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Beasley v. John Wiley & Sons, Inc.

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

July 21, 2014

MICHAEL BEASLEY, Plaintiff,
v.
JOHN WILEY & SONS, INC., Defendant

For Michael Beasley, Plaintiff: Christopher Seidman, LEAD ATTORNEY, Harmon & Seidman LLC, Grand Junction, CO; Adam Dileo, PRO HAC VICE, Harmon & Seidman, LLC, Brooklyn, NY; E. Bryan Dunigan, III, Law Offices of E. Bryan Dunigan, Chicago, IL; Jennifer Marie Johnson, Harmon & Seidman, LLC, Arvada, CO; Maurice J. Harmon, Harmon & Seidman LLC, New Hope, PA.

For John Wiley & Sons, Inc., Defendant: Christopher P. Beall, LEAD ATTORNEY, Levine Sullivan Koch & Schulz, L.L.P., New York, NY; Kevin Andrew Thompson, William T. McGrath, Davis, Mannix & McGrath, Chicago, IL; Michael Beylkin, Levine Sullivan Koch & Schulz, Llp, Denver, CO.

Page 938

MEMORANDUM OPINION

John F. Grady, United States District Judge.

Before the court are several motions. For the reasons explained below, plaintiff's motion for summary judgment of liability on Count I is granted; defendant's motion for summary judgment on Counts II and III is entered and continued; and plaintiff's motion to challenge defendant's confidentiality designations is denied as moot.

BACKGROUND

Plaintiff, Michael Beasley, is a professional photographer who licenses his images to various publishers, including defendant John Wiley & Sons, Inc. (" Wiley" ). Beasley's licensing agent for the relevant photos was Odyssey Productions, Inc. (" Odyssey" ), a stock photography licensing agency, which is not a party to this action.

The facts are largely undisputed. In July 2005, Matthew Kiernan, a Wiley representative, sent Odyssey an e-mail on behalf of Richard Fox, a senior photo editor at Wiley. The e-mail explained that Wiley sought to license a number of photographic images of locations in Chicago for a new Wiley travel guidebook titled " Frommer's Chicago Day by Day." (Pl.'s Reply, Ex. 1,

Page 939

Decl. of Jennifer Johnson, Ex. B.) During the next few months, Odyssey and Wiley exchanged e-mails regarding particular photos that Wiley needed. (Decl. of Christopher P. Beall, Ex. B.) In December 2005, Odyssey and Wiley communicated further about the photos and negotiated the terms of the copyright license. On December 19, 2005, Odyssey issued a $7,500.00 invoice (the " Invoice" ) to Wiley for a nonexclusive license to use 31 of Beasley's photos (along with 5 photos created by other photographers) in Wiley's guidebook. Under the heading " Usage Rights Granted," the Invoice states:

One time nonexclusive print rights, John Wiley & Sons Inc, Frommer's " Chicago Day by Day" 1st Edition, English language only, up to 46,000 total press run, published May 2006, World rights (defined as: USA plus 10% English language countries), six years. No electronic rights.

(Decl. of Michael Beasley, Ex. A, Invoice.) Wiley paid the invoice in January 2006.

In May 2006, Wiley published the first edition of Frommer's Chicago Day by Day (" Chicago Day by Day" ) in a printed-book format that contained 29 of Beasley's photos. From May 2007 through July 2011, Wiley offered a electronic version of the book on Amazon.com; another electronic version of the book was offered through other vendors until July 2011. In May 2009, Wiley published a second edition of Chicago Day by Day, which contained 27 of Beasley's photos. An electronic version of the second edition was also offered beginning in May 2009.

It is undisputed that Wiley printed 75,938 copies of Chicago Day by Day (total, across the two editions). Wiley maintains that although it printed this many copies, it actually distributed fewer copies--just over 55,000, and that it distributed less than 46,000 copies of the first edition. It is undisputed that Wiley distributed 42 electronic copies of the first edition and 16 electronic copies of the second edition.

Wiley had never sought to renew the license or to obtain permission to use Beasley's photos beyond the scope of the license. On October 31, 2012, Beasley filed this action. He alleges that Wiley's use of his photographs exceeded the terms of the limited license. The complaint contains three counts. Count I alleges that Wiley infringed Beasley's copyrights in the photos. Count II alleges common-law fraud in that when Wiley obtained the license, it " intentionally misrepresented the format in which the [p]hotographs would be reproduced, intending that Odyssey would rely upon that misrepresentation to its detriment by charging a lower fee and to Wiley's gain by paying less than it would have paid if it had been honest." (Compl. ¶ 11.) In Count III, plaintiff alleges that Wiley violated the Digital Millennium Copyright Act (the " DMCA" ), 17 U.S.C. § 1202 et seq., by intentionally removing copyright-management information from Beasley's photos in order to " induce, enable, facilitate or conceal its copyright infringements." (Compl. ¶ 32.) Beasley seeks an order permanently enjoining defendant from further infringement, the impoundment of all copies of his photos in Wiley's possession, either actual or statutory damages, an award of attorney's fees and costs in relation to the DMCA claim, and punitive damages.

Beasley moves for summary judgment of liability on Count I, the copyright infringement claim.[1] Wiley moves for summary judgment on Counts II and III, the

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fraud and DMCA claims. Also pending is Beasley's motion to provisionally file certain documents Wiley designated as confidential; Beasley challenges Wiley's designation.

DISCUSSION

A. Plaintiff's Motion for Summary Judgment on Count I

" The court shall grant summary judgment 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). In considering such a motion, the court construes the evidence and all inferences that reasonably can be drawn therefrom in the light most favorable to the nonmoving party. See Pitasi v. Gartner Group, Inc., 184 F.3d 709, 714 (7th Cir. 1999). " The court need consider only the cited materials, but it may consider other materials in the record." Fed.R.Civ.P. 56(c)(3). " Summary judgment should be denied if the dispute is 'genuine': 'if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.'" Talanda v. KFC Nat'l Mgmt. Co., 140 F.3d 1090, 1095 (7th Cir. 1998) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986)). The court will enter summary judgment against a party who does not " come forward with evidence that would reasonably permit the finder of fact to find in [its] favor on a material question." McGrath v. Gillis, 44 F.3d 567, 569 (7th Cir. 1995).

Count I is a claim for copyright infringement. The Copyright Act grants copyright owners certain exclusive rights in their copyrighted works, including the exclusive rights to reproduce and distribute copies of the work. 17 U.S.C. § 106(1), (3). A plaintiff claiming copyright infringement must establish two elements: " (1) ownership of a valid copyright, and (2) copying of constituent elements of the work that are original." Janky v. Lake County Convention & Visitors Bureau, 576 F.3d 356, 361 (7th Cir. 2009) (quoting Feist Publ'ns, Inc. v. Rural Tel. Serv. Co., 499 U.S. 340, 361, 111 S.Ct. 1282, 113 L.Ed.2d 358 (1991)). " Where the plaintiff has granted the defendant a license, to establish the second element, the plaintiff must demonstrate that the license was limited in scope and that the scope of the license has been exceeded." Bergt v. McDougal Littell, 661 F.Supp.2d 916, 921 (N.D. Ill. 2009); see also ITOFCA, Inc. v. MegaTrans Logistics, Inc., 322 F.3d 928, 940 (7th Cir. 2003) (Ripple, J., concurring) (" A licensee infringes the owner's copyright if its use exceeds the scope of its license." ).

1. Scope of the Copyright License

The first element that Beasley must establish, ownership of valid copyrights in the photographs at issue, is undisputed. (Def.'s Resp. to Pl.'s Rule 56.1 Statement, ¶ ¶ 6-7.) It is also undisputed that Wiley had a nonexclusive license to use the photos. Wiley submits, however, that the scope of the license is at issue. Beasley contends that the terms of the license agreement are set out solely in the Invoice that Odyssey sent to Wiley and Wiley paid. Wiley argues that the Invoice is " ambiguous" with respect to its right to print a second edition of Chicago Day by Day incorporating Beasley's photos and that " there is simply no single document signed by both Odyssey . . . and Wiley that governs the scope of Wiley's authorized use of the photos." (Def.'s Mem. in Opp'n to Pl.'s Mot. at 8, 5.) According to Wiley, where, as here, the parties operated as though they had reached a license agreement, the terms of that agreement " may be construed from the letters and writings between the parties." (Def.'s Mem. in Opp'n

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to Pl.'s Mot. at 5 (internal quotation marks and brackets omitted).)

" Normal rules of contract construction are generally applied in construing copyright agreements." Kennedy v. Nat'l Juvenile Det. Ass'n, 187 F.3d 690, 694 (7th Cir. 1999). " As a general rule, a contract need not be contained in a single writing; it may be collected from several different writings which do not conflict with each other and which, when connected, show the parties, subject matter, terms, and consideration. Generally, a contract is operative as such from the time when there is a meeting of the minds . . . ." O'Brien v. Kawazoye, 27 Ill.App.3d 810, 327 N.E.2d 236, 240-41 (Ill.App.Ct. 1975) (citation omitted).[2]

The invoice that Odyssey sent to Wiley, and which Wiley subsequently paid with evidently no further discussion about the terms of the license, states in pertinent part as follows:

Invoice # 765174 Invoice Date: December 19 2005

Project Title: Chicago Day by Day 1

License Start Date: Dec 19, 2005

License End Date: Dec 19, 2011

Length of Run: 6 years

Maximum Circulation/Press Run: 46,000

Territory: World

Usage Rights Granted

One time nonexclusive print rights, John Wiley & Sons Inc, Frommer's " Chicago Day by Day" 1st Edition, English language only, up to 46,000 total press run, published May 2006, ...

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