Robert L. Stark Enterprises, Inc. et al v. Neptune Design Group, LLC

Filing 42

Memorandum of Opinion and Order: This matter is before the Court upon Plaintiffs' Motion for Summary Judgment on Copyright Infringement (Doc. 28 ). Also pending is Plaintiffs' Motion for Summary Judgment on DMCA Claim (Doc. 29 ). The motions are GRANTED in PART and DENIED in PART. Plaintiff is entitled to summary judgment on all claims, with the exception of the copyright infringement and corresponding declaratory judgment claims as they pertain to defendant's allegation that plaintiff emailed copies of certain plans to Bialosky. Judge Patricia A. Gaughan on 4/12/17. (LC,S)

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF OHIO
EASTERN DIVISION

Robert L. Stark Enterprises, Inc.,
et al.,
Plaintiffs,
Vs.
Neptune Design Group, LLC,
Defendant.

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CASE NO. 1:16 CV 264
JUDGE PATRICIA A. GAUGHAN

Memorandum of Opinion and Order

INTRODUCTION
This matter is before the Court upon Plaintiffs’ Motion for Summary Judgment on
Copyright Infringement (Doc. 28). Also pending is Plaintiffs’ Motion for Summary Judgment
on DMCA Claim (Doc. 29). This is a copyright infringement case. For the reasons that follow,
the motions are GRANTED in PART and DENIED in PART. Plaintiff is entitled to summary
judgment on all claims, with the exception of the copyright infringement and corresponding
declaratory judgment claims as they pertain to defendant’s allegation that plaintiff emailed
copies of certain plans to Bialosky.

1

FACTS
Plaintiffs Robert L. Stark Enterprises, Inc. and Yogurt Treats (collectively “plaintiff”)
bring this lawsuit against defendant Neptune Design Group, LLC seeking a declaratory judgment
of non-infringement and further asking that the Court declare that plaintiff did not improperly
remove Copyright Management Information (“CMI”).
MGI Group, Inc. (“Menchie’s”) started as a frozen yogurt store located in California.
The plans for that location were prepared by another architect. The plans include a circular pay
counter and a curved wall of yogurt machines. Mara Lubbell worked as a designer on the
Menchie’s brand, including preparing the logo and determining colors, shapes, characters,
features, and other design elements. By 2008, other Menchie’s stores were located in California.
In October of 2008, Elisa Bayha and Chris Neal, employees of defendant, met with a Menchie’s
representative regarding the possibility of replacing Menchie’s previous architect. (Bayha Dep.
16-17). Menchie’s was looking to replace its “teams” as it was not happy with any of the
previous architectural teams and was unhappy with the existing stores. (Bayah Dep. 16). After
the meeting, Bayha and Neal again met with Menchie’s and toured certain store locations.
(Bayha Dep. 18). After a subsequent meeting, Menchie’s sent defendant a number of materials
including a “graphic designer generated elevations for the Fallbrook store,” a “layout for the
Fallbrook store,” “the same graphic designer developed rendered plan -- or layout or elevation
for the Valley Village store,” and “a set of drawings for Culver City.” (Bayha Dep. 20). In
addition, at some point Menchie’s provided defendant with construction documents for the
Rendondo Beach store and 3-D color renderings, i.e., color illustrations, of the Valley Village
store. (Neal Dep. 35, 53).

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The parties agree that the first project defendant submitted to Menchie’s involved the
Woodland Hills store. (Bahya Dep. 123). Defendant and Menchie’s entered into a design
services contract with respect to this store and all other stores for which defendant provided
services to Menchie’s franchisees. (“DS Contracts”). The DS Contracts were either between
Menchie’s and defendant or defendant and the franchisee. Those contracts provide, in relevant
part:
Drawings, specifications, and other design documents, whether written or electronic,
prepared by [defendant] or [defendant] consultants, are instruments of service used solely
with respect to this Project. [Defendant] and [defendant’s] consultants are deemed the
authors and sole owners of their respective instruments of service and shall retain all
common law, statutory, and other reserved rights, including copyrights. [Menchie’s] and
[Menchie’s] contractors shall have no right to copy or use the data on other projects, or
for additions to this Project, without agreement of and compensation to [defendant], and
all of Client’s written agreement with its contractors shall reflect this fact accordingly....
(Doc. 37).
The construction drawings for the Woodland Hills store are dated November 14, 2008
and entitled “2008 MGI CD Set of Plans.” (Hereafter, “2008 Plans”) (Neal Depo. Ex. 26). The
architect for the project was David Udkow. (Bayha Dep. 24). Udkow was not employed by
defendant and, instead, was an independent contractor (Bayha Dep. 25). The plans identify
Udkow as the architect. (Neal Dep. Ex. 26 a p.3). Udkow is a licensed architect who reviewed
the plans for approval and permitting. (Bahya Dec. 19). He did not participate in the creation of
any work for which defendant received a copyright. (Bahya Dec. ¶ 19)1. In addition, the plans

1

Plaintiff moves to strike the declaration of Bahya for various
reasons. The Court need not reach the issue. Although the
declaration is rife with statements that are not based on personal
knowledge and are in essence an effort by defendant to simply
have a witness aver to the truth of the entire brief, the Court did
not rely on the declaration in a manner that detrimentally affected
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provide:
Upon city approval and permit these plans have been reviewed by Menchie’s for its
design consistency and conformity to Menchie’s strict design standards. Under no
circumstances shall these drawings be modified in any way without the express written
consent of both the architect and Menchie’s corporate office.
Defendant used the outcome of the Woodland Hills project as a template for the next
project. After the first few months of the relationship, Menchie’s and defendant agreed that
Menchie’s would use defendant exclusively for the development of all future franchises. (Bahya
Dec. ¶ 6). Thereafter, defendant created a document entitled “2009 [Menchie’s] Design Guide”
to assist franchisees and building contractors. (Bahya Dec. ¶ 23). In addition, for approximately
four years, defendant created store designs, floor layouts, and construction documents for
Menchie’s stores. (Bahya Dec. ¶ 6). Ultimately, defendant registered a number of copyrights
correlating to plans defendant prepared for various Menchie’s stores, although defendant did not
disclaim any pre-existing material in these registrations. Defendant obtained a copyright
registration from the Copyright Office on May 13, 2005. (Neal Dep. Ex. 26).
In late 2010, plaintiff began its relationship with Menchie’s. Plaintiff planned to build a
number of stores quickly. (Neal Depo. Ex. 11). Menchie’s required plaintiff and defendant to
work together on the projects. To that end, plaintiff and defendant entered into four DS
Contracts for locations in Ohio (“Ohio DS Contracts”). Defendant created and delivered to
plaintiff plans for those stores. Defendant obtained copyright registrations for those materials.
Defendant further prepared some initial layouts for additional stores plaintiff intended to
open. Defendant sent those initial layouts to Menchie’s for review. (Bayha Dep. p. 79-80). At

plaintiff.
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some point in the process, plaintiff became frustrated with defendant’s work. Plaintiff inquired
of Menchie’s as to whether plaintiff could utilize the services of another architect for the
remaining stores it planned to open. It appears that Menchie’s agreed. (Regev. Dep. Ex. M)
To that end, plaintiff hired Bialosky + Partners Architects, LLC (“Bialosky”) to replace
defendant. Plaintiff continued to be bound by its obligations as a franchisee of Menchie’s. In
other words, plaintiff had to operate under the “Menchie’s System,” which included utilizing
certain design requirements imposed by Menchie’s. (Kleinberger Dep. Ex. C). As such,
Menchie’s instructed one of its employees to send plaintiff “2-3 full packages of new projects
(make sure you are using the most update [sic] package; new frames, starlet, etc.’) ....We provide
the different plans to make sure [plaintiff] has all items and can convert a full set for CAD.2”
(Regev. Dep. Ex. L). In addition, the agreement between plaintiff and Bialosky required
Bialosky to create site specific architectural plans “based on Menchie’s standard criteria
drawings.” (Rapport Dep. Ex. 27 at ¶ 1). The agreement further provides that plaintiff “will be
provided with Autocad.dwg CAD files of the prototype drawings that will be created by
scanning existing drawings. The CAD files that we are provided with will be created using our
standard layering system....” (Id. at § G5).
Menchie’s sent plaintiff the drawings with instructions to have CAD files created from
the PDF files. (Deutsch Dep. Ex X). Plaintiff forwarded to Bialosky plans for certain Menchie’s
stores. The drawings had title blocks containing defendant’s name, as well as the name of the
architect. The drawings also had Menchie’s name on them. From this set, Bialosky selected
drawings of a North Carolina Menchie’s store, along with several pages of the Westgate store, to

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It appears that CAD stands for “computer aided design.”
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send to a CAD company. (Deutsch Dep. 164-67). Bialosky also sent its “layering standards” to
create a “kit” that Bialosky could use in designing the stores for plaintiff. Bialosky always
receives prototype drawings and puts them into its specific CAD format. (Deutsch Dep. 151-52).
At no point did any party receive permission from defendant to use works copyrighted by
defendant and defendant was not included in the communications between Menchie’s and
plaintiff. Thereafter, Bialosky created a number of drawings used by plaintiff in opening new
Menchie’s stores. Plaintiff testified that all of the Menchie’s franchises it opened share a “very
consistent” design.
Defendant also testified that it had received shell drawings prepared by the architect of
the buildings in CAD form from the landlord. According to defendant, these drawings contain
only shell outlines of the space. Defendant incorporated the CAD into its CAD in order to create
a design for the Menchie’s store. (Bayha Dep. 51). Defendant indicated that such a process is
commonplace. (Bayha Dep. 141-42).
In February of 2013, while working together on another project, Menchie’s sent
defendant a confidentiality agreement. That document provides that all “Confidential
Information,” which is defined to include copyrights, belongs to Menchie’s. The document is
missing the evenly numbered pages, and the “Confidential Information” provision is set forth on
an evenly numbered page. Nonetheless, the parties signed the document.
Thereafter, in October of 2013, defendant and Menchie’s agreed to part ways. (Neal
Dep. 139-140). Defendant offered Menchie’s full ownership rights to its CAD files and designs
for two Menchie’s franchise drawings, as well as a set of “drive through” designs. Menchie’s
responded that it did not believe it needed the design plans for two stores or the drive-through

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designs. (Neal Dep. Ex. 20). As such, Menchie’s inquired as to whether the price for the CAD
for one store would be $4,500.00. (Id). It does not appear that any further communication
occurred. (Neal Dep. 146). One of Mechine’s employees testified that he understood the email
to be an offer to perform new work. (Regev Dep. 94). Menchie’s believes that it owns the rights
to items such as “the logo, colors, the curved wall and the circular bubble, the signage, whether
it's interior and exterior.” (Kleinberger Dep. 245). This is so because these elements were
present in the first store. (Id.).
In late 2015, counsel for defendant wrote to plaintiff alleging that defendant owned
certain copyrighted designs, including those covered under the DS Contracts and others, and that
plaintiff had used those designs without defendant’s permission. In response, plaintiff filed this
lawsuit asserting two claims for declaratory relief. Count one seeks a declaration of noninfringement and count two seeks a declaration that plaintiff did not violate the Digital
Millennium Copyright Act (“DMCA”). Defendant filed a counterclaim asserting ten claims for
relief. Counts one through eight assert copyright infringement claims. Count nine is a claim for
violation of DMCA and count ten is a claim for breach of contract. The Court previously
granted in part defendant’s motion to compel mediation and arbitration. The Court determined
that counts one and two, as well as counterclaims one through nine, are subject to mediation and
arbitration to the extent they are based on copyrights derived from work performed pursuant to
the Ohio DS Contracts. The Court further compelled mediation and arbitration with respect to
the breach of contract claim.
Plaintiff now moves for summary judgment with respect to the remaining claims and
defendant opposes the motions.

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STANDARD OF REVIEW
Rule 56(a) of the Federal Rules of Civil Procedure, as amended on December 1, 2010,
provides in relevant part that:
A party may move for summary judgment, identifying each claim or defense—or the part
of each claim or defense—on which summary judgment is sought. The court shall grant
summary judgment if the movant shows that there is no genuine dispute as to any
material fact and the movant is entitled to judgment as a matter of law.
Fed .R.Civ.P. 56(a).
Rule 56(e) provides in relevant part that “[i]f a party fails to properly support an assertion
of fact or fails to properly address another party's assertion of fact as required by Rule 56(c), the
court may ... consider the fact undisputed for purposes of the motion ... [and] grant summary
judgment if the motion and supporting materials—including the facts considered
undisputed-show that the movant is entitled to it.” Fed.R.Civ.P. 56(e).
Although Congress amended the summary judgment rule, the “standard for granting
summary judgment remain unchanged” and the amendment “will not affect continuing
development of the decisional law construing and applying” the standard. See, Fed.R.Civ.P. 56,
Committee Notes at 31.
Accordingly, summary judgment is appropriate when no genuine issues of material fact
exist and the moving party is entitled to judgment as a matter of law. Celotex Corp. v. Catrett,
477 U.S. 317, 322-23 (1986) (citing Fed. R. Civ. P. 56(c)); see also LaPointe v. UAW, Local
600, 8 F.3d 376, 378 (6th Cir. 1993). The burden of showing the absence of any such genuine
issues of material facts rests with the moving party:
[A] party seeking summary judgment always bears the initial
responsibility of informing the district court of the basis for its
motion, and identifying those portions of “the pleadings,
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depositions, answers to interrogatories, and admissions on file,
together with affidavits,” if any, which it believes demonstrates the
absence of a genuine issue of material fact.
Celotex, 477 U.S. at 323 (citing Fed. R. Civ. P. 56(c)). A fact is “material only if its resolution
will affect the outcome of the lawsuit.” Anderson v. Liberty Lobby, 477 U.S. 242, 248 (1986).
Once the moving party has satisfied its burden of proof, the burden then shifts to the
nonmoving party. The court must afford all reasonable inferences and construe the evidence in
the light most favorable to the nonmoving party. Cox v. Kentucky Dep’t. of Transp., 53 F.3d
146, 150 (6th Cir. 1995) (citation omitted); see also United States v. Hodges X-Ray, Inc., 759
F.2d 557, 562 (6th Cir. 1985). However, the nonmoving party may not simply rely on its
pleading, but must “produce evidence that results in a conflict of material fact to be solved by a
jury.” Cox, 53 F.3d at 150.
Summary judgment should be granted if a party who bears the burden of proof at trial
does not establish an essential element of his case. Tolton v. American Biodyne, Inc., 48 F.3d
937, 941 (6th Cir. 1995) (citing Celotex, 477 U.S. at 322). Accordingly, “the mere existence of a
scintilla of evidence in support of plaintiff’s position will be insufficient; there must be evidence
on which the jury could reasonably find for the plaintiff.” Copeland v. Machulis, 57 F.3d 476,
479 (6th Cir. 1995) (quoting Anderson, 477 U.S. at 52 (1986)). Moreover, if the evidence is
“merely colorable” and not “significantly probative,” the court may decide the legal issue and
grant summary judgment. Anderson, 477 U.S. at 249-50 (citation omitted).
ANALYSIS
1. Copyright infringement
Copyright owners possess certain protections for “original works of authorship expressed

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in various media.” Strombeck v. New Line Cinema, 384 F.3d 283, 293 (6th Cir. 2004). That
protection provides the copyright owner with exclusive rights to:
(1) reproduce the copyrighted work;
(2) prepare derivative works;
(3) distribute copies;
(4) perform publically a copyrighted work; and
(5) display publically a copyrighted work.
17 U.S.C. § 106.
In order to establish a claim for copyright infringement, a party must prove: (1)
ownership of a valid copyright; and (2) copying of constituent elements of the work that are
original. Feist Publishing, Inc. v. Rurual Telephone Services, Co., 499 U.S. 340, 361 (1991).
Infringement may be established with either direct evidence of copying, or through an inference
of copying. A copyright owner may establish “an inference of copying by showing (1) access to
the allegedly-infringed work by the [infringer] and (2) a substantial similarity between the two
works at issue.” Kohus v. Marisol, 328 F.3d 848, 853-54 (6th Cir. 2003).
Here, the parties dispute both “ownership” and “copying.” For ease of analysis, the
Court will address these elements in reverse order.
Defendant argues that it has presented evidence of direct copying. According to
defendant, plaintiff reproduced and distributed certain works covered by defendant’s copyrights
when it forwarded to Bialosky via email PDF versions of the materials. Bialosky then forwarded
the materials to a company that created CAD files from the PDF files. Although not specifically
identified by the parties, it appears that two sets of Westgate plans, as well as plans for the Avon

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and Lakewood locations, were provided by plaintiff to Bialosky. (Deutsch Dep. Exs. M, N, O).3
Bialsoky then instructed a CAD firm to convert certain aspects of the plans into Bialosky’s CAD
form. In response, plaintiff argues that in order to constitute “distribution” in violation of 17
U.S.C. § 106, the transmission must be tied to an “end purpose.” In other words, plaintiff argues
that nothing suggests that “forwarding an email is in and of itself distribution in violation of the
statute.” The Court is not convinced that plaintiff’s argument is correct, but it need not
specifically address this issue. As set forth in the counterclaim, defendant alleges that by
emailing the plans to Bialosky, who then forwarded the plans to a CAD company, plaintiff
reproduced the copyrighted material in violation of 17 U.S.C. § 106(1). Although defendant did
not fully develop this argument, plaintiff wholly fails to address the issue of whether plaintiff’s
actions constitute reproduction–as opposed to distribution–and, as such, the Court must conclude
that a question of fact exists with regard to whether plaintiff reproduced the Westgate,
Lakewood, and Avon plans that were subject to defendant’s copyrights.
With regard to all other copyrighted plans, there is no direct evidence of infringement.
Therefore, in order to satisfy the copying element of an infringement claim, defendant may rely
on an inference of copying by showing (1) access to the allegedly-infringed work by the
[infringer] and (2) a substantial similarity between the two works at issue. Kohus, 328 F.3d at
853-54. Assuming arguendo that plaintiff had access to the allegedly infringing work, the Court
finds that defendant wholly fails to satisfy the “substantial similarity” prong.

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Additional plans were forwarded as well, but defendant does not
attach Copyright registrations for those plans to its counterclaim.
As such, it does not appear that these plans are at issue in this
lawsuit.
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In assessing whether two works are substantially similar, this Court must apply a twopart test. First, the Court must “filter out the unoriginal, unprotectible elements – elements that
were not independently created by the inventor, and that possess no minimal degree of creativity,
through a variety of analyses.” Stromback v. New Line Cinema, 384 F.3d 283, 294 (6th Cir.
2004). Second, the Court is to “determine whether the allegedly infringing work is ‘substantially
similar’ to protectible elements of the artist’s work.” Id. And, although “summary judgment in
favor of an [accused infringer] in a copyright case is a practice that should be used sparingly, in
an appropriate case, a court may compare the two works and render summary judgment for the
[accused infringer] on the ground that as a matter of law a trier of fact would not be permitted to
find substantial similarity.” Id.
Plaintiff argues that defendant has not identified any specific protectible element in any
particular copyrighted material. In response to an interrogatory propounded by plaintiff,
defendant responded:
[Defendant] states that with respect to its Copyrighted Works, the selection and
combination of individual features, the overall form, flow and function, as well as
the arrangement and composition of spaces and elements in the design are all
original to it. These original elements include but are not limited to such things as
the sizes and shapes of the kitchen, walk-in coolers, bathrooms, serving area,
purchase area, and dining area; and the spatial relationships of these areas to each
other; the size, including length, width and height, as well as the arrangement and
shapes of walls (angled, curved and/or partial walls), kitchen counters, walk-in
coolers, serving counters, serving machines, toppings bar, cash register area,
windows and doors and the relationships between and among these features;
arrangements, locations and spatial relationships between and among appliances,
countertops, bathrooms, serving area, purchase area, and dining area; the
arrangement and placement of kitchen closets, walk-in cooler, and other storage
type areas; and the manner in which the traffic flows through the store. Further,
the selection of stylish elements and materiality, such as colors and designs of
walls, including the “bubble tile radius, travel-area wall,” the toppings counter
“wave wall,” design of the circular kiosk pay-station area, circular soffit above
the
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circular kiosk pay-station area, the selection and incorporation of the entire FF&
E, and the overall “look and feel” of Menchie’s restaurant branding.
Plaintiff argues that this response is insufficiently general to allow the Court to determine
what features are unique, as opposed to dictated by the Menchie’s design requirements or the
practicalities of working within a particular space. In other words, anything arguably “original”
is the result of the things such as landlord requirements, existing conditions, and government
regulations, as opposed to creative expression.
With regard to substantial similarity, plaintiff argues that defendant wholly fails to
identify a particular plan created by Bialosky and compare it to defendant’s copyrighted
material. Bialosky describes certain plans it created as “extremely” different from Menchie’s
criteria plans, including a Texas store plan drawn by defendant. Plaintiff also notes that at best
the only similar features are the circular sales counter and curved wall of the yogurt dispensers.
Plaintiff points to evidence, however, indicating that these features were present in the first
Menchie’s store, which was constructed prior to defendant’s involvement and thus cannot be
said to an expression of defendant’s creativity.
In response, defendant notes that pursuant to 17 U.S.C. § 101, an architectural work is
defined as “the overall form as well as the arrangement and composition of spaces and elements
in the design, but does not include individual standard features,” such as common windows,
doors, and other staple building requirements.” Defendant then points out that plaintiff produced
construction plans for the stores developed with Bialosky and notes that the “accused works are
strikingly similar in too many ways to have been the product of independent creation.4”

4

Defendant also cites to the deposition of Neal in support of this
proposition, but that testimony does not appear to be on point.
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Defendant further notes that plaintiff admitted that all Menchie’s stores developed by plaintiff
share a “very consistent design.”
Upon review, the Court finds that plaintiff is entitled to summary judgment on the issue
of “substantial similarity.” Here, defendant makes no effort to point out specific original
elements contained in its designs. In fact, defendant does not even refer to a particular plan
when addressing this issue. Undoubtedly, the plans are different, yet defendant makes only a
generic recitation regarding “original elements” that would apply to essentially any architectural
plan.5 But, even assuming that defendant’s generic argument regarding the “overall look and
feel” is somehow sufficient to identify the creative elements so that this Court could perform a
filtering analysis, defendant wholly fails to point the Court to any allegedly infringing
comparison plan for the Court to compare. Here, defendant alleges ten copyrighted works that it
claims plaintiff infringes upon. Defendant then summarily points out that plaintiff produced
“construction sets” and that the “accused works” are “strikingly similar.” These ten
copyrightrighted works vary from each other, as do Bialosky’s plans. Yet, at not point does
defendant discuss a specific copyrighted plan or compare such plan to any allegedly infringing
plan or construction set. Based on this analysis, no reasonable juror could find that any allegedly
infringing plan is “substantially similar” to defendant’s copyrighted materials. Thus, although
summary judgment is granted sparingly, it is appropriate here based on defendant’s wholesale

(Neal Dep. 3-7, 23, 26-28, 30).
5

Defendant’s interrogatory response does identify the “bubble tile
radius, travel-area wall” and the toppings counter “wave wall.” It
is not at all clear, however, where these elements appear, as
defendant fails to discuss the copyrighted materials themselves.
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failure to even point out which two plans the fact finder should compare.
Having concluded that a question of fact exists as to the “copying” element only with
respect to the plans emailed by plaintiff to Bialosky and then forwarded to the CAD company,
the Court turns to whether plaintiff is entitled to summary judgment with respect to copyright
“ownership.” It appears that plans for the Westgate store, as well as plans for the Avon and
Lakewood locations, were arguably reproduced by plaintiff when it provided them to Bialosky.
Those plans are the subject of copyright registrations that were obtained within five years of first
publication. As such, a presumption of validity attaches. 17 U.S.C.A. § 410(c). Although this
presumption may be rebutted, it is the burden of the party challenging the copyright to do so.
Hi-Tech Video Productions, Inc. v. Capital Cities/ABC, Inc., 58 F.3d 1093, 1095 (6th Cir. 1995).
To rebut this presumption, plaintiff argues that the 2008 Plans provide that the architect
for the project is David Udkow, who performed the work as an independent contractor. In
addition, plaintiff notes that a note appears on the face of this set of plans, which provides that
the plans cannot be modified without the express written consent of Menchie’s. According to
plaintiff, because the document reserves exclusive rights only to Menchie’s, defendant cannot
assert ownership rights over the plans. Plaintiff further points out that defendant testified that he
considers the architect to be the owner of the work. And, in this case, the architect is not an
employee of defendant.
In response, defendant points out that Udkow did not design or in any other way create
the plans. Rather, he reviewed the plans and signed them for permitting purposes. Plaintiff
further points out that the Ohio DS Contracts between plaintiff and defendant provide that
defendant owns the copyrights to the plans. In addition, defendant notes that the franchise

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disclosure documents provided to franchisees from Menchie’s contain the following language:
As of the date of this Disclosure Document we do not own any rights in or to any
patents, patent applications or copyrights that are material to the franchise. We claim
copyright protection for our Operations Manual and other publications and promotional
materials although we have not registered any of the materials with the U.S Copyright
Office.... We reserve the right to register any of our copyrighted materials at any time we
deem appropriate.
(Neal Dep. Ex. 18).
Upon review, the Court finds that plaintiff is not entitled to summary judgment on the
issue of copyright ownership. As an initial matter, as noted previously, the plans that were
emailed to Bialosky are plans for which a presumption of validity attaches. Therefore, the
burden is on plaintiff to rebut that presumption. Plaintiff has not done so for purposes of
summary judgment. Although plaintiff points out that the registration for the 2008 Plans
provides that the plans cannot be modified without the express written consent of Menchie’s,
plaintiff points to no such language on the face of the particular plans that plaintiff sent to
Bialosky. Although plaintiff notes that the Westgate store plans provide that Udkow was the
architect, defendant notes that Udkow was engaged for permitting and approval purposes only.
Plaintiff points to no evidence indicating that Udkow actually created the plans that are the
subject of the copyright registrations.
In its reply brief, plaintiff claims that its argument is that Menchie’s – not defendant–
owned the 2008 Plans. Specifically, plaintiff argues that “undisclosed pre-existing material,
which consists of the [2008 Plans] and the criteria drawings [defendant] admits receiving from
Menchie’s prior to the creation of the [2008 Plans], was owned by Menchie’s, not [defendant].”
The argument is insufficient to warrant summary judgment on the issue of ownership. Although
plaintiff offers testimony that certain documents and drawings were prepared by previous
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architects and sent to defendant, there is no indication that these drawings consisted of the 2008
Plans, as claimed by plaintiff. Without any explanation, the Court finds that plaintiff fails to
overcome the presumption afforded to the copyright registrations for the plans sent by plaintiff to
Bialosky. At best, plaintiff points to evidence indicating that Menchie’s may be an owner of the
2008 Plans.
Plaintiff also asks the Court to invalidate the copyright on the grounds that plaintiff failed
to identify the 2008 Plans as preexisting work that underlies the registrations for the Westgate,
Avon Lake, and Lakewood stores. According to plaintiff, defendant cannot establish that the
registrations for these stores contain minimal creativity. Plaintiff points out that none of the
registrations disclaim as preexisting material the 2008 Plans, Udkow’s work, or any earlier
Menchie’s designs. In other words, it appears that plaintiff is claiming that the copyright
registrations for the plans plaintiff sent to Bialosky are invalid because they are derivative works
and defendant failed to disclose pre-existing works when obtaining the registration.
The Court finds that plaintiff is not entitled to summary judgment on this issue. “The
purpose of the Copyright Act requires that the application for copyright registration of a
derivative work ‘shall include ... an identification of any preexisting work or works that it is
based on or incorporates, and a brief, general statement of the additional material covered by the
copyright claim being registered.’” Dorchen/Martin Associates, Inc. v. Brook of Cheboygan,
Inc., 2012 WL 4867608 (E.D. Mich. Oct. 15, 2012)(citing 17 U.S.C. § 409(9)).
“The issue raised by § 409(9) is whether and to what extent the derivative design
incorporates elements designed by someone else.” Frank Betz Associates, Inc. v. J.O.
Clark Const., LLC, 2010 WL 2253541, at *11 (M.D.Tenn. May 30, 2010). Where the
evidence indicates that Plaintiff created derivative designs based on its own original
designs, “the concerns that § 409(9) raises are not implicated.” Id.

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Id. at *5.
Here, as set forth above, a question of fact exists as to whether defendant owns the
copyright in the 2008 Plans. To the extent defendant owns a valid copyright in those plans, the
Court finds that on the facts of this case, the failure to disclose the plans as pre-existing material
when registering later works, standing alone, would not invalidate the subsequent registration.
As the copyright would have simply incorporated plans created by defendant, its failure to
identify those plans as pre-existing materials does not implicate Section 409(9) of the Copyright
Act. Accordingly, summary judgment in favor of plaintiff is not proper.
It further appears that plaintiff is claiming that defendant failed to re-disclose the preexisting material identified in the 2008 Plans. In that registration, defendant identified
“photography, jewelry design, 2-D artwork, sculpture, technical drawing” as material excluded
from the claim. Plaintiff further notes that defendant used the 2008 Plans as a prototype for
future stores. The Court finds that plaintiff is not entitled to summary judgment because plaintiff
fails to point out that these previously disclosed items are contained in the plans that plaintiff
emailed to Bialosky. Although defendant may have used the 2008 Set of Plans as a “prototype,”
there is no indication that defendant incorporated every item contained in those plans in creating
the subsequent plans. As such, the Court simply cannot say whether these items constitute preexisting materials that should have been disclosed by defendant. Accordingly, summary
judgment is not warranted.
Next, plaintiff argues that it was authorized to use the design plans. According to
plaintiff, Menchie’s possessed joint ownership rights in the plans or, at a minimum, Menchie’s
had an implied license to use the plans. Menchie’s, in turn, gave plaintiff permission to copy and

18

distribute the plans to Bialosky. In support of its position, plaintiff notes that the process utilized
by Menchie’s and defendant was collaborative, in that Menchie’s would provide defendant with
a packet of information about a new location along with the franchisee’s contact information.
Defendant drew an initial layout and sent it to Menchie’s for approval. Thereafter, Menchie’s
might make changes to the design before forwarding the design to the franchisee. Here,
defendant sent initial layouts for the Lakewood and Avon stores to Menchie’s.
In response, defendant argues that the burden of establishing an authorized use defense
rests with plaintiff. Defendant points out that in all of the DS Contracts signed by the
franchisees, the franchisee and defendant agreed that defendant owned the plans and design
documents. Defendant further notes that plaintiff testified that at the time plaintiff and defendant
“parted ways,” defendant had no reason to believe that anyone other than defendant owned the
the designs to the “four stores.6”
A non-exclusive license may be granted orally, or may be implied from conduct. This is
true because a nonexclusive license is not a transfer of ownership under 17 U.S.C. § 101
and is not, therefore, subject to the writing requirement of § 204. The key to finding an
implied license is in the intent of the copyright holder. Like an express license, the
existence of an implied license to use the copyright for a particular purpose precludes a
finding of infringement.
Murphy v. Lazarev, 589 Fed.Appx. 757, * 765 (6th Cir. 2014)(citations and quotations omitted).
Upon review, the Court finds that plaintiff is not entitled to summary judgment on the issue of
implied license.7 Here, the Court must determine whether defendant intended to grant Menchie’s

6

It appears that the deponent may be referring to the stores that are
the subject of the Ohio DS Contracts.

7

For the reasons stated previously, the Court finds that question of
fact exists as to whether Menchie’s is a “co-owner” of the plans.
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an implied license to use the plans that Menchie’s provided to plaintiff, who then in turn
provided them to Bialosky. There is simply no evidence that defendant intended to grant
Menchie’s an implied license with respect to plans where the franchisee refused to utilize
defendant on the project. Rather, the evidence shows that defendant was in essence the
exclusive architect with respect to the construction of Menchie’s stores. To that end, defendant
entered into DS Contracts with the franchisee, pursuant to which defendant was paid to prepare
plans. Those agreements further inform the franchisee that “[Menchie’s] and [Menchie’s]
contractors shall have no right to copy or use the data on other projects, or for additions to this
Project, without agreement of and compensation to [defendant].8” However, it appears that with
respect to at least certain plans, i.e., the Lakewood and Avon stores, defendant prepared plans,
but the parties did not sign DS Contracts with respect to those plans. See, e.g., Johnson v.
Jones, 149 F.3d 494 (6th Cir. 1998). Although plaintiff points to some evidence that Menchie’s
may have been granted an implied license with respect to certain plans, that evidence is
insufficient to warrant summary judgment.
2. DMCA
Plaintiff also moves for summary judgment on defendant’s DMCA claim. There,
defendant alleges that plaintiff violated 17 U.S.C. § 1202, which provides:

8

The Court rejects plaintiff’s argument that the DS Contracts have
no place in this analysis. Although the contracts were not with
Menchie’s, plaintiff was in fact a party to four DS Contracts.
Thus, at a minimum, a genuine issue of material fact exists as to
whether defendant intended to grant a license to Menchie’s that
would allow Menchie’s to then grant a license to plaintiff. This is
so because the DS Contracts evidence defendant’s intent to not
grant such a license.
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(b) Removal or alteration of copyright management information. –No person shall,
without the authority of the copyright owner or the law–
(1) intentionally remove or alter any copyright management information,
(2) distribute or import for distribution copyright management information
knowing that the copyright management information has been removed or altered
without authority of the copyright owner or the law, or
(3) distribute, import for distribution, or publicly perform works, copies of works,
or phonorecords, knowing that copyright management information has been
removed or altered without authority of the copyright owner or the law,
Plaintiff argues that it is entitled to summary judgment on this claim because there is no
evidence that anyone removed any copyright management information (“CMI”).9 Plaintiff
argues that Bialosky, through a third-party, created a CAD file using Bialosky’s layering
instructions. According to plaintiff , the testimony shows that the CAD process does not
“remove” CMI. Rather, information is inputted into Bialosky’s layering system, which produces
a new work. It is not an exact copy of defendant’s original work. Therefore, at no point did
anyone “remove” CMI. Plaintiff further argues that defendant cannot establish actual knowledge
of unauthorized removal. Rather, the evidence shows that plaintiff understood that it had
permission from Menchie’s to use the drawings.
In response, defendant argues that the definition of removal should not be so narrowly
construed. Rather, the Court should not require that a party physically remove the CMI.
According to defendant, the evidence establishes that plaintiff performed “acts of removal”
through its agent, i.e., Bialosky. Defendant points out that plaintiff forwarded emails containing
defendant’s copyrighted works to Bialosky. Defendant further notes that “Bialosky...converted

9

CMI includes items such as the title and author of the work. 17
U.S.C. § 1202(c).
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[the copyrighted works] from PDF to CAD, and used them in order to create the sixteen
additional [Menchie’s] stores.” According to defendant, the new stores are “strikingly similar”
to defendant’s works, yet they do not display defendant’s CMI. In essence, defendant argues
that Bialosky removed the CMI and then created derivative works without retaining defendant’s
CMI on those derivative works.
Upon review, the Court finds that plaintiff is entitled to summary judgment. Here,
plaintiff admittedly sent copyrighted plans to Bialosky, which then scanned the documents into
its system.10 To the extent these actions could arguably constitute copying, there is no evidence
even suggesting that the CMI was removed during this process. Accordingly, these actions are
not sufficient to establish a violation of the DMCA. Moreover, the Court finds that defendant
fails to point to a genuine issue of material fact with regard to the “removal” of the CMI during
the CAD conversion process. Deutsch, an employee of Bialosky, testified that Bialosky
modifies the materials in order to conform them to Bialosky’s layering system. In other words,
the program does not “copy” the materials. Rather, it creates a digital layer similar to overlay
drafting and the layering instructions result in changes to the materials based on the layering
system employed.11 Although defendant generically argues that the plans created from this

10

Defendant argues that Bialosky itself scanned documents, as
opposed to having received documents scanned by plaintiff. The
testimony cited, however, does not directly support this
proposition. See, (Deutsch Dep. 202-203)(“I've said that I have -we had scanned drawings that we received that were prototype
drawings....”)

11

See Deutsch Dep. Ex. X. (Email noting that “the layer standards
for the MEP drawings will be sent separately but in the meantime
the work on the architectural drawings can begin. Please note that
there are standards for 1.) Floor Plans, 2.) Reflected Ceiling Plans,
22

process are “strikingly similar,” defendant wholly fails to show that the resulting works are
“copies” of defendant’s copyrighted work. Because there is no evidence that plaintiff or its
agents removed CMI from defendant’s original work or “distributed” a “copy” of defendant’s
work knowing that CMI had been removed, summary judgment in favor of plaintiff is warranted.
See, e.g. Frost-Tsuji Architects v. Highway Inn, Inc., 2015 WL 263556 (D. Hawai’i Jan. 21,
2015)(“basing a design on the [previous architect’s] work [is] not the same as removing
copyright management information from an original copyrighted work.”); See also, Kelly v.
Arriba, 77 F.supp.2d 1116, 1122 (C.D. Cal. 1999)( “Based on the language and structure of the
statute, the Court holds that [Section 1202(b)(1)] applies only to the removal of copyright
management information on a plaintiff's product or original work,” and Section 1202(b)(3)
requires the claimant to show that the wrongdoer distributed copies wherein the CMI was
removed) . 12
CONCLUSION
For the foregoing reasons, plaintiff is entitled to summary judgment on all claims, with
the exception of the copyright infringement and corresponding declaratory judgment claims as
they pertain to defendant’s allegation that plaintiff emailed copies of certain plans to Bialosky.

3.) Interior Elevations, and 4.) Sections Detail views. This means
that the person setting up the layers should use the corresponding
standard for each type of drawing (“Floor Plans standard” for
plans, “RCP standard,” for RCP Plans etc.”)
12

The parties correctly note that virtually no authority exists
interpreting this provision.
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IT IS SO ORDERED.

/s/ Patricia A. Gaughan
PATRICIA A. GAUGHAN
United States District Judge

Dated: 4/12/17

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