Opinion ID: 709490
Heading Depth: 2
Heading Rank: 4

Heading: The Court's Finding of Willfulness

Text: 71 Lollytogs challenges as well the court's finding of willfulness. As noted above, the district court found that Lollytogs' violation of the Copyright Act was willful and in bad faith, in that Lollytogs deliberately set out to knock ... off Knitwaves' sweaters, and succeeded in doing so. Tr. of proceedings of Sept. 1, 1992, at 2-3. The court found incredible the testimony of Lollytogs' Gindi and Laino that, working from Knitwaves' sweaters, they set out to create a new design, and that it was for this reason that they felt they did not need to consider whether or not Knitwaves' sweaters were copyrighted. The court's finding of willfulness supported both its award of enhanced statutory damages, pursuant to 17 U.S.C. Sec. 504(c)(2), and its award of full attorney's fees. We review the court's finding of willfulness for clear error, with particular deference to determinations of witness credibility. Twin Peaks, 996 F.2d at 1382. 72 Lollytogs contends that, while its designers clearly used Knitwaves' sweaters as models, they intended to copy only the unprotected elements of Knitwaves' designs, and to modify the protected elements sufficiently to avoid infringement. No evidence was adduced, Lollytogs contends, to support the required finding that the defendant had 'knowledge that its actions constitute[d] an infringement.'  N.A.S. Import Corp. v. Chenson Enterprises, Inc., 968 F.2d 250, 252 (2d Cir.1992) (quoting Fitzgerald Publishing Co. v. Baylor Publishing Co., 807 F.2d 1110, 1115 (2d Cir.1986)). Thus, Lollytogs contends, the court's finding was clear error. 73 We cannot agree. To show willfulness, Knitwaves was not required to prove Lollytogs' actual knowledge that it was infringing. Knowledge of infringement may be constructive rather than actual; that is, it need not be proven directly but may be inferred from the defendant's conduct. Id. at 252. [R]eckless disregard of the copyright holder's rights ... suffices to warrant award of the enhanced damages. Id. (quoting RCA/Ariola Int'l, Inc. v. Thomas & Grayston Co., 845 F.2d 773, 779 (8th Cir.1988)); see also Twin Peaks, 996 F.2d at 1382. 74 In challenging the district court's finding of willfulness, Lollytogs relies entirely on the testimony of Gindi and Laino, which the district court expressly rejected as incredible. Given the court's credibility determination and the other evidence--in particular, Lollytogs' admission that it set out to create designs having the same look and feel as Knitwaves' sweaters, its admission that it did not look for copyright notices on the sweaters, and the lack of original artwork by Lollytogs--it was not clearly erroneous for the district court to conclude that Lollytogs, if it did not willfully set out to appropriate Knitwaves' protected designs, at least acted recklessly in disregarding Knitwaves' copyrights. Cf. Twin Peaks, 996 F.2d at 1382 (affirming a finding of willfulness where defendant publisher knew of plaintiff's copyright but contended that it copied in the belief that it was engaging in fair use); N.A.S. Import Corp., 968 F.2d at 253 (similarity of buckle design, in conjunction with close proximity of plaintiff's and defendant's stores, strongly supported finding of knowing appropriation); Fitzgerald Publishing Co., 807 F.2d at 1115 (defendant's position as an experienced publisher gave it constructive knowledge of its infringement).