Wednesday, September 14, 2005

Remedies in Architecture Cases

I know I am "building" up posts on architecture, but I came across an opinion that is so wacky it shouldn't go without comment; and, it raises issues not previously discussed: remedies in architecture cases. The opinion is Palmetto Builders and Designers, Inc. v. Unireal, Inc., 342 F. Supp.2d 468, 473 (D.S.C. 2004), and the relevant part of it is:

"[B]ecause the constructed homes constitute infringing copies of the Plaintiffs copyrighted works, they cannot be lawfully resold without the Plaintiff's permission. Under 17 U.S.C. § 106(3) a copyrighted article may be sold only by the owner of the copyright. Any sale by another party without the owner's permission constitutes an act of infringement. The only exception to this rule exists under 17 U.S.C. § 109(a) which permits the resale of a copyrighted article by a buyer who received a valid non-infringing copy of the work. This is known as the "first sale" doctrine. An infringing copy, therefore, does not fit within the "first sale" doctrine embodied in 17 U.S.C. § 109(a) and cannot be resold without the resale causing an additional act of infringement. The homeowners, the Nickols and Kellers, own houses that are infringing copies. Thus, without express permission by the Plaintiff, any sale of the houses by them - or by any subsequent owner - will constitute an act of infringement for which the copyright owner could bring suit. To fully enforce its rights, the copyright owner would have to bring a new lawsuit every time one of the houses was sold. One of the reasons for equitable relief is to prevent such a multiplicity of lawsuits. For this reason, too, the injunction is not only appropriate but indeed necessary."

There is a heap wrong with this. The suit was for infringement of architectural plans, not the architectural work. Copyright in architectural plans does not give one the right to enjoin construction of a building, ever. The reasons for this hearken back to Baker v. Selden and are also found in Section 113(b). Congress reaffirmed this view in the 1988 Berne implementing legislation committee reports, see S. Rep. No. 352, 100th Cong., 2d Sess. 8 (1988); H.R. Rep. No. 609, 100th Cong., 2d Sess. 50-51 (1988). For the same reasons, monetary relief for infringement of the plans is limited to things like lost license fees; it does not include lost profits from the construction of the building nor defendant's profits from the sale of an infringing structure. If you want those type of remedies you have to sue for infringement of the architectural work.

So the first error in Palmetto is granting relief for infringement of plans that could be granted, if at all, only for infringement of the architectural work. The other error, laughable were it not true (or perhaps even more laughable because it is true), was the court's reference to the hapless homeowners not being able to resell their homes. Resale, the court thought, would be a distribution. Huh? These weren't mobile homes, carted off their mooring and taken to a different site. Distribution of an infringing architectural structure (as compared to the copy of it) is impossible.

38 comments:

Bruce said...

I don't see why movement is necessary for "distribution." If I walk over to your house and sell you an infringing CD, that's distribution even if the CD never leaves your house after that. Sure, I moved the object to get it to your house, but there's no 106 right to keep a copyrighted work immobile; the infringement is in the transfer of ownership to members of the public.

Anonymous said...

Could you post a link to this ruling? I'd love to see it.

William Patry said...

I have provided a link to the opinion in the posting itself. As for Bruce's point, I agree that if I walk over to your house and sell you an infringing CD there is a distribution: I distributed it. The buyer didn't though distribute the copy and if he or she thereafter keeps it in her house and does nothing with it, there is no violation of the Copyright Act: there is no exclusive right against someone who merely possesses an infringing copy.

Bruce said...

Right, but I wasn't talking about the homeowner as buyer, the injunction prohibits resale -- i.e., the homeowner acting as seller. A public distribution under Section 106 occurs "by sale or other transfer of ownership, or by rental, lease, or lending;" there's nothing about movement. Works can be publicly distributed, even if they never leave the warehouse, as long as a transfer of ownership to a member of the public has occurred.

Assuming you are correct that only plans, and not architectural works, are at issue, then it seems to me the houses do not infringe the plans in the same way a cake does not infringe the protected expression in a recipe. However, perhaps I'm missing it, but I don't see anything in the decision indicating that no architectural work is at issue here. If the houses have any non-trivial non-standard features, then aren't they architectural works? If so, then both the plans and the buildings themselves are embodiments -- copies -- of those works, and they can't be distributed to the public without permission.

Perhaps as a policy matter distribution without permission should have been added to Section 120(b), although it seems to be on a different footing than the actions allowed there (alteration and destruction as opposed to sale). But if architectural works are at issue here, then the court's decision appears to be at least plausible.

Anonymous said...

Thanks, I've wondered about the extent of copyright for blueprints.

William Patry said...

Bruce:

The registrations were for plans and that's what the opinion refers to, so no injunction over construction of the house: the same applies to blueprints.

Anonymous said...

"For the same reasons, monetary relief for infringement of the plans is limited to things like lost license fees; it does not include lost profits from the construction of the building nor defendant's profits from the sale of an infringing structure. If you want those type of remedies you have to sue for infringement of the architectural work."

Any way I could get a cite for this?

Bruce said...

I looked up the registration summaries at http://www.copyright.gov and it's more confusing than either of us thought. VA 711-478, the "Wedgewood" plan, has a "retrieval code" of "1", meaning "Architectural works in which the drawings only are being claimed", not "3", which indicates the underlying work is being claimed. VA 1-133-719, the "Newcastle" plan, has a retrieval code of "3." There is a note that the claim is limited to "NEW MATTER: architectural work" by Evans Group. However, the original registration for the Newcastle, in 1999, VA 1-100-941, also is classified as an "architectural work." The court refers to the plaintiff acquiring "exclusive rights" in the "copyrighted architectural plans," but it's unclear to me whether that included the underlying work in the case of the Newcastle. In any event, at the very least, the Wedgewood registration, which was filed in 1995, does not appear to claim an architectural work.

Anonymous said...

Have to disagree with you on this one . . .

First, according to my friends who represented the plaintiff, the copyright at issue WAS in the architectural work, not just the technical drawings.

Second, the basis of the court's decision was the first sale doctrine -- which you do not mention or discuss. As discussed in the opinion, it is settled law that resales of infringing copies are acts of infringement because there has been no "lawful first sale" of the infringing copy. Under the AWCPA, an infringing building is considered a "copy" of the protected work. What the Palmetto Builders court did was to simply apply the first sale doctrine to such "copies" of protected architectural works. What's the flaw this analysis? Should we just ignore the "first sale" cases, or hold that architectural works are to be treated differently from other works (which as you know would violate the legislative history of the AWCPA).

Third, the court did not hold that mere ownership was distribution. What the court noted was that any *future* sale of the houses (and people do tend to sell their houses eventually, y'know) would be an act of infringement, and that an injunction was preferable to a multiplicity of suits. That's hardly groundbreaking; indeed, in CTA4, permanent injunctive relief is practically required if infringement is found and the defendant does not establish that future infringement is impossible. (See the Lyons Partnership v. Morris Costumes case on this).

Fourth, the argument that architectural works must be "movable" to implicate the distribution right is at odds with just about all the AWCPA cases I'm aware of. Constructed buildings are rarely moveable, yet it is clear that under the AWCPA, the sale of an infringing building is an act of infringement. Again, are you suggesting that architectural works must be treated differently than other works? And if so, what of the contrary legislative history?

Is the result in this case harsh? Sure. Does it depart from settled law? Not that I can see.

(Disclosure: I handle a large number of AWCPA lawsuits, and have been making the argument adopted by the Palmetto Builders court for years.)

LKB in Houston

Anonymous said...

Isn't an architectural work a derivative work from the underlying architectural plans? And if so, aren't the Palmetto remedies (other than the injunction against sale)properly directed to the invasion of the derivative right?

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amey said...

Here's hoping you're still getting comment notifications.

Has there been a legal decision regarding blueprints and selling of the houses made with those prints? For example: if I buy blueprints, can i then build and sell multiple houses with that one blueprint? Have there been decisions on similar topics (sewing patterns, etc)? I see building plan sites say "only one house per print" basically, but I don't know if that's a statement that can be legally upheld. If I buy plans or patterns that say "for personal use only" am I violating copyright or contract law if I use that plan to make more than one item for sale? Has there been specific case law related to this?
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