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Games Workshop Limited v. Chapterhouse Studios

April 1, 2013

GAMES WORKSHOP LIMITED, PLAINTIFF,
v.
CHAPTERHOUSE STUDIOS, LLC, DEFENDANT.



The opinion of the court was delivered by: Matthew F. Kennelly, District Judge:

MEMORANDUM OPINION AND ORDER

Games Workshop (GW) has sued Chapterhouse Studios (Chapterhouse), alleging copyright and trademark infringement and related state and federal claims. The parties previously filed cross-motions for summary judgment, which the Court partly granted and partly denied, leaving a good many of GW's claims for trial. Games Workshop Ltd. v. Chapterhouse Studios, LLC, No. 10 C 8301, 2012 WL 5949105 (N.D. Ill. Nov. 27, 2012). The Court later granted GW leave to amend its complaint to add similar claims that it had asserted in a second lawsuit against Chapterhouse.

Each side has again moved for summary judgment. In addition, Chapterhouse has asked the Court to reconsider part of its prior summary judgment ruling and award Chapterhouse costs that it incurred in obtaining previously undisclosed correspondence between GW and the United States Copyright Office. For the reasons stated below, the Court (1) partly grants and partly denies Chapterhouse's motion for reconsideration, (2) denies Chapterhouse's motion for summary judgment, and (3) partly grants and partly denies GW's motion for summary judgment.

Background

The Court described the relevant factual background in its prior summary judgment decision. The Court assumes familiarity with that decision.

In connection with this lawsuit, the parties have exchanged numerous requests for documents. On September 9, 2011, Chapterhouse asked GW to produce "all correspondence with any government agency or private copyright registration service" concerning any work at issue in the case. Def.'s Mot. for Recons., Ex. 2 at 5. GW responded that it believed it had disclosed all responsive documents but would provide any additional responsive documents in its possession. Id., Ex. 3 at 2.

On November 2, 2012, counsel held a telephone conference to discuss the parties' contemplated motions in limine. According to Chapterhouse, its counsel expressed concern to lead counsel for GW about not receiving any further correspondence between GW and the Copyright Office. Although the parties dispute how GW's attorney reacted, it is undisputed that at some point soon after the telephone conference, GW agreed to supplement its response to the discovery request.

Chapterhouse's attorney states in an affidavit that in late October 2012, Chapterhouse undertook its own investigation into correspondence between GW and the Copyright Office, and on November 7, it requested documents directly from the Copyright Office for two of GW's copyright applications, including an application for Assault Squad shoulder pads (implicated by entries 46--48 in GW's second revised claim chart). On December 12, 2012, approximately two weeks after the Court had issued its ruling on the motions for summary judgment, Chapterhouse received from the Copyright Office correspondence regarding the Assault Squad shoulder pads application, which revealed a number of communications between GW's attorney and the Copyright Office. GW did not produce any of this correspondence until January 4, 2013, together with its response to Chapterhouse's first motion for reconsideration.*fn1

Documents that Chapterhouse obtained from the Copyright Office reflect that Robin Jones, a Copyright Registration Specialist, e-mailed GW's attorney on June 7, 2012 in connection with GW's application. Jones expressed a number of concerns, many of which appear to be requests for clarification. In her e-mail, however, Jones stated that "we cannot register the sculpture portion as it is too minimal." Id., Ex. 5 at 3. Approximately twenty days later, GW's attorney responded, asking to speak with Jones about the "question [she had] regarding the sculptural elements." Id., Ex. 5 at 4.

Jones did not respond to the e-mail from GW's attorney until November 7, 2012, after GW's attorney had called the Copyright Office to speak with her about the pending application. In her response, Jones stated that "[t]he email stated that the 'sculpture' was to[o] minimal (it is basically an 'X') and could not be registered." Id., Ex. 5 at 7. GW's attorney replied to Jones on December 7, noting that the Court's summary judgment decision "ruled that the basic shape of the Games Workshop shoulder pad is copyrightable (even without surface ornamentation)." Id., Ex. 5 at 10. According to correspondence produced by GW in January 2013, Jones responded to GW's attorney on December 11: "[T]his particular shoulder pad submitted is not copyrightable. [I]t is simply circular, with an x or plus sign on it." Id., Ex. 6 at 2. In response, GW's attorney again brought up the Court's previous ruling and discussed the evidence upon which the Court had relied. On December 27, 2012, Carol Frenkel, a Supervisory Registration Specialist, notified GW's attorney that she had taken over the application and would make a determination shortly.

On January 4, 2013, Frenkel wrote GW a letter stating that the Copyright Office could not register the work. The letter laid out the basic standards for protection under the federal copyright law and stated that the office had "determined that this particular work will not support a claim to copyright for 2-Dimensional artwork or sculpture under the standards described above." Id., Ex. 7 at 1.

Discussion

I. Chapterhouse's motion for reconsideration and costs

Chapterhouse asks the Court to reconsider its earlier ruling on the copyrightability of GW's shoulder pads based on the Copyright Office's decision to deny registration of the Assault Squad shoulder pads. Chapterhouse argues that the Court should defer to the Copyright Office's finding. It also asks the Court to award Chapterhouse the $1,039 it spent conducting an independent investigation into GW's correspondence with the Copyright Office.

A. Motion for reconsideration

The Court's earlier summary judgment ruling is interlocutory in nature and thus may be reconsidered at any time. See, e.g., Morningware, Inc. v. Hearthware Home Prods., Inc., No. 09 C 4348, 2011 WL 1376920, at *1 (N.D. Ill. Apr. 12, 2011). The appropriate purpose of a motion for reconsideration is to correct manifest errors of law or fact, or to present newly discovered evidence. Hicks v. Midwest Transit, Inc., 531 F.3d 467, 474 (7th Cir. 2008). "Reconsideration is not an appropriate forum for rehashing previously rejected arguments or arguing matters that could have been heard during the pendency of the previous motion." Caisse Nationale de Credit Agricole v. CBI Indus., Inc., 90 F.3d 1264, 1270 (7th Cir. 1996).

Chapterhouse contends that the Copyright Office's January 4, 2013 letter rejecting GW's application for copyright registration is newly discovered evidence and is persuasive authority to which the Court should defer. Accordingly, Chapterhouse seeks reconsideration with regard to the GW products identified in entries 4--7, 12--13, 19--22, 46--62, 64--65, 97--98,*fn2 and 101--02 of GW's second revised copyright claim chart. GW argues that the Court should not give deference to the Copyright Office's rejection of its application because, among other things, the January 2013 letter does not constitute final agency action.

Courts differ with regard to what level of deference, if any, should be given to a rejection by the Copyright Office. Compare Norris Indus., Inc. v. Int'l Tel. & Tel. Corp., 696 F.2d 918, 922 (11th Cir. 1983) ("The district court properly gave some deference to the expertise of the Register in its decision."), with Aqua Creations USA Inc. v. Hilton Hotels Corp., No. 10 Civ. 246, 2011 WL 1239793, at *3 (S.D.N.Y. Mar. 28, 2011) ("Where the Copyright Office denies registration, and the unsuccessful applicant subsequently brings an infringement action, courts nonetheless make an independent determination as to copyrightability."). Further complicating the issue is the fact that the Copyright Office itself does not consider correspondence to be "final agency action" until the Review Board renders a decision after a second request for reconsideration, 37 C.F.R. § 202.5(g), and GW has not submitted its application for even a first reconsideration. The Court need not resolve this issue, however, because even assuming that the Copyright Office's rejection is entitled to some deference, the Court nonetheless concludes that GW's shoulder pads are eligible for copyright protection.

Copyright Registration Specialist Jones denied GW's copyright claim on the basis that the sculpture portion of the shoulder pads is too minimal; she stated that it is "simply circular, with an x or plus sign on it." Def.'s Mot. for Recons., Ex. 6 at 2. Jones's initial response, however, indicated that GW may be able to obtain registration for the two-dimensional "graphics of the pads . . . ." Id., Ex. 5 at 3. Based upon the graphics included in entries 46--48 of the second revised claim chart, which the Court assumes was the two-dimensional artwork submitted to the office, the Court does not see any basis to extend copyright protection to one and not the other. To the contrary, the graphic is by nature two-dimensional and appears more rudimentary and commonplace than the three-dimensional shoulder pads that GW sells:

At some point the Copyright Office changed its mind about the two-dimensional artwork, and in the January 2013 letter that Supervisory Registration Specialist Frenkel sent to GW, she concluded that both the two-dimensional artwork and the sculpture were not copyrightable. Frenkel's letter, however, contained no explanation for this determination. The letter simply recited, in summary fashion, several basic copyright law principles-the claimant must have independently created the work, the work must possess at least a minimal amount of creativity, and copyright law does not protect ideas or concepts-and it concluded, in a single sentence, that "[a]fter careful consideration, we have determined that this particular work will not support a claim to copyright for 2-Dimensional artwork or sculpture under the standards described above." Id., Ex. 7 at 1. This conclusory statement does not identify what standard or principle of copyright law Frenkel relied upon in rejecting GW's claim. Even assuming that Frenkel concluded the item was not sufficiently creative, the letter gives no hint regarding why or how she came to that conclusion.

In addition, the Court notes that in its previous summary judgment ruling, the Court considered the context within which the shoulder pads exist. The Court noted that the shoulder pads were unusually large as compared to the size of the Space Marine's head and that the proportional difference was sufficient to constitute a creative addition sufficient to afford the shoulder pads copyright protection.

For these reasons, even were the Court to afford some deference to the Copyright Office's decision to deny GW's claim, the Court still would conclude that GW has crossed the modest threshold of creativity needed to obtain copyright protection. See Feist Publ'ns, Inc. v. Rural Tel. Serv. Co., 499 U.S. 340, 345 (1991) ("To be sure, the requisite level of creativity is extremely low; even a slight amount will suffice."). The Court therefore denies Chapterhouse's motion for reconsideration.

B. Chapterhouse's investigation costs

Chapterhouse has asked the Court to award it $1,039.00 in out-of-pocket costs that it incurred investigating two of GW's applications to and correspondence with the Copyright Office as described earlier. In support of its motion, Chapterhouse has attached as an exhibit an itemized invoice from Peerless Patents, Ltd., a document retrieval service that Chapterhouse hired to request and obtain the documents from the Copyright Office. Def.'s Mot. for Recons., Ex. 4. The invoice details the expenses that Chapterhouse incurred, including: (a) $80 for certified copies of the two "Copyright Application or Registration Correspondence File[s]"; (b) $50 for a "Rush Processing Service Fee"; (c) $50 for transportation charges to and ...


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