Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_18-cv-02914/USCOURTS-cand-5_18-cv-02914-2/pdf.json

Nature of Suit Code: 820
Nature of Suit: Copyright
Cause of Action: 17:101 Copyright Infringement

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CASE NO.: 5:18-cv-02914-EJD

ORDER GRANTING MOTION TO DISMISS

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United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

JOELLE SIGNORELLI,

Plaintiff,

v.

NORTH COAST BREWING CO. INC.,

Defendant.

Case No. 5:18-cv-02914-EJD 

ORDER GRANTING MOTION TO 

DISMISS SECOND AMENDED 

COMPLAINT

Re: Dkt. No. 25

I. INTRODUCTION

Plaintiff Joelle Signorelli (“Signorelli”) initiated this suit for copyright infringement 

against Defendant North Coast Brewing Co. Inc. (“North Coast Brewing”) and Does 1 through 10 

to stop defendants from using her late husband’s artwork on North Coast Brewing beer bottle 

labels and merchandise. North Coast Brewing moves to dismiss the Second Amended Complaint 

(“SAC”) pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. For the reasons set 

forth below, North Coast Brewing’s motion to dismiss will be granted.

II. BACKGROUND1

Plaintiff and her husband Eduardo Smissen (“Eduardo”) were married from 2004 until 

Eduardo’s death in February of 2015. SAC ¶ 7. In October of 2005, Doug Moody (“Moody”) of 

North Coast Brewing asked Eduardo if he would be interested in designing a bottle label featuring 

jazz artist Thelonious Monk for a beer now known as Brother Thelonious Belgian Style Abbey 

Ale. Id. ¶ 11. Eduardo emailed Moody a three-part proposal: (1) $350 for the initial sketches of 

Thelonious Monk, to be done in coordination with designer Theresa Whitehall of Colored Horse 

 

1 The Background is a summary of the allegations set forth in the SAC. Dkt. No. 22.

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ORDER GRANTING MOTION TO DISMISS

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(“Whitehall”); (2) $1,150 for the final artwork and “licensing of the image for the beer label”; and 

(3) $1,500 for the original painting, if desired. Id. ¶ 12. Moody emailed Whitehall and asked if 

she was ready to proceed with Eduardo’s proposal. Id. ¶ 13. Whitehall responded, “Absolutely! 

That’s terrific.” Id. ¶ 14. Moody did not respond in writing to Eduardo’s proposal. Id. ¶ 15. 

Nevertheless, Eduardo completed his work and “Eduardo’s beer label was being affixed by North 

Coast Brewing to bottles of Brother Thelonious Abbey Ale” by the end of 2005. Id. ¶ 16. 

By 2006 or 2007, Eduardo and Signorelli had learned that North Coast Brewing had been 

using Eduardo’s artwork “more broadly than even anticipated as a beer label—most specifically 

on various merchandising items—and to promote all of its products by way of Jazz music records, 

concerts, and festivals.” Id. ¶ 17. “Eduardo’s beer label had become a crucial part of North Coast 

Brewing’s corporate identity.” Id. This use of Eduardo’s work “was not part of the parties’ 

anticipation in late 2005 (neither in scope nor extent)—nor could the success of the label and its

subsequent adoption as a form of corporate identity have been predicted.” Id. By 2006 or 2007, 

Eduardo and Signorelli also learned from Moody that Eduardo’s design for the beer label “had 

been singularly instrumental in growing North Coast Brewing from a small local brewery into an 

international presence. This too involved use of Eduardo’s design that far exceeded any 

anticipated use.” Id. ¶ 18. Signorelli further alleges that “[i]n using Eduardo’s design in ways 

that differed from or exceeded any use anticipated by the parties, North Coast Brewing has 

benefitted financially and has deprived Eduardo of financial value that is now rightfully hers.” Id. 

¶ 19.

Later, North Coast Brewing and the Thelonious Monk Institute of Jazz and/or the Monk 

estate reached some type of partnership whereby North Coast Brewing would promote Jazz music. 

Id. ¶ 20. By 2006 or 2007, Eduardo and Signorelli learned that North Coast Brewing had been 

giving the Thelonious Monk Institute of Jazz $1.00 for every case of Brother Thelonious Abbey 

Ale that North Coast Brewing had sold. Id. ¶ 21. Signorelli asked Moody to “make a financial 

arrangement with Eduardo that was fairer,” but was told it was “too late.” Id. ¶ 21.

In 2010-2012, Moody hired Eduardo “to design some merchandising related to Thelonious 

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ORDER GRANTING MOTION TO DISMISS

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Monk “that was separate and discrete from the 2005 work,” although some of this 2010-2012 

work involved “tinkering with the 2005 work to adjust it to merchandise such as Christmas 

ornaments and T-shirts.” Id. ¶ 22. Neither Eduardo nor Signorelli sold the 2010-2012 work to 

North Coast Brewing. Id. ¶ 23. Nevertheless, North Coast Brewing retained and benefitted from 

the 2010-2012 work. Id. 

In 2015, Eduardo passed away. Id. ¶ 24. At the memorial services, Moody acknowledged 

to Signorelli that the “financial arrangements” for Eduardo’s “work” had been “unfair” and 

“promised” to “make this right.” Id. Shortly thereafter Moody told Signorelli that the board of 

North Coast Brewing had said “no” to any compensation for Signorelli. Id. Despite the board’s 

decision, in August of 2016 and again in June 2017, Signorelli “received $2,000 from North Coast 

Brewing by way of the Elk Community Center.” Id. 

In December of 2017, Signorelli obtained copyright registration for Eduardo’s 2005 

“design.” Id. ¶ 26. Signorelli later notified North Coast Brewing “that any consent previously 

given to North Coast Brewing by Eduardo for use of his design on the beer label was immediately 

terminated and revoked, and that North Coast Brewing could no longer use the design without 

entering into a merchandising agreement with her.” Id. ¶ 27. Signorelli similarly notified North 

Coast Brewing that any consent previously given for use of Eduardo’s beer label design or any 

design based on the beer label design for anything else including merchandising items was 

immediately terminated and revoked. Id. Despite the notices, North Coast Brewing has continued 

to use Eduardo’s 2005 design on beer labels and merchandising. Id.

On May 17, 2018, Signorelli initiated the instant suit asserting claims for: (1) copyright 

infringement under federal law; (2) copyright infringement under California law; (3) conversion; 

(4) unjust enrichment/restitution; and (5) breach of express and implied contract, including breach 

of the implied covenant of good faith and fair dealing. Dkt. No. 1. North Coast Brewing moved 

to dismiss the original complaint, arguing, among other things, that it had an implied, nonexclusive, unlimited and irrevocable license to Eduardo’s painting. The court found North Coast’s 

arguments persuasive and granted North Coast Brewing’s motion to dismiss with leave to amend. 

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Dkt. No. 21. 

North Coast Brewing now moves to dismiss the SAC, contending that the sole claim for

copyright infringement fails as a matter of law because North Coast has an irrevocable license; the 

SAC fails to allege that the license was limited so as to bar the marketing efforts about which 

Signorelli complains; and even if the license was limited, the Copyright Act’s Advertising 

Immunity bars Signorelli’s claim.

III. STANDARDS

Federal Rule of Civil Procedure 8(a) requires a plaintiff to plead each claim with sufficient 

specificity to “give the defendant fair notice of what the . . . claim is and the grounds upon which 

it rests.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007) (internal quotations omitted). 

A complaint which falls short of the Rule 8(a) standard may therefore be dismissed if it fails to 

state a claim upon which relief can be granted. Fed. R. Civ. P. 12(b)(6). “Dismissal under Rule 

12(b)(6) is appropriate only where the complaint lacks a cognizable legal theory or sufficient facts 

to support a cognizable legal theory.” Mendiondo v. Centinela Hosp. Med. Ctr., 521 F.3d 1097, 

1104 (9th Cir. 2008). When deciding whether to grant a motion to dismiss, the court must accept 

as true all “well pleaded factual allegations” and determine whether the allegations “plausibly give 

rise to an entitlement to relief.” Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009). The court must also 

construe the alleged facts in the light most favorable to the plaintiff. Love v. United States, 915 

F.2d 1242, 1245 (9th Cir. 1989). 

IV. DISCUSSION

Like the original Complaint, the SAC rests on factual allegations that North Coast has a 

non-exclusive implied license. At issue are (1) the scope of the license and (2) Signorelli’s right, 

if any, to unilaterally revoke the license. 

Scope of License

An implied license is granted when “(1) a person (the licensee) requests the creation of a 

work, (2) the creator (the licensor) makes that particular work and delivers it to the licensee who 

requested it, and (3) the licensor intends that the licensee-requestor copy and distribute his work.” 

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I.A.E., Inc. v. Shaver, 74 F.3d 768, 776 (7th Cir. 1996) (citing Effects Assocs., Inc. v. Cohen, 908 

F.2d 555, 558-59 (9th Cir. 1990)). The scope of an implied license is determined by the licensor’s 

objective intent at the time of the creation and delivery of the copyrighted work as manifested by 

the parties’ conduct. Asset Marketing Systems, Inc. v. Gagnon, 542 F.3d 748, 756 (9th Cir. 2008). 

The burden is on the licensor “to express an intent to... limit...[the] license if he intended to do 

so... [and a] belated statement... [i]s not sufficient....” Id.

Here, Signorelli alleges that Eduardo intended for North Coast Brewing to copy his 2005 

work onto the label to be affixed to North Coast Brewing’s Brother Thelonious Belgian Style 

Abbey Ale “to assist in its identification and marketing.” SAC ¶ 36. Signorelli alleges that the 

scope of the implied license “would have permitted North Coast Brewing to place Eduardo’s 

artwork on a limited number of bottles for limited geographical (i.e., local) distribution.” Id.

Nowhere, however, does Signorelli allege facts to show that Eduardo expressed his intent to North 

Coast Brewing—whether by word or by action—to limit the scope of the implied license in any 

manner. Instead, the allegations from the SAC strongly suggest that Eduardo and North Coast 

Brewing did not discuss any limitations on the implied license because neither party expected 

North Coast Brewing, a small local Mendocino brewery, to become an international success. SAC 

¶ 37. Signorelli alleges that nobody expected the North Coast Brewing to be so successful due in 

large part to Eduardo’s artwork, and “[a]ccordingly any copyright ownership for non-local beer 

label usage remained, and must have remained, exclusively with Eduardo and Joelle.” Id. The 

SAC similarly makes clear that Eduardo and North Coast Brewing did not express any intent to 

preclude use of Eduardo’s 2005 work or merchandise. Signorelli alleges that “[t]he discussion 

between the parties in 2005 had been about a beer label, nothing more. There was no discussion, 

and therefore could be no agreement, with North Coast Brewing about using Eduardo’s work for 

anything aside from a beer label.” SAC ¶¶ 37-38.

The lack of any discussions regarding the scope of the implied license is fatal to 

Signorelli’s claim. The burden was on Eduardo to express an intent to limit the scope of the 

implied license at the time the license was granted. Asset Mktg. Sys., Inc., 542 F.3d at 756. That 

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the parties did not give any thought to North Coast Brewing’s potential future success does not 

negate the requirement that the licensor expressly limit the license. Having failed to express any 

intent to limit the implied license, North Coast Brewing received an unlimited implied license to 

Eduardo’s work “to assist in its identification and marketing” of the Brother Thelonious Belgian 

Style Abbey Ale. See e.g., Castro v. Calicraft Distributors, LLC, No. 14-CV-05226-RS, 2015 WL 

5042225, at *2 (N.D. Cal. Aug. 25, 2015) (granting motion to dismiss because there were “no 

allegations that” any purported “limitation [of the license] was communicated to defendants”);see 

also Beijing Zhongyi Zhongbiao Elec. Info. Tech. Co. v. Microsoft Corp., 655 F. App’x 564, 566 

(9th Cir. 2016) (affirming granting of motion to dismiss, without leave to amend, where face of 

complaint showed no “intent to limit the license’s scope”). 

Advertising Immunity

Moreover, even if the license was limited, which it is not, North Coast Brewing’s use of 

Eduardo’s work in marketing efforts is permitted under Section 113(c) of the Copyright Act, 

which provides as follows:

In the case of a work lawfully reproduced in useful articles that have 

been offered for sale or other distribution to the public, copyright 

does not include any right to prevent the making, distribution, or 

display of pictures or photographs of such articles in connection 

with advertisements or commentaries related to the distribution or 

display of such articles, or in connection with news reports.

17 U.S.C. § 113(c). “A ‘useful article’ is an article having an intrinsic utilitarian function that is 

not merely to portray the appearance of the article or to convey information. An article that is 

normally a part of a useful article is considered a ‘useful article.’” 17 U.S.C. § 101. Applying this 

definition, North Coast Brewing’s beer bottles are “useful articles.” See e.g. Ets-Hokin v. Skyy 

Spirits, Inc., 225 F.3d 1068, 1080 (9th Cir. 2000) (alcohol beverage bottle recognized to be a 

“useful article”). Likewise, the labels, themselves, are useful articles because they are “normally a 

part of” North Coast Brewing’s beer bottles. 17 U.S.C. § 101; see also Major v. Sony Music 

Entertainment, Inc., No. 92-2826 PKL, 1992 WL 210115, at * 3 (S.D.N.Y. August 17, 1992) 

(finding video package cover is a “useful article”). In Major, the defendant was authorized to use 

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the plaintiff’s copyrighted photograph on a video package cover, a useful article. The plaintiff

contended that defendant had exceeded the scope of its licenses by publishing the photograph in 

conjunction with “an advertisement and [by using] and continu[ing] to utilize the [photograph] to 

advertise.” Major, 1992 WL 210115, at *1. The court rejected plaintiff’s argument, reasoning 

that because the photograph was lawfully reproduced as part of the video package cover, 

plaintiff’s copyright did not include the right “prevent the . . . display of . . . photographs of such 

articles in connection with advertisements. . . related to the distribution of such articles.” Id. at *3. 

As in Major, North Coast Brewing’s use of Eduardo’s 2005 artwork in advertising is 

authorized pursuant to section 113(c). Signorelli acknowledges that section 113(c) permits some 

types of advertising, and implicitly concedes that North Coast Brewing may use photographs of its 

beer bottle to advertise in magazines or otherwise. Pl.’s Opp. at 5. Signorelli contends, however,

that section 113(c) does not permit North Coast Brewing to use Eduardo’s artwork on coasters, 

key rings, Christmas ornaments, beer taps and banners to sell other products and services. Pl’s 

Opp. at 5. The argument is unpersuasive because as stated previously, the beer labels themselves 

are “useful articles,” and as such, may be displayed in connection with advertisements that are 

related to the distribution or display of the beer bottle labels or the beer bottles pursuant to section 

113(c). Moreover, branded merchandise is a form of advertising and placing the label design on 

other merchandise or in other promotional materials is a way to advertise North Coast Brewing’s 

beer. 

Signorelli’s reliance on Jones v. Corbis Corp., 815 F. Supp.2d 1108 (C.D. Cal. 2001), 

aff’d, 489 F.App.’x 155 (9th Cir. 2012), is misplaced. In Jones, plaintiff claimed a violation of 

her rights of publicity. In discussing the scope of plaintiff’s consent to the use of her likeness, the 

court stated that its “holding leaves Plaintiff's rights of publicity undisturbed in cases where a 

defendant uses Plaintiff's image to advertise an unrelated product such as a food item or if a 

defendant transforms Plaintiff's image into a separate product.” Id. at 1116. The Jones case did 

not involve copyright infringement, much less advertising immunity under section 113(c), and 

therefore lends no support to Signorelli’s argument.

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Revocable or Irrevocable License

The SAC alleges that North Coast Brewing paid Eduardo for his painting. This payment 

establishes that the implied license is irrevocable. Asset Marketing Sys., Inc., 542 F.3d at 757

(“because [licensee] paid consideration, this license is irrevocable”). 

Reformation

Lastly, Signorelli argues that the injunctive relief she intends to seek includes reformation 

or rescission of the implied license, and that these remedies are not subject to a motion to dismiss.

The argument is baseless. The SAC makes no mention of reformation of rescission. Furthermore, 

because the SAC fails to state a viable claim, Signorelli is not entitled to any remedy. 

V. CONCLUSION

For the reasons set forth above, Defendant’s motion to dismiss is GRANTED. The 

dismissal is without leave to amend because Signorelli has already had three opportunities to plead 

a viable claim. The Clerk shall close the file.

IT IS SO ORDERED.

Dated: June 21, 2019

______________________________________

EDWARD J. DAVILA

United States District Judge

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