The solemn, esteemed appellate courts don’t get to tell parties to just buzz off, of course. But after a decade of litigation, will some movie memorabilia product-makers finally give up their campaign to tap images from some of Warner Brothers’ most iconic films and characters?
The U.S. Court of Appeals for the Eighth Circuit, in a second adverse decision, has affirmed lower court rulings against plaintiffs Art and Vintage Entertainment Licensing Agency (AVELA), Dave Grossman Creations, X One X Productions and Leo Valencia. Instead, the court has given the studio yet another legal victory. Specifically, the appellate judges said AVELA et al can’t raise new arguments now and they owe Warner Brothers $2.57 million for copyright infringement.
The appellate judges upheld a permanent injunction in favor of Warner against the plaintiffs, a court order issued as part of a lawsuit launched in 2006, in which the studio accused AVELA et al of acquiring restored versions of movie posters and lobby cards for its films and extracting from publicity materials images of legendary characters like Dorothy, Tin Man, Cowardly Lion, and Scarecrow from The Wizard of Oz, Scarlett O’Hara and Rhett Butler from Gone with the Wind, and Tom and Jerry from the eponymous cartoon show. Warner complained the images violated its intellectual property when they were used on products like T-shirts, lunch boxes, playing cards, and action figures.
Lawsuit launches in ’06
Warner sued AVELA et al under the Copyright Act, Lanham Act, and state law in 2006, winning in 2009 in a U.S. District Court in St. Louis summary judgment on its infringement claims. The federal court issued a permanent injunction against AVELA barring them “from using any of the [Warner] … images in any way except for exact duplication of publicity materials in the public domain.” AVELA had asserted that it could freely use certain images it had acquired, pulling these from publicity materials the studio flooded the market with, hadn’t directly copyrighted, and, thus, arguably had put into the public domain.
The trial court disagreed, issuing its summary judgment. AVELA appealed the decision. The appellate judges in the Eighth Circuit in 2011 upheld the lower court and most of its court order, favoring the studio.
The appellate court split the infringing AVELA products into three distinct groupings, remanding the case to the trial court and asking it to consider whether infringement had occurred when the disputed images from publicity materials had been: used in a 3-D object; and when they were combined with other images and text to create a composite work. The appellate court said a third category of products, those reproducing “ one image from an item of publicity material as an identical two-dimensional image,” were held not to infringe.
Trial court reconsiders
On remand, Warner requested statutory damages for its copyright claims, and attorney’s fees. It also moved for summary judgment on its trademark infringement and unfair competition claims. At issue in the infringement claims finally were a total of 257 works. The trial court determined the studio should receive statutory damages of $10,000 per infringed copyright, totaling an award of $2,570,000. The district court granted summary judgment on the trademark infringement and unfair competition claims, holding that the entertainment giant had registered trademarks in words and phrases from the films. The lower court found that Warner Brothers possessed common law trademarks in the film characters.
AVELA et al appealed again. The appellate court’s Nov. 1 opinion laid waste to the new challenges. As for the claims that the lower court’s permanent injunction violated the Seventh Amendment, the appellate court told the appellants, well, tough luck. That argument needed to be made earlier and at the trial court level, not on appeal.
The appellate court further rejected AVELA’s claim that the $2.57 million judgment against it and the others violated their due process rights and was disproportionate to their offenses. U.S. Circuit Judge Raymond W. Gruender, writing for the three-judge appellate panel, noted that AVELA continued its infringement during trial by failing to stop its sales “over the many years of the litigation.” Further, to deter future infringement, especially when as extensive as AVELA’s, the court needed to impose substantial damage awards.
Gruender discarded a half-dozen attacks by AVELA on the lower court’s finding in favor of the movie studio on trademark infringement and unfair competition, again telling the unhappy parties that they had their chance to raise many of the issues more appropriately at the trial court level.