Design Furnishings, Inc. v. Zen Path LLC, 2:10-02765 WBS GGH (E.D. Cal. Oct. 20, 2010)
Design Furnishings and Zen Path sold wicker furniture from the same manufacturer on eBay. Zen Path, the defendant, sent a cease and desist to Design Furnishings, the declaratory judgment plaintiff, stating that Design Furnishings’ sale of the furniture infringed Zen Path’s exclusive rights granted under the Copyright and Patent Acts, and that the photos Design Furnishings used to market the furniture on Ebay infringed Zen Path’s copyrights. Design Furnishings stopped using the photos, but continued to sell the furniture.
Zen Path then allegedly sent a series of sixty-three takedown notices to Ebay, claiming that the sale of the furniture infringed its exclusive rights. Zen Path also filed copyright registration applications for four different furniture collections. Zen Path filed the registrations as “sculpture/3-D artwork, Ornamental Design” and attached pictures of the furniture. (A picture of one of the deposits is below.)
Design Furnishings filed an action in state court, which was later removed to federal court, which included claims for (1) misrepresentation of intellectual property infringement in violation of 17 U.S.C. § 512(f) of the Digital Millennium Copyright Act (“DMCA”), (2) tortious interference with a contract, (3) tortious interference with prospective economic advantage, (4) a violation of California’s Unfair Competition Law, Cal. Bus. & Prof. Code §§ 17200-17210, and (5) declaratory and injunctive relief.
17 U.S.C. 512(f) of the DMCA provides, inter alia, that any person who knowingly materially misrepresents that “material or [an] activity is infringing,” “shall be liable for any damages, including costs and attorneys’ fees, incurred by the alleged infringer.” The Court noted, citing Rossi v. Motion Picture Ass’n of Am., Inc., 391 F.3d 1000, 1005 (9th Cir. 2004), that “Liability does not extend to when “an unknowing mistake is made, even if the copyright owner acted unreasonably in making the mistake. Rather, there must be a demonstration of some actual knowledge of misrepresentation on the part of the copyright owner.”
The Court, nonetheless, granted Design Furnishings’ motion for a temporary restraining order that barred Zen Path from issuing additional DMCA takedown notices. The Court found that it could draw an inference of “knowing misrepresentation” from contradictions in the defendant’s copyright registration applications:
Here, defendant’s applications for copyright protection claimed the works were sculptures or 3-D artwork or ornamental designs, indicating that defendant knew the limits of copyright protection. The pictures of the furniture, though, suggest that defendant impermissibly sought protection of the “industrial design” of the furniture. Moreover, the internal contradiction in the applications raises a strong inference that defendant subjectively knew it did not have a copyright infringement claim when it notified eBay. Accordingly, the court finds that plaintiff has a likelihood of success on the merits.