FameFlynet, Inc. v. Jasmine Enters., Inc.

344 F.Supp.3d 906

FAMEFLYNET, INC., Plaintiff,

v.JASMINE ENTERPRISES, INC., Defendant.

No. 17 C 4749

United States District Court, N.D. Illinois, Eastern Division.

Signed September 25, 2018

Craig B. Sanders, Erica Carvajal, Sanders Law, PLLC, Garden City, NY, David Michael Barshay, Barshay Sanders PLLC, New York, NY, for Plaintiff.

Christopher James Pickett, John Matthew Buscemi, Lindsay, Pickett & Postel, LLC, Chicago, IL, James Joseph Walsh, III, Walsh & Walsh, Attorneys at Law, Port Jefferson, NY, for Defendant.

MEMORANDUM OPINION & ORDER

Honorable Thomas M. Durkin, United States District Judge

Plaintiff FameFlynet Inc. ("FFN") brings a copyright claim against defendant Jasmine Enterprises, Inc. for alleged infringement of FFN's copyright in three photographs of Nicky Hilton and James Rothschild taken at their July 10, 2015 celebrity wedding ("the Hilton-Rothschild Photos"). Currently before the Court is FFN's motion for summary judgment as to liability [58]. For the reasons explained below, the Court grants FFN's motion.

Background

FFN is a California-based company that provides photojournalism services and owns the rights to many photographs, primarily featuring celebrities, which it licenses to online and print publications for profit. R. 84 ¶¶ 1-3 (Jasmine's L.R. 56.1 Response to FFN's Statement of Material Facts).¹ Among FFN's copyrighted photographs are the Hilton-Rothschild Photos taken at Hilton and Rothschild's July 10, 2015 wedding. Id. ¶ 17. Since the wedding, FFN has sold a number of licenses to the Hilton-Rothschild Photos. The highest fee it received for the Photos was $2,500 from People Magazine. Id. ¶ 21; R. 91 ¶ 18 (FFN's Reply to Jasmine's L.R. 56.1 Statement of Additional Facts). FFN made seven additional sales of the Photos in July 2015, the highest of which was for $300. R. 91 ¶ 16. FFN registered the Hilton-Rothschild Photos with the United States Copyright Office on September 24, 2015. R. 84 ¶¶ 18-19.

Jasmine is an Illinois-based company that sells wedding dresses out of a retail store, owns and operates a website (www.jasminegalleria.com), and operates a blog with posts on fashion trends and news about weddings (http://jasminegalleria.com/blog). Id. ¶ 12; R. 91 ¶¶ 1-2. In October 2015, FFN observed the Hilton-Rothschild Photos on Jasmine's blog, along with the comment: "Now without further ado ... let's discuss THE dress ... Isn't that a dream? Elegant and timeless," along with a photo of a similar-looking Jasmine wedding dress and the caption "Real Celebrity Wedding ... Acquire It! Jasmine Couture Style F161069." R. 84 ¶ 22; R. 91 ¶ 12; R. 85-2 at 68-69. Jasmine employee Allison Paschold originated this posting in August 2015. R. 84 ¶¶ 23-26. The blog post gave credit for the images to "POPSUGAR.com." R. 91 ¶ 13. Neither Jasmine nor Allison Paschold had FFN's permission to copy or display the Hilton-Rothschild Photos. Id. ¶ 28. After the blog posting date, FFN continued to sell licenses to the Hilton-Rothschild Photos for amounts ranging from $11.73 to $250. R. 85-2 at 62.

FFN's president Boris Nizon lacks specific knowledge about Jasmine, its website, its blog, or any financial benefits Jasmine receives from them. R. 91 ¶¶ 3, 6-7, 9. As a general matter, however, FFN's business model of acquiring celebrity photos and selling them to online and print media outlets depends on being able to control the timing and volume of the distribution of its photos. R. 84 ¶ 7. When a photograph is stolen, FFN loses the ability to control that photograph's exclusivity, id. ¶ 9, and when a photo is leaked to the public, the value of the photograph usually diminishes immediately, id. ¶ 10. The value of photos typically goes down as they get older. R. 91 ¶ 15.

FFN sued Jasmine for copyright infringement in the Southern District of New York in September 2016. R. 1. The Southern District of New York granted Jasmine's motion to change venue in June 2017. See R. 45. That same month, FFN rejected Jasmine's offer of judgment under Fed. R. Civ. P. 68 for $15,000 including attorney's fees. R. 83-3. FFN instead has elected to recover statutory damages as well as attorney's fees. In September 2017, FFN moved for summary judgment as to liability only. R. 58.²

Standard

Summary judgment is appropriate "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) ; see also Celotex Corp. v. Catrett , 477 U.S. 317, 322-23, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). The Court considers the entire evidentiary record and must view all of the evidence and draw all reasonable inferences from that evidence in the light most favorable to the nonmovant. Horton v. Pobjecky , 883 F.3d 941, 948 (7th Cir. 2018). To defeat summary judgment, a nonmovant must produce more than a "mere scintilla of evidence" and come forward with "specific facts showing that there is a genuine issue for trial." Johnson v. Advocate Health and Hosps. Corp. , 892 F.3d 887, 894, 896 (7th Cir. 2018). Ultimately, summary judgment is warranted only if a reasonable jury could not return a verdict for the nonmovant. Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).

Analysis

Copyright infringement has two elements: "(1) ownership of a valid copyright, and (2) copying of constituent elements of the work that are original." Feist Publications, Inc. v. Rural Tel. Serv. Co., Inc. , 499 U.S. 340, 361, 111 S.Ct. 1282, 113 L.Ed.2d 358 (1991). Jasmine does not dispute that FFN has established these elements. FFN has produced valid copyright registrations for the Hilton-Rothschild Photos, which constitutes prima facie evidence of the copyrights' validity. JCW Investments, Inc. v. Novelty, Inc. , 482 F.3d 910, 914-15 (7th Cir. 2007). Jasmine has not rebutted that prima facie evidence. And there is no dispute that Jasmine copied the Hilton-Rothschild Photos and displayed them on its blog.

Jasmine instead asserts that summary judgment should be denied based on its affirmative defense of fair use. "Fair use is a mixed question of law and fact, which means that it may be resolved on summary judgment if a reasonable trier of fact could reach only one conclusion—but not otherwise." Ty, Inc. v. Publications Int'l Ltd. , 292 F.3d 512, 516 (7th Cir. 2002). "The burden of proof is on the [defendant] because fair use is an affirmative defense," meaning that the defendant must present "evidence sufficient to withstand summary judgment." Chicago Bd. of Educ. v. Substance, Inc. , 354 F.3d 624, 629 (7th Cir. 2003).

Congress has provided four statutory factors for courts to consider in evaluating a fair use defense. They are: "(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes; (2) the nature of the copyrighted work; (3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and (4) the effect of the use upon the potential market for or value of the copyrighted work." 17 U.S.C. § 107. "[T]he four factors ... are not exhaustive and do not constitute an algorithm that enables decisions to be ground out mechanically." Chicago Bd. of Educ. , 354 F.3d at 629 ; accord Ty , 292 F.3d at 522 ("the four factors are a checklist of things to be considered rather than a formula for decision"). "The general standard, however, is clear enough: the fair use copier must copy no more than is reasonably necessary (not strictly necessary—room must be allowed for judgment, and judges must not police criticism with a heavy hand) to enable him to pursue an aim that the law recognizes as proper." Chicago Bd. of Educ. , 354 F.3d at 629. The Court first considers the factors one at a time and then as a whole.

A. First Factor – Purpose and Character of Use

The first factor requires courts to determine not "whether the sole motive of the use is monetary gain but whether the user stands to profit from exploitation of the copyrighted material without paying the customary price." Harper & Row Publishers, Inc. v. Nation Enterprises , 471 U.S. 539, 562, 105 S.Ct. 2218, 85 L.Ed.2d 588 (1985). Jasmine is a for-profit business selling wedding dresses, in connection with which it operates a blog that displays wedding dresses and comments on them. In this case, it posted the Hilton-Rothschild Photos along with a photo of a similar-looking Jasmine dress and the caption "Real Celebrity Wedding ... Acquire It! Jasmine Couture Style F161069." R. 85-2 at 68-69.

Jasmine attempts to distinguish its blog from its website and suggest that the blog could be considered to be for "nonprofit educational purposes," 17 U.S.C. § 107, based on the lack of record evidence that Jasmine makes money from the blog itself. But Jasmine presents no affirmative evidence that it does not make money from the blog itself, which is its burden. See Chicago Bd. of Educ. , 354 F.3d at 629 (the defendant must present "evidence sufficient to withstand summary judgment" on fair use). And even if it is true that Jasmine makes no money directly from the blog, "[f]inancial benefit exists where the availability of infringing material acts as a draw for customers." A&M Records, Inc. v. Napster, Inc. , 239 F.3d 1004, 1023 (9th Cir. 2001), as amended (Apr. 3, 2001), aff'd sub nom. A&M Records, Inc. v. Napster, Inc. , 284 F.3d 1091 (9th Cir. 2002). The only reasonable inference from the facts in the record is that Jasmine's blog is designed to act as a draw for customers, regardless of whether Jasmine makes money from the blog itself. Jasmine cites no testimony from its representatives or other evidence to the contrary.

The first prong of the fair use inquiry also asks whether copying "permissibly ‘transforms’ and thus ‘complements’ the original, as opposed to creating a ‘substitute’ that ‘supersedes’ the original." Leveyfilm, Inc. v. Fox Sports Interactive Media, LLC , 2014 WL 3368893, at *9 (N.D. Ill. July 8,...