LN Win Reversed In Merch Suit

Live Nation suffered a setback in a copyright case Aug. 18 when a federal appeals court reversed a lower court’s summary judgment ruling that cleared the company of charges it willfully infringed upon a photographer’s Run DMC images for merchandise.  

Run DMC approved Live Nation’s use of images for a calendar and three T-shirt designs in 2008. However, it turned out the group didn’t own them all. Glen Friedman, who photographed them in in the 1980s, owned five of them. He filed suit, accusing Live Nation of copyright infringement and of removing copyright management information from his images. Eventually, Live Nation and Friedman each filed motions for summary judgment after Friedman missed a discovery deadline. A federal court granted partial summary judgment to each, with Live Nation stipulating that it admitted to the infringement, but not that it had done so willingly – a condition that would substantially increase its liability.

While acknowledging the infringement, Live Nation successfully argued that Friedman provided no evidence the company willfully infringed his copyrights or knowingly removed CMI from any of the images. Summary judgment was granted in both motions, with the court rejecting Friedman’s claim for damages of $3.12 million on the basis of 104 separate retailers that handled the merchandise. Friedman appealed the court order limiting damages to one statutory damages award per infringed work and a Ninth Circuit appellate court panel ruled the summary judgment was granted prematurely and both questions deserved to go to trial.

“On the current record, a jury could reasonably conclude that Live Nation’s approval procedures amounted to recklessness or willful blindness with respect to Friedman’s intellectual property rights,” U.S. Circuit Judge Marsha Berzon wrote in her opinion, noting that Live Nation’s product-approval forms appear to assume – rather than confirm – the artist holds the rights to any images it submits for merchandise design.

“Given an approval process that never explicitly asks about copyrights at all, a jury could reasonably conclude that Live Nation’s reliance on the artists who were the subjects of the photographs at issue to clear photographic rights, rather than on the photographers who took them – based only on a purported industry practice never reflected in any document – amounted to recklessness or willful disregard, and thus willfulness,” Berzon wrote.

Regarding the alleged CMI removal, the appellate panel also ruled the question should go to trial. “We note at the outset that the district court focused on the wrong question,” Berzon wrote. “The statute does prohibit the intentional removal of CMI … But Friedman could also prevail upon a showing that Live Nation distributed his works with the knowledge that CMI had been removed, even if Live Nation did not remove it.”

Live Nation did catch a break from the appellate court, however, when it upheld the lower court ruling that Friedman could not claim $3.12 million statutory damages on the basis of 104 separate distributors of the merchandise. The court concluded “due to the large number of downstream infringers, granting Friedman a separate award for each would ‘lead to an absurd result,’” and limited Friedman to one damage award per infringed work.