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The Copyright Act authorizes only two types of claimants to sue for copyright infringement: (1) owners of copyrights and (2) persons who have been granted exclusive licenses by owners of copyrights. 17 U.S.C.S. § 501(b). Within the first category are both those who hold copyrights on wholly new material and those who hold copyrights on derivative works, based substantially on pre-existing materials. 17 U.S.C.S. § 103(a).
The subject of this case was the alleged copying of a drawing of the copyrighted fictional character Paddington Bear, the central figure in a series of children's books written by Michael Bond. Paddington and Company, Limited ("Paddington"), a British corporation, held all rights to these books, and to the characters therein. In 1975, Paddington entered into an agreement with Eden, an American corporation, granting Eden exclusive North American rights to produce and sell, and to sublicense the production and sale of, a number of Paddington products. This agreement was amended in 1980 to grant Eden the exclusive North American rights to produce and sublicense all Paddington products except books, tapes and records, stage plays, motion pictures, and radio and television productions. At some point between 1975 and 1977 Ivor Wood, the illustrator of the Paddington Bear books, drew a series of sketches ("the Ivor Wood sketches") for the use of Eden and its sublicensees. There is evidence in the record that in July 1980 Eden obtained in its own name U.S. copyright registration certificate No. TXU 50-185 for these sketches as "derivative" works. Using the Ivor Wood sketches as a point of departure, the C.R. Gibson Company ("Gibson"), pursuant to a sublicense from Eden, produced a design for gift wrap that included seven drawings of Paddington Bear ("the Eden/Gibson drawings"). This gift wrap was first published in January 1978. In March 1980, Eden registered the gift wrap design with the Copyright Office as a derivative work. In November 1979, Eden discovered that Florelee Undergarment Co., Inc. (“Florelee”) was selling a nightshirt featuring a print of a bear later found by the district court to be "identical in almost all respects" to one of the Eden/Gibson drawings of Paddington Bear. The nightshirt bore the legend ") Fred Original." After discovering a second nightshirt with the same apparent "knockoff" of the Eden/Gibson drawing Eden filed suit against Florelee in April 1980, alleging both that Florelee had violated Eden's rights under the Copyright Act and that Florelee had made a "false designation of origin" or "false description" of its product, in violation of § 43(a) of the Lanham Act, 15 U.S.C. § 1125(a) (1976), by printing ") Fred Original" on its shirts. Florelee's motion for summary judgment dismissing the copyright claim, and Eden's motion for summary judgment enforcing the Lanham Act claim were granted.
Does Eden have standing to claim copyright infringement as a copyright owner?
Assuming that, upon remand and amendment of the complaint to add its claim based upon the Ivor Wood copyrighted sketch (No. 2 above) derived from pre-existing Paddington Bear drawings (such as No. 1), Eden were found to be the owner of U.S. Copyright No. TXU 50-185, registered July 22, 1980, which covers the Ivor Wood sketch, Eden would be entitled to copyright protection for any novel additions made by this work to the existing copyrighted drawings of Paddington. The fact that Eden apparently did not register this copyright (or the Eden/Gibson copyright) until after Florelee's alleged infringement does not preclude Eden from recovering for infringement of these copyrights occurring before the date of registration. However, Eden's delay in registering the copyrights would preclude it from claiming either attorney's fees or statutory damages.
Similarly, Eden's copyrighted Eden/Gibson drawing (No. 3 above) registered on March 7, 1980, as No. VA 44-638 and the balance of its gift wrap design represent derivative works based on the copyrighted Ivor Wood sketches (including No. 2 above). The Eden/Gibson variations of the Ivor Wood sketch, although too minor to entitle the Eden/Gibson work to claim a different aesthetic appeal, are still original and substantial enough to deserve independent copyright protection. The numerous changes made by Gibson -- the changed proportions of the hat, the elimination of individualized fingers and toes, the overall smoothing of lines -- combine to give the Eden/Gibson drawing a different, cleaner "look" than the Ivor Wood sketch on which it is based. Such a contribution satisfies the minimal requirements of originality for registration under the Copyright Act.