Pearson Educ., Inc. v. C&N Logistics, Inc.

PEARSON EDUCATION, INC., et al., Plaintiffs, v. C&N LOGISTICS, INC., et al., Defendants.

NO. 3:18-cv-00438

UNITED STATES DISTRICT COURT FOR THE MIDDLE DISTRICT OF TENNESSEE NASHVILLE DIVISION

January 7, 2021

JUDGE RICHARDSON

MEMORANDUM OPINION

Pending before the Court is Plaintiffs' Motion for Summary Judgment and Permanent Injunction (Doc. No. 111, "Motion"), supported by an accompanying Memorandum of Law (Doc. No. 112). Defendants White and Chadwell,¹ each acting pro se, have filed responses to the Motion (Doc. Nos. 130 and 134), and Plaintiffs have filed replies (Doc. Nos. 132 and 138). Defendants have also filed responses to Plaintiffs' Statement of Undisputed Material Facts (Doc. Nos. 135 and 137).

BACKGROUND

Plaintiffs describe themselves as "leading educational publishers who develop, market, distribute, license, and sell a comprehensive range of traditional and digital educational content and tools to professionals and students." (Second Amended Complaint ("SAC"), Doc. No. 62). They allege that Defendants have distributed hundreds of counterfeit copies² of Plaintiffs'textbooks in the United States, and they assert claims against Defendants for copyright infringement, secondary copyright infringement, false designation of origin, and trademark counterfeiting. (Id.). Plaintiffs claim that Defendants are distributing, offering for sale, and/or selling counterfeit copies of Plaintiffs' textbooks; that is, unauthorized copies of Plaintiffs' copyrighted works. They also claim that the counterfeit copies bearing Plaintiffs' registered trademarks infringe those trademarks.

Via the Motion, Plaintiffs seek summary judgment as to liability for copyright infringement of 43 textbook titles and trademark infringement of four trademarks (identified in Doc. Nos. 113-116). Plaintiffs also seek, via the Motion, a permanent injunction to enjoin Defendants from infringing Plaintiffs' copyrights and trademarks. Plaintiffs do not, via the Motion, seek a ruling as to whether the alleged infringement was willful or seek summary judgment on the secondary copyright infringement and false designation of origin claims in the SAC or the amount of any damages.

The SAC asserts—and White admits (Doc. No. 67 at ¶ 13)—that Defendant White is the owner, president, and registered agent of Defendant C&N Logistics ("C&N"), a Tennessee corporation. (Doc. No. 62 at ¶¶ 12-13). Plaintiffs contend that Defendant Chadwell has a business association with C&N and with White and was involved in the procurement and/or distribution of the counterfeit copies at issue. (Doc. No. 62 at ¶ 14). In support of the Motion, Plaintiffs claim that all Defendants acted jointly and severally with regard to the alleged copyright and trademark infringement. (Doc. No. 112 at 19).

In response to the Motion, Defendants argue that: (1) there is no or insufficient proof that Defendants moved or distributed the textbook copies at issue; (2) there is no or insufficient proof of the chain of custody of the subject textbook copies to show that the copies inspected are thesame copies shipped by Defendants; (3) there is no or insufficient proof of a proper "quarantine procedure" for moving the suspected copies; (4) Plaintiffs have not produced purported expert reports concerning inspections for all the copies; and (5) the purported expert reports of Plaintiffs' "in-house experts" concerning the suspicious copies being counterfeit are insufficient (although Defendants have presented no expert testimony of their own). (Doc. Nos. 130 and 134).

SUMMARY JUDGMENT STANDARD

Summary judgment is appropriate where there is no genuine issue as to any material fact and the movant is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c). "By its very terms, this standard provides that the mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986). In other words, even if genuine, a factual dispute that is irrelevant or unnecessary under applicable law is of no value in defeating a motion for summary judgment. See id. at 248. On the other hand, "summary judgment will not lie if the dispute about a material fact is 'genuine[.]'" Id.

A fact is "material" within the meaning of Rule 56(c) "if its proof or disproof might affect the outcome of the suit under the governing substantive law." Anderson, 477 U.S. at 248. A genuine dispute of material fact exists if the evidence is such that a reasonable jury could return a verdict for the non-moving party. Harris v. Klare, 902 F.3d 630, 634-35 (6th Cir. 2018).

The party bringing the summary judgment motion has the initial burden of identifying portions of the record that demonstrate the absence of a genuine dispute over material facts. Pittman v. Experian Information Solutions, Inc., 901 F.3d 619, 627-28 (6th Cir. 2018). If thesummary judgment movant meets that burden, then in response the non-moving party must set forth specific facts showing that there is a genuine issue for trial. Id. at 628.

A party asserting that a fact cannot be or genuinely is disputed—i.e., a party seeking summary judgment and a party opposing summary judgment, respectively—must support the assertion by citing to materials in the record, including, but not limited to, depositions, documents, affidavits or declarations. Fed. R. Civ. P. 56(c)(1)(A). In reviewing a motion for summary judgment, this court must view the evidence in the light most favorable to the non-moving party. Tlapanco v. Elges, 969 F.3d 638, 647 (6th Cir. 2020) (quoting Anderson, 477 U.S. at 248). Likewise, the court should view the facts and draw all reasonable inferences in favor of the non-moving party. Pittman, 901 F.3d at 628. Credibility judgments and weighing of evidence are improper. Hostettler v. College of Wooster, 895 F.3d 844, 852 (6th Cir. 2018). As noted above, where there is a genuine dispute as to any material fact, summary judgment is not appropriate. Id. The court determines whether sufficient evidence has been presented to make the issue of fact a proper jury question. Id. The mere existence of a scintilla of evidence in support of the non-moving party's position will be insufficient to survive summary judgment; rather, there must be evidence upon which the jury could reasonably find for the non-moving party. Rodgers v. Banks, 344 F.3d 587, 595 (6th Cir. 2003).

On a motion for summary judgment, a party may object that the supporting materials specified by its opponent "cannot be presented in a form that would be admissible in evidence." Fed. R. Civ. P. 56(c)(2). Upon such an objection, the proponent of the supporting material must show that the material is admissible as presented or explain how it could be presented in a form that would be admissible. Thomas v. Haslam, 303 F. Supp. 3d 585, 624 (M.D. Tenn. 2018);Mangum v. Repp, 2017 WL 57792 at ** 5 (6th Cir. Jan. 5, 2017) (citing Fed. R. Civ. P. 56(c) advisory committee's note to 2010 amendment).

Thus, as the movants here, Plaintiffs bear the initial burden of demonstrating that there are no genuine issues of material fact as to the elements of their claims and they are entitled to judgment as a matter of law on those claims. If Plaintiffs carry that burden, then the burden shifts to Defendants to set forth specific facts showing that there is a genuine issue for trial.

COPYRIGHT INFRINGEMENT

Federal law provides a cause of action for any copyright owner against anyone who infringes the copyright by violating an "exclusive right" of that copyright owner. 17 U.S.C. § 501. The exclusive rights of a copyright owner include the rights to reproduce the copyrighted works; to prepare derivative works; to distribute copies by sale, rental, lease or lending; and to display the copyrighted work publicly. 17 U.S.C. § 106. Remedies for copyright infringement include injunctive relief (17 U.S.C. § 502) and damages (17 U.S.C. § 504).

A plaintiff alleging copyright infringement must prove that (1) it owns or is the exclusive licensee of a valid copyright and (2) the alleged infringer violated at least one exclusive copyright right prescribed by 17 U.S.C. § 106. Average Joe's Entm't Grp., LLC v. SoundCloud, LTD., No. 3:16-cv-3294, 2018 WL 6582829, at *2 (M.D. Tenn. Oct. 17, 2018).³ The first element, ownership, is presumptively established by the copyright registration. Kinman v. Burnop, No. 3:18-cv-00809, 2020 WL 707583, at *3 (M.D. Tenn. Feb. 12, 2020); Sands v. Fan Fest News, LLC., No. 3:18-cv-01353, 2019 WL 6715114, at *2 (M.D. Tenn. Dec. 10, 2019). "A certificate of copyrightregistration constitutes prima facie evidence of the validity of the certificate and the facts stated in the certificate." Tennessee Walking Horse Breeders' & Exhibitors' Ass'n v. Nat'l Walking Horse Ass'n, No. 1:05-0088, 2007 WL 325774, at *5 (M.D. Tenn. Jan. 31, 2007).

"Copyright infringement . . . is at its core a strict liability cause of action, and copyright law imposes liability even in the absence of an intent to infringe the rights of the copyright holder." Capitani v. World of Miniature Bears, Inc., No. 3:19-cv-00120, 2020 WL 4805729, at *2 n.3 (M.D. Tenn. Aug. 18, 2020) (quoting Jacobs v. Memphis Convention and Visitors Bureau, 710 F. Supp. 2d 663, 677-78 n.21 (W.D. Tenn. 2010)) (collecting cases and noting that this is a "fundamental tenet of the Copyright Act"). Therefore, intent or knowledge is not an element of copyright infringement.⁴ Pearson Educ., Inc. v. Labos, No. 19 CIV. 487 (CM), 2019 WL 1949820, at *4 (S.D.N.Y. Apr. 23, 2019).

Here, Plaintiffs have filed a declaration from a representative of each Plaintiff publisher, stating that the publisher is the owner or holder of the exclusive rights⁵ under copyright for the textbook titles at issue, along with copies of the relevant copyright registrations for each.⁶ TheCourt finds nothing in the...