Hamil Am., Inc. v. GFI, Inc. - 193 F.3d 92 (2d Cir. 1999)

Rule:

To prove infringement, a plaintiff with a valid copyright must demonstrate that: (1) the defendant has actually copied the plaintiff's work; and (2) the copying is illegal because a substantial similarity exists between the defendant's work and the protectible elements of plaintiff's.

Facts:

Hamil America, Inc. and GFI (a Division of Goldtex, Inc.) are companies doing business in the garment industry. Each sells printed fabric to manufacturers that, in turn, create garments for sale to wholesalers or retailers. Hamil America sued GFI, SGS Studio, Inc. and J.C. Penney Company, Inc. for copyright infringement. According to Hamil America, GFI copied one of Hamil America's floral fabric patterns, SGS manufactured garments using the infringing GFI fabric and sold the garments to J.C. Penney, and J.C. Penney sold the garments in its retail stores. Hamil America prevailed at trial and was awarded damages against all three defendants. GFI, SGS, and J.C. Penney appeal the district court's finding of liability for infringement and its calculation of damages. Hamil America cross-appeals the district court's calculation of damages, arguing that the district court should have awarded damages for profits that Hamil America presumably would have earned had other customers not purchased GFI's infringing pattern.

Issue:

Did the district court properly find that GFI Pattern No. 330 infringed Hamil America's copyright for Pattern No. 96?

Answer:

Yes.

Conclusion:

The court concluded the district court reviewed the designs under the appropriate ordinary observer standard. The intended uses of both fabric patterns supported a finding of substantial similarity. The court affirmed the holding of infringement. To prove infringement, a plaintiff with a valid copyright must demonstrate that: (1) the defendant has actually copied the plaintiff's work; and (2) the copying is illegal because a substantial similarity exists between the defendant's work and the protectible elements of plaintiff's. The court concluded that Hamil America "established not simply by a preponderance of the evidence but by . . . clear and convincing evidence that the defendants set out to copy an original design that had been produced by the plaintiff and that had been requested by J.C. Penney." The many similarities between the patterns are probative of copying. The district court did err in excluding an allocation of general overhead expenses in its calculation of profits. The court remanded for recalculation of damages.