw claims after defendant served its summary judgment
Putting the Bean and French Instances aside, as discussed at length
above, DRK lacks standing to maintain its counterclaims against Wiley as to
the DRK Summary Judgment Instances. The parties do not dispute that the
same Representation Agreements and Assignment Agreements govern the
photographs at issue. Just as those two agreements could not confer standing
as to the DRK Summary Judgment Instances, they similarly cannot confer
standing as to the broader category of the DRK Counterclaim Instances. For
that reason, Wiley’s motion for summary judgment as to the DRK Counterclaim
Instances (less the French and Bean Instances) is granted.
Wiley’s Declaratory Judgment Claims as to the Non-Bean
and Non-French Instances Must Be Dismissed
Wiley seeks a declaratory judgment under the Declaratory Judgment Act
for non-infringement as to the more comprehensive group of Wiley NonInfringement Instances, except the Bean and French Instances, arguing that
DRK lacks standing as to these instances. (See Pl. Br. 6-12). Wiley also argues
that it is entitled to declaratory relief for the additional reasons that DRK failed
to file counterclaims as to 22 instances included in Wiley’s complaint, and that
the Krasemann Images’ copyright registrations are invalid. (Id. at 12-18). In
response, DRK relies on the same Representation Agreements and Assignment
Agreements to argue that it has standing to sue (Def. Opp. 13-18); it claims
Even if DRK had not sought to voluntarily dismiss these claims, summary judgment
would still have been granted in Wiley’s favor for the reasons set forth herein.
that not opposing the 21 instances does not equate to a declaration of noninfringement in Wiley’s favor (id. at 27); and it contends that the copyright
registrations for the Krasemann Images are valid (id. at 19-26). 22
The Court has held that neither the Representation Agreements nor the
Assignment Agreements confer standing on DRK to sue for copyright
infringement. Accordingly, because the same agreements govern the Wiley
Non-Infringement Instances (except, as noted, the Bean and French Instances),
the Court agrees with Wiley that DRK lacks standing to sue as to these
instances. DRK’s lack of standing, however, does not equate to Wiley’s
entitlement to a declaration of non-infringement. Quite the opposite: DRK’s
lack of standing to sue Wiley requires dismissal of Wiley’s claims as to the nonBean and non-French Wiley Non-Infringement Instances.
The Declaratory Judgment Act provides:
In a case of actual controversy within its jurisdiction, … any court
of the United States, upon the filing of an appropriate pleading,
may declare the rights and other legal relations of any interested
party seeking such declaration, whether or not further relief is or
could be sought.
28 U.S.C. § 2201(a). “[T]he phrase ‘case of actual controversy’ in the
[Declaratory Judgment] Act refers to the type of ‘Cases’ and ‘Controversies’ that
are justiciable under Article III.” MedImmune, Inc. v. Genentech, Inc., 549 U.S.
Because the Court resolves the issue on standing grounds, it need not determine
whether the copyright registrations for the Krasemann Images are valid. Similarly, as
to the Non-Bean Instances within the 21 instances, those too are resolved on standing
grounds and need not be separately addressed. The 21 instances not related to
photographs by Bean include instances at lines 293, 294, 296, 299 to 312, and 315 to
316 of Wiley’s Chart.
118, 127 (2007) (quoting Aetna Life Ins. Co. v. Haworth, 300 U.S. 227, 240
(1937)). “It is a basic principle of Article III that a justiciable case or
controversy must remain ‘extant at all stages of review, not merely at the time
the complaint is filed.’” United States v. Juvenile Male, 131 S. Ct. 2860, 2864
(2011) (quoting Arizonans for Official English v. Arizona, 520 U.S. 43, 67
(1997)); see also Alvarez v. Smith, 558 U.S. 87, 92 (2009) (“The Constitution
permits this Court to decide legal questions only in the context of actual ‘Cases’
or ‘Controversies.’ An ‘actual controversy must be extant at all stages of
review, not merely at the time the complaint is filed.’” (quoting Preiser v.
Newkirk, 422 U.S. 395, 401 (1975) (internal citation omitted)). “[T]he question
in each case is whether the facts alleged, under all the circumstances, show
that there is a substantial controversy, between parties having adverse legal
interests, of sufficient immediacy and reality to warrant the issuance of a
declaratory judgment.” MedImmune, Inc., 549 U.S. at 127.
“Throughout the litigation, the party seeking relief must have suffered, or
be threatened with, an actual injury traceable to the defendant and likely to be
redressed by a favorable judicial decision.” Juvenile Male, 131 S. Ct. at 2864.
“As with any federal action, courts may not entertain actions for declaratory
judgment ‘when the parties are asking for an advisory opinion, when the
question sought to be adjudicated has been mooted by subsequent
developments, and when there is not standing to maintain the action.’” Velvet
Underground v. Andy Warhol Found. for the Visual Arts, Inc., 890 F. Supp. 2d
398, 403 (S.D.N.Y. 2012) (quoting Flast v. Cohen, 392 U.S. 83, 95 (1968)).
“To have standing to pursue a declaratory relief action regarding
copyright infringement, a plaintiff must show that ‘under all the circumstances
of the case, there is a substantial controversy between parties having adverse
legal interests, and that the controversy is of sufficient immediacy and reality
to warrant declaratory relief.’” Amaretto Ranch Breedables v. Ozimals Inc., 907
F. Supp. 2d 1080, 1084-85 (N.D. Cal. 2012) (quoting Hal Roach Studios, Inc. v.
Richard Feiner & Co., 896 F.2d 1542, 1555-56 (9th Cir. 1989)). The party must
have “a real and reasonable apprehension that he will be subject to liability if
he continues the allegedly infringing conduct.” Id.; see also Velvet
Underground, 890 F. Supp. 2d at 403-04 (“Under the Declaratory Judgment
Act, a party who wishes to engage in conduct that may infringe another’s
intellectual property rights may seek a declaration that those rights are invalid
without first exposing itself to liability. But the dispute must be presented in
the context of a specific live grievance that justifies invoking the protection of
the courts to shield the plaintiff against the defendant’s actual interference
with its legal interests.” (internal citations and quotation marks omitted)).
The Court’s determination that DRK lacks standing effectively moots the
controversy between the parties. In light of the Court’s holding, Wiley is no
longer confronted with a reasonable apprehension that it will be subject to
liability to DRK for the alleged infringement, if it continues to engage in the
allegedly infringing conduct. Although Wiley argues that a determination that
DRK lacks standing under the copyright law equates to a declaration of noninfringement in its favor (Pl. Reply 11), such a result is not tenable under
Article III. DRK’s inability to sue Wiley for copyright infringement for the nonBean and non-French Instances strips this Court of subject matter jurisdiction.
Amaretto Ranch Breedables, 907 F. Supp. 2d at 1086 (holding that plaintiff
lacked standing for declaratory relief where the defendants lacked standing to
sue for copyright infringement; finding that the court would not exercise its
discretion to grant declaratory relief even if standing was established; and
denying plaintiff’s motion for summary judgment as to the declaratory
judgment claims and dismissing those claims for lack of subject matter
jurisdiction); see also Fina Research S.A. v. Baroid Drilling Fluids, Inc., 98 F.3d
1357 (Table), 1996 WL 521465, at *2-3 (Fed. Cir. 1996) (upholding district
court’s dismissal of plaintiff’s declaratory judgment complaint for lack of “case
of actual controversy,” where defendant, an alleged patentee, did not have
standing to sue); cf. Velvet Underground, 890 F. Supp. 2d at 404 (“Accordingly,
in intellectual property cases, when a declaratory judgment plaintiff seeks a
declaration that an asserted right is invalid or otherwise unenforceable and the
declaratory defendant provides the plaintiff with a covenant not to sue for
infringement of that right, that covenant can ‘extinguish any current or future
case or controversy between the parties, and divest the district court of subject
matter jurisdiction.’” (quoting Dow Jones & Co. v. Ablaise Ltd., 606 F.3d 1338,
1348 (Fed. Cir. 2010))); Orion Elec. Co., Ltd. v. Funai Elec. Co., Ltd., No. 01 Civ.
3510 (AGS) (JCF), 2001 WL 1506009, at *3 (S.D.N.Y. Nov. 26, 2001)
(recognizing that if defendant did not have standing to bring a claim against the
plaintiff, it would not be a proper defendant in a declaratory judgment
Wiley’s motion for summary judgment for a declaration of noninfringement for the non-Bean and non-French Wiley Non-Infringement
Instances is denied, and its claims as to those instances are likewise dismissed
for lack of subject matter jurisdiction. 24
Wiley Is Not Entitled to a Declaration of NonInfringement as to the Remaining Bean Instances
Remaining before the Court are the Bean Instances not included in
DRK’s Counterclaim Instances, and identified at lines 313 and 314 of Wiley’s
Chart (the “Remaining Bean Instances”). Wiley argues that a declaration of
non-infringement should issue as to these Instances because DRK has
“presented no evidence of infringement for [these] instances.” (Pl. Br. 18).
The Court’s reliance on cases concerning patent law is entirely appropriate here. See
Sony Corp. of Am. v. Universal City Studios, Inc., 464 U.S. 417, 439 (1984) (“There is no
precedent in the law of copyright for imposition of vicarious liability on such a theory.
The closest analogy is provided by the patent law cases to which it is appropriate to
refer because of the historic kinship between patent law and copyright law.”); Davis,
505 F.3d at 104 (“We find support for this holding in the law of patents. Although
patents and copyright law function somewhat differently, courts considering one have
historically looked to the other for guidance where precedent is lacking.”).
The Court’s conclusion here does not conflict with its prior Opinion rejecting
Defendant’s argument that Plaintiff lacked standing to bring a declaratory judgment
action. (Dkt. #36). That decision was predicated on Defendant’s argument that Plaintiff
needed to plead ownership and, more importantly, was decided without the record now
before the Court, from which it can assess whether Plaintiff lacked standing to assert a
claim for copyright infringement.
Wiley offers neither citation to case law nor evidentiary support to establish its
entitlement to a declaratory judgment. Yet it is Wiley who carries “at a
minimum the risk of non-persuasion, if not the actual burden of proof” on its
motion for summary judgment. See Thompson v. Cnty. of Franklin, 314 F.3d
79, 80 (2d Cir. 2002) (“Nevertheless, [Plaintiff] commenced this action for a
declaratory judgment in an effort to establish her claim and sought summary
judgment toward that end. In so doing, she carried ‘at a minimum the risk of
non-persuasion, if not the actual burden of proof.’” (quoting NRT Metals, Inc. v.
Manhattan Metals (Non-Ferrous), Ltd., 576 F. Supp. 1046, 1052 n.17 (S.D.N.Y.
1983))); Cont’l Assur. Co. v. Sanasee, No. 04 Civ. 412 (ILG), 2006 WL 335419,
at *2 (E.D.N.Y. Feb. 13, 2006) (“[T]he burden of proof rests upon the plaintiff,
as it generally would in a declaratory judgment action, to establish its
entitlement to judgment as a matter of law.”).
“A party seeking summary judgment on a claim of non-infringement of
copyright must establish that at least one element of the alleged infringement
cannot be proven as a matter of law.” Bill Diodata Photography, LLC v. Kate
Spade, LLC., 388 F. Supp. 2d 382, 394 (S.D.N.Y. 2005); Jean v. Bug Music, Inc.,
No. 00 Civ. 4022 (DC), 2002 WL 287786, at *4 (S.D.N.Y. Feb. 27, 2002). Wiley
admits that DRK’s Representation Agreements with Bean were exclusive
licenses that accorded to DRK the right to assert a claim for copyright
infringement. (Pl. Br. 7 n.5). In doing so, Wiley implicitly concedes that DRK
has established the first element necessary to prove copyright infringement.
See Davis, 505 F.3d at 101 (“An exclusive license … conveys an ownership
interest.”); see also U.S. Naval Inst. v. Charter Commc’n, Inc., 936 F.2d 692, 695
(2d Cir. 1991) (“An exclusive license granted by the copyright owner constitutes
a transfer of ownership of the copyright rights conveyed in the license.”).
As for the second element, “copy[ing] the protected material without
authorization,” Rogers, 960 F.2d at 306, Wiley has not submitted evidence to
establish that it used the Remaining Bean Instances within the scope of its
license agreement. Thus, Wiley has not demonstrated that at least one element
of the alleged infringement cannot be proven as a matter of law. Accordingly,
Wiley’s motion for summary judgment for a declaration of non-infringement as
to the Remaining Bean Instances is denied.
For the foregoing reasons, DRK’s motion for partial summary judgment is
denied as to the DRK Summary Judgment Instances except the Three Bean
Instances, and DRK’s claims as to those instances are dismissed; DRK’s motion
for partial summary judgment as to the Three Bean Instances is granted;
Wiley’s motion for summary judgment dismissing the non-Bean and nonFrench DRK Counterclaim Instances is granted, and DRK’s claims as to those
instances are dismissed; Wiley’s motion for summary judgment for declaratory
relief of non-infringement is denied; and its claims for declaratory relief as to
the Wiley Non-Infringement Instances are dismissed except for the French and
Bean instances at lines 3, 117, 120, 137, 140, 149, 150, 160, 163, 192, 210,
213, 224, 225, 233, 236, 247, 248, 265, 287, 290, 313, and 314 of Wiley’s
The Clerk of Court is directed to terminate Docket Entries 52 and 73.
A pretrial conference will be held on March 21, 2014, at 2:30 p.m. to
discuss scheduling trial in this matter.
Dated: February 21, 2014
New York, New York
KATHERINE POLK FAILLA
United States District Judge
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