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`Case 2:17-cv-03923-SMB Document 71 Filed 04/10/19 Page 1 of 15
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF ARIZONA
`
`No. CV-17-03923-PHX-SMB
`
`ORDER
`
`
`Suzanne Powers,
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`Plaintiff,
`
`v.
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`Caroline's Treasures Incorporated, Ronald D
`Rutherford, Jr., and Walter Dennis Knight,
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`Defendants.
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`
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`At issue is Defendants’ Motion for Summary Judgment (Doc. 43, “Mot.”). Plaintiff
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`responded to the motion (Doc. 53, “Resp.”), and Defendants replied. (Doc. 60). For the
`reasons that follow, Defendants’ motion is denied in part and granted in part.
`I.
`Background
`Suzanne Powers (“Powers” or “Plaintiff”) created 56 drawings entitled “Dogs of the
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`West aka Dog Country” in 1997 and 1998. In 2002, Powers entered into an agreement with
`Caroline Treasure’s, Inc. (“CTI”) to license these works for use on CTI’s products for two
`years (the “2002 License”). (Resp. at Exh. B). CTI is an Alabama Corporation that retails
`home items. (Doc. 31 ¶ 64). Defendants Ronald Rutherford (“Rutherford”) and Walter
`Knight (“Knight”) are officers of CTI. (Doc. 31 ¶¶ 65–66). The 2002 License included a
`clause that said the agreement could be renewed in one-year increments if both parties
`agreed. (Resp. at Exh. B). The 2002 License ended on May 29, 2004.
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`Nevertheless, after the license expired, the parties stayed in contact and Defendants
`continued to use Plaintiff’s works and their business relationship continued under the same
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`terms. (Mot. at 4; Resp. at 1). In November 2006, Powers and CTI entered into a new two-
`year licensing agreement (the “2006 License”). The 2006 License had a same renewal
`clause as the 2002 License. (Resp. at Exh. D). When the license lapsed in November 2008,
`CTI continued selling licensed products. (Mot. at 5). In November 2009, Powers contacted
`CTI requesting a payment for royalties, which CTI paid by check. (Id.). In the memo line
`for that check, it noted it was for royalties from October 2008 to October 2009.
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`The parties present different characterizations of their business relationship between
`2002 and 2009. Defendants argue that it was established practice that they would pay
`Powers royalties whenever she requested. (Mot. at 3–6). Powers argues this was a constant
`frustration for her, and she attaches emails from 2003, 2004, and 2007 asking for payment.
`(Resp. at 9, Exh. E, F, G). In a May 30, 2007, email, Powers wrote, “If you are not going
`to send me what is owed on a timely basis without me hounding you . . . I wish to terminate
`our relationship . . . .” (Resp. at Exh. F). A week later, she seems to walk back her demand
`in another email: “I would like to not have to ask to be paid, that’s all. As far as pulling the
`designs, that is up to you. As long as you don’t disappear into the night on me!” (Resp. at
`Exh. G).
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`Powers claims she thought the agreement lapsed November 26, 2008, and
`Defendants would stop selling her works at that point. (Resp. at Declaration of Suzanne
`Powers, “Powers Decl.,” ¶ 14). She further alleges that even though the last check for her
`royalties went through “Oct. 2009,” she thought it was just for October 2008 and November
`2008, the last two months of the license agreement. (Id. ¶¶ 15–16). She alleges she only
`found out about the continued use of her images in June 2017 and immediately contacted
`CTI. (Id. ¶ 21). When she contacted CTI at that time, they sent her a check for post-October
`2008 royalties. (Mot. at 8, Exh. M-1). She did not deposit the check, because she “decided
`to look into a lawsuit.” (Id. at M-1).
`Defendants argue that Powers impliedly consented to continuing the license by
`following the same course of conduct that followed the 2002 License’s lapse. Plaintiff
`contends that she believed their business relationship was over once the 2006 License
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`ended and Defendants continuing to sell past the expiration date of the 2006 License
`constitutes breach of contract and copyright infringement. Powers also alleges violations
`of the Digital Millennium Copyright Act. Pub. L. No. 105-304, 112 Stat. 2860 (1998)
`(codified in scattered sections of Title 17). Powers alleges she sent all 56 of the copyrighted
`works to Defendants digitally with her signature and the copyright symbol (©), which
`constitutes copyright management information (“CMI”) under 17 U.S.C. § 1202. (Resp. at
`5). When the images were posted online to sell the goods, the signature and copyright
`symbol were not shown. Defendants say they posted the images as they received them and
`did not remove a signature or copyright symbol, and they provide website archives from
`June 2002 through April 2004 and June 2004 through May 2006 that show the images
`without a signature or copyright symbol on their website and crediting Powers as creating
`the artwork. (Reply at 2; Doc. 56). Powers notes that when she saw her images replaced
`with a new background on various websites in June 2017, none of the sites credited her and
`instead had references to Caroline’s Treasures. (Resp. at 6, Exh. H).
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`Defendants also raise a statute of limitations defense. Defendants believe Powers
`was on notice that they were continuing to use the images based on their previous business
`dealings and the royalty check noting it went through October 2009. Thus, any damages
`that accrued more than three years prior to filing suit are time-barred. Additionally,
`Defendants believe Knight and Rutherford should be granted summary judgment on the
`breach of contract claim even if CTI is not, because only the corporate entity is liable. The
`Court will take each argument in turn.
`II.
`Legal Standard
`Summary judgment is appropriate when “there is no genuine dispute as to any
`material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P.
`56(a). A material fact is any factual issue that might affect the outcome of the case under
`the governing substantive law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
`A dispute about a fact is “genuine” if the evidence is such that a reasonable jury could
`return a verdict for the nonmoving party. Id. “A party asserting that a fact cannot be or is
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`genuinely disputed must support the assertion by . . . citing to particular parts of materials
`in the record” or by “showing that materials cited do not establish the absence or presence
`of a genuine dispute, or that an adverse party cannot produce admissible evidence to
`support the fact.” Fed. R. Civ. P. 56(c)(1)(A), (B). The court need only consider the cited
`materials, but it may also consider any other materials in the record. Id. 56(c)(3). Summary
`judgment may also be entered “against a party who fails to make a showing sufficient to
`establish the existence of an element essential to that party’s case, and on which that party
`will bear the burden of proof at trial.” Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986).
`Initially, the movant bears the burden of demonstrating to the Court the basis for the
`motion and “identifying those portions of [the record] which it believes demonstrate the
`absence of a genuine issue of material fact.” Id. at 323. If the movant fails to carry its initial
`burden, the nonmovant need not produce anything. Nissan Fire & Marine Ins. Co. v. Fritz
`Cos., 210 F.3d 1099, 1102–03 (9th Cir. 2000). If the movant meets its initial responsibility,
`the burden then shifts to the nonmovant to establish the existence of a genuine issue of
`material fact. Id. at 1103. The nonmovant need not establish a material issue of fact
`conclusively in its favor, but it “must do more than simply show that there is some
`metaphysical doubt as to the material facts.” Matsushita Elec. Indus. Co. v. Zenith Radio
`Corp., 475 U.S. 574, 586 (1986). The nonmovant’s bare assertions, standing alone, are
`insufficient to create a material issue of fact and defeat a motion for summary judgment.
`Liberty Lobby, 477 U.S. at 247–48. Additionally, the Ninth Circuit “has refused to find a
`‘genuine issue’ where the only evidence presented is ‘uncorroborated and self-serving’
`testimony.” Villarimo v. Aloha Island Air, Inc., 281 F.3d 1054, 1061 (9th Cir. 2002)
`(quoting Kennedy v. Applause, Inc., 90 F.3d 1477, 1481 (9th Cir. 1996)). “If the evidence
`is merely colorable, or is not significantly probative, summary judgment may be granted.”
`Libberty Lobby, 477 U.S. at 249–50 (citations omitted). However, in the summary
`judgment context, the Court believes the nonmovant’s evidence, id. at 255, and construes
`all disputed facts in the light most favorable to the nonmoving party, Ellison v. Robertson,
`357 F.3d 1072, 1075 (9th Cir. 2004). If “the evidence yields conflicting inferences
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`[regarding material facts], summary judgment is improper, and the action must proceed to
`trial.” O’Connor v. Boeing N. Am., Inc., 311 F.3d 1139, 1150 (9th Cir. 2002).
`III. Analysis
`1. The DMCA Claim Under 17 U.S.C. § 1202(b)—Removal of CMI
`Section 1202(b) states:
`No person shall, without the authority of the copyright owner or the law—
`(1) intentionally remove or alter any [CMI],
`(2) distribute or import for distribution [CMI] knowing that the [CMI] has
`been removed or altered without authority of the copyright owner . . .
`knowing or . . . having reasonable grounds to know that it will induce,
`enable, facilitate or conceal an infringement of any right under this title.
`CMI is “information conveyed in connection with” a work. 17 U.S.C. § 1202(c). It
`includes the name of and identifying information about the author of a work. Id.
`§ 1202(c)(2). Powers alleges Defendants removed her signature and a copyright symbol
`from the copyrighted works and replaced them with a notation that said “Caroline’s
`Treasures.” She argues this constitutes two DMCA violations regarding CMI—one for
`removing her CMI and one for adding false CMI.
`Neither party has submitted the original images, which were sent electronically to
`the Defendants in 2002.1 The only evidence Powers presented that her signature and a
`copyright symbol were on the images when Defendants received them is her statement that
`it was her business practice to put them on her copyrighted works. (Resp. at 5; Powers
`Decl. ¶ 5). Defendants do not contest that a signature and copyright symbol are CMI.
`Rather they allege they received the images without the signature and copyright symbol on
`them. Therefore, they could not have removed them. Defendants have also presented
`website archives showing the alleged CMI missing from the images they posted on their
`store website while the licensing agreement was still in place. (Mot. at Exh. M-4 & M-5).
`
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`1 In Plaintiff’s Response, Exhibit C contains the copyrighted works. They contain her
`signature and a copyright symbol on each page. She does not allege that Exhibit C is the
`form in which Defendants received the works, but rather that it is her business practice to
`display her signature with a copyright symbol on the bottom right-hand portion of her
`artwork. (Resp. at 5).
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`They argue this shows both that the CMI was not there when Powers gave them the images
`and, even if it was, it was removed at a time when a licensing agreement was in place.
`Therefore, it was not removed with the intent to induce, enable, facilitate, or conceal
`infringement.
`Initially, Defendant Knight gave a conflicting account of how Defendants received
`the images. In a declaration, he said that CTI received the images with Powers’ signature
`on them. (Mot. at Exh. 2 ¶ 14). In the same declaration he said the images filed by Powers
`in this action “differ from the images CTI received from Powers in that CTI’s images did
`not have any copyright symbol or Powers’ signature.” (Id. at ¶ 15). Defendants’ were later
`granted leave to file a corrected declaration, (Doc. 61), where they removed the portion of
`paragraph 14 that said each image had Powers’ signature on it, (Doc. 62). Knight’s initial
`declaration was also different than Defendant Rutherford’s. Rutherford declared CTI
`received the images with no identifying information other than an electronic file name.
`(Mot. at Exh. 3 ¶¶ 20–22).
`The Court agrees with Defendants that Powers cannot show a genuine issue of
`material fact regarding whether her signature and a copyright symbol were on the images
`when they received them and will grant summary judgment regarding Powers claim that
`Defendants removed CMI from the protected images. In order for a plaintiff to prove a
`defendant removed her CMI, she must be able to show it was originally “conveyed in
`connection with” the protected work. 17 U.S.C. § 1202(c); Personal Keepsakes, Inc. v.
`Personalizationmall.com, Inc., 975 F. Supp.2d 920, 927–29 (N.D. Ill. 2013). A number of
`courts have held that for CMI to be protected, it must be near, around, or on the original
`work. Personal Keepsakes, 975 F. Supp. 2d at 929 (collecting cases).
`Beyond merely removing CMI, the statute also has a “knowing” or “intent”
`requirement for a defendant to be liable. 17 U.S.C. § 1202(b); see Chevrestt v. Am. Media,
`Inc., 204 F. Supp. 3d 629, 632 (S.D.N.Y. 2016) (applying 17 U.S.C. § 1202(b)) (“Since
`there are not factual allegations supporting an inference that [Defendant’s] CMI alteration
`or removal was done intentionally, [Defendant’s] motion to dismiss the DMCA claim is
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`granted[.]”); see also Lenz v. Universal Music Corp., 815 F.3d 1145, 1157 (9th Cir. 2015)
`(comparing a different section of the DMCA with a “knowingly” requirement to an
`intentional tort). The CMI must be removed “intentionally,” with the remover “knowing,
`or . . . having reasonable grounds to know, that it will induce, enable, facilitate, or conceal
`an infringement.” 17 U.S.C. § 1202(b)(1).
`Both Knight and Rutherford have submitted declarations attesting that Defendants
`received the images without Powers’ signature or copyright symbol. They have also
`submitted website archives from June 2002 through April 2004 and June 2004 through
`May 2006 that show Powers’ images for sale without a signature or copyright symbol.
`Powers does not object to the use of the archived website and, in fact, even used those
`exhibits to argue for her preferred outcome during oral argument. The archived website
`also shows that, if they did remove CMI, it was done years prior to the alleged
`infringements while they had a valid license to use the images, which undercuts any
`allegation that the alleged CMI was removed to induce, enable, facilitate, or conceal
`infringement. The Court finds Defendants’ evidence, particularly the images that
`corroborate their statements that they received the images without her signature or a
`copyright symbol, persuasive and meets the burden of establishing that there is no genuine
`issue of material fact regarding whether Defendants removed CMI knowing that it would
`induce, enable, facilitate, or conceal infringement.
`Defendants have met their burden, thus shifting the burden to Powers to establish
`there is a genuine issue of material fact. Powers fails to do so because she has provided
`nothing more than bare assertions and uncorroborated, self-serving evidence to refute
`Defendants’ evidence. Powers contends that she sent the original images to Defendants
`with images that contained her signature and a copyright symbol because it was her
`business practice to include that on her artwork. Specifically, she said, “To the best of my
`knowledge, because it was always my standard practice, I included my CMI on all 56 of
`the Copyrighted Works when I originally sent Defendants my artwork pursuant to the 2002
`License.” (Powers Decl. ¶ 5). She also attaches the 56 images to her response as Exhibit C.
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`Those images have her signature and a copyright symbol on each of them, but she does not
`even go as far as to say that she sent the images as those same files. Instead, she relies on
`it being her standard practice to add a signature and copyright symbol.
`Defendants object to her testimony as inadmissible habit evidence. Even assuming
`it is admissible, however, it amounts to nothing more than uncorroborated, self-serving
`evidence. Uncorroborated, self-serving evidences is not enough for a court to “find a
`genuine issue.” Villarimo, 281 F.3d at 1061 (internal quotations omitted). Additionally,
`“bare assertions” are not enough to create a material issue of fact. Liberty Lobby, 477 U.S.
`at 247. Powers has simply not presented significantly probative evidence to prevent
`summary judgment on the 17 U.S.C. § 1202(b) claim.
`2. The DMCA Claim Under 1202(a)—False CMI
`Plaintiff asserts a falsification claim under § 1202(a), which requires Plaintiff to
`establish that Defendants “knowingly and with the intent to induce, enable, facilitate, or
`conceal infringement—(1) provide[d] copyright management information that is false, or
`(2) distribute[d] or import[ed] for distribution copyright management information that is
`false.” 17 U.S.C. § 1202(a). Powers alleges that when she discovered her copyrighted
`works being advertised and sold on third party websites, the works “contained a notation
`which read ‘Caroline’s Treasures.’” (Resp. at 7–8). She says this constitutes replacing her
`CMI with false CMI knowing that it “would induce, enable, facilitate, and/or conceal the
`infringements of Powers’ Copyrighted Works.” (Resp. at 8). She attaches screenshots of
`websites where Caroline’s Treasures sold products, such as Alibaba, Ebay, and Amazon,
`that show Caroline’s Treasures as a seller and put it in the description of the item for sale.
`(Resp. at Exh. H).2 Powers argues the “Caroline’s Treasures” notation constitutes false
`CMI.
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`2 For example, one item in Exhibit H is listed on Alibaba as “Carolines [sic] Treasures
`SP5222GF Basset Hound Dog Country Lucky Horseshoe Flag – Garden Size, 11 x 15 in.”
`Another listing on Amazon leaves out “Carolines Treasures” (though some Amazon
`listings include it) but it says, “Labrador Yellow Dog Country Lucky Horseshoe Ultra
`Beverage Insulators for slim cans SP5202MUK.” The Amazon listings have “by Carolines
`Treasures” underneath them.
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`Section 1202 provides eight different definitions for CMI, and Powers does not
`explain which one she believes the Caroline’s Treasures “notation” falls under. CMI is
`defined as:
`(c) Definition.--As used in this section, the term “copyright management
`information” means any of the following information conveyed in
`connection with copies or phonorecords of a work or performances or
`displays of a work, including in digital form, except that such term does not
`include any personally identifying information about a user of a work or of a
`copy, phonorecord, performance, or display of a work:
`(1) The title and other information identifying the work, including the
`information set forth on a notice of copyright.
`(2) The name of, and other identifying information about, the author
`of a work.
`(3) The name of, and other identifying information about, the
`copyright owner of the work, including the information set forth in a
`notice of copyright.
`(4) With the exception of public performances of works by radio and
`television broadcast stations, the name of, and other identifying
`information about, a performer whose performance is fixed in a work
`other than an audiovisual work.
`(5) With the exception of public performances of works by radio and
`television broadcast stations, in the case of an audiovisual work, the
`name of, and other identifying information about, a writer, performer,
`or director who is credited in the audiovisual work.
`(6) Terms and conditions for use of the work.
`(7) Identifying numbers or symbols referring to such information or
`links to such information.
`(8) Such other information as the Register of Copyrights may
`prescribe by regulation, except that the Register of Copyrights may
`not require the provision of any information concerning the user of a
`copyrighted work.
`17 U.S.C. § 1202(c). Of these definitions, the Caroline’s Treasures notation only seems to
`be a plausible fit for the first three definitions—the title of the work, the name of the author,
`the copyright owner of the work, or other information identifying the work.
`
`The Court is persuaded that there is a factual dispute about whether the Caroline’s
`Treasures notation is CMI. CMI must be info “conveyed in connection with” a work. This
`does not necessarily mean CMI must be placed directly upon or affixed to a copyrighted
`work, but the location of information can determine what it refers to or whether an alleged
`infringer lacked the required intent. Banxcorp v. Costco Wholesale Corp., 723 F. Supp. 2d
`596, 611 (S.D.N.Y. 2010). A number of courts have held that for CMI to be protected, it
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`must be near, around, or on the original work. Personal Keepsakes, 975 F. Supp. 2d at 929
`(collecting cases). The notation to Caroline’s Treasures is not on the works in question. It
`is off to the side or underneath and appears to be part of the product description, but it could
`be interpreted as conveying the title, name of the author, or owner of the work.
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`Where “Caroline’s Treasures” appears in relation to the work is not consistent. In
`the dozens, perhaps hundreds, of listings provided by Powers, it often appears in the same
`line as words that describe the products being sold. Sometimes, such as when “by
`Caroline’s Treasures” appears on the Amazon listings, it appears to communicate nothing
`more than who is selling the item. At other times, “Caroline’s Treasures” appears in the
`title of the item. A viewer of the work could interpret “Caroline’s Treasures” as title, author,
`or owner of the work.
`
`Additionally, though the haphazard manner in which “Caroline’s Treasures” was
`added to the listings makes the Court doubt that Defendants had the intent required by
`§ 1202(a), the Court cannot say so conclusively. See ICONICs, Inc. v. Massaro, 192 F.
`Supp. 3d. 254, 273 (D. Mass. 2016) (explaining that “questions of intent” are “best left for
`a jury”) (citing Hodgens v. Gen. Dynamics. Corp., 144 F.3d 151, 167 (1st Cir. 1998). On
`some pages of listings provided by Powers, “Caroline’s Treasures” does not appear at all.
`On some, it only appears in the product listing, and on others it is in the product listing in
`addition to Caroline’s Treasures being listed as the seller. Defendants were using “Dog
`Country,” the same name they used when the parties signed the first licensing agreement
`in 2002. If Defendants really were intentionally trying to induce, enable, facilitate, or
`conceal infringement, it would be a strange choice to retain the name that they used when
`they first began their business relationship with Powers. Nevertheless, that is a factual issue
`for a jury to resolve and the Court will not grant summary judgment with regard to
`Plaintiff’s false CMI claim.
`3. Breach of Contract and Implied License
`Defendants contend that the parties’ established course of conduct and their
`payment of royalties after the expiration of the 2006 License establish that they had an
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`implied license to continue using Powers’ drawings and did not breach the agreement. “A
`copyright owner may grant a nonexclusive license expressly or impliedly through
`conduct.” Field v. Google, Inc., 412 F. Supp. 2d 1106, 1115 (D. Nev. 2006) (citing Effects
`Assocs., Inc. v. Cohen, 908 F.2d 555, 558–59 (9th Cir. 1990). “Consent to use the
`copyrighted work need not be manifested verbally and may be inferred based on silence
`where the copyright holder knows of the use and encourages it.” Id. (emphasis added).
`Some courts have called the implied consent doctrine “narrow” and required a defendant
`to “prove there was a meeting of the minds.” Ulloa v. Universal Music & Video Distrib.
`Corp., 303 F. Supp. 2d 409, 416 (S.D. N.Y. 2004) (citing SmithKline Beecham Consumer
`Healthcare, L.P. v. Watson Pharmaceuticals, Inc., 211 F.3d 21, 25 (2d Cir. 2000)). The
`Ninth Circuit has found implied license when a party creates a work at the request or in
`partnership of the defendant. Effects Assocs., 908 F.2d at 558; Oddo v. Ries, 743 F.2d 630,
`632 (9th Cir. 1984).
`As Ulloa notes, the “meeting of the minds” issue must be addressed under state
`contract law. See also Foad Consulting Group, Inc. v. Azzalino, 270 F.3d 821, 827 (9th Cir
`2001) (“Thus, so long as it does not conflict with the Copyright Act, state law determines
`whether a copyright holder has granted [an implied copyright] license.”). The parties did
`not have a choice-of-law provision in their licensing agreement, but they agreed at oral
`argument that Arizona law applies when interpreting the agreement.3 Therefore, whether
`the course of conduct established that Powers conveyed an implied license and whether
`Defendants breached the contract are essentially the same analysis.
`The Court is not convinced by Defendants’ argument that the facts show they are
`entitled to an implied license as a matter of law. “The terms of a contract may be expressly
`stated or may be inferred from the conduct of the parties.” Beaudry v. Insurance Co. of the
`
`3 This comports with our precedent. “A federal court ordinarily applies the choice-of-law
`rules of the state in which it sits.” Consul Ltd. v. Solide Enter., 802 F.2d 1143, 1146 (9th
`Cir. 1986). Arizona applies the “most significant relationship” test from the Restatement
`(Second) of Conflict of Laws. See Bates v. Super. Ct., 749 P.2d 1367, 1369 (Ariz. 1988).
`Under this test, the law of the state that has the most significant relationship to an issue will
`apply to that issue. Id. Plaintiff lived here when she entered into the agreement to license
`the copyrighted works, lives here now, and received payments to her Arizona address.
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`West, 50 P.3d 836, 839 (Ariz. Ct. App. 2002). “The general rule is that the determination
`whether in a particular case a promise should be implied in fact is a question of fact. Where
`reasonable minds may draw different conclusions or inferences from undisputed
`evidentiary facts, a question of fact is presented.” Wagenseller v. Scottsdale Memorial
`Hosp., 710 P.2d 1025, 1038 (Ariz. 1985) (internal citations omitted), superseded in other
`respects by A.R.S. § 23-1501.
`Here, both the 2002 License and 2006 License had the same renewal clause, which
`allowed renewal in one-year increments if both parties agreed. Prior to the last expiration,
`there had only been one previous lapse. During that time, the parties continued in the
`normal course of business before re-upping the contract a little over two years later.
`Moreover, during the second license, Powers expressed frustration with the contract and
`threatened to terminate the relationship. After the 2006 License lapsed, Defendants heard
`from Powers only one or two times, the last time being in November 2009. After that, there
`was no contact between the parties for almost eight years. Reasonable minds could draw
`different conclusions about whether the parties agreed to renew their contract after the 2006
`License lapsed. Therefore, summary judgment is not granted to Defendants on this claim.
`4. Notice and Statute of Limitations for the Copyright Claims
`Defendants argue Powers is barred by the statute of limitations from collecting any
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`damages that occurred more than three years prior to the commencement of this suit. See
`17 U.S.C. § 507(b). Powers argues the statute of limitations was tolled until she discovered
`the allegedly infringing products in June 2017. Defendants counter that Powers was on
`notice because it was unreasonable that she would not be aware of the continued use of her
`copyrighted works. For the reasons below, the Court finds that summary judgment is
`precluded by factual disputes.
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`“A cause of action for copyright infringement accrues when one has knowledge of
`a violation or is chargeable with such knowledge.” Roley v. New World Pictures, Ltd., 19
`F.3d 479, 481 (9th Cir. 1994). The “general rule” is that a “‘plaintiff’s right to damages is
`limited to those suffered during the statutory period for bringing claims.’” Polar Bear Prod.
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`v. Timex Corp., 384 F.3d 700, 706 (9th Cir. 2004) (quoting Los Angeles News Serv. v.
`Reuters Television Int’l, 149 F.3d 987, 992 (9th Cir. 1998)). A plaintiff’s claim will not
`accrue if her “lack of knowledge was reasonable under the circumstances.” Id. If a plaintiff,
`however, could have learned of a cause of action “by reasonable diligence,” the statue of
`limitations is not tolled. Id. (quoting Taylor v. Meirick, 712 F.2d 1112, 117 (7th Cir. 1983)).
`
`Defendants argue Powers knew or should have known of her potential claims as
`early as November 2009 when she received the check for royalties that noted they were for
`October 2008 to October 2009. She also was aware of how Defendants treated the previous
`lapse in the licensing agreement. Defendants seemingly have continued selling the
`copyrighted works since the 2006 License lapsed in 2008 without a change in their business
`name nor in what they called the product. They argue that through reasonable diligence,
`Powers would have learned of the alleged infringement.
`
`Plaintiff presented evidence that she believed the last check only constituted
`payment for the end of the license term and she believed that the agreement was terminated.
`Her evidence is supported by her changed behavior after the 2006 License lapsed, as she
`did not continue requesting payment from Defendants after November 2009. The question
`of whether Plaintiff’s claim accrued in 2009 or in 2017 is properly presented to the jury.
`See Design Basics, LLC v. Forrester Wehrle Homes, Inc., 305 F. Supp. 3d 788, 795 (N.D.
`Ohio 2018) (finding a fact issue as to whether company had reason to know of customer’s
`infringing conduct precluded summary judgment on issue of whether company was on
`inquiry notice to trigger limitations period); Ranch Realty, Inc. v. DC Ranch Realty, LLC,
`614 F. Supp. 2d 983, 989 (D. Ariz. 2007) (“When discovery occurs and a cause of action
`accrues are ordinarily questions of fact for the jury.”). Whethe