Reinsdorf V Skechers USA

Case 2:10-cv-07181-DDP-SS Document 225
Filed 02/06/13 Page 1 of 27 Page ID #:7422
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 27 28 This order supercedes the courts October 9, 2012 Order Denying Summary Judgment (Dkt. No. 196) and addresses the issues raised, briefed, and argued by the parties in relation to Skechers subsequent Motion for Clarification (Dkt. No. 198).
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UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA
RICHARD REINSDORF, an individual, Plaintiff, v. SKECHERS U.S.A, a Delaware corporation; SKECHERS U.S.A.., INC., II, a Delaware corporation, Defendants. ___________________________
) ) ) ) ) ) ) ) ) ) ) ) ) )
Case No. CV 10-07181 DDP (SSx) AMENDED ORDER RE: DEFENDANTS MOTION FOR SUMMARY JUDGMENT, MOTIONS IN LIMINE, AND OBJECTIONS TO EVIDENCE
[Dkt. No. 198]
Presently before the court is Defendant Skechers U.S.A. (Skechers)s Motion for Summary Judgment. Having considered the
submissions of the parties and heard oral argument, the court grants the motion in part, denies the motion in part, and adopts the following amended order.1 I. Background As explained in this courts earlier order denying Defendants Motion to Dismiss, Skechers is a shoe company. (Declaration of
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Robert Welsh in support of Motion (Welsh Dec.) Ex.19.)
Beginning
in 2005, Skechers hired Plaintiff Richard Reinsdorf (Reinsdorf), a photographer, to conduct several photo shoots. 6). (Undisputed Fact
Between 2006 and 2009, Skechers engaged Reinsdorf to conduct
five photo shoots at issue here, in connection with Skecherss marketing efforts. (Complaint 14-15, 18-19, 22-23, 25, 29-30.)
Prior to each photo shoot, Skechers explained to Reinsdorf the type of images Skechers hoped to capture. 10,12.) (Welsh Dec., Ex. 44
These explanations included storyboards and photographic
examples, as well as drawings depicting particular poses for Skechers selected models. (Id. 12, 14.) During the shoots,
Reinsdorf posed models, arranged lighting and props, and otherwise directed the photography sessions. (Compl. 23.) Reinsdorf
delivered raw photographs (the photographs) to Skechers at the conclusion of each photo shoot. (UF 22.)
Upon receiving the photographs from Reinsdorf, Skechers proceeded to modify the images for use in Skechers advertisements. (Welsh Dec., Ex. 44 17.) The alterations varied with each image,
and ranged from slight modifications in models skin tone to the substitution of models body parts and the addition of substantial graphic effects. (Id. 17, 21.) These enhanced images were then (Id.
used in Skechers advertisements (the advertisements). 16.)
No raw, unaltered photograph was ever incorporated into a (Id.)
finished advertisement.
Reinsdorf submitted invoices to Skechers for his services, and contends that he granted Skechers a limited license to use the photographs. 22). (Compl. 442; Statement of Genuine Issues 16-20,
Reinsdorf brought suit in this court alleging copyright 2
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infringement, as well as state law causes of action for breach of contract and unfair competition, alleging that Skechers utilized his copyrighted images as part of Skechers marketing efforts in violation of the temporal and geographic limits of the use licenses. II. (Compl. 6.) Skechers now moves for summary judgment.
Legal Standard Summary judgment is appropriate where the pleadings,
depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show 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). A party
seeking summary judgment bears the initial burden of informing the court of the basis for its motion and of identifying those portions of the pleadings and discovery responses that demonstrate the absence of a genuine issue of material fact. Catrett, 477 U.S. 317, 323 (1986). See Celotex Corp. v.
All reasonable inferences from See
the evidence must be drawn in favor of the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 242 (1986).
If the moving party does not bear the burden of proof at trial, it is entitled to summary judgment if it can demonstrate that there is an absence of evidence to support the nonmoving partys case. Celotex, 477 U.S. at 323. Once the moving party meets its burden, the burden shifts to the nonmoving party opposing the motion, who must set forth specific facts showing that there is a genuine issue for trial. Anderson, 477 U.S. at 256. Summary judgment is warranted if a
party fails to make a showing sufficient to establish the existence of an element essential to that partys case, and on 3
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which that party will bear the burden of proof at trial. 477 U.S. at 322.
Celotex,
A genuine issue exists if the evidence is such
that a reasonable jury could return a verdict for the nonmoving party, and material facts are those that might affect the outcome of the suit under the governing law. Anderson, 477 U.S. at 248.
There is no genuine issue of fact [w]here the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party. Matsushita Elec. Indus. Co. v. Zenith Radio Corp.,
475 U.S. 574, 587 (1986). It is not the courts task to scour the record in search of a genuine issue of triable fact. Keenan v. Allan, 91 F.3d 1275,
1278 (9th Cir. 1996). Counsel has an obligation to lay out their support clearly. Carmen v. San Francisco Sch. Dist., 237 F.3d The court need not examine the entire
1026, 1031 (9th Cir. 2001).
file for evidence establishing a genuine issue of fact, where the evidence is not set forth in the opposition papers with adequate references so that it could conveniently be found." III. Discussion A. Procedural History Id.
Skechers previously brought a Motion to Dismiss for lack of jurisdiction, arguing that the advertisements at issue in this case are joint works created by both Reinsdorf and Skechers. Because the jurisdictional issues were inextricably entwined with the merits of the case, this court applied the more rigorous standard applicable to motions for summary judgment under Federal Rule of Civil Procedure 56. (See March 9, 2012 Order Denying
Defendants Motion to Dismiss (Order), Dkt. No. 28.)
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As explained in the courts earlier Order, a joint work is a copyrightable work prepared by (1) two or more authors who (2) make independently copyrightable contributions and (3) intend that those contributions be merged into inseparable or interdependent parts of a unitary whole. Richlin v. Metro-Goldwyn-Mayer Pictures, Co-authors in a joint
Inc., 531 F.3d 962, 969 (9th Cir. 2008).
work cannot be held liable to one another for infringement of the copyright in the joint work. Oddo v. Ries, 743 F.2d 630, 632-33
(9th Cir. 1984); Thomson v. Larson, 147 F.3d 195, 199 (2d Cir. 1998). This court found that the first two factors, authorship and independently copyrightable contributions, were not at issue. With
respect to authorship, the court expressly declined to determine whether Reinsdorf was the sole author of the raw photographs because, even if that were the case, the finished advertisements at issue here would nevertheless be the product of contributions from two authors, Reinsdorf (raw photographs) and Skechers (graphical additions and modifications). (Order at 5 n.3.)
The court focused, therefore, on the third factor necessary to establish the existence of a joint work: the intent of the parties to merge independent contributions into a unitary whole. After
concluding that the record did not establish that Reinsdorf intended his raw photographs to be merged into a finished advertisement, the court denied Skechers motion. (Id. at 7.)
Reinsdorf did not move for reconsideration or otherwise challenge the courts conclusions. Now, after the conclusion of discovery, Skechers seeks summary judgment on the joint work issue. 5 Skechers argues that the fully-
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developed record now demonstrates that Reinsdorf did indeed intend for his raw photographs to be merged with Skechers graphical enhancements into a finalized marketing image. Reinsdorfs opposition to the motion does not dispute Skechers contentions regarding his intent with respect to the synthesis of the parties independent contributions. Instead,
Reinsdorf now challenges the second, authorship element of the joint work test, arguing that the marketing images at issue here are not the creations of two or more authors. B. Joint Authorship In most (Opp. at 8-16.)
This case presents an unusual set of circumstances.
cases, a plaintiff seeks to establish that he is the sole author of a work, see, e.g., Morrill, 157 F. Supp. 2d at 1122, or at least a co-author of a work, see, e.g., Aalmuhammed v. Lee, 202 F.3d 1227, 1230 (9th Cir. 2000), so as to enjoy the benefits of copyright ownership (or co-ownership). Here, in contrast, Plaintiff
Reinsdorf seeks to disavow any authorship role in the finished marketing works. Reinsdorfs position is understandable in light of the fact that, as explained above, a co-author in a joint work cannot be liable to another co-owner for infringement of the copyright in that work. Oddo, 743 F.2d at 632-33 (9th Cir. 1984). Furthermore,
and perhaps more importantly, [i]n a joint work, . . . each author obtains an undivided ownership in the whole of the joint work, including any portion thereof. Consequently, one joint author
thereby obtains the right to use or license that portion of the joint work that was the sole creation of the other joint author. 1 Nimmer on Copyright 6.06[A]. Thus, to bring a successful 6
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infringement claim against Skechers, Reinsdorf must establish that his role in the creation of the final marketing images did not rise to the level of authorship. The criteria for joint authorship include whether 1) an alleged author exercises control over a work, serves as the inventive or master mind, or creates or gives effect to an idea; 2) there exists an objective manifestation of a shared intent to be coauthors; and 3) the audience appeal turns on both contributions and the share of each in its success cannot be appraised. Aalmuhammed, 202 F.3d at 1233-35 (internal quotations Due to the variety of creative
and citations omitted).
relationships to which these factors apply, however, the factors cannot be reduced to a rigid formula. 1. Control Id. at 1235.
Courts in this district have found the joint control criterion satisfied where both parties had creative control over separate and indispensable elements of the completed product. Morrill v.
Smashing Pumpkins, 157 F. Supp. 2d 1120, 1124 (C.D. Cal. 2001); see also Eagle Rock Entmt. Inc. v. Coming Home Prods., Inc., No. CV 3571 FMC; 2004 WL 5642002 *13 (C.D. Cal. Sept. 1, 2004). Here, the
parties appear to agree on their respective degrees of control over the constituent parts of the marketing images. Reinsdorfs
opposition argues that [a]lthough . . . Skechers controlled the latter half of the creative process here, namely the graphic design of its marketing images, it exercised little to no control over Reinsdorfs authorship of his underlying photographs. . . . at 9.) (Opp.
Similarly, Reinsdorf asserts that [j]ust as Skechers had
minimal involvement in Reinsdorfs authorship of his photographs, 7
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[Reinsdorf] likewise did not exercise any supervisory powers over the design of Skechers marketing images . . . . (internal quotation omitted).) characterizations. (Opp. at 11
Skechers does not dispute these Thus, as in Morrill and
(Reply pp. 7-10.)
Eagle Rock Entertainment, each party had exclusive, or nearexclusive, power over the distinct constituent parts of the unitary whole. The supervisory or control factor thus weighs in favor
of joint authorship. 2. Audience Appeal
While acknowledging that the audience appeal of the marketing images could be attributed to both parties contributions, Reinsdorf argues that the bulk of the images appeal can be attributed to Reinsdorfs photos, and quantified. Reinsdorf
contends that the relative appeal of the parties separate contributions can be appraised by a casual comparison of the raw photographs with the finished images. (Opp. at 17.) From that
basis, Reinsdorf claims, one can fairly easily parse how much of the audience appeal of the work originates from the various elements. (Id.) This conclusory assertion notwithstanding, the
only evidence Reinsdorf cites is a survey study by Dr. Frank Luntz. (Opp. at 17.) Dr. Luntz survey was designed to test brand
recognition, not to appraise the relative audience appeal of the various elements in the finished advertisements. Putting aside for
the moment Skechers objections to Dr. Lunzs opinions, it does not appear that Dr. Lunz ever compared Reinsdorfs raw photographs to the finished Skechers advertisements. Nor did Dr. Luntz present
either Skechers complete advertisements or Reinsdorfs raw photographs to survey participants. 8 (Declaration of Dr. Carol
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Scott in Support of Motion to Exclude Luntz Report 46.)
Without
such a comparison, Skechers cannot credibly argue that the relative audience appeal of the joint authors contributions has been ascertained, and has failed to demonstrate that the share of appeal attributable to each element can be appraised. The audience appeal
factor therefore weighs in favor of joint authorship. 3. Objective Manifestations of Intent
With respect to manifestations of intent, in the absence of a contract, the inquiry here must focus on the facts. 202 F.3d at 1235. Aalmuhammed,
Here, Skechers has presented facts that it Reinsdorf
suggests evince the parties intent to be joint authors.
testified, for example, that his goal was to do a great job, defined as capturing great moments that Skechers could use in its advertising and marketing materials. Welsh Dec., Ex. 50 at 323:3-6.) (Reinsdorf Deposition,
Reinsdorf did not expect anything
in particular about the finished images, as [Skechers] could do whatever, and never did anything creatively with the pictures that it was not allowed to do. 6.) (Reinsdorf Depo. at 314:18-19; 330: 2-
Indeed, Reinsdorf had created similar images, which Skechers
subsequently modified for use in advertising materials not at issue in this case, for Skechers at an earlier photo shoot, the Michelle K photo shoot. (Id. at 393.) As with the earlier Michelle K
shoot, Reinsdorf understood that he would be taking photos for Skechers to use in its catalogs and other marketing materials. (Id. at 396:10-20.) Reinsdorfs representative, Robert Heller
(Heller), acknowledged in an e-mail to Skechers personnel that Skechers intended to digitally play with or otherwise decorate Reinsdorfs raw images. (Ex. 53 to Welsh Dec. at 128.) 9
Case 2:10-cv-07181-DDP-SS Document 225 Filed 02/06/13 Page 10 of 27 Page ID #:7431
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Heller also testified that, as Reinsdorfs representative, he affirmatively wanted Skechers to do something with the images, to make beautiful ads for their company. (Id. at 130.) Indeed,
Reinsdorf facilitated Skechers manipulation of the images by suggesting that Skechers use a gray or white background so as to facilitate digital alteration of Reinsdorfs photos. 125:5-7.) (Id. at
When Reinsdorf received samples of the finished
advertisements, his representative did not express shock or confusion, but rather stated, These came out great! direction in the graphics!! (Ex. 24 to Welsh Dec.) Love the art Even after
the commencement of this suit, Reinsdorf displayed the finished marketing images on his personal website. in Opposition to Motion, Ex. 46.)2 While these actions and communications provide an indication of Reinsdorfs intent that the parties separate contributions be merged into a unified whole, that is not the question here. Rather, the issue is whether the parties manifested an intent to be co-authors. The difference is important. While intent to merge (Dec. of William Briggs
separate contributions is a necessary element of a joint work, it is not equivalent to an intent to be joint authors. Aalmuhammed itself provides a useful illustration of the distinction. There, the plaintiff wrote certain passages and Aalmuhammed 202 F.3d at 1231-32.
scenes that appeared in a movie.

2
The exhibit in question is not an image of Reinsdorfs website, but rather a cease and desist letter sent to Reinsdorf by Skechers, referencing the use of the advertisements. In its reply, Skechers asserts that it sought to prevent Reinsdorf from displaying Skechers trademarks and logos, but not the marketing images. (Reply at 10.) It is unclear whether the website displayed Skechers logos or trademarks separate and apart from the advertising images themselves. 10
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The court found that the parties all intended for the plaintiffs contributions to be merged into independent parts of the movie as a whole. Id. at 1332. That intent, however, had no bearing on
whether the parties intended the contributing plaintiff to be an author of the film. Id. at 1232-35. Applying the control,
audience appeal, and intent factors described above, the Aalmuhammed court ultimately determined that, despite the parties intent to merge their independent contributions, the parties did not intend for the plaintiff to be a co-author of the movie and the plaintiff was not an author of the film. Id. at 1235.
Skechers evidence that the parties here intended Reinsdorfs photos to be merged with Skechers digital alterations and additions therefore does not resolve the authorship issue. Indeed,
the parties behaved in ways uncharacteristic of joint authors. Perhaps most importantly, Reinsdorf charged Skechers thousands of dollars for his work. Not only did Reinsdorf charge for his time (Declaration
and effort, but also for usage of the photographs. of Robert Heller in Opposition to Motion, Ex. 11.)
Reinsdorf also
attempted to limit Skechers use of its ads by including temporally and geographically restrictive language in his invoices to Skechers. Skechers, for its part, also sought to prevent Reinsdorf
from making use of the finished images on his personal website, even during the pendency of this suit. (Briggs Dec., Ex. 46.)
A party intending to jointly produce a finished work generally would not require payment from a co-author and, conversely, would not likely agree to pay for a purported co-authors contribution. More importantly, a co-author would not attempt to constrain an intended co-authors use of a collaborative work. 11 Other courts
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have come to similar conclusions under similar circumstances. Tang v. Putruss, 521 F. Supp. 2d 600 (E.D. Mich. 2007), for example, a contract between a photographer and a purported co-
In
author required that the second party pay the photographer money before using the photographers photos. Id. at 607. The court
found such a provision inconsistent with an intent to be joint authors. Id.
The court in Robinson v.Buy-Rite Jewelery, Inc., No. 03 CIV 3619(DC), 2004 WL 1878781 (S.D.N.Y. Aug. 23, 2004), addressed circumstances similar to, but critically different from, those here. In Robinson, as here, a photographer was hired for a fashion
shoot, and yielded all subsequent decision-making authority as to how the photos would be used. Id. at *3. Unlike here, however,
the photographer agreed that the other contracting party could use the photographs without limitation. Id. Relying on this
critical fact, the court concluded that the parties did intend to be joint authors. Id.
This courts analysis of the three Aalmuhammed authorship factors indicates that while the control and audience appeal factors suggest plural authorship, the parties behavior toward one another could indicate a lack of intent to be joint authors of the finished works. There remains, therefore, a genuine dispute of
material fact as to whether Skechers finished advertisements are the products of multiple authors.3 See S.O.S., Inc., v. Payday,
Inc., 886 F.2d 1081, 1086 (9th Cir. 1989) (Authorship is a As discussed at argument, it is unclear at this juncture whether Skechers intends to pursue its joint authorship theory, which might give rise to a claim for an accounting. See Harper & Row Publishers v. Nation Enters., 471 U.S. 539, 568 (1985). 12
3
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question of fact.); Gaylord v. U.S., 595 F.3d 1364, 1377 (Fed. Cir. 2010); Medforms, Inc. v. Healthcare Management Solutions, Inc., 290 F.3d 98, 110 (2d Cir. 2002). C. License Issues 1. Exclusivity
The complaint alleges that Reinsdorf entered into a series of written license agreements with Skechers for its exclusive use of his photos . . . . (Compl. 55.) In February 2012, Reinsdorf
confirmed that the facts asserted in his complaint were accurate to the best of his knowledge. (Reinsdorf Depo. at 16:14-16.)
Three months later, however, over two months after the deadline to make changes to the deposition transcript, Reinsdorf purported to completely change his answer to Skechers did not actually get exclusive use of the pictures. Robert Welsh, Ex. 6.) (Supplemental Dec. of
Reinsdorf has not provided any explanation Reinsdorf also now states in opposition
for the untimely reversal.
to the instant motion for summary judgment that he never granted Skechers an exclusive right to use my photographs. Dec. at 17.) (Reinsdorf
A party may not, however, create an issue of fact by Van Asdale v. Intl Game The court finds that
contradicting prior deposition testimony. Tech., 577 F.3d 989, 998 (9th Cir. 2009).
there is a clear inconsistency between Reinsdorfs initial testimony, in which he confirmed the complaints allegation that he granted Skechers an exclusive license, and his later untimely correction and declaration that he did not grant Skechers an exclusive license. Reinsdorfs subsequent affidavit is a sham, and Id.
is therefore stricken. 2.
Copyright Infringement vs. Breach of Contract 13
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Skechers also argues that it is entitled to summary judgment because the invoices Reinsdorf sent to Skechers are not copyright licenses as a matter of law. Instead, Skechers contends, the
licenses are ordinary contracts that do not give rise to copyright protections or remedies. In Skechers words, the invoices merely
reflect the transfer of ownership of a complete set of Plaintiffs raw photographs for Skechers exclusive use, subject only to a contractual obligation to provide Plaintiff with additional compensation for uses that may have extended beyond the six month usage period. (Reply in Support of Motion for Clarification
(C.Reply) at 16:18-21; 17:20-23.) Skechers relies primarily on the Ninth Circuits decision in UMG Recordings Inc. v. Augusto, 628 F.3d 1175 (9th Cir. 2011). In
Augusto, a record company sent out unsolicited promotional CDs to music critics and other industry professionals, but affixed promotional use only, not for sale - type language to the discs. Augusto, 628 F.3d at 1177-78. The defendant somehow acquired Id. at 1178. The
several of the promotional CDs and re-sold them.
record company then brought a copyright action for violation of its exclusive right to distribute the CDs. Id. The question presented
was whether the record companys mailing served to transfer title to the CDs to the recipients, thus enabling a first sale defense, or whether the promotional use only language on the CDs constituted a copyright license rather than a transfer of ownership. In that context, the court looked to several factors
before concluding that no copyright license existed, and that the record companys initial distribution of the CDs effected a sale. Id. at 1179-83. 14
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The question here, however, is not whether a particular transfer constituted a copyright license or a transfer of ownership, but rather whether a particular breach of a license constituted a copyright violation or a run-of-the-mill breach of contract. Augusto is, therefore, inapposite.
Rather, the situation presented here is controlled by MDY Industries, Inc., LLC, v. Blizzard Entertainment, Inc. 928 (9th Cir. 2011). 629 F.3d
As the Ninth Circuit explained in MDY,
contractual terms that limit a licenses scope are conditions, the breach of which constitutes copyright infringement. F.3d at 939. MDY, 629
All other license terms are covenants, the breach of Id. Wherever
which is actionable only under contract law.
possible, equity construes ambiguous contract provisions as covenants rather than conditions. Id.
A breach of a license agreement only gives rise to a copyright claim if the licensee (1) exceeds the licenses scope (2) in a manner that implicates one of the licensors exclusive statutory rights. Id. At 940. As the Federal Circuit has illustrated:
[C]onsider a license in which the copyright owner grants a person the right to make one and only one copy of a book with the caveat that the licensee may not read the last ten pages. Obviously, a licensee who made a hundred copies of the book would be liable for copyright infringement because the copying would violate the Copyright Act's prohibition on reproduction and would exceed the scope of the license. Alternatively, if the licensee made a single copy of the book, but read the last ten pages, the only cause of action would be for breach of contract, because reading a book does not violate any right protected by copyright law. Storage Tech. Corp. v. Custom Hardwar Engineering & Consulting, Inc., 421 F.3d 1307, 1316 (Fed. Cir. 2005).
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The issue presently before this court is not whether Reinsdorfs licenses constitute copyright licenses or non-copyright contracts, but whether Skechers conduct violated a condition or a covenant of the agreements between the parties. The parties appear
to agree that Skechers was licensed to use Reinsdorfs photographs for only six months. (Complaint 5-6; C.Reply at 16.) Reinsdorf
alleges that Skechers copied his photographs beyond the temporal, geographical, and media limitations of the licenses. (Compl. 6.)
Such unauthorized use would encroach upon Reinsdorfs exclusive right to copy his works, conferred upon him by the Copyright Act, and would therefore violate a condition of the license rather than a covenant. Thus, the breaches at issue here give rise to a See Storage Tech., 421 F.3d at 1316
copyright infringement claim.
([U]ses that violate a license agreement constitute copyright infringement only when those uses would infringe in the absence of any license agreement at all.) (internal quotation omitted). D. Evidentiary Issues
Skechers filed Motions in Limine seeking to exclude the testimony of Plaintiffs experts Frank Luntz and Jamie Turner, and raised an evidentiary objection to the Supplemental Report of expert David Connelly. Under Federal Rule of Evidence 702, an
expert witness may offer opinion testimony if 1) that specialized knowledge will aid the trier of fact, 2) the testimony is based on sufficient information, 3) the testimony is the product of reliable methods, and 4) the expert has properly applied those methods to the facts of the particular case. 1. Frank Luntz Fed. R. Evid. 702.
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Plaintiffs expert Dr. Frank Luntz (Luntz) conducted a survey designed to test 1) whether Reinsdorfs photographs were directly linked to the Skechers brand and 2) whether Reinsdorfs photos influenced consumers decision to purchase a product. at 5.) (Opp.
Skechers contends that this survey was fatally flawed, in
that it was directed at an unrepresentative population, employed improper stimuli that produced biased responses, and failed to use adequate controls. (Mot. at 1).
Although Dr. Luntz knew that Skechers customer base is disproportionately female, he surveyed an even number of men and women aged sixteen to twenty-four. Luntz Depo. at 119). (Decl. of Carol Scott 9;
Luntz selected that age range because,
according to his research, that demographic is the meat of the athletic wear purchaser.4 (Declaration of Jeffrey A. Barker 5.)
Skechers, however, has submitted evidence that it is not an athletic wear company, but rather a fashionable footwear company that sells products ranging from active apparel to dress[wear]. Luntz surveyed participants from five geographical
regions, but did not compare the distribution of participants to the distribution of Skechers advertising and sales. Deposition at 113-15.) (Luntz
Nor did Luntz determine whether the ads
used in the survey had actually been displayed in participants home regions. Luntz attempted to evaluate the link between Reinsdorfs photos and Skechers brand by showing survey participants an image, then asking the participants to identify the company the image was Luntz did not keep any written records of his demographic research. 17
4
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promoting.
(Luntz Depo., Ex. 511.)
Respondents had the option to (Id.)
choose between Skechers, Adidas, Converse, Nike, and Reebok. There was no I dont know option. (Id.)
As described above,
Skechers sells a broad range of products, including dress apparel. Luntz later acknowledged that all survey options other than Skechers are principally athletic apparel companies. at 172-73.) Skechers argues that the survey format produced biased, unreliable results. (Barker Dec. 6.) For example, at question (Luntz Depo.
10, participants were shown an image of a woman in heavy makeup, tight, shiny, purple leather pants, a revealing top, and raisedheel, strapped, polka dot shoes. (Luntz Depo., Ex. 511). Survey
respondents were then asked whether the image promoted Adidas, Converse, Nike, Reebok, or Skechers. (Luntz Depo., Ex. 511).
Question 11, in contrast, poses the same brand-identification inquiry with respect to an image of a baseball player on a baseball field, in uniform and batting helmet, lifting a weighted baseball bat. (Id.) The survey is replete with other examples of Skechers
ads featuring models in leather jackets and jewelry staring straight into the camera, while all non-Skechers ads feature action and sports scenes. (Id.)
Later in the survey, respondents were again presented with the same ads they had already seen. This time, ads from all five The survey
companies were presented to respondents side-by-side.
asked participants to identify which of the five ads (disco girl with sunglasses, baseball player, gymnast, etc) was a Skechers ad. (Id.) Skechers argues that the obvious differences between
Skechers fashionable ads and the other companies athletic-themed 18
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ads skewed identifications toward Skechers and render the Luntz survey fundamentally deficient. Lastly, Skechers contends that the Luntz survey failed to use adequate controls. (Mot. at 11-12.) Survey participants were not
shown any ads that did not contain any Reinsdorf images, nor were they shown any unaltered Reinsdorf images. Instead, respondents
were only shown images containing both Reinsdorfs photographs and alterations and enhancements made by Skechers. Participants were
never asked why they associated a particular ad with Skechers. Skechers argues that absent any controls, such as ads containing photos other than Reinsdorfs or Reinsdorfs unaltered photos, the survey provides no basis upon which to conclude that Reinsdorfs photos are the motivating force behind consumers association of the ads in question with Skechers brand. Reinsdorf makes virtually no attempt to defend Luntzs methods. Instead, Reindsdorf contends that Skechers has merely
nitpicked the Luntz survey, and that any questions regarding the surveys technical reliability is a question of weight to be determined at trial. (Opp. at 1, 5); see E. & J. Gallo Winery v. The first
Gallo Cattle Co., 967 F.2d 1280, 1292 (9th Cir. 1992).
step in the courts analysis of any survey, however, is to determine whether the survey is admissible, relevant, and conducted according to accepted principles. Clicks Billiards, Inc. v. The court
Sixshooters, Inc., 251 F.3d 1252, 1263 (9th Cir. 2001).
must, therefore, determine whether a preponderance of the evidence establishes that the reasoning or methodology underlying expert testimony is scientifically valid. Inc., 509 U.S. 579, 593 (1993). Daubert v. Merrell Dow Pharms.,
Unless survey evidence is 19
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 27 28
conducted according to accepted principles, it is not admissible in the first instance. Fortune Dynamic, Inc. v. Victorias Secret
Stores Brand Mgmt, Inc., 618 F.3d 1025, 1036 (9th Cir. 2010). Here, the preponderance of the evidence indicates that the Luntz survey was not conducted according to accepted scientific principles. Luntz did not identify any basis, save for his own
undocumented research, for selecting the survey population that he used. There is no indication that the survey population had any
relationship to the relevant population of Skechers consumers. Skechers fashion-focused ads were presented alongside obviously distinctive sportswear ads in closed-ended brand identification questions with no I dont know option. Furthermore, though the
survey purported to examine the role that Reinsdorfs photos played in consumers association of certain ads with Skechers brand, the survey did not include any controls or basis for comparison. These inadequacies speak not merely to the weight that should be accorded to the survey, but rather to the fundamental reliability of Luntzs approach. Reinsdorf does not identify any
scientific principles underlying the Luntz survey, which appears to violate numerous accepted practices in the field of survey research. (Scott Dec. 24-25, 31; Shari S. Diamond, Reference
Guide on Survey Research, REFERENCE MANUAL ON SCIENTIFIC EVIDENCE 373-408 (Fed. Judicial Center 3d ed. 2011). Accordingly, Skechers
Motion to Exclude Luntzs testimony and report is GRANTED.5 The court further notes that Reinsdorf did not comply with the Magistrate Judges order regarding the production of raw data from the Luntz survey. Though Reinsdorf eventually produced the data, he did so after the expiration of the deadline set by the Magistrate Judge and after the filing of the instant motion. (continued...) 20
5
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 27 28
5
2.
Jamie Turner
A copyright owner is entitled to recover any profits of [an] infringer that are attributable to the infringement. 504(b). 17 U.S.C.
Recoverable profits include an infringers indirect
profits, which generally arise when an infringer uses a copyrighted work to sell another product. Garcia v. Coleman, No.
C-07-2279 EMC, 2009 WL 799393 at *2-3 (N.D. Cal. Mar. 24, 2009) (citing Polar Bear Prods. v. Timex Corp., 384 F.3d 700 (9th Cir. 2004)). Because only those profits attributable to the
infringement are recoverable under the Copyright Act, a causal link between the infringement and the monetary remedy sought is a predicate to recovery of any kind. Polar Bear, 384 F.3d at 708.
It is the plaintiffs burden to establish a non-speculative causal connection between an infringement and the infringers profits. Id. at 708, 711; Mackie v. Rieser, 296 F.3d 909, 914-16 A plaintiff cannot merely present an infringers
(9th Cir. 2002).
gross revenue, but rather must identify a particular revenue stream that bears a legally sufficient relationship to the infringement. Polar Bear, 383 F.3d at 711. Reinsdorf seeks to introduce the testimony of Jamie Turner to establish the amount of Skechers profits attributable to Skechers use of Reinsdorfs photographs. follows: 1. [W]e can broadly conclude that more than 0% but less than 100% of the net profits generated by Skechers during this period can be attributable to Mr. Reinsdorfs brand imagery. Turner summarized his analysis as
(...continued) Nevertheless, Skechers does not appear to have been unduly prejudiced by the late production. 21
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2.
3. 4. 5. 6.
We know there was already some value to Skechers [sic] brand . . . so it is safe to assume that Mr. Reinsdorfs images are worth less than 100% of the net profits . . . . [W]e know that Mr. Reinsdorfs brand imagery was used around the globe . . . . We also know that this brand imagery was a foundational element of the marketing program . . . . [W]e know that the residual value of the brand imagery will continue for approximately five years . . . . Therefore, based on the above facts and based on my experiences working with brands such as The Coca Cola Company, AT&T and CNN . . ., it is reasonable to conclude that the value that Mr. Reinsdorfs copyrighted brand images contributed to the net profits for the corporation fall somewhere between 50% and 75% of the net profits . . . .
(Turner Report at 14-15.) Turners entire contribution to this dispute essentially amounts to, I have a lot of experience with brands and marketing, therefore I can divine that 50-75% of this large, successful, companys profits come from Reinsdorfs photographs. This
analysis identifies no causal link, let alone a non-speculative connection, between Skechers alleged infringement and any particular revenue stream. Turner somehow settles upon an indirect
profits figure between $161 million and $241.1 million without any specific data or discernible methodology, and in reliance on such facts as it is safe to assume that Mr. Reinsdorfs images are worth less than 100% of the net profits.6
6
Turners opinion is not
The court does not consider Turners newly proffered opinion, submitted as an opposition to Skechers Motion in Limine. See Fed. R. Civ. P. 37(c)(1). Even if the court were to consider Turners declaration, the result here would not change. The declaration is internally inconsistent, referring at one point to financial reports from 2007 through 2009 and elsewhere to reports spanning from 2008 to 2010, and purports to rely on other latefiled declarations that conflict with Turners statements and (continued...) 22
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 27 28
based upon sufficient facts and is not the product of reliable methods. Because Turners opinion fails to illustrate a
relationship of any kind between infringing conduct and specific income, it cannot serve as a basis for granting Reinsdorf Skechers indirect profits. GRANTED.
7
Skechers motion to exclude Turners testimony is
3.
David Connelly
After the close of discovery, Reinsdorf provided a Supplemental Report by expert David Connelly as an exhibit to Plaintiffs opposition to Skechers Motion for Summary judgment. Skechers objects to the Connelly Supplemental Report (Supplmental Report or CSR).8 Parties bear a duty to supplement expert reports or deposition testimony if the disclosure is somehow incomplete or incorrect. Fed. R. Civ. P. 26(e). Supplementation . . . means correcting
inaccuracies, or filling the interstices of an incomplete report based on information that was not available at the time of the
(...continued) conclusions. Having concluded that Turners opinion is inadmissible for failure to apply reliable methods and rely upon sufficient information, the court does not address Skechers contention that Turner is not qualified to present expert testimony. A party may challenge the admissibility of summary judgment evidence by objection or by a motion to strike. Pfingston v. Ronan Engg Co., 284 F.3d 999, 1003. Skechers raised an objection to and Motion to Strike the Connelly report (and the supplemental declaration from Jamie Turner, see n.6, supra) all in a single document, filed twenty-one days prior to the noticed hearing date. (Dkt. No. 185.) Because the court considers Skechers objection to the Connelly Supplemental Report timely raised, the court does not address whether a Motion to Strike need comply with Central District of California Local Rule 6-1. 23
8 7
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 27 28
initial disclosure. (D.Mont. 1998).
Keener v. United States, 181 F.R.D. 639, 640
The duty to supplement does not give license to
sandbag ones opponent with claims and issues which should have been included in the expert witness [original] report. Rojas v.
Mako Zaninovich, Inc., No. 09-cv-00705 AWI JLT, 2011 WL 4375297 at *2 (E.D. Cal. Sept. 19, 2011) (citation omitted). In his Supplemental Report, Connelly states that he initially did not have access to sufficiently detailed financial information to enable an assessment of Skechers [indirect] profits. 1.) (CSR at
Connelly explained at his deposition that he would need
[a]dditional information concerning the particular product lines at Skechers before he could perform an indirect profits analysis. (Connelly Deposition at 96::1-2.) Later, after his initial report
and deposition, Connelly received general ledger type transaction records, which he then used to perform an indirect profits analysis in the Supplemental Report. (CSR at 1.) The Supplemental
Report ultimately concludes that $33,479,171 of Skechers profits are attributable to its infringing uses of Reinsdorfs photos. (Id. at 10; Ex. B.) Skechers argues that Connellys report is a new opinion rather than a supplement, and that his reliance on the newly available general ledger type data is a mere pretext. The court agrees.
Connelly initially opined that he could not perform an indirect profits analysis without specific product line information. By
Connellys own admission, however, the new evidence, upon which the Supplemental Reports indirect profits calculation is ostensibly based, does not attribute [Skechers] sales to specific
24
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 27 28
product lines.9
(CSR at 6.)
Indeed, the CSR explains that
because at least 87.4% of the net sales transactions reported in Skechers transaction records were described only in very general terms, and not attributed to specific products, . . . the recently produced records do not provide sufficient detail concerning Skechers sales . . . . (CSR at 7.) The new general ledger data,
therefore, cannot possibly serve as the basis for Connellys indirect profits analysis. There is no indication that the other
information underlying Connellys newly formed conclusion was unavailable at the time of Connellys initial report and deposition. Skechers objection to the CSR is therefore sustained, Fed. R. Civ. P. 37(c)(1).
and the CSR is excluded.
Furthermore, even if the CSR had been timely produced, it suffers from serious methodological and factual deficiencies that raise serious questions as to its admissibility and relation to Reinsdorfs indirect profits claim. Despite the CSRs
acknowledgment that the required product-line data is lacking, the CSR goes on to reach an indirect profits figure of over $33 million. To reach that figure, the CSR begins with the baseless
assumption that 100% of sales not attributed to a specific product line (see n.9, supra) were the result of Skechers infringing uses of Reinsdorfs photos. (CSR at 8.) Although it is undisputed that
Skechers was authorized to use the photos for at least six months, the CSR makes no attempt to break out sales resulting from
The CSR explains that the general ledger information did include some product-specific data, but only for lines not associated with Resindorfs photos and not at issue in this case. These fashion and street brand sales represented only 12.6% of Skechers reported revenue. (CSR at 6-7.) 25
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 27 28
authorized uses.
In addition, that CSR relies upon the fatally
flawed Luntz survey, described above, to support the conclusion that Reinsdorfs photos were responsible for Skechers increasing gross revenues.10 (CSR at 3, 11.) The CSR is not grounded upon
reliable methods or data, and does no more than establish a speculative relationship between Skechers profits and its infringing uses of Reinsdorfs photographs. Fed. R. E. 702; Polar
Bear, 384 F.3d at 7011; Mackie, 296 F.3d at 914-16. E. Statutory Damages and Attorneys Fees
Skechers seeks summary judgment on Reinsdorfs claims for statutory damages and attorneys fees due to his failure to register his photographic works within the period contemplated by the Copyright Act. Plaintiff does not oppose the motion with Having reviewed the record, the court
respect to these issues.
GRANTS Skechers Motion for Summary Judgment with respect to statutory damages and attorneys fees. IV. Conclusion Skechers has not demonstrated that the parties intended to be co-authors of the finished marketing images, which are, therefore, not joint works. Nor has Skechers demonstrated, as a matter of
law, the lack of a copyright license agreement or breach of such argument. Accordingly, Skechers Motion for Summary Judgment is
DENIED in these respects. The expert opinions of Frank Luntz and Jamie Turner do not satisfy the requirements of Federal Rule of Evidence 702. The CSRs conclusion that Skechers enjoyed above-average sales growth is itself based upon a somewhat suspect comparison to only a narrow subset of Skechers competitors. (CSR at 8 n.12 (excluding Nikes high growth rate from comparison.)) 26
10
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 27 28
Accordingly, Skechers Motions in Limine to exclude those opinions are GRANTED. Skechers objection to the Supplemental Report of
David Connelly is SUSTAINED. Given Plaintiffs failure to adequately demonstrate a causal link between Skechers profits and its allegedly infringing conduct, Skechers motion for summary judgment on Plaintiffs indirect profits claim is GRANTED. Skechers unopposed motion for
summary judgment with respect to statutory damages and attorneys fees is also GRANTED.
IT IS SO ORDERED.
Dated: February 6, 2013
DEAN D. PREGERSON United States District Judge
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Reinsdorf V Skechers USA

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Case 2:10-cv-07181-DDP-SS Document 225

Filed 02/06/13 Page 1 of 27 Page ID #:7422

UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA

[Dkt. No. 198]

Case 2:10-cv-07181-DDP-SS Document 225

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Robert Welsh in support of Motion (Welsh Dec.) Ex.19.)

Between 2006 and 2009, Skechers engaged Reinsdorf to conduct

These explanations included storyboards and photographic

used in Skechers advertisements (the advertisements). 16.)

No raw, unaltered photograph was ever incorporated into a (Id.)

Reinsdorf brought suit in this court alleging copyright 2

Case 2:10-cv-07181-DDP-SS Document 225

Filed 02/06/13 Page 3 of 27 Page ID #:7424

Legal Standard Summary judgment is appropriate where the pleadings,

All reasonable inferences from See

Case 2:10-cv-07181-DDP-SS Document 225

Filed 02/06/13 Page 4 of 27 Page ID #:7425

A genuine issue exists if the evidence is such

1026, 1031 (9th Cir. 2001).

Defendants Motion to Dismiss (Order), Dkt. No. 28.)

Case 2:10-cv-07181-DDP-SS Document 225

Filed 02/06/13 Page 5 of 27 Page ID #:7426

Inc., 531 F.3d 962, 969 (9th Cir. 2008).

Case 2:10-cv-07181-DDP-SS Document 225

Filed 02/06/13 Page 6 of 27 Page ID #:7427

This case presents an unusual set of circumstances.

Case 2:10-cv-07181-DDP-SS Document 225

Filed 02/06/13 Page 7 of 27 Page ID #:7428

and citations omitted).

Similarly, Reinsdorf asserts that [j]ust as Skechers had

minimal involvement in Reinsdorfs authorship of his photographs, 7

Case 2:10-cv-07181-DDP-SS Document 225

Filed 02/06/13 Page 8 of 27 Page ID #:7429

Skechers does not dispute these Thus, as in Morrill and

(Reply pp. 7-10.)

of joint authorship. 2. Audience Appeal

Case 2:10-cv-07181-DDP-SS Document 225

Filed 02/06/13 Page 9 of 27 Page ID #:7430

Scott in Support of Motion to Exclude Luntz Report 46.)

factor therefore weighs in favor of joint authorship. 3. Objective Manifestations of Intent

Here, Skechers has presented facts that it Reinsdorf

suggests evince the parties intent to be joint authors.

Reinsdorf did not expect anything

Indeed, Reinsdorf had created similar images, which Skechers

Case 2:10-cv-07181-DDP-SS Document 225 Filed 02/06/13 Page 10 of 27 Page ID #:7431

When Reinsdorf received samples of the finished

scenes that appeared in a movie.

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Case 2:10-cv-07181-DDP-SS Document 225 Filed 02/06/13 Page 12 of 27 Page ID #:7433

found such a provision inconsistent with an intent to be joint authors. Id.

Case 2:10-cv-07181-DDP-SS Document 225 Filed 02/06/13 Page 13 of 27 Page ID #:7434

for the untimely reversal.

Copyright Infringement vs. Breach of Contract 13

Case 2:10-cv-07181-DDP-SS Document 225 Filed 02/06/13 Page 14 of 27 Page ID #:7435

several of the promotional CDs and re-sold them.

Case 2:10-cv-07181-DDP-SS Document 225 Filed 02/06/13 Page 15 of 27 Page ID #:7436

As the Ninth Circuit explained in MDY,