Opinion ID: 2995865
Heading Depth: 2
Heading Rank: 1

Heading: Renewed Motion for Judgment as a

Text: Matter of Law or a New Trial We review the denial of a post-trial motion for judgment as a matter of law de novo but view the evidence in a light most favorable to the nonmoving party. See Am. Nat’l Bank & Trust v. Reg’l Transp. Auth., 125 F.3d 420, 431 (7th Cir. 1997). In applying this de novo standard of review, we evaluate whether any reasonable jury could have reached the same conclusion. See id. If we answer this question affirmatively, then we will not overturn the district court’s denial of the motion. See id. With respect 8 Nos. 01-1744 and 01-2119 to Yang and Liu’s motion for a new trial, we will only overturn the district court’s denial of this motion for an abuse of discretion. See id. Under this standard, “we shall not second-guess the decision of a trial judge that is in conformity with established legal principles and, in terms of its application of those principles to the facts of the case, is within the range of options from which one would expect a reasonable trial judge to select.” Id. (quotation omitted). Yang and Liu do not dispute that Price Waterhouse authorized Yang and the Sky Company programmers to produce a derivative work using the original RevUp32 program. Instead, Yang and Liu contend that contrary to the findings below, the intent of the parties is irrelevant to the question of who owns the copyrights in the derivative work. They assert that even if the parties intended that Price Waterhouse would own the copyrights in the derivative work, Price Waterhouse by law cannot own these copyrights because the derivative work’s authors did not execute a written document assigning ownership of the derivative work to Price Waterhouse pursuant to 17 U.S.C. § 204(a). Section 204(a) provides that “[a] transfer of copyright ownership, other than by operation of law, is not valid unless an instrument of conveyance, or a note or memorandum of the transfer, is in writing and signed by the owner of the rights conveyed or such owner’s duly authorized agent.” 17 U.S.C. § 204(a). Yang and Liu’s reasoning is flawed. Price Waterhouse, as the owner of the copyrights in the original RevUp32 program, possesses the exclusive right to prepare derivative works from this original program. See 17 U.S.C. § 106(2); Stewart v. Abend, 495 U.S. 207, 220, 110 S. Ct. 1750, 109 L. Ed. 2d 184 (1990). Because Price Warehouse possesses such an exclusive right, in order for the Sky Company programmers to have lawfully prepared a deNos. 01-1744 and 01-2119 9 rivative work, the programmers needed authorization from Price Waterhouse to use its original program. See S.O.S., Inc. v. Payday, Inc., 886 F.2d 1081, 1088-89 (9th Cir. 1989). The June 7, 1995 letter agreement authorized Yang to recruit the Sky Company programmers to use its original work to prepare a derivative work. Because the trial court found that the language of the June 7, 1995 agreement was ambiguous, it was appropriate to look at the intent of the parties to determine the scope of the Sky Company programmers’ authorization. The June 7, 1995 letter agreement stated that “[u]pon completion of the project, ALL source code will be given back to Price Waterhouse.” Viewing this language in a light most favorable to Price Waterhouse and CLR, the license agreement provided that Price Waterhouse, not the Sky Company programmers, would obtain copyright ownership of the China RevUp32 program. Further, obtaining copyright protection in the derivative work was beyond the scope of the permissible uses authorized by the June 7, 1995 letter agreement. See 1 NIMMER ON COPYRIGHT § 3.06, at 3-34.26 at 26(1) (2002) (“[T]he right to claim copyright in a noninfringing derivative work arises by operation of law, not through authority from the copyright owner of the underlying work. Nonetheless, if the pertinent agreement between the parties affirmatively bars the licensee from obtaining copyright protection even in a licensed derivative work, that contractual provision would appear to govern.”) (emphasis added); see also Gracen v. Bradford Exch., 698 F.2d 300, 303 (7th Cir. 1983) (stating that “[e]ven if [Gracen] was authorized to exhibit her derivative works, she may not have been authorized to copyright them”). Contrary to Yang and Liu’s argument on appeal, because the Sky Company programmers never had any owner- ship interest in the copyrights in the derivative China 10 Nos. 01-1744 and 01-2119 RevUp32 program, 17 U.S.C. § 204(a) is inapplicable. As the district court explained: While the Copyright Act makes authors of derivative works the presumptive owners of copyright rights in their contribution, it also allows parties to adjust those rights by contract. Here, the jury found that the parties to the letter agreement did just that—agreed that Price Waterhouse would hold the copyright in the derivative work. Because of the ambiguity in the letter agreement, it was necessary and proper for the jury to consider “the parties’ ” intent in entering into the letter agreement in order to determine the respective rights of Price Waterhouse, Yang and the subsequent authors of the derivative work, even though those subsequent authors, the Sky Company Programmers, did not sign the letter agreement. Because the jury found that, pursuant to the June 7, 1995 letter agreement, the parties intended that Price Waterhouse would own the copyrights in the derivative work, we find no error in the district court’s denial of Yang and Liu’s motion for judgment as a matter of law and no abuse of discretion in the district court’s denial of Yang and Liu’s motion for a new trial.3