Court misapplies Dastar because customers buy photo to show love of subject

Masck v. Sports Illustrated, No. 13-10226 (E.D. Mich. June 11, 2013)

I know the year’s not even half over, but I am tentatively declaring a winner in the “year’s worst misunderstanding of Dastar” category.  Other contenders will have to work hard.

Plaintiff Masck took an “iconic” photo of defendant Desmond Howard, who was running back a punt for a touchdown in a football game where the University of Michigan “soundly defeated” their archrival Ohio State.  He made the “Heisman pose” by lifting his left leg up and stretching out his left arm, and Masck alleged that he was the only photographer who got a “sharp” shot of the pose.  It was included in a Sports Illustrated article, crediting him.  He didn’t register the photo until August 2011.

Masck negotiated with Howard’s agent and Howard, but was unable to reach an agreement about joint sales.  He alleged that he sent a slightly altered photo to Howard to track unauthorized use, which was then uploaded to Howard’s website.  Masck identified numerous instances of infringing use, including a copy in a book about Howard, I Wore 21: The Legend of Desmond Howard. Howard’s website also had a reproduction of the photo at one time.  Reproductions of the photo were offered for sale on Amazon.  In September 2012, Masck requested Amazon to stop selling unauthorized copies, but Amazon continued to sell them. 

Masck sued many, many entities for infringement, violation of the Lanham Act, state unfair competition, tortious interference, and unjust enrichment.

Lanham Act: The Supreme Court held that “origin” of “goods” in the Lanham Act refers only to “tangible goods” and not “communicative products.” The court even quotes the correct standard: “[T]aking tangible goods and reselling them as your own constitutes a Lanham Act violation; taking the intellectual property contained in those goods and incorporating it into your own goods does not.” Nat'l Bus. Dev. Servs., Inc. v. Am. Credit Educ. & Consulting Inc., 299 F. App'x 509, 511 (6th Cir. 2008).

However, the court wasn’t ready “at this time” to conclude that the photo was an intangible item.  (No, the intellectual property embodied in the photo is an intangible item; each physical photo is tangible, but defendants allegedly produced each one in suit, as in Dastar.)  Masck sells his own copies of the photo, “making him a producer of tangible goods.”  (And if defendants had resold his copies, that could be a relevant fact.)  He alleged that some of the infringing activity involved “the copying of a physical copy of plaintiff’s photograph and then placing their trademark on the item.” Here, unlike in National Business, “the infringing activity involved wholesale copying of Plaintiff’s photo rather than incorporating elements of his materials into their own works.”

Okay: Whether there was wholesale copying or not was a standard explicitly rejected in Dastar.  If Masck made the copies, then reverse passing off is possible (but copyright infringement isn’t, given first sale).  If defendants made the copies, as Masck alleges, then there’s no Lanham Act claim.  That’s what it means to distinguish between the source of physical copies (within the subject matter of the Lanham Act) and the source of intangible expression embodied in each copy (not within the subject matter of the Lanham Act).

The court continued that Masck claimed to have the only sharp photo of the event, and that “since not all pictures taken that day were of the same quality, the source of the photo is important.”  But in the same sentence, the court says that consumers can judge quality for themselves, making clear that the court has misunderstood the legal meaning of “source.”  If consumers are interested in the quality of the photo, they don’t care who took it or whether all copies came from the same entity, which is what “source” means for §43(a) purposes. The photo does not gain any value because Masck took it (as it might had Ansel Adams taken it); this discussion concedes that its value comes from being a good picture, not from its photographer-identifying significance.  But, the court concludes, “reproductions of the photo may lead to confusion about the source of the photograph and dilute Plaintiff’s sales.”  (Because what this discussion really needs is use of the term “dilution.”) 

True, Agence France Presse v. Morel, 769 F. Supp. 2d 295 (S.D.N.Y. 2011), reached the correct, contrary result.  But, though Masck’s photo has “a communicative aspect,” “it is not as easily reduced to simply an ‘idea, concept, or communication’ as other photos”:

Consumers do not purchase the photo simply for its communicative properties, they purchase it as a token of their fandom for the University of Michigan, or Desmond Howard. As much is clear by the fact that consumers purchase and retain the photo in its physical form. So, unlike other photographs, the physical nature of the photo remains an inalienable characteristic.

I don’t really know where to start here.  How about: if consumers are purchasing the photo as a token of their fandom for two different entities who aren’t Masck, the Lanham Act claim must fail, since Masck has no source identification claims?  Or: it doesn’t matter what the mystical content of this particular photo is, since Dastar sets out a blanket rule?  The court denied the motion to dismiss without prejudice.

The state law claims were preempted under 17 USC § 301 for lack of an extra element.  Masck claimed that the publisher of the book about Howard, Champions Press, committed tortious interference by intentionally interfering with Masck’s business relationship with Howard, because it knew that there were ongoing negotiations about buying the rights to the photo, yet Champions published the photo without permission.  The “interference” here was unauthorized copying, not anything different from infringement. Nor was Masck’s Michigan Consumer Protection Act claim qualitatively different.  Masck “tried to make the two claims sound different by describing the basis of the consumer protection claim to be confusion over the source of the photo. However, the underlying conduct complained of is the unauthorized copy of Plaintiff’s photo.”  And unjust enrichment was preempted, since there were no allegations of an implied in fact contract/promise to pay.

The court granted Howard’s motion to kick out the statutory damages and attorneys’ fees claims (for all defendants alleged to have infringed before registration).  In the Sixth Circuit, “infringement ‘commences’ for the purposes of § 412 when the first act in a series of acts constituting continuing infringement occurs.” Johnson v. Jones, 149 F.3d 494 (6th Cir. 1998)—here, February 2010.  Masck didn’t dispute this, but argued that Howard engaged in separate post-registration acts of infringement, because of his use of the altered photo in August 2012.  No dice—as Johnson held, the purpose of Section 412 “would be thwarted by holding that infringement is ‘commenced’ for the purposes of § 412 each time an infringer commits another in an ongoing series of infringing acts.” 

Even if the series of infringing acts should be chopped up, the differences between the photos weren’t significant enough that using the second one was a new act of infringement—the alterations were designed to be so slight that they would not “appear to the untrained eye.” “Given the purpose of the alterations and Plaintiff’s own assessment that the differences are not easily discernable, the altered photo is not a new work.”  And putting the altered photo on the website wasn’t a new act.  It was effectively the same photo, on the same website, by the same defendant.

The court also granted Amazon’s motion to dismiss the vicarious infringement claim against it, but not the contributory infringement claim.  Amazon, as an e-commerce platform provider, argued that it had no practical ability to control what occurred on its site (and no direct financial interest in infringement). The court agreed that Amazon couldn’t be expected to examine every third party product for infringement.  “Copyright infringement . . . lends itself readily to abusive litigation . . . Therefore, greater particularity in pleading, through showing ‘plausible grounds,’ is required.” Merely pleading that Amazon had the right and ability to control the content of its website, without factual allegations, was insufficient to show that Amazon could plausibly verify the copyright status of each and every piece of merchandise it lists from third-party sellers.  (While I agree with the result, note that the court’s reasoning is special to copyright vicarious liability; true vicarious liability, in for example an employer-employee relationship, asks about the right and ability to control the employee’s conduct, not about whether the employer could reasonably have known about the specific act of infringement or infringement in general.  But given the metastasized idea of "right and ability to control" far beyond traditional agency that has occurred in copyright, it is unsurprising that courts have incorporated other fault-based concepts to rein it in a bit.)

The contributory infringement claim wasn’t dismissed, because Masck requested Amazon to remove the allegedly infringing merchandise, giving Amazon knowledge of the infringing activity.  (Interesting factual question: if there are multiple photos of this event, what constitutes sufficient knowledge that a particular item has a copy of Masck’s photo rather than some other photo, and that Masck has a legitimate claim rather than an anticompetitive one?)  Because Amazon continued to sell the merchandise, and selling infringing merchandise materially contributes to infringement, Masck stated a plausible contributory infringement claim.  Amazon argued that Sony v. Universal should protect it, but “the product in question is not Amazon’s website, but the merchandise sold on its website.”  Sony was therefore inapplicable, and anyway Sony was about limiting the imputation of culpable intent as a matter of law from the characteristics or uses of a distributed product.  “There is no need to impute culpable intent since the products sold by Amazon already possessed their infringing characteristics,” and because Amazon knew about the alleged infringement. (The court is conflating Amazon’s service with the products sold through its service—like conflating the VCR with the videotapes made by end users.  Even the swap meet cases do better than this applying Sony to services.)