Court Opinion

ID: 4457509
Source: CourtListenerOpinion
Date Created: 2019-11-20 21:00:29.632935+00
Date Added: 2024-06-11T14:51:26.057808
License: Public Domain

NOT FOR PUBLICATION                           FILED
                    UNITED STATES COURT OF APPEALS                       NOV 20 2019
                                                                      MOLLY C. DWYER, CLERK
                                                                       U.S. COURT OF APPEALS
                           FOR THE NINTH CIRCUIT

GREG YOUNG PUBLISHING, INC., a                  No.    18-55522
corporation,
                                                D.C. No.
                Plaintiff-Appellant,            2:16-cv-04587-SVW-KS

 v.
                                                MEMORANDUM*
ZAZZLE, INC., a California corporation;
DOES, 1-10,

                Defendants-Appellees.

                   Appeal from the United States District Court
                       for the Central District of California
                   Stephen V. Wilson, District Judge, Presiding

                     Argued and Submitted November 6, 2019
                              Pasadena, California

Before: MURGUIA and HURWITZ, Circuit Judges, and GUIROLA,** District
Judge.

      Greg Young Publishing, Inc. (“Young”) brought this copyright-infringement

action against Zazzle, Inc. (“Zazzle”) after discovering its copyrighted images for

      *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
      **
            The Honorable Louis Guirola, Jr., United States District Judge for the
Southern District of Mississippi, sitting by designation.
sale on items on Zazzle’s website. Before trial, Zazzle conceded infringement as to

the thirty-five images remaining at issue, contesting only damages and whether

infringement was willful. The jury awarded Young $460,800 in statutory damages;

in doing so, the jury awarded over $30,000 for five of the works, necessarily finding

willful infringement as to those works. See 17 U.S.C. § 504(c). The district court

reduced the award by $109,700, finding insufficient evidence of willful

infringement. The court also (1) entered, but later vacated, a permanent injunction,

(2) denied Young’s motion for attorney’s fees, and (3) awarded costs to both parties.

We have jurisdiction over Young’s appeal under 28 U.S.C. § 1291. We affirm in

part, reverse in part, and remand.

      1. Recklessness can constitute willful infringement, and can be established

by an infringer’s knowing reliance on obviously insufficient oversight mechanisms.

See Unicolors, Inc. v. Urban Outfitters, Inc., 853 F.3d 980, 992 (9th Cir. 2017);

Friedman v. Live Nation Merch., Inc., 833 F.3d 1180, 1186–87 (9th Cir. 2016).

Zazzle never deviated from, or improved, its oversight system throughout the two-

year period at issue, despite repeated notice of that policy’s ineffectiveness. Zazzle

“knew it needed to take special care with respect to [Young’s] images,” Friedman,
833 F.3d at 1187, but never gave its content-management team a catalogue of those

images provided by Young. Even after Young provided the catalogue, Zazzle

continued to sell products bearing each of the works for which the jury found willful

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infringement. Zazzle also relied on a user-certification process it knew produced

false certifications and took no action to remove a user who had marketed more than

2,000 infringing products. A reasonable jury could find willfulness on this evidence

and we therefore remand for entry of judgment consistent with the jury verdict.

      2. The district court did not abuse its discretion in vacating the permanent

injunction. See Ariz. Dream Act Coal. v. Brewer, 855 F.3d 957, 965 (9th Cir. 2017)

(stating standard of review); see also Liberty Mut. Ins. Co. v. E.E.O.C., 691 F.2d
438, 441 (9th Cir. 1982) (“The law in this circuit is that errors of law are cognizable

under Rule 60(b).” (citing Gila River Ranch, Inc. v. United States, 368 F.2d 354, 356

(9th Cir. 1966))). To obtain injunctive relief, Young was required to demonstrate “a

likelihood of irreparable harm.” Flexible Lifeline Sys., Inc. v. Precision Lift, Inc.,

654 F.3d 989, 998 (9th Cir. 2011) (per curiam). The district court reasonably found

Young’s assertions of irreparable harm grounded “in platitudes rather than

evidence.” See Herb Reed Enters., LLC v. Fla. Entm’t Mgmt., Inc., 736 F.3d 1239,

1250 (9th Cir. 2013).1

1
       Young’s motions for judicial notice concerning alleged continued
infringement are denied. See Bingham v. Holder, 637 F.3d 1040, 1045 n.3 (9th Cir.
2011) (holding that “[t]he content of particular websites on a specified date . . . is
not ‘capable of accurate and ready determination by resort to sources whose
accuracy cannot reasonably be questioned.’”) (quoting Fed. R. Evid. 201 (1974)
(amended Dec. 2011)). On remand, however, the district court is free to consider
“other relevant events that may have intervened.” Lyng v. Nw. Indian Cemetery
Protective Ass’n, 485 U.S. 439, 458 (1988).

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      3. The district court did not abuse its discretion in denying Young’s motion

for attorney’s fees. See Perfect 10, Inc. v. Giganews, Inc., 847 F.3d 657, 665 (9th

Cir. 2017) (stating standard of review). Zazzle conceded infringement of the works

considered by the jury, and Young’s ultimate recovery was only about 16% of the

damages sought at trial. Zazzle obtained summary judgment on eight works. Zazzle

also defeated a summary judgment motion on its Digital Millennium Copyright Act

defense.2

      4. The district court did not err in awarding Zazzle costs pursuant to Rule 68.

Zazzle’s final offer of judgment of $525,000, inclusive of attorney’s fees, is more

favorable than Young’s net recovery, even after the jury’s willfulness finding is

reinstated.3 See United States v. Trident Seafoods Corp., 92 F.3d 855, 859 (9th Cir.

1996).

      AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.

Each party shall bear its own costs.4

2
      In light of our reinstatement of the jury award—and Young’s consequent
increased degree of success on the merits—our decision today is without prejudice
to Young seeking reconsideration of its fee application on remand.
3
      If the district court elects to award fees to Young, it can of course revisit the
Rule 68 issue in light of Young’s ultimate recovery.
4
      Zazzle’s motion to strike portions of Young’s reply brief is denied.

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