Case5:06-cv-04812-PSG Document234 Filed07/02/12 Page1 of 17
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` Plaintiff,
`v.
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`EDITIONS LIMITED WEST, INC., ET AL.,
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`Case No.: C-06-04812 PSG
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`FINDINGS OF FACT AND
`CONCLUSIONS OF LAW AFTER
`BENCH TRIAL
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`UNITED STATES DISTRICT COURT
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`NORTHERN DISTRICT OF CALIFORNIA
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`SAN JOSE DIVISION
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` Defendants. )
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`VICTORIA RYAN,
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`I. INTRODUCTION
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`This is a copyright infringement action brought by Plaintiff Victoria Ryan (“Ryan”) against
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`Defendant Editions Limited West, Inc. (“ELW”). Ryan is an artist working in pastel on paper and
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`ELW is authorized to publish, distribute and sell certain of Ryan’s paintings as posters. Defendant
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`ArtSelect, Inc. (“ArtSelect”) is a retailer of artwork. Ryan claims that ELW authorized and
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`encouraged retailers like ArtSelect to sell derivative works of the posters without her permission.
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`Ryan originally brought claims for copyright infringement, unfair competition, breach of
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`contract, and slander of title.1 On June 4, 2009, the court granted summary judgment to ELW on
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`each of Ryan’s claims.2
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`1 See Docket No. 1.
`2 See Docket No. 142.
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`Case No.: C 06-4812 PSG
`ORDER
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`For the Northern District of California
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`United States District Court
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`Case5:06-cv-04812-PSG Document234 Filed07/02/12 Page2 of 17
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`Ryan then appealed the grant of summary judgment, as well as various discovery rulings.3
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`On March 3, 2011, the Ninth Circuit issued a single opinion addressing all issues before it.4 The
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`appellate court affirmed the summary judgment on Ryan’s breach of contract, unfair competition,
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`and slander of title claims, but determined that “Ryan had raised a triable issue as to whether she is
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`entitled to judgment against ELW for [contributory or vicarious] copyright infringement.”5 The
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`Ninth Circuit also instructed that “[i]f the district court finds ELW liable for contributory or
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`vicarious copyright infringement, it should consider whether Ryan is the prevailing party under the
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`broad language of the contract, and whether she is entitled to a permanent injunction against
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`ELW.”6 The case was then remanded for further consideration consistent with this disposition.
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`On April 7, 2011, the appellate court granted Ryan’s motion to transfer to the district court
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`consideration of attorney’s fees on appeal. The appellate court noted in determining whether Ryan
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`is entitled to any contractual or statutory attorney’s fees, “the district court may take whatever
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`action it deems appropriate.”7
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`In light of the retirement of Judge Patricia V. Trumbull and the appointment of the
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`undersigned, the case was reassigned.8
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`After the parties waived their right to a jury trial, these matters were tried to the court.
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`Richard DeLiberty represented Ryan. Michael Painter represented ELW. The parties had
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`previously consented to the jurisdiction of a magistrate judge pursuant to 28 U.S.C. § 636(c).
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`3 See Docket No. 146.
`4 See Docket No. 180.
`5 Id. at 3.
`6 Id.at 5.
`7 See Docket No. 187.
`8 See Docket No. 190.
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`Case No.: C 06-4812 PSG
`ORDER
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`For the Northern District of California
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`United States District Court
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`Case5:06-cv-04812-PSG Document234 Filed07/02/12 Page3 of 17
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`Although both sides submitted proposed findings of fact and conclusions of law, the court
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`has determined to make its own findings and reach its own conclusions rather than picking and
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`choosing between their competing versions. That a proposed finding has not been adopted does not
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`necessarily mean it has been rejected. It simply means that the court has determined that it is
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`unnecessary either to adopt or reject it. The court does not find it necessary to cite to the record
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`throughout this order and will do so only where it might prove particularly helpful for purposes of
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`any appeal. To the extent this order identifies conclusions of law as findings of fact, or vice versa,
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`it does so without prejudice to their proper consideration and treatment.
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`II. FINDINGS OF FACT
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`The court heard testimony from Ryan, Joanne Chappell (“Chappell”), Todd Haile (“Haile”),
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`and Barbara Vollmer (“Vollmer”).
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`On balance, the court found Ryan’s testimony to be credible.
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`The court found Chappell to be a somewhat less credible witness. She testified repeatedly
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`that as the owner of ELW, she had no knowledge of the licensing agreements that ELW entered
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`into with third parties such as ArtSelect. But deposition testimony from several ELW employees,
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`including Michael Jakola, ELW’s Chief Executive Officer from July 2004 through 2007, showed
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`otherwise. Given this contradictory testimony, the court generally affords Chappell’s testimony
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`less weight.
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`The court found Haile to be a credible witness as to ELW’s policies and relationships with
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`artists, but notes that on cross-examination that Haile admitted he lacked knowledge regarding the
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`company’s specific license terms and conditions during the relevant time period. In addition, Haile
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`had difficulty remembering specific conversations with Ryan, and needed documents to refresh his
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`recollection.
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`Case No.: C 06-4812 PSG
`ORDER
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`For the Northern District of California
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`United States District Court
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`Case5:06-cv-04812-PSG Document234 Filed07/02/12 Page4 of 17
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`The court finds Vollmer to be a credible witness as to her communications with Ryan.
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`Vollmer lacked knowledge, however, regarding ELW’s canvas transfer policies.
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`Against this backdrop, the court makes the following specific findings of fact.
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`A.
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`ELW and Ryan’s Contract, and the Emergence of Canvas Transfers
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`Ryan met Chappell in the 1980s. Chappell operated ELW and began selling Ryan’s artwork
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`in its gallery. Later ELW became a publisher of art posters.
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`On August 19, 1995, Ryan and ELW entered into a written contract wherein Ryan licensed
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`ELW the exclusive right to publish, distribute and sell certain Ryan paintings as posters.9 The
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`contract refers only to posters and does not grant rights as to derivative works such as canvas
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`transfers, giclees, or wall murals.
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`A canvas transfer is created by lifting the ink from a paper poster and remounting it onto a
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`canvas. First, a chemical solution is applied to the poster. The poster is then adhered to a plastic
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`carrier sheet that lifts the ink off the paper. The transfer sheet is then applied to a canvas. Canvas
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`transfers have existed since the late 1980s, or early 1990s. They were not commonplace in the
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`industry, however, when Ryan and ELW entered into their contract in 1995.
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`Similar to a canvas transfer, a giclée is a reproduction of an artwork, but it is created from a
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`digital image of it. An ink jet printer prints the digital image either on canvas or paper. A giclée
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`does not need to be the same size as the original poster. Giclées are generally of a higher quality
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`than canvas transfers because the printer uses four ink colors and a continuous spray as opposed to
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`the three ink colors and dot printing that are used for posters.
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`A wall mural is a large picture to be affixed to a wall.
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`Ryan and ELW’s contract provides for attorney’s fees for the prevailing party in any suit
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`“with regard” to the contract. Section 12 of the contract states:
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`9 Pl. Ex. 1 at 1.
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`Case No.: C 06-4812 PSG
`ORDER
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`For the Northern District of California
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`United States District Court
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`Case5:06-cv-04812-PSG Document234 Filed07/02/12 Page5 of 17
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`In the event that litigation is instituted with regard to this Agreement,
`the prevailing party shall be entitled to its costs of the suit, including
`reasonable attorney’s fees. 10
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`In 2004, Ryan noticed canvas transfers of her posters for sale on the internet. Ryan
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`contacted Haile to express her concern about such canvas transfers. No action was taken by either
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`Ryan or ELW immediately following that conversation.
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`On November 9, 2004, Ryan sent an email to Haile once again expressing her concerns
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`regarding canvas transfers. It states:
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`I have been learning more about ‘canvas transfers’ and wonder what you think about the
`ethics of utilizing this method to market posters. I wonder if there is a legal or copyright
`issue here. I know of several companies that use this technology on my posters and others
`and it just doesn’t sit too well to think that a new product is being made and no
`compensation is rendered to the artist. I’m curious to know your opinion on this issue.11
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`B.
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`ELW’s Policies Regarding Canvas Transfers
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`After 2004, canvas transfers became more prominent in the art publishing industry. Around
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`that same time, ELW’s catalogue and website began including a general policy prohibiting its
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`customers from utilizing ELW posters in canvas transfers.12 Customers had to obtain approval
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`from ELW management before any artwork was reproduced as a canvas transfer. ELW salespeople
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`understood that the artist’s approval was required under ELW policy before ELW would authorize
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`any canvas transfer of that artist’s works. Typically, a salesperson would receive a customer
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`inquiry and would then speak with, or email, Jakola or Chappell. They would respond within a few
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`days. There was no file or central database at ELW for a salesperson to use to find out whether a
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`specific artist had a policy with respect to canvas transfers. If an artist approved of a canvas
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`transfer at a time other than when the agreement is signed, no information was recorded.
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`10 Def. Exh. No. 201, ¶ 4.
`11 Pl. Exh. No. 9.
`12 See Pl. Exh. Nos. 10, 11.
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`Case No.: C 06-4812 PSG
`ORDER
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`For the Northern District of California
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`United States District Court
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`Case5:06-cv-04812-PSG Document234 Filed07/02/12 Page6 of 17
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`Its general policy notwithstanding, ELW would regularly authorize canvas transfer without
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`obtaining permission first from the artist and despite any authority provided by the artist’s contract.
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`With too many accounts and artists to keep track of them all, if an artist did not have a clause
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`explicitly denying the right to canvas transfer, ELW would not impose such a restriction on canvas
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`transfers.
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`C.
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`ELW and Third-Party Agreements
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`In 2005, ELW authorized ArtSelect to produce giclées of its artists’ works. On April 4,
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`2005, ELW provided ArtSelect with a “go” list of artists approved to be a part of the giclée
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`agreement. Jakola, Chappell, and Haile discussed which artists would be included on the list.
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`Chappell represented to Jakola that she would contact the artists that she was unsure about
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`approving for canvas transfers. Ryan was one such artist that Chappell agreed to contact, and
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`Ryan’s artworks, “Primavera I,” “Primavera II,” “Slow Journey,” “Still Water,” “Vineland I,”
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`“Vineland II” were part of the ELW-ArtSelect agreement.13 Chappell never contacted these artists,
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`however, and never received approval for the giclée agreement.
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`In 2005, ELW also authorized ArtSelect to make canvas transfers from its posters for some
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`of its artists and their works. ELW salesman Jeremy Conybeare (“Conybeare”) provided ArtSelect
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`with a specific list of artists approved for canvas transfers, including Ryan.14 On May 2, 2005,
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`ArtSelect sent ELW a revised list of artists whose works it wanted to use for canvas transfers.
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`Conybeare approached Haile to confirm which artists had approved canvas transfers of their
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`artwork. Conybeare contacted Haile because Chappell was often hard to find, and Haile was the
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`person that had contact with the artists. ELW approved ArtSelect’s list the next day.15
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`13 See Pl. Exh. No. 12.
`14 See Pl. Exh. No. 15.
`15 See Pl. Exh. No. 16.
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`Case No.: C 06-4812 PSG
`ORDER
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`For the Northern District of California
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`Case5:06-cv-04812-PSG Document234 Filed07/02/12 Page7 of 17
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`ArtSelect did not offer canvas transfers of artists’ works unless it had prior approval. If a
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`publisher advised ArtSelect that canvas transfers were authorized for a particular artist, ArtSelect
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`continued to assume approval until it was notified otherwise. ArtSelect itself never sought direct
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`authorization from artists before they produced canvas transfers. ArtSelect also did not endeavor to
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`confirm that a publisher, who represented that it has the rights to print particular artwork, actually
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`had those rights. It was reasonable for ArtSelect to rely on ELW’s representations.
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`On May 27, 2005, ArtSelect sold a canvas transfer of Ryan’s artwork, “Primavera I” for the
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`sale price of $98.96.16 After ArtSelect placed the order, ELW shipped the poster directly to an
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`outside vendor named DeNunzio, Inc. (“DeNunzio”) to complete the canvas transfer process. On
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`June 22, 2005, ArtSelect shipped the canvas transfer of “Primavera I” to its customer. On July 6,
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`2005, the customer returned the canvas transfer because he did not like it. The customer obtained a
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`full refund. Items returned to ArtSelect were placed in its outlet stock. On July 24, 2005, the outlet
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`re-sold the canvas transfer for $51.69 and it was shipped two days later.17 After calculating all of
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`the costs, ArtSelect’s profit on the sale of the canvas transfer was $1.72.18
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`On July 1, 2005, ELW entered into an agreement with Environmental Graphics / Murals
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`Your Way (“Environmental Graphics”) to produce wall murals. ELW authorized Environmental
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`Graphics to create wall murals of all artists and images attached to the agreement “as agreed to by
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`Lisa Jerlstrom and Michael Jakola.”19 “Example A” was attached to the agreement and contains a
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`list of artists and images that ELW approved for the wall murals.20 This list included Ryan and her
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`16 See Pl. Exh. No. 18.
`17 See Pl. Exh. No. 19.
`18 See Pl. Exh. No. 18. ArtSelect’s incurred a $29.42 dropship cost, a $1.42 box cost, a $7.13
`shipping cost, and a $12.00 handling cost, netting a total profit of $1.72 for the canvas transfer.
`19 Pl. Exh. No. 13.
`20 See Pl. Exh. No. 14.
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`Case No.: C 06-4812 PSG
`ORDER
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`For the Northern District of California
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`United States District Court
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`

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`Case5:06-cv-04812-PSG Document234 Filed07/02/12 Page8 of 17
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`works, including “Primavera I,” “Primavera II,” Slow Journey,” “Still Water,” “Vineland I,” and
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`“Vineland II.” Environmental Graphics never sold, or produced any mural based on Ryan’s work.
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`D.
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`The Demise of the Ryan-ELW Relationship
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`Ryan’s displeasure with ELW’s practices reached a peak in early 2005. At the Sausalito Art
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`Festival, Ryan expressed her anger and frustration that ELW was authorizing others to produce
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`canvas transfers of her work.
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`On or around June 9, 2005, Haile21 received a phone call from Ryan demanding that ELW
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`immediately stop its customers from making canvas transfers of her work. Jakola was informed of
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`the phone call, and Ryan’s name was immediately removed from both the canvas transfer list and
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`giclée agreement. Conybeare emailed ArtSelect, who immediately removed images of canvas
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`transfers of Ryan’s artwork from ArtSelect’s website.22 Also on June 9, Jakola emailed ArtSelect
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`to remove Ryan from the giclée agreement, and ArtSelect did so the next day.23 Despite these
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`instructions, Ryan still found her artwork on other websites. She then retained counsel, who sent a
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`cease and desist letter to ELW and sought an accounting for the sales of Ryan’s artwork.24 On
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`February 8, 2006, ELW revised its agreement with Environmental Graphics and removed several
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`artists from the parties’ agreement, including Ryan.25 After this suit was initiated, ELW terminated
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`its relationship with Ryan and has not conducted any business with her whatsoever.
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`21 Chappell testified that she received the phone call. Both Haile and Jakola testified that Haile
`received the phone call and relayed the information to both Chappell and Jakola. In light of this
`conflicting testimony, the court finds Haile and Jakola to be more credible, and that Haile in fact
`received the phone call.
`22 See Pl. Exh. No. 21.
`23 See Pl. Exh. No. 20.
`24 See Pl. Exh. No. 2.
`25 See Pl. Exh. 22.
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`Case No.: C 06-4812 PSG
`ORDER
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`For the Northern District of California
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`Case5:06-cv-04812-PSG Document234 Filed07/02/12 Page9 of 17
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`III. CONCLUSIONS OF LAW
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`A.
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`Claim 1: Contributory Copyright Infringement
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`In order to show contributory infringement, Ryan must show that ELW knew or had reason
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`to know of a third party's directly infringing activity, and substantially participated in that activity,
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`such as by inducing, causing, or materially contributing to the infringing conduct, or by failing to
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`take simple measures to prevent further damage to copyrighted works.26 Three key cases have
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`addressed liability under this standard: Fonavisa;27 Napster;28 and Grokster.29 In Fonovisa, the
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`Ninth Circuit held a swap meet operator contributorily liable for the sale of pirated works at the
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`swap meet. In Napster, the Ninth Circuit held the operator of an electronic file sharing system
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`liable when users of that system employed it to exchange massive quantities of copyrighted music.
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`In Grokster, the Supreme Court found liability for the substantially similar act of distributing
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`software that enabled exchange of copyrighted music on a peer-to-peer, rather than a centralized,
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`basis.
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`1.
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`Direct Infringement of Ryan’s Works
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`Anyone who violates any of the exclusive rights of the copyright owner is a direct infringer
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`of the copyright of the author.30 In order to present a prima facie case of direct copyright
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`infringement, the copyright holder must (1) show ownership of the allegedly infringed material and
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`26 See Perfect 10, Inc. v. Visa Int'l Serv. Ass'n, 494 F.3d 788, 795 (9th Cir. 2007). See also Metro
`Goldwyn-Mayer Studios, Inc. v. Grokster, Ltd., 545 U.S. 913, 936 (2005) (holding that a party is
`liable for contributory copyright infringement if the party intentionally induced or encouraged
`direct infringement through specific acts); A&M Records, Inc. v. Napster, Inc., 239 F.3d 1004,
`1020 (9th Cir. 2001).
`27 Fonavisa, Inc. v. Cherry Auction, Inc.,76 F.3d 259 (9th Cir. 1996).
`28 A&M Records, Inc. v. Napster, Inc., 239 F.3d 1004 (9th Cir. 2001).
`29 Metro-Golwyn-Mayer Studios, Inc. v. Grokster, Ltd., 545 U.S. 913, 125 S.Ct. 2764, 162 L.Ed.2d
`781 (2005).
`30 See 17 U.S.C. § 501(a).
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`Case No.: C 06-4812 PSG
`ORDER
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`For the Northern District of California
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`United States District Court
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`Case5:06-cv-04812-PSG Document234 Filed07/02/12 Page10 of 17
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`(2) demonstrate that the alleged infringers violated at least one exclusive right granted to the
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`copyright holder under 17 U.S.C. § 106.31
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`Ryan has demonstrated ownership. She owned a valid copyright for each of her paintings
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`the moment they were completed, and fixed in the canvas. Ryan registered the original art relevant
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`to this copyright infringement action on October 28, 2005,32 thereby allowing her to initiate the
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`present action.33 ELW does not dispute the originality, or validity of Ryan’s copyrighted works.
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`Among other rights, a copyright owner has the exclusive rights to reproduce the
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`copyrighted work,34 prepare derivative works based upon the copyrighted work,35 and distribute
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`copies of the copyrighted work by sale or other transfer of ownership.36 The contract between Ryan
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`and ELW granted ELW the exclusive rights to publish, distribute and sell poster editions of Ryan’s
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`original works of authorship. Ryan thus divested herself of only a portion of her exclusive rights by
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`her contract and retained all other rights.
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`When it created the canvas transfer, ArtSelect infringed Ryan’s retained right to prepare
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`derivative works. 37 A derivative work is
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`a work based upon one or more preexisting works, such as a translation, musical
`arrangement, dramatization, fictionalization, motion picture version, sound
`recording, art reproduction, abridgment, condensation, or any other form in which a
`work may be recast, transformed, or adapted.
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`31 See A&M Records, Inc., 239 F.3d at 1013.
`32 See Def’s. Exhs. 203 – 207.
`33 See 17 U.S.C. § 411(a).
`34 See 17 U.S.C. § 106(1).
`35 See 17 U.S.C. § 106(2).
`36 See 17 U.S.C. § 106(3).
`37 The reproduction right was not implicated. See Mirage Editions, Inc. v. Albuquerque A.R.T. Co.,
`856 F.2d 1341, 1344 (9th Cir. 1988) (“removing the individual images from the book and placing
`them on tile, perhaps [does not] accomplish[] reproduction”).
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`Case No.: C 06-4812 PSG
`ORDER
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`For the Northern District of California
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`In Mirage Editions, the Ninth Circuit has held that mounting a “preexisting, copyrighted individual
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`art image[] without the consent of the copyright proprietors [constitutes] a derivative work and
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`infringe[s] the subject copyrights.”38 The court held that when defendant mounted copyrighted
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`notecards to tile they were sufficiently “transformed,” thus rendering the tiles derivative works.39
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`While this holding may have broad implications for copyright infringement by suggesting that art
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`galleries, museums, or art collectors create a derivative work each time they change the frame on a
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`painting or the matte of a photograph,40 this court is bound by Ninth Circuit precedent. ArtSelect
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`therefore prepared a derivative work and infringed Ryan’s copyright when it prepared the canvas
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`transfer of Primavera I.
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` There was no direct infringement by Environmental Graphics.41 Because the only act of
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`direct infringement proved at trial was the canvas transfer created by ArtSelect, ELW can be
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`contributorily or vicariously liable only for that act.
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`2. ELW Had Knowledge of the Direct Infringement
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` ELW authorized ArtSelect to create canvas transfers from Ryan’s posters. It did so at
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`ArtSelect’s specific request. ELW also received an invoice from ArtSelect reflecting that Ryan’s
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`poster was to be shipped to Denunizo,42 who at the time created canvas transfers for ArtSelect
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`38 Mirage Editions, 856 F.2d at 1343.
`39 See id.
`40 See Lee v. A.R.T. Co., 125 F.3d 580, 582-83 (7th Cir. 1997) (explicitly rejecting Mirage Editions
`in finding that when the lithograph was bonded to the tile it was not changed in the process, and
`still depicts exactly the same artwork, and thus had not been recast, adapted, or transformed).
`41 While Section 106 grants the copyright holder the right to authorize the enumerated activities,
`courts have found this clause as contemplating liability for contributory infringement – not
`imposing direct liability for authorizing the activity. See Subafilms, Ltd. v. MGM-Pathe Commc’ns
`Co., 24 F.3d 1088, 1093 (9th Cir. 1994).
`42 See Pl. Ex. 37.
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`Case No.: C 06-4812 PSG
`ORDER
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`For the Northern District of California
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`United States District Court
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`Case5:06-cv-04812-PSG Document234 Filed07/02/12 Page12 of 17
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`exclusively. Based on this uncontroverted evidence, ELW knew, at least constructively, of
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`ArtSelect’s direct infringement.43
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`3. ELW Materially Contributed to the Direct Infringement
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`ELW supplied ArtSelect with Ryan’s poster and authorized its use for canvas transfer.
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`ELW provided this authorization at ArtSelect’s specific request and even though its contract and
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`communications with Ryan supplied no such authorization to ELW. Without the poster and ELW’s
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`authorization, ArtSelect would not have infringed Ryan’s work. ELW thus materially contributed
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`to the direct infringement.
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`Because both elements of a contributory infringement claim have been established, ELW is
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`liable on this claim.
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`B.
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`Claim 2: Vicarious Copyright Infringement
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`ELW is liable for vicarious copyright infringement if (1) ELW enjoyed a direct financial
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`benefit from ArtSelect’s infringing activity, and (2) ELW had the right and ability to supervise the
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`infringing activity.44 A vicarious infringer profits from direct infringement while declining to
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`exercise a right to stop or limit it.45 “A defendant exercises control over a direct infringer when he
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`has both a legal right to stop or limit the directly infringing conduct, as well as the practical ability
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`43 See A&M Records, 239 F.3d at 1020. See also, Perfect 10, Inc. v. Amazon.com, Inc., 487 F.3d
`701, 727 (9th Cir. 2007) (quoting Restatement (Second) of Torts § 8A cmt. B (1965) (“the actor
`knows that the consequences are certain, or substantially certain, to result from his act, and still
`goes ahead, he is treated by the law as if he had in fact desired to produce the result”)).
`44 See Ellison v. Robertson, 357 F.3d 1072, 1076 (9th Cir. 2004); Perfect 10, Inc. v. Amazon.com,
`Inc., 487 F.3d 701, 729 (9th Cir. 2007).
`45 See Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd., 545 U.S. 913, 930 (2005); Range Rd.
`Music, Inc. v. E. Coasts Foods, Inc., 668 F.3d 1148, 1152-53 (9th Cir. 2012).
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`Case No.: C 06-4812 PSG
`ORDER
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`to do so.”46 A financial benefit may exist under several circumstances, one of which is when “the
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`availability of infringing material acts as a draw for customers.”47
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`Here, the profits – however modest – from the sale of the underlying poster establishes that
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`ELW enjoyed a financial benefit from ArtSelect’s infringing activity and thus met the first element
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`for vicarious liability. But for the second element, the court is not persuaded that ELW had the
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`legal right to do so. Ryan introduced no contract or other means by which ELW could exercise
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`legal authority over ArtSelect and its actions.
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`Because both elements of a vicarious infringement claim have not been established, ELW’s
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`is not liable on this claim.
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`C.
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`No Damages Are Warranted
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`While the Copyright Act provides for an award of damages upon a finding of infringement,
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`Ryan introduced no evidence to substantiate a claim to any portion of ELW’s profits or any other
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`damages award here. Even though counsel references a damages award in his closing argument,
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`argument alone is not evidence.
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`D.
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`Injunctive Relief in Favor of Ryan is Appropriate
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`“Upon prevailing in a statutory copyright infringement action, [Ryan] may obtain, in
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`addition to monetary recovery, a permanent injunction restraining further infringement . . . . Such
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`injunctive relief ordinarily will not be granted when there is no probability or threat of continuing
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`or additional infringements.”48
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`46 Id. at 730.
`47 A&M Records, 239 F.3d at 1023.
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`48 Shapiro, Bernstein & Co. v. 4636 S. Vermont Ave., Inc., 367 F.2d 236, 242 (9th Cir. 1966). See
`also Sega Enters. Ltd. v. Maphia, 948 F.Supp. 923, 940 (N.D. Cal. 1996) (finding that continued
`access to the equipment that allowed defendant to illegally download and distribute game programs
`constituted a threat of future copyright violations); MAI Sys. Corp. v. Peak Computer, Inc., 991
`F.2d 511, 520 (9th Cir. 1993) (finding that a computer servicing company that maintained
`13
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`Case No.: C 06-4812 PSG
`ORDER
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`For the Northern District of California
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`The court may consider four factors in determining whether to issue a permanent
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`injunction: (1) irreparable harm; (2) success on the merits; (3) a balancing of competing claims of
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`injury to the parties; and (4) consideration of the public interest.49
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`The elements required for issuing a permanent injunction are satisfied here. Evidence of
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`copyright infringement, as has been established here, is presumed to give rise to irreparable harm.50
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`Ryan also has adequately demonstrated that she will suffer irreparable harm if ELW is not
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`permanently enjoined. Its published policy notwithstanding and despite explicit instructions from
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`Ryan to the contrary, ELW authorized others to prepare derivative works of Ryan’s artwork. While
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`Chappell testified that ELW ceased conducting business with Ryan in 2005, ELW has not
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`terminated or repudiated its contract with Ryan, and the court is not persuaded in light of her
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`overall lack of credibility that this pledge is sufficient to avoid any probability or threat of
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`infringement in the future.51 The court also cannot discern any detriment to ELW that would
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`outweigh the harm to Ryan if an injunction were issued.
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`The public interest also weighs in favor of granting a permanent injunction in this case.
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`Injunctions issued pursuant to Section 502 of the Copyright Act serve the public interest by
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`upholding copyright protections.52 As noted by the Third Circuit, “the public interest can only be
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`served by upholding copyright protections and . . . preventing the misappropriation of skills,
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`computers in its inventory with protected software presented a threat of future copyright violations
`and warranted an injunction).
`49 See Sony Music Entertainment, Inc. v. Global Arts Productions, 45 F.Supp.2d 1345, 1347 (S.D.
`Fla. 1999).
`50 See Elektra Entm’t Group Inc. v. Bryant, No. CV 03-6381 GAF (JTLX), 2004 WL 783123, at
`*17 (C.D. Cal. Feb. 13, 2004); see also Micro Star v. Formgen Inc., 154 F.3d 1107, 1109 (9th Cir.
`1998) (“[I]n a copyright infringement claim, a showing of a reasonable likelihood of success on the
`merits raises a presumption of irreparable harm”).
`51 Cf. MAI Systems Corp. v. Peak Computer, Inc., 991 F.2d 511, 520 (9th Cir. 1993).
`52 See Autoskill, Inc. v. Nat’l Educ. Support Sys., Inc., 994 F.2d 1476, 1499 (10th Cir. 1993).
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`Case No.: C 06-4812 PSG
`O