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First off today, Blake Brittain at Bloomberg Law reports that the Seventh Circuit Court of Appeals has upheld a lower court’s decision against awarding attorneys’ fees to a victorious defendant in a copyright infringement lawsuit, even though it agrees the case was “baseless” and “objectively unreasonable.”
The case centers around a pair of wellness stores in Wisconsin. Shortly after being fired from Apple Wellness, David Knott started his own shop, Embrace Wellness. Apple Wellness sued him claiming that the stores were too similar and attempted to claim trademark, trade dress and copyright infringement. Though the copyright claims were quickly dismissed and recognized by the court as unreasonable, the court denied any award of attorneys’ fees related to them.
The reason, according to the lower court, was because they were dismissed so quickly and because the case was filed in good faith. Furthermore, there was no chance of the copyright claims being filed again and the claims were voluntarily dismissed, meaning that there was “no pressure to abandon a meritorious defense and settle” the case. The Appeals Court maintained that there is a “strong presumption” of attorneys’ fees in frivolous cases but felt the lower court was appropriate in denying them here.
Next up today, Judy Greenwald at Business Insurance reports that Hartford Financial Services Group, a company that specializes in business insurance, has won a decision in the Second Circuit Court of Appeals that holds the company does not have to indemnify and defend a fabric retailer that’s accused of copyright infringement.
Spandex House Inc. is being sued by Rex Fabrics for copyright infringement over Spandex’s creation, distribution and sale of fabric designs that Rex claims to have copyrighted. Spandex turned to Hartford, with which it holds a policy, to indemnify and pay for its defense, but the company declined. According to Hartford, the claim has multiple infringement allegations unrelated to advertising, which precludes coverage.
To that end, both the lower court and the Appeals Court agreed, ruling in favor of Hartford. Spandex expressed concern that the case could encourage plaintiffs to rewrite complaints so that they eliminate insurance coverage. The courts, however, did not see that issue here and, instead, sided with the insurance provider in the case.
3: CJEU Says Copyright Protection May Apply to Product Designs if Technical Result Doesn’t Prevent Creative Choice
Finally today, Steve Brachmann at IP Watchdog reports that the Court of Justice of the European Union (CJEU) has issued a decision that says copyright law in the EU may extend to product shapes if the shape is from the author’s creative expression and not from a technical limitation.
The case in question is Brompton Bicycle Ltd. v. Chedech/Get2Get, which pits Brompton against a South Korean company that made similar bicycles theirs. The patent on the folding mechanism for the bike had expired some time ago but Brompton argued that the appearance of the bike was not governed by the technical result achieved and, as such, the imitation bikes were copyright infringements. The CJEU, which received the case from a Belgian court, agreed.
The result of the case leans heavily from a 2018 case DOCERAM v. CeramTech, which looked at industrial design law. That case also found that designs could be protected so long as they were not dictated by a technical function. The CJEU simply applied the same standard to copyright law in the Brompton case.