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Nature of Suit Code: 820
Nature of Suit: Copyright
Cause of Action: 

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United States Court of Appeals

FOR THE EIGHTH CIRCUIT

___________

No. 03-3112

___________

Rita Mulcahy, *

*

Plaintiff - Appellee, *

* Appeal from the United States

v. * District Court for the

* District of Minnesota.

Cheetah Learning LLC; Jeff Schurrer, *

*

Defendants - Appellants. *

___________

Submitted: May 10, 2004

Filed: October 19, 2004

___________

Before LOKEN, Chief Judge, BRIGHT and SMITH, Circuit Judges.

___________

LOKEN, Chief Judge.

This is a copyright dispute between two organizations that offer competing

courses to prepare students to pass the Project Management Professional (PMP) Exam

given by the Project Management Institute (PMI). Rita Mulcahy filed the lawsuit,

claiming copyright infringement and unfair competition by Cheetah Learning LLC

and by Jeff Schurrer, an instructor who distributed allegedly infringing materials to

Cheetah students. The district court granted Mulcahy partial summary judgment and

a permanent injunction on her claim that defendants infringed her copyrighted work,

PMP Exam Prep. Cheetah and Schurrer appeal. We conclude there are genuine

issues of material fact regarding whether PMP Exam Prep infringes PMI’s exclusive

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right to prepare derivative works based on its preexisting copyrighted work and

whether PMP Exam Prep is a fair use of that work. Accordingly, we reverse the grant

of partial summary judgment and vacate the permanent injunction. 

I. Background. 

Established in 1969, PMI is a not-for-profit association for project management

professionals (PMPs) that now “supports over 100,000 members in 125 countries

worldwide.” As part of its continuing and seemingly successful effort to establish

project management as a true profession, PMI first offered a PMP certification exam

in 1984 and first published a work entitled Project Management Body of Knowledge

in 1987. In 1996, PMI published a superseding copyrighted work entitled Guide to

the Project Management Body of Knowledge, which we will refer to as the PMBOK.

PMI advertises that the PMBOK is approved by the American National Standards

Institute and is “[t]he foundation document for project management training and/or

education.” PMI’s PMP exam has been “based upon” the PMBOK during the period

relevant to this dispute. However, the PMBOK’s introductory statement of purpose

suggests that it serves as a desk reference work for practicing project managers as

well as a “consistent structure” for PMI’s certification of PMPs. There is no

testimony by a PMI representative in the summary judgment record, nor does the

record reveal whether PMI has copyrighted PMP exam materials. 

PMI certification has come to be viewed as an important credential, creating

a market for textbooks and courses that prepare aspiring PMPs to pass the PMI exam.

PMI website materials in the record suggest that PMI, colleges and universities, and

numerous private vendors have entered this market. Because PMI bases the PMP

exam on the PMBOK, a comprehensive reference work, it is hard to imagine that a

vendor could devise a successful course teaching students to pass the PMP exam

without using -- or plagiarizing -- the PMBOK. In this regard, PMI’s copyright

notice in the front of the PMBOK advises:

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All rights reserved. Permission to republish in full is granted freely. No

part of this work may be reproduced or transmitted in any form . . .

without prior written permission of the publisher.

Likewise, a PMI website warns: 

Anyone wishing to use excerpts from the PMBOK Guide must obtain

written permission to do so and pay the appropriate permission fee,

where applicable. This includes PMI members, PMI Components and

PMI Registered Education Providers.

Mulcahy is an expert in the field of project management who offers test

preparation courses and materials to teach students to pass the PMP exam. To this

end, Mulcahy wrote and copyrighted PMP Exam Prep. The book begins with

materials specifically focused on passing the PMP exam that have no counterparts in

the PMBOK, such as sections entitled “An Overview of the Exam,” “Types of

Questions on the Exam,” “How to Study for the Exam,” and “Tricks for Taking the

Exam.” However, the subsequent sections, which are entitled “The Materials” and

take up 150 of the work’s 165 pages, track the PMBOK’s organization of the project

management “knowledge areas” and reproduce or condense the materials presented

in the PMBOK. Although PMP Exam Prep states that it is “intended to work hand-inhand” with the PMBOK, and the record includes a PMI website that says,“Get Rita’s

book,” whether PMI authorized Mulcahy to use excerpts from the PMBOK in her

work is a disputed issue of fact.

Cheetah offers a variety of exam preparation and professional training courses.

Founder Michelle LaBrosse testified that she uses “a unique educational model which

utilizes dietary control, yoga meditative techniques, color recognition, state

conditioning and psych-acoustics to accelerate the learning process.” In 2000,

Cheetah retained Eric Nielsen to develop the substantive content for a PMP exam

preparation course. Cheetah began offering the four-day course in September 2001,

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By permanently enjoining defendants from using “any materials that are

substantially similar to any edition of Plaintiff’s PMP Exam Prep,” paragraph 3.b. of

the court’s order threatens defendants with contempt sanctions if they continue using

revised Cheetah course materials that were not before the court, contrary to the

principle that blanket injunctions to obey the law are disfavored. See Jake’s, Ltd.,

Inc. v. City of Coates, 356 F.3d 896, 904 (8th Cir. 2004). 

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using the PMBOK as the “primary reference” and also distributing to students looseleaf materials called the Candidate Notetaker. LaBrosse was soon advised of

significant similarities between Cheetah’s Candidate Notetaker and Mulcahy’s PMP

Exam Prep. LaBrosse compared the two works and informed Mulcahy’s attorney that

she “had revised Cheetah’s course materials to remove what I believed to be the

allegedly infringing content.” Unsatisfied, Mulcahy filed this lawsuit. Nielsen

testified that he used PMP Exam Prep and other reference works in preparing the

Cheetah course materials and sample test questions.

Ruling on the parties’ cross motions for summary judgment, the district court

granted Mulcahy summary judgment on her copyright infringement claim, concluding

that (i) Mulcahy’s copyright is valid because PMP Exam Prep does not infringe

PMI’s copyright in the PMBOK, (ii) alternatively, PMP Exam Prep is a fair use of the

PMBOK, and (iii) Cheetah’s course materials are substantially similar to PMP Exam

Prep and therefore infringe Mulcahy’s copyright as a matter of law. The court

broadly enjoined defendants from “using, copying, selling, distributing, or

displaying” specific Cheetah materials created between August 2001 and September

2002 and all other materials “substantially similar to any edition” of PMP Exam

Prep.

1

 Though copyright damage issues remain unresolved, we have jurisdiction to

review the court’s grant of a permanent injunction. 28 U.S.C. § 1292(a)(1). If

summary judgment was improvidently granted on Mulcahy’s claim of copyright

infringement, the permanent injunction must be vacated. See Randolph v. Rodgers,

170 F.3d 850, 856 (8th Cir. 1999).

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We do not consider defendants’ further contention that Mulcahy’s copyrights

are unenforceable because she filed knowingly false copyright applications.

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II. Discussion.

Two elements are required to establish copyright infringement, ownership of

a valid copyright and copying of original elements of the work. Feist Publ’ns, Inc.

v. Rural Tel. Serv. Co., 499 U.S. 340, 361 (1991). Here, we need only consider the

first element because we agree with defendants that the district court erred in

concluding as a matter of law that PMP Exam Prep is not an unauthorized derivative

of the PMBOK and that any copying of the PMBOK in PMP Exam Prep was a “fair

use” within the meaning of 17 U.S.C. § 107.2

 

A. Unauthorized Derivative. The statutory rights of a copyright owner include

the exclusive right “to prepare derivative works based upon the copyrighted work.”

17 U.S.C. § 106(2). The Copyright Act broadly defines a derivative work as - 

a work based upon one or more preexisting works, such as a translation,

musical arrangement, dramatization, fictionalization, motion picture

version, sound recording, art reproduction, abridgment, condensation,

or any other form in which a work may be recast, transformed, or

adapted. 

17 U.S.C. § 101. One who violates the copyright owner’s right to create derivative

works is an infringer. See 17 U.S.C. § 501(a). 

A derivative work may itself be copyrighted if it has the requisite originality.

However, “the copyright is limited to the features that the derivative work adds to the

original.” Pickett v. Prince, 207 F.3d 402, 405 (7th Cir. 2000); see Stewart v. Abend,

495 U.S. 207, 223 (1990). Moreover, because the owner of the original copyright has

the exclusive right to prepare derivative works, the creator of an original derivative

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work is only entitled to a copyright if she had permission to use the underlying

copyrighted work. See 17 U.S.C. § 103(a); Dam Things from Denmark v. Russ

Berrie & Co. Inc., 290 F.3d 548, 563 (3d Cir. 2002); Gracen v. Bradford Exch., 698

F.2d 300, 302 (7th Cir. 1983). Thus, if the PMP Exam Prep is an unauthorized

derivative work of the PMBOK, Mulcahy’s copyrights are invalid. 

The district court did not discuss the concept of a derivative work. It simply

concluded that PMP Exam Prep does not infringe PMI’s copyright in the PMBOK

because, while the two works have “many substantive details in common,” they are

not substantially similar “in substance, purpose, presentation, and functionality.” The

court applied the two-part test for determining substantial similarity adopted by this

court in diverse copyright infringement cases such as Hartman v. Hallmark Cards,

Inc., 833 F.2d 117, 120 (8th Cir. 1987), Schoolhouse, Inc. v. Anderson, 275 F.3d 726,

729 (8th Cir. 2002), and Taylor Corp. v. Four Seasons Greetings, LLC, 315 F.3d

1039, 1043 (8th Cir. 2003). 

While substantial similarity is the test we use in determining copyright

infringement, here the issue is whether Mulcahy’s book is a derivative work. In

general, the two tests are similar. In the words of a leading copyright treatise, “Unless

sufficient of the pre-existing work is contained in the later work so as to constitute

the latter an infringement of the former, the latter by definition is not a derivative

work.” 2 Nimmer on Copyright § 8.09[A], p. 8-138 (2004); see Litchfield v.

Spielberg, 736 F.2d 1352, 1357 (9th Cir. 1984) (“a work is not derivative unless it has

been substantially copied from the prior work”), cert. denied, 470 U.S. 1052 (1985).

But as this case illustrates, a determination of what is substantial or sufficient must

take into account the nature of the derivative work inquiry.

PMI has created and copyrighted a multi-purpose reference work, the PMBOK,

and has made that work the “foundation” of its test that a student must pass to receive

PMI’s valuable PMP certification. Without doubt, an outside educator could obtain

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copies of the PMBOK from PMI and lecture students on how to use that work to pass

the exam without infringing the PMBOK copyright. In addition, the educator could

create and distribute written materials on subjects not covered in the PMBOK -- such

as “How to Study for the Exam” and “Tricks for Taking the Exam” -- without

infringing. But Mulcahy has done far more. Large portions of her PMP Exam Prep

appear to copy, condense, and adapt those portions of the PMBOK that are relevant

to passing the exam. She admits that these portions of her work are derived from and

based upon the PMBOK. The question is whether this copying, condensing, and

adapting of the PMBOK encroaches upon, i.e., infringes, PMI’s exclusive right “to

prepare derivative works based upon the copyrighted work.” 17 U.S.C. § 106(2).

This issue cannot be answered by looking at the percentage of the PMBOK that has

been condensed or copied in PMP Exam Prep. Rather, a reasonable factfinder could

find that PMP Exam Prep is an infringing derivative work if it copied or condensed

the qualitative core of one marketable portion of the multi-purpose PMBOK. See

Castle Rock Ent., Inc. v. Carol Pub. Group, Inc., 150 F.3d 132, 138-39 (2d Cir. 1998).

It is true that, in most infringement cases, “[i]nfringement of expression occurs only

when the total concept and feel of the works in question are substantially similar,”

Hartman, 833 F.2d at 120-21. But the derivative work issue, like the fair use issue,

should turn on “the qualitative nature of the taking.” Harper & Row Publishers, Inc.

v. Nation Enters., 471 U.S. 539, 565 (1985). Thus, a work may be found to be

derivative even if it has “a different total concept and feel from the original work.”

Castle Rock, 150 F.3d at 140. 

Mulcahy argues that the PMBOK is entitled to only limited protection because

it is “a common project management lexicon,” a collection of underlying facts and

theories that cannot themselves be copyrighted. The Supreme Court has warned that

“the copyright in a factual compilation is thin” because “a subsequent compiler

remains free to use the facts . . . to aid in preparing a competing work.” Feist, 499

U.S. at 349. That principle may apply here. But PMI’s website materials in the

summary judgment record suggest that the PMBOK may be an original work intended

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Mulcahy also argues that, if PMP Exam Prep is a derivative work, PMI ratified

her use of the PMBOK by not responding when she sent PMI a pre-publication of the

first PMP Exam Prep and by selling PMP Exam Prep in PMI’s online bookstore. See

Eden Toys, Inc. v. Florelee Undergarment Co., Inc., 697 F.2d 27, 34 n.6 (2d Cir.

1982). This, too, is an issue requiring a trial that explores the extent of PMI’s right

to prepare derivative works and, if the right extends to PMP exam teaching materials

based on the PMBOK, the manner in which PMI has exploited that right.

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to transform project management into a recognized profession, rather than a mere

compilation of well-known facts and ideas. In that case, the work’s organization and

presentation would reflect far more protectible originality than, for example, the

copyrighted “tables of information on area public and private schools” at issue in

Schoolhouse, 275 F.3d at 727. Again, this is a fact-intensive issue not properly

decided as a matter of law on a summary judgment record.3

For these reasons, we conclude that the district court erred in deciding that

Mulcahy’s PMP Exam Prep is not a derivative work as a matter of law.

B. Fair Use Doctrine. Alternatively, Mulcahy argues and the district court

concluded that PMP Exam Prep is a fair use of the PMBOK as a matter of law. The

statute, 17 U.S.C. § 107, sets forth four non-exclusive factors that “shall” be

considered in determining whether an otherwise infringing use is a non-infringing fair

use. Though all four must be considered together, the fourth factor -- “the effect of

the use upon the potential market for or value of the copyrighted work” -- “is

undoubtedly the single most important element of fair use.” Harper & Row, 471 U.S.

at 566. The district court concluded that Mulcahy’s use was fair because the

introduction to PMP Exam Prep tells students, “You need both the PMBOK and this

book to prepare for the exam,” and thus “the effect of Mulcahy’s work would likely

improve the potential market for and enhance the value of the PMBOK.” 

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In our view, the effect of Mulcahy’s use is not so clear. In the first place,

students may find that PMP Exam Prep is such an effective condensation and

adaptation that they need not obtain and study the PMBOK. But more importantly,

PMI has created a for-profit education market by offering a valued certification exam.

PMI offers courses on passing its exam, demonstrating an intent to exploit that

market. By basing its exam on the copyrighted PMBOK, PMI has also created a

market for selling or licensing this work to educators and students; “the potential for

destruction of this market by widespread circumvention of the plaintiffs’ permission

fee system is enough, under the Harper & Row test, ‘to negate fair use.’” Princeton

Univ. Press v. Mich. Document Servs., Inc., 99 F.3d 1381, 1388 (6th Cir. 1996) (en

banc), cert. denied, 520 U.S. 1156 (1997). Moreover, by publishing a comprehensive

condensation of the portions of the PMBOK relevant to passing the exam, Mulcahy

may have deprived PMI of “the capacity arbitrarily to refuse to license one who seeks

to exploit the work.” Stewart, 495 U.S. at 229. Fair use is a mixed question of law

and fact. Here, the issue of fair use, like the issue of derivative work, raises genuine

issues of material fact.

In addition, a finding that Mulcahy’s copyrights are valid only because PMP

Exam Prep is a fair use of the PMBOK would likely affect other issues. Mulcahy

emphasizes the extent to which Cheetah’s materials copy PMP Exam Prep. But “[a]n

author’s right to protection of the derivative work only extends to the [original]

elements that [she] has added to the work; [she] cannot receive protection for the

underlying work.” Dam Things, 290 F.3d at 563; see Feist, 499 U.S. at 363

(“copyright protects only those constituent elements of a work that possess more than

a de minimis quantum of creativity”). Thus, the factfinder “must filter out and

disregard” the copying of non-protected elements -- such as elements of PMP Exam

Prep that are a fair use of the PMBOK -- in determining whether defendants are guilty

of copyright infringement. Cavalier v. Random House, Inc., 297 F.3d 815, 822-23

(9th Cir. 2002).

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III. Conclusion.

For the foregoing reasons, Paragraph 1.a. of the district court’s order dated July

28, 2003, is reversed, the permanent injunction in paragraph 3. is vacated, and the

case is remanded for further proceedings not inconsistent with this opinion. 

______________________________

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