Free Trial Brief - District Court of Arizona - Arizona

GREENBERG TRAURIG, LLP 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 Plaintiff Awareness Corporation ("Awareness") hereby submits its bench memorandum regarding its claim for direct copyright infringement against distributor defendants Paige and Kelly Mattice (collectively, "Mattice"), Lynn and Renie Remelski (collectively, "Remelski"), and Kevin and Cheryl MacGregor (collectively, "MacGregor"). Awareness further hereby submits its bench memorandum regarding its claim for contributory copyright infringement against defendant Mattice. Awareness brought suit against the Distributor Defendants because each defendant unlawfully copied certain of Awareness' copyrighted materials, including materials found in Awareness' Extranet Software. Awareness also brought claims against each Distributor Defendant for contributory copyright infringement because each encouraged and/or induced other soon-to-be former Awareness distributors to copy Awareness' Extranet
phx-fs1\1506615v01\8/8/05\6:44:00PM ATTORNEYS AT LAW SUITE 700 2375 EAST CAMELBACK ROAD PHOENIX, ARIZONA 85016 (602) 445-8000

Steven M. Weinberg, SBN 016817, [email protected] Brian J. Schulman, SBN 015286, [email protected] Kimberly A. Warshawsky, SBN 022083, [email protected] Attorneys for Plaintiff Awareness Corporation and Third Party Defendants Allcock and Schmidt IN THE UNITED STATES DISTRICT COURT DISTRICT OF ARIZONA Awareness Corporation, Plaintiff, v. Group Vision International, L.L.C., et al., Defendants. And related cross claims and third party actions. No. CV03-2024-PHX-DGC PLAINTIFF AWARENESS CORPORATION'S BENCH MEMORANDUM NO. 1 RE: COPYRIGHT INFRINGEMENT AND CONTRIBUTORY COPYRIGHT INFRINGEMENT

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Software for the purpose of building their individual GVI businesses. Only Awareness' claims for direct copyright infringement against defendants Mattice, Remelski, and MacGregor (collectively, the "defendants") remain following the Court's June 1, 2005 Order on the parties' respective motions for summary judgment (the "June 1 Order"). Awareness also possesses its claim for contributory infringement against defendant Mattice. To sustain a claim for direct copyright infringement, Awareness must establish that it owns a valid copyright in its Extranet Software, and that the defendants copied protected elements of that software program. Brown Bag Software v. Symantec Corp., 960 F.2d 1465, 1472 (9th Cir. 1992). Because it is undisputed that Awareness owns a valid copyright, the only issue for trial is whether the defendants copied Awareness' copyrighted program. See id. See also Johnson Controls v. Phoenix Control Sys., 886 F.2d 1173, 1175 (9th Cir. 1989) (holding that the owner of a registered copyright is entitled to a presumption of originality in its copyrighted program). With respect to its claim for contributory infringement against defendant Mattice, Awareness must establish that Mattice contributorily infringed Awareness' copyright by intentionally inducing or encouraging others to directly infringe that copyright. Studios, Inc. v. Grokster, Ltd., 125 S.Ct. 2764, 2776 (2005). It is well established that the copyright in a computer program covers all of the screen displays generated by the program. See Copyright Office Circular 61, Copyright Registration for Computer Works ("The Copyright Office has consistently believed that a single registration is sufficient to protect the copyright in a computer program and related screen displays, including videogames, without a separate registration for the screen displays or a specific reference to them on the application for the computer program"). See also Broderbund Software, Inc. v. Unison World, Inc., 648 F. Supp. 1127, 1133 (D. Cal. 1986) ("[C]opyright protection is not limited to the literal aspects of a computer program, but rather...extends to the overall structure of a program, including its
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audiovisual displays."). The unauthorized copying of qualitatively important, even if quantitatively small, portions of the protected work constitutes copyright infringement. See NIMMER ON COPYRIGHT, § 13.03[F]; Higgins v. Baker, 309 F.Supp. 635 (S.D.N.Y. 1969) (noting that liability may exist if qualitatively important, even though quantitatively it consists of only 0.8 percent of plaintiff' work). s Each defendant has admitted making unauthorized photocopies of, or printing out pages from, Awareness' proprietary registered software program, and is therefore liable to Awareness for direct copyright infringement. See MGM Studios, 125 S.Ct. at 2776 (discussing contributory and direct infringement). Defendant Remelski has admitted that defendant Mattice instructed her to copy pages of Awareness' Extranet Software prior to terminating her Awareness distributorship. Defendant Mattice is therefore also liable to Awareness for contributing to, among others', Remelski's infringing activities. Damages for copyright infringement consist either of plaintiff's actual damages plus the infringer's profits attributable to the infringement, or, in the alternative, statutory damages. 17 U.S.C. § 504(c). A plaintiff can elect whether or not it is seeking actual or statutory damages at any time until final judgment is rendered. Id. Attorneys' fees may be awarded to the prevailing party, and damages can be enhanced for willful infringement. 17 U.S.C § 504(c); NIMMER ON COPYRIGHT § 14.01[B]. See generally Nintendo of Am., Inc. v. Dragon Pac. Int'l et al., 40 F.3d 1007 (9th Cir. 1994), cert. denied, 1995 U.S. LEXIS 3721 (1995) (describing copyright damages and also holding that damages awarded under the Lanham Act and the Copyright Act are not duplicative). The date upon which plaintiff registered ownership of its copyrighted materials has no relevance whatsoever to the amount of damages a plaintiff can recover from an infringing defendant. See Copyright Office Circular 1; NIMMER ON COPYRIGHT § 7.16[C]. See also 17 U.S.C. § 412 (awarding statutory damages only where plaintiff has registered its copyright); Cook v. Jane Lyons Adver., Inc., d/b/a/ The Lyons Agency, 47 U.S.P.Q.2d 1147 (D. D.C. 1998) (on defendant's motion to dismiss, late filed registrations precluded only statutory
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damages and attorneys' fees claim; non-statutory damages claims and claims for costs other than attorneys' fees not dismissed). Section 504(b) of the Copyright Act provides the sole monetary remedy for a plaintiff who has not registered his copyright prior to the defendant's infringement: The copyright owner is entitled to recover the actual damages suffered by him or her as a result of the infringement, and any profits of the infringer that are attributable to the infringement and are not taken into account in computing the actual damages. In establishing the infringer's profits, the copyright owner is required to present proof only of the infringer's gross revenue, and the infringer is required to prove his or her deductible expenses and the elements of profit attributable to factors other than the copyrighted work. 17 U.S.C. § 504(b), quoted in Mackie v. Rieser, 296 F.3d 909, 914 (9th Cir. 2002) (emphasis provided in Mackie). "Profits indirectly gained from infringements used in promotional efforts ... fall squarely within the rubric of wrongful profits." Polar Bear Prods., Inc. v. Timex Corp., 384 F.3d 700, 707 (9th Cir. 2004). RESPECTFULLY SUBMITTED this 8th day of August, 2005. GREENBERG TRAURIG, LLP By: /s/ Kimberly A. Warshawsky Steven M. Weinberg Brian J. Schulman Kimberly A. Warshawsky Attorneys for Awareness Corp. and Third Party Defendants Allcock and Schmidt

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CERTIFICATE OF SERVICE 1 2 3 4 5 6 7 8 9
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I hereby certify that on August 8, 2005, I electronically transmitted the attached document to the Clerk' Office using the CM/ECF System for filing and transmittal s of a Notice of Electronic Filing to the following CM/ECF registrants: Curtis D. Drew, Esq. 2342 North Pima Road Scottsdale, Arizona 85257-2405 [email protected] Attorney for Defendant Group Vision International, L.L.C. G. Gregory Eagleburger, Esq. The Eagleburger Law Group 2999 North 44th Street, Suite 303 Phoenix, Arizona 85018 [email protected] Attorneys for Distributor Defendants I hereby certify that on August 8, 2005, I served the attached document by facsimile and United States mail on the following, who are not registered participants of the CM/ECF System:

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/s/ J. David Smith

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