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PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT

SEADOCS:279990.1

1

VANTAGE LAW PLLC

355 NW GILMAN BLVD, SUITE 203

ISSAQUAH, WA 98027

(425) 391-8741

Honorable Mary Alice Theiler

UNITED STATES DISTRICT COURT

WESTERN DISTRICT OF WASHINGTON

AT SEATTLE

PROPET USA, INC.,

Plaintiff,

v.

LLOYD SHUGART

Defendants. 

Case No. C06-0186 MAT

PLAINTIFF’S MOTION FOR 

SUMMARY JUDGMENT

Note for Consideration: 

July 13, 2007

This case involves photographs of shoes. Plaintiff Propet USA, Inc. (“Propet”) 

brings this motion for summary judgment asking the Court to find that Propet is licensed to use the 

photographs Propet paid the defendant Lloyd Shugart (“Shugart”) to take. This motion follows 

Propet’s earlier motion for summary judgment that was denied by the Court. At that time, the Court 

indicated that certain issues raised by Propet were premature because discovery had not closed. 

Propet incorporates herein the exhibits made of record in connection with Propet’s earlier motion.

I. UNDISPUTED FACTS

The undisputed material facts are as follows:

1. On several dates between approximately 1999 through 2005 Shugart was 

retained by Propet to create photographs to be used by Propet in various advertising materials. 

Case 2:06-cv-00186-MAT Document 75 Filed 06/18/07 Page 1 of 7
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PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT

SEADOCS:279990.1

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VANTAGE LAW PLLC

355 NW GILMAN BLVD, SUITE 203

ISSAQUAH, WA 98027

(425) 391-8741

Shugart created many sets of photographs that Shugart delivered to Propet and then Propet used them 

to advertise Propet’s products (“shoes”). See Declaration of Lloyd Shugart ¶ 3, Docket No. 32.

2. Shugart admits that Propet collectively paid Shugart over $100,000 for his 

services. See Shugart’s Answer and Counterclaim ¶ 9, Docket No. 13.

3. According to Shugart, the only written instruments exchanged between 

Shugart and Propet were Shugart’s invoices and a “film delivery memo.” See Declaration of Lloyd 

Shugart ¶¶ 6-7, Docket No. 32.

4. Shugart testified that he delivered film to Propet in a “sealed” package that 

bore a notice indicating that use of Shugart’s film was subject to the terms of the “film delivery 

memo.” See Shugart Deposition Transcript at pp. 123-127 attached as Exhibit B to Kaser 

Declaration, Docket No. 43 (“Shugart Dep.”).

5. Shugart also testified that he mailed the “film delivery memo” to Propet with 

his invoice. Id. at p. 127.

6. Shugart testified that he has no evidence that Propet acknowledged the terms 

of the “film delivery memo” in writing. Id. at pp. 71 and 162.

7. Shugart testified that he could not explain how much extra money he would 

have charged Propet for the unauthorized uses he claims Propet made in violation of Shugart’s “film 

delivery memo,” even if Propet is bound by the memo’s terms. Id. at 106-114.

II. ARGUMENT

As Propet indicated in its earlier motion for summary judgment, this case involves an 

unreasonable assertion of technical rights by a photographer following termination by his client.

a. THE STANDARD FOR SUMMARY JUDGMENT.

Summary judgment may be used to avoid useless, expensive, and time-consuming 

trials where there is no genuine issue of fact remaining to be tried. Summary judgment is not “a 

disfavored shortcut, but rather . . . an integral part of the Federal Rules as a whole, which are 

designed ‘to secure the just, speedy and inexpensive determination of every action.’” Celotex Corp. 

v. Catrett, 477 U.S. 317, 327 (1986) (quoting Fed. R. Civ. P. 1).

Case 2:06-cv-00186-MAT Document 75 Filed 06/18/07 Page 2 of 7
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PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT

SEADOCS:279990.1

3

VANTAGE LAW PLLC

355 NW GILMAN BLVD, SUITE 203

ISSAQUAH, WA 98027

(425) 391-8741

Summary judgment should be granted when there is no genuine issue as to any 

material fact and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c). 

It may be granted when no “reasonable jury could return a verdict for the nonmoving party.” 

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986); see also Matsushita Elec. Indus. Co. v. 

Zenith Radio Corp., 475 U.S. 574, 586–87 (1986) (“[T]he nonmoving party must come forward with 

‘specific facts showing that there is a genuine issue for trial.’”)

b. THE ISSUE

Propet and Shugart had a business relationship that was defined by Propet’s payment 

of Shugart’s invoices coupled with a course of conduct over several years. During the period Propet 

employed Shugart, he was hired to take pictures for Propet’s advertising and Shugart then invoiced 

Propet for his work.

Shugart confirms that the documents memorializing the relationship consist of (1) 

Shugart’s various invoices submitted to Propet from time to time; and (2) Shugart’s purported “film 

delivery memo.” See Declaration of Lloyd Shugart, Docket No. 32. The invoices are routine in form 

and consist of invoices for services rendered. They specify no special terms and conditions nor place 

limits on Propet’s use of Shugart’s shoe photographs. On the other hand, the “film delivery memo,” 

if binding on Propet, imposes numerous terms and conditions. In Propet’s earlier motion, Propet 

contended that these terms and conditions were unreasonable.

The essence of the parties’ claims and counterclaims in this case center on Shugart’s 

contention that the “film delivery memo” is binding on Propet.1 However, Shugart concedes that 

Propet never acknowledged the terms and conditions of the “film delivery memo,” at least in writing,

nor did he specifically ask Propet to acknowledge it. See Kaser Decl., Dkt. No. 43, Shugart Dep. at 

pp. 71 and 162. Therefore, Shugart seeks to impose these terms and conditions by way of the

conduct of the parties. The issue presented to the Court in this motion is as follows:

Can a party create binding contractual terms by submitting film to one person,

indicating that the film is subject to written terms and conditions at the time of film 

1 At first Shugart testified the parties had entered into a contract. This sworn testimony has been 

repudiated by Shugart.

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PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT

SEADOCS:279990.1

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VANTAGE LAW PLLC

355 NW GILMAN BLVD, SUITE 203

ISSAQUAH, WA 98027

(425) 391-8741

delivery, and, rather than obtain written acceptance of the terms, claim 

acknowledgment based on use of the film or independent delivery of written terms 

with the party’s billing invoice?

For the reasons that follow, the answer to the question should be “no.” If so, Propet 

asks the Court to find that (1) Propet has an implied license to use any photographs created by 

Shugart for Propet prior to Propet’s termination of its relationship with Shugart; (2) Propet’s license 

is unrestricted in scope so long as Shugart’s photographs are used in the regular course of advertising 

Propet brand products to the public.

c. PROPET HAS AN IMPLIED LICENSE

There is no question that the lack of documentation between the parties creates a 

situation where Shugart is the technical copyright holder of his photographs. However, in situations 

of this kind, the 9th Circuit has held that Propet stands in the position of a non-exclusive licensee. See

Effects Associates Inc. vs. Larry Cohen et al., 908 F. 2d 555, 558 (9th Cir. 1990).

In Effects Associates, the 9th Circuit found:

Effects created a work at defendant's request and handed it over, intending that 

defendant copy and distribute it.[footnote omitted] To hold that Effects did not at the 

same time convey a license to use the footage in “The Stuff” would mean that 

plaintiff's contribution to the film was “of minimal value,” a conclusion that can't be 

squared with the fact that Cohen paid Effects almost $56,000 for this footage. 

Accordingly, we conclude that Effects impliedly granted nonexclusive licenses to 

Cohen and his production company to incorporate the special effects footage into 

"The Stuff" and to New World Entertainment to distribute the film.

Id. at 558.

The holding in Effects Associates provides no specific guidelines concerning the 

scope of Propet’s implied license other than the general guideline that Propet has an unrestricted 

license to use Shugart’s photos for Propet’s intended purposes. Other courts have followed the same 

general guideline. See Korman v. HBC Fla., Inc., 182 F.3d 1291, 1293 (11th Cir. 1999) (parties 

conduct indicates that jingle writer granted radio station non-exclusive right to continue playing 

jingle following termination of relationship between radio station and jingle writer); Jacob Maxwell, 

Incorporated v. Veeck et al., 110 F.3d 749 (11th Cir. 1997) (songwriter created song at defendant’s 

request and handed a master tape over, intending that defendant play the song at games).

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PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT

SEADOCS:279990.1

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VANTAGE LAW PLLC

355 NW GILMAN BLVD, SUITE 203

ISSAQUAH, WA 98027

(425) 391-8741

Since Shugart’s business invoices place no limits on Propet’s use, and the holding in 

Effects Associates means that Propet is licensed, Shugart independently seeks to impose limits via his 

“film delivery memo.” Shugart can point to no legal authority that imposes these additional terms on 

Propet as a binding contract under the circumstances, even when giving Shugart the benefit of the 

doubt as to the facts.

First, Shugart concedes that he has no written acknowledgment from Propet.

Therefore, in order to bind Propet to the “film delivery memo,” Shugart must necessarily claim that 

Propet is bound because Shugart delivered film to a Propet employee. Shugart has been ambiguous, 

at best, concerning whether he physically delivered the “film delivery memo” to the employee every 

time he delivered film. However, Shugart testified that he mailed it to Propet along with his invoice. 

This course of conduct is not sufficient to bind Propet to the terms of the memo.

The Federal Courts appear to the uniform in holding that state law applies to contract 

terms involving copyright license, unless a federal statute specifically applies to an applicable 

contract term. See e.g., Rano v. Sipa Press Inc., 987 F.2d 580 (9th Cir. 1993) (mere allegation of 

breach of contract does not create federal jurisdiction even if the contract involves copyright). There 

are no federal statutes that apply here with respect to limitations on Propet’s use of Shugart’s 

photographs. Accordingly, under Washington State law, Shugart has the burden of proving that 

Propet accepted the additional terms and conditions of his “film delivery memo.” See Eskay Plastics, 

Ltd. v. Chappell, 34 Wash.App. 210, 214 (1983) (“We hold that the burden of proof of the existence 

of these conditions rests on the party who will benefit therefrom”).

Shugart cannot bind Propet to the “film delivery memo” unless he has evidence that

Propet clearly accepted it. Shugart has no such evidence. Beyond that, there is no fact dispute that 

Shugart handed over photographs for use in Propet’s advertising and was paid for the photographs.

To hold that Shugart did not convey a license to Propet, allowing Propet to make reasonable use of 

what are largely stock photographs of shoes (see Shugart’s Answer and Counterclaims in this Action, 

Exhibit A), would mean that Propet paid Shugart over $100,000 to receive no benefit at all.

Case 2:06-cv-00186-MAT Document 75 Filed 06/18/07 Page 5 of 7
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PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT

SEADOCS:279990.1

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VANTAGE LAW PLLC

355 NW GILMAN BLVD, SUITE 203

ISSAQUAH, WA 98027

(425) 391-8741

III. CONCLUSION

The law is clear that Shugart holds the copyright to his photographs of Propet’s 

shoes, but Propet nevertheless has an ongoing license right to use them. For the foregoing reasons, 

Propet respectfully requests that summary judgment be entered in Propet’s favor, and that the court 

enter the following order:

1. Propet has an implied license to use any photographs created by Shugart for 

Propet prior to Propet’s termination of its relationship with Shugart;

2. Propet’s license is unrestricted in scope, so long as Shugart’s photographs are 

used during the regular course of advertising Propet brand products to the public, and Propet may 

convey Shugart’s photographs to others who advertise Propet brand products and make substantially 

the same use of Shugart’s photographs as Propet; and

3. Shugart’s counterclaims against Propet are dismissed with prejudice;

DATED this 18th day of June, 2007.

VANTAGE LAW PLLC

/s/ Bruce A. Kaser

Bruce Kaser, WSB No. 13532

Vantage Law PLLC

355 N.W. Gilman Blvd., Suite 203

Issaquah, WA 98027

(425) 391-8741

Attorneys for Plaintiff

James Phillips, WSB No. 13186

Miller Nash LLP

4400 Two Union Square

601 Union Street

Seattle, WA 98101 – 2352

Direct: (206) 622 – 8484

Attorneys for Plaintiff

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PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT

SEADOCS:279990.1

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VANTAGE LAW PLLC

355 NW GILMAN BLVD, SUITE 203

ISSAQUAH, WA 98027

(425) 391-8741

CERTIFICATE OF SERVICE

I hereby certify that on the 18th day of June, 2007, I electronically filed 

PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT with the Clerk of the Court, using the 

CM/ECF system which will send notification of such filing to:

Philip P. Mann

MANN LAW GROUP

1420 Fifth Avenue, Suite 2200

Seattle, Washington 98101

mannlaw@comcast.net

phil@mannlawgroup.com

eryn@mannlawgroup.com

DATED this 18th day of June, 2007.

/s/ James L. Phillips

James L. Phillips

Case 2:06-cv-00186-MAT Document 75 Filed 06/18/07 Page 7 of 7