Court Opinion

ID: 9478534
Source: CourtListenerOpinion
Date Created: 2023-08-05 06:51:39.34287+00
Date Added: 2024-06-11T17:46:29.101837
License: Public Domain

PER CURIAM:
Cream Records, Inc. appeals the district court’s award of damages against Benton & Bowles, Inc. Cream contends that the district court’s determination of the proportion of defendant’s profits attributable to defendant’s infringement of plaintiff’s copyright was clearly erroneous. We review the district court’s apportionment of profits for clear error. See Frank Music Corp. v. Metro-Goldwyn-Mayer, Inc., 772 F.2d 505, 518 (9th Cir.1985).
1. Cream first contends that since Benton & Bowles failed to introduce evidence of costs and of profits not attributable to the infringement, the defendant’s gross revenue from the commercial is the appropriate measure of profits. We agree. Under section 504(b) of the Copyright Act, 17 U.S.C. § 504(b) (1982), “the copyright owner is required to present proof only of the infringer’s gross revenue, and the in-fringer is required to prove his or her deductible expenses and the elements of profit attributable to factors other than the copyrighted work.” Cream met its burden when it introduced evidence establishing that Benton & Bowles was paid $175,872.78 for producing the commercial; the defendant introduced no evidence of either its deductible expenses or the elements of profit attributable to factors other than the infringement. “If the infringing defendant does not meet its burden of proving costs, the gross figure stands as the defendant’s profits.” Frank Music, 772 F.2d at 514 (citing Russell v. Price, 612 F.2d 1123, 1130-31 (9th Cir.1979)), cert. denied, 446 U.S. 952, 100 S.Ct. 2919, 64 L.Ed.2d 809 (1980). Therefore, the correct base for calculating profits attributable to the infringement is $175,872.78.
2. Cream next contends that the district court erred by awarding it only $1750, a mere one percent of Benton & Bowles’ profits. Although the district court’s grounds for apportioning damages are unclear,1 its award of $1750 suggests that it found that the infringing material made a de minimis contribution to the commercial as a whole. The court may have based this conclusion on its earlier finding “that the infringement ‘was minimal,’ consisting principally of a ten-note ostinato, and that the infringing material did not add substantially to the value of the commercial.” Cream Records, Inc. v. Jos. Schlitz Brewing Co., 754 F.2d 826, 828 (9th Cir.1985).
Having carefully reviewed the record, and having examined both the copyrighted material and the infringing commercial, we are unable to sustain the district court’s judgment. While we approve the district court’s earlier finding that “the infringement did not substantially add to the value of the commercial,” id., we think it clear that the amount it contributed was, nevertheless, more than de minimis. The one *670percent award by the district court was therefore clearly erroneous.2
The award of profits is vacated; the case is remanded with instructions that the district court award Cream more than a de minimis portion of the $175,872.78 in profits that Benton & Bowles is deemed to have earned from the commercial.

. Plaintiff also contends that the district court erred by failing to give a reasoned explanation of its apportionment of the defendant’s profits. We are unable to consider Judge Gray’s explanation, if one was in fact offered during the hearing, because the court reporter never filed a reporter’s transcript and cannot be located. We therefore base our understanding of the district court proceedings on the parties’ statements of proceedings filed pursuant to Federal Rule of Appellate Procedure 10(c).

. Our earlier affirmance of an award of one-tenth of one percent of defendant Schlitz’s profits does not preclude us from finding the district court's apportionment of Benton & Bowles’ profits clearly erroneous. That earlier apportionment was based on the total profits Schlitz earned from its nationwide sale of malt liquor, Cream I, 754 F.2d at 828; only a small fraction of those sales were attributable to the infringing commercial. Here, we are dealing with profits derived entirely from the infringing work.