Opinion
Case No. 02-60772-CIV-DIMITROULEAS
July 9, 2002
ORDER GRANTING IN PART MOTION FOR PRELIMINARY INJUNCTION
THIS CAUSE is before the Court upon Plaintiff's Motion for Preliminary Injunction [DE 10]. The Court has carefully considered the motion, response, reply, affidavits, deposition testimony, as well as the arguments presented at a hearing held before the undersigned on July 1, 2002, and is otherwise fully advised in the premises. The Court gave the parties until Wednesday morning, July 3, 2002 to attempt to resolve their differences and notify the Court if a settlement is reached. No such notification was made, and the Court now proceeds to enter its ruling.
I. BACKGROUND
Plaintiff, owner of federal copyright for yacht listings and operator of a multiple listing service ("MLS") for yachts, including web-based version that it licensed to yacht brokers, sues Defendants for claims of direct copyright infringement (Count I — IYC, Count II — Bradford); vicarious copyright infringement through the actions of IYC employee Tierney (Count III — IYC); contributory copyright infringement (Count IV — IYC, Count V — Tierney, Count VI — MLS Inc., Count VII — Pazos, Count VIII — FYBA, Count IX — Bradford); tortious interference with contract against IYC, Tierney and FYBA (Count X); false designation under Lanham Act (Count XI — IYC); and breach of contract against Bradford (Count XII).
Defendants are International Yacht Council Limited ("IYC"), Barbara Tierney, MLS Solutions, Inc. ("MLS, Inc."), William Pazos, Florida Yacht Brokers Association, Inc. ("FYBA"), and Bradford Yacht Sales, Inc. ("Bradford").
The complaint alleges that Plaintiff has had a yacht MLS service since 1961, and a computer service with yacht listings since 1982. Plaintiff has the dominant product for yacht listings, with few competitors. Plaintiff further alleges that in 2000, Defendant IYC sought to hire a company to provide a multiple listing service, for which Plaintiff bid. Plaintiff was not chosen for the job, but alleges that IYC's product, launched around August of 2001, ultimately looked very similar and in fact had some of Plaintiff's listings pasted verbatim onto the IYC website. Plaintiff alleges that Defendants infringed on its copyrighted listings by copying them into IYC's new MLS website. In addition to specific examples of copying, Plaintiff also argues that the speed with which FYBA and IYC accumulated over 6,000 listings is further evidence that copying of listings from BUC's website occurred. See Exhibit I to the Complaint.
Defendants MLS Solutions and Pazos are sued as the computer support company and person who put together the IYC website. Plaintiff also alleges that Bradford had licensed Plaintiff's program by license agreement dated October 15, 2001, but breached the agreement by distributing the listing data to IYC, who then put it on the IYC website.
Plaintiff notes that Defendant Tierney is employee of Bradford and President of IYC.
Defendants argue that argue that any information that might have been copied from Plaintiff's website was not a "creative work of authorship" but merely yacht listing information inputted by a broker. The IYC defendants state that the information put on their website by MLS Solutions came from brokers, and to the extent any listings had reference to BUC, that information has been removed (without admitting liability). In addition, IYC argues that BUC does not have proprietary rights in the listings, rather the brokers have them. On the equities, the IYC defendants argue that completely shutting down its website, one of only two competitors to Plaintiff, is a harsh remedy for the few specific violations put forth by Plaintiff.
II. DISCUSSION
In order to obtain a preliminary injunction, Plaintiff must establish the following four elements: (1) a substantial likelihood that the plaintiff will prevail on the merits; (2) a substantial threat that plaintiff will suffer irreparable injury if the injunction is not granted; (3) the threatened injury to plaintiff outweighs the threatened harm the injunction may do to the defendants; and (4) granting the preliminary injunction will not disserve the public interest.
Plaintiff stated at the July 1, 2002 hearing that it seeks to shutdown the IYC website because Plaintiff holds copyrights to all components of its listings, and the evidence shows that Plaintiff's listings were copied onto the IYC website. See Composite Exhibits L and M to the Complaint; Affidavit of Ivan Saltz [DE 50]; Supplemental Affidavit of Ivan Saltz [DE 55].
However, upon a review of the relevant caselaw, Plaintiff's copyright protection in a multiple listing service compilation of factual information is limited to the words used to express attributes of the yachts listed, as factual information itself cannot be protected by copyright.
A. Elements of Copyright Action
To show a prima facie case of copyright infringement, Plaintiff must show (1) that it owns a valid copyright in the MLS listings and (2) that Defendants copied original elements of the MLS listings. See Palmer v. Braun, 287 F.3d 1325, 1329 (11th Cir. 2002). Defendants apparently do not dispute the validity of the Plaintiff's copyright, other than their argument, discussed below, that Plaintiff has no protectable interest in its MLS listings. On the issue of whether Defendants copied Plaintiff's listings, the Court, as discussed above, concludes that copying of the listings did occur. However, additional analysis is required, because simple copying of facts along from a compilation is not an infringing activity.
B. Compilations are Protectable
Congress has specifically authorized copyright protection in a compilation. A compilation is defined as: "a work formed by the collection and assembling of preexisting materials or of data that are selected, coordinated, or arranged in such a way that the resulting work as a whole constitutes an original work of authorship." 17 U.S.C. § 101 (West 2002). The United States Supreme Court has explained that "the statute identifies three distinct elements and requires each to be met for a work to qualify as a copyrightable compilation: (1) the collection and assembly of pre-existing material, facts, or data; (2) the selection, coordination, or arrangement of those materials; and (3) the creation, by virtue of the particular selection, coordination, or arrangement, of an `original' work of authorship." Feist Publications, Inc. v. Rural Telephone Service Co., Inc., 499 U.S. 340, 357, 111 S.Ct. 1282, 1293 (1991). The key factor "in determining whether a fact-based work is an original work of authorship, [courts] should focus on the manner in which the collected facts have been selected, coordinated, and arranged." Id. at 358, 111 S.Ct. at 1294. The Supreme Court held in Feist that a local telephone company's white pages does not satisfy the minimum standards for copyright protections because it was "devoid of slightest trace of creativity". Id. at 362, 111 S.Ct. at 1296.
The law is now clear that industrious collection or "sweat of brow" is an insufficient basis for copyright protection. The theory that investment of time and energy to compile a set of facts entitles a publisher to copyright protection has been rejected by Congress and the Supreme Court. Id. at 352-355, 111 S.Ct. at 1291-92. Thus, Plaintiff's argument that it has spent years refining the process and availability of yacht listings is not relevant to whether their compilation has copyright protection. Rather, the key determination is whether a copyright owner made individual judgment as to the selection of facts to include in a compilation. Warren Pub., Inc. v. Microdos Data Corp., 115 F.3d 1509, 1519 (11th Cir. 1997) ("analysis of the compiler's acts of selection is relevant only to determine whether the compiler exercised any individual judgment that is equivalent to creativity").
Plaintiff argues, and the Court agrees to a certain extent, that an MLS database is protected by copyright. This general question was answered in the positive by the District Court of Maryland in Montgomery County Association of Realtors v. Realty Photo Master Corporation, 878 F. Supp. 804, 810 (D.Maryland 1995), aff'd, 91 F.3d 132 (4th Cir. 1996). In this case, the Court concludes that Plaintiff's BUCnet MLS product is a compilation that is protectable by copyright, because Plaintiff made individual judgments about what facts to include in the listings, and because the listings contain expressive words in addition to facts. See Feist, 499 U.S. at 348, 111 S.Ct. at 1289 ("if the compilation author clothes facts with an original collocation of words, he or she may be able to claim a copyright in this written expression. Others may copy the underlying facts from the publication, but not the precise words used to present them.").
The Court notes that Montgomery County decision was not a case of competing MLS products, and was not decided in the preliminary injunction context. The Court does not rely solely on this decision, for those reasons.
Defendants also argue that it is the brokers rather than Plaintiff that made selections as to what facts to include, and to the extent words are used to describe features of the yachts, those expressions are the brokers' words, not Plaintiff. Although the factual record on this point is not completely developed, Plaintiff rests on the contract provisions in its license agreements with brokers (See Exhibit B to Complaint, ¶ 8 at page 2). This provision states that Plaintiff shall own all rights to photographs and listings provided by the licensee (broker), including copyright to derivative works that Plaintiff may create from the photographs and listings.
C. Were Original Elements Copied?
Plaintiff must still show a substantial likelihood that original elements of its compilation were copied. More specifically, Plaintiff must show "substantial similarity" of its listings with those on the IYC website. Warren, 115 F.3d at 1516-17. As discussed above, the Court concludes that Plaintiff has submitted relevant evidence of substantial similarity of the expressive portions of the listings (i.e. descriptions of yachts or features on a yacht), based in particular upon the listings submitted with the Complaint and the affidavits of Ivan Saltz.
Defendants argue that the merger doctrine precludes a finding of infringement as to the listings. The merger doctrine applies when there are so few ways of expressing an idea that the idea and expression merge, and therefore these few expressions do not receive copyright protection, since such protection would thus extend to the protection of the idea itself. Palmer, 287 F.3d at 1330; Warren, 115 F.3d at 1518 n. 27. In this case, however, the protectable part of Plaintiff's listings are not the facts of yacht specifications, but the descriptive adjectives used to describe the yacht's features. Thus, there are not so few ways of expressing such descriptions as to warrant application of the merger doctrine.
Turning next to the appearance of the respective computer websites and the coordination and arrangement of the facts within Plaintiff's MLS compilation, here the Court follows the standard of "virtual identicality." The Eleventh Circuit has held that in analyzing claims of compilation copyright infringement of nonliteral elements of a computer program, the correct standard is one of "virtual identicality" MiTek Holdings, Inc. v. Arce Engineering Co., Inc., 89 F.3d 1548, 1558 (11th Cir. 1996). Such a standard conveys a level of similarity greater than the "substantial similarity" test. MiTek, 89 F.3d at 1558 n. 24. In this case, this standard applies to the determination of whether the computer arrangement of the compilation information as seen on the screen by the user is virtual identical. Defendant IYC argues that the structure and organization of its listings is not "virtually identical" to Plaintiff's MLS product. This Court concludes that based upon the record before it, Plaintiff has not shown a substantial likelihood of success on this discrete element of its claim. Plaintiff's computer screen appears more lineal and sentence-based, as compared to Defendant's columnar format. This decision influences the remedy that the Court will fashion.
To the extent that IYC also argues that Plaintiff has misused its copyright so as to thwart injunctive relief, such arguments are rejected.
D. Remaining Injunction Elements
Plaintiffs argue that the wholesale copying of its listings has resulted in irreparable injury to its business. The Court agrees that if Defendants website is being offered for free, containing Plaintiffs' copyrighted yacht descriptions, Plaintiffs face a substantial threat that it will likely lose business that will be difficult to calculate. Turning next to the balance of the equities between the parties, the threatened injury to Plaintiffs outweighs the harm to Defendants in removing from their website descriptions copied from Plaintiff. Finally, as to the public interest, though Defendants make a good argument that maintenance of a monopoly disserves the public interest, the breaking of a monopoly cannot be accomplished by copyright infringement. There is no doubt that the information compiled by Plaintiff could have been compiled by Defendants.
Moreover, the Court is concluding that the factual information Plaintiff has collected by the "sweat of its brow" is not protected by copyright. Rather, the descriptive words that are used in the listings to express the quality of a yacht's features are protected by Plaintiff's copyright and license agreements with brokers.
III. CONCLUSION
The Court concludes that Plaintiff has met the four requirements for entry of a preliminary injunction. In fashioning such an injunction, the Court is guided by the legal principle that a work of compilation has minimal copyright protection. Warren, 115 F.3d at 1515, n. 16 ("The Act has created a hierarchy in terms of the protection afforded to these different types of copyrights. A creative work is entitled to the most protection, followed by a derivative work, and finally by a compilation. This is why the Feist Court emphasized that the copyright protection in a factual compilation is `thin.'") citing Feist, 499 U.S. at 349, 111 S.Ct. at 1289. Therefore, the Court enjoins Defendants from copying descriptive expressions from Plaintiff's MLS listings, and orders Defendants to immediately remove such listings from the IYC website.
Accordingly, it is ORDERED AND ADJUDGED as follows:
1. Plaintiffs' Motion for Preliminary Injunction [DE 10] is hereby GRANTED in part;
2. Defendants, their partners, subsidiaries, officers, agents, servants, employees, attorneys and those persons or companies in active concert or participation with them, any of them, be and hereby are preliminarily enjoined from:
a) copying descriptions of yachts or features on yachts from Plaintiff's listings; and
b) maintaining such copies on any website, whether such site is open to the public or only open to licensed users.
3. Defendants, their partners, subsidiaries, officers, agents, servants, employees, attorneys and those persons or companies in active concert or participation with them, any of them, shall immediately seek out and remove any such descriptions of yachts or features on yachts from Plaintiff's listings that are located on any website owned or operated by any of the Defendants;
4. Defendants shall complete this task of seeking out and removing such copyright protected material no later than August 2, 2002;
5. On August 2, 2002, Defendants shall file a compliance report with the Clerk of Court as to how this injunction was complied with, and certify that no infringing material as defined by this Order remains on any website owned or operated;
DONE AND ORDERED in Chambers at Fort Lauderdale, Broward County, Florida, this 9th day of July, 2002.