4:08-cv-04101-TLW Date Filed 02/28/11 Entry Number 159 Page 1 of 29
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF SOUTH CAROLINA
`FLORENCE DIVISION
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`C/A No. 4:08-4101-TLW-SVH
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` REPORT AND RECOMMENDATION
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`) ) ) ) ) ) ) ) ) ) ) ) )
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`The Sater Design Collection, Inc.,
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`Plaintiff,
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` vs.
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`Wingard Properties, Inc.; James T.
`Wingard; Deborah Wingard; The
`Lowrey Group, Inc.; and Robert C.
`Lowrey,
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`Defendants.
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`On December 22, 2008, plaintiff Sater Design Collection, Inc. (“Sater”) filed suit
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`against defendants Wingard Properties, Inc. (“Wingard”); Wingard’s president, James T.
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`Wingard; and Wingard’s vice-president, Deborah Wingard (“Individual Wingard
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`Defendants”); alleging all infringed several of its copyrighted architectural works
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`house
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`plans numbered 6910 and 6746
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`by using those plans in designing and building several
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`homes in the Grande Dunes area of Myrtle Beach, South Carolina. [Entry #1]. In June
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`2009, Sater filed an amended complaint, adding as defendants Ray Covington;
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`architectural firm The Lowrey Group, Inc. (“TLG”); TLG’s president, Robert C. Lowrey
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`(“Lowrey”); and owners of one of the homes at issue, Steve and Jennifer Schwartz. [Entry
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`#34]. In September 2009, Sater voluntarily dismissed defendant Covington. [Entry #70].
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`On February 19, 2010, Sater amended its complaint to include additional infringement
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`claims regarding other copyrighted architectural works: house plans 6653, and its
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`derivatives 6721, 6719, and 6756. [Entry #92]. On March 30, 2010, Sater voluntarily
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`4:08-cv-04101-TLW Date Filed 02/28/11 Entry Number 159 Page 2 of 29
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`dismissed defendants Steve and Jennifer Schwartz. [Entry #99]. Because corporate
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`parties can not proceed pro se, the court granted Sater’s motion to strike the answer of
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`TLG [Entry #115], and the Clerk of Court entered default as to TLG on July 12, 2010
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`[Entry #116].
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`This matter is before the court on three motions: 1) Sater’s motion for summary
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`judgment as to all claims [Entry #129]; 2) the motion for summary judgment of the
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`individual Wingard Defendants, seeking dismissal of all claims brought against them in
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`their individual capacities [Entry #127]; and 3) Sater’s motion for default judgment as to
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`defendant TLG [Entry #128]. All pretrial proceedings in this case were referred to the
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`undersigned pursuant to the provisions of 28 U.S.C. § 636(b)(1)(A) and (B) and Local
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`Rule 73.02(B)(2)(e), DSC. Because these motions are dispositive, this Report and
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`Recommendation is entered for review by the district judge.
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`I.
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`Relevant Factual Background
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`Sater is an architectural design firm that, among other things, creates and sells
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`custom and pre-drawn house plans. It alleges that six of its copyrighted plans were
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`infringed by Defendants in designing, constructing, and participating in the construction
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`of homes in the Grande Dunes development. Sater claims that Wingard built numerous
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`residences that improperly used Sater Plans 6910, 6653, 6721, 6653, 6719, 6756, and
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`6746. Sater also brings infringement claims against the Individual Wingard Defendants,
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`alleging they were contributorily or vicariously liable for Wingard’s allegedly infringing
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`actions. Sater alleges TLG violated copyright law by producing drawings for the
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`4:08-cv-04101-TLW Date Filed 02/28/11 Entry Number 159 Page 3 of 29
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`Wingard-built homes that were based in large part on Sater’s copyrighted works. Sater
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`claims that Lowrey is contributorily or vicariously liable as TLG’s president.
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`Sater avers that all Wingard and Lowrey Defendants infringed on Plan 6910 in
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`planning and building one or more Grande Dune residences. 2d Am. Compl. ¶ 14 & ex. 3.
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`Sater also claims that Defendants infringed on Plan 6653 and its derivative 6721 in
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`planning and constructing three or more Grande Dune residences, including homes on
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`Members Club, lot 176; Riviera, lot 49; Members Club, lot 25; and Bal Harbor, lot 39.
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`See 2d Am. Compl. ¶ 41 & ex. 9. Additionally, Sater claims all Defendants infringed on
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`Plan 6653 and its derivatives 6719 and 6756 in constructing eight or more Grande Dunes
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`residences, including those at Calais, lots 15, 22, 26, 28; Cadiz, lots 2, 12; and Capri, lot
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`28. See 2d Am. Compl. ¶ 55 & ex. 12. Finally, Sater claims the Wingard Defendants
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`infringed on Plan 6746 in planning and building a home at Plantation Point, lot 10,
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`Grande Dunes. 2d Am Compl. ¶ 27 & ex. 6.
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`II.
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`Applicable Legal Standards
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`A. Summary Judgment
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`The court shall grant summary judgment “if the movant shows that there is no
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`genuine dispute as to any material fact and the movant is entitled to a judgment as a
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`matter of law.” Fed. R. Civ. P. 56(a). The movant bears the initial burden of
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`demonstrating that summary judgment is appropriate; if the movant carries its burden,
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`then the burden shifts to the non-movant to set forth specific facts showing that there is a
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`genuine issue for trial. See Celotex Corp. v. Catrett, 477 U.S. 317, 322 23 (1986). If a
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`4:08-cv-04101-TLW Date Filed 02/28/11 Entry Number 159 Page 4 of 29
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`movant asserts that a fact cannot be disputed, it must support that assertion either by
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`“citing to particular parts of materials in the record, including depositions, documents,
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`electronically stored information, affidavits or declarations, stipulations (including those
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`made for purposes of the motion only), admissions, interrogatory answers, or other
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`materials; “ or “showing . . . that an adverse party cannot produce admissible evidence to
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`support the fact.” Fed. R. Civ. P. 56(c)(1).
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`In considering a motion for summary judgment, the evidence of the non-moving
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`party is to be believed and all justifiable inferences must be drawn in favor of the
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`non-moving party. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986).
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`However, “[o]nly disputes over facts that might affect the outcome of the suit under the
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`governing law will properly preclude the entry of summary judgment. Factual disputes
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`that are irrelevant or unnecessary will not be counted.” Id. at 248. Further, while the
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`federal court is charged with liberally construing a complaint filed by a pro se litigant to
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`allow the development of a potentially meritorious case, see, e.g., Cruz v. Beto, 405 U.S.
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`319 (1972), the requirement of liberal construction does not mean that the court can
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`ignore a clear failure in the pleadings to allege facts that set forth a federal claim, nor can
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`the court assume the existence of a genuine issue of material fact when none exists.
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`Weller v. Dep’t of Soc. Servs., 901 F.2d 387 (4th Cir. 1990).
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`B. Default Judgment
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`When a defendant does not answer or otherwise respond to a plaintiff’s complaint,
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`or when a defendant’s answer is stricken, upon motion of the plaintiff, default is entered.
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`In considering a motion for default judgment, the court examines a plaintiff’s claims
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`under the applicable statutory or common-law scheme to determine whether plaintiff has
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`set forth claims as to which relief can be granted pursuant to the standard of Fed. R. Civ.
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`P. 12(b)(6). See generally GlobalSantaFe Corp. v. Globalsantafe.com, 250 F. Supp. 2d
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`610, 612 n. 3 (E.D. Va. 2003) (considering facts and evaluating plaintiff’s claims prior to
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`entry of default judgment in copyright action). If plaintiff’s causes of action satisfy this
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`standard, the court may determine that default judgment is appropriate and may consider
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`the plaintiff’s request for damages.
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`III.
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`Discussion
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`A.
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`Sater’s Motion for Summary Judgment [Entry #129]
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`Sater brings several counts of copyright infringement pursuant to the Copyright
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`Act, codified at 17 U.S.C. § 101, et seq., separating the counts according to the house
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`plans infringed and the Defendants who allegedly infringed. “Architectural works,” such
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`as house plans, are copyrightable works of authorship that are listed in the Copyright Act.
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` See 17 U.S.C. § 102(a)(8). To establish an infringement cause of action, “two elements
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`must be proven: (1) ownership of a valid copyright, and (2) copying of the constituent
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`elements of the work that are original.” Feist Publ’n, Inc. v. Rural Tel. Serv. Co., 499
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`U.S. 340, 361 (1991) (internal citations omitted).
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`1.
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`Ownership of a Valid Copyright
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`Copyright protection requires that the thing being copyrighted is original. See
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`Feist, 499 U.S. at 346. A certificate of copyright from the United States Copyright Office
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`4:08-cv-04101-TLW Date Filed 02/28/11 Entry Number 159 Page 6 of 29
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`(USCO) is “is prima facie proof of the validity of plaintiff’s copyright, including the
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`existence of the elements of originality and fixation.” M. Kramer Mfg. Co. v. Andrews,
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`783 F.2d 421, 434 (4th Cir. 1986).
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`In support of its claimed ownership of valid copyrights for each plan at issue,
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`Sater presented the sworn testimony of its president, Dan F. Sater II, as well as copies of
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`certifications of registrations of each plan with the USCO. See Sater Aff. [Entry #129-2]
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`at ¶¶ 6, 8, exs. A, B (Sater Plan 6910); ¶¶ 15, 17, exs. D, E (Sater Plan 6746); ¶¶ 24 26,
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`exs. I, J, K (Sater Plan 6653 and its derivative 6721); ¶¶ 35 38, exs. G, O, P (Sater Plan
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`1
`6653 and its derivatives 6719, 6756). Further, Defendants have not challenged Sater’s
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`ownership of a valid copyright in relation to the various house plans at issue. See
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`1
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` In discussing Sater’s motion for summary judgment, reference to “Defendants,”
`unless otherwise noted refers to the Wingard Defendants because they filed a legal
`memorandum in response to Sater’s motion. The remaining defendants are The Lowrey
`Group, Inc. and Robert C. Lowrey. Robert Lowrey, proceeding pro se, did not submit a
`legal memorandum, per se; however, he did submit his affidavit in opposition to Sater’s
`motion. See Entry #142. Because Mr. Lowrey did not supply specific legal argument or
`detailed factual analysis of each legal element of Sater’s infringement claims and focused
`his factual filing on his lack of knowledge regarding where the Wingard Defendants
`obtained the drawings at issue, Sater proposes that the court grant summary judgment as
`to his liability without further analysis. Pl.’s Reply to Lowrey Response at 3 4 [Entry
`#155]. The court is to liberally construe submissions by pro se parties. See Haines v.
`Kerner, 404 U.S. 519, 520 (1972). The undersigned recommends the court decline
`Sater’s request to summarily find Lowrey liable. In his answer, Lowrey questioned
`whether there were similarities between Sater’s plans and those on which he worked with
`Wingard Properties. See Lowrey’s Answer [Entry #53] (noting “not aware of any
`similarities to or infringements of” Sater’s plans). For reasons discussed herein, the
`undersigned recommends Sater’s motion for summary judgment as to Lowrey be denied
`for the same reasons set forth herein as to the Wingard Defendants. Sater’s claims against
`Lowrey’s architectural firm, Defendant TLG, are discussed below in connection to
`Sater’s motion for default judgment against TLG. [Entry # 128].
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`Wingard Defs.’ Resp. to Pl.’s Mot. at 2 [Entry #140] (“[T]he Wingard Defendants have
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`no basis to dispute the ownership of the copyrights on the Plaintiff’s plans at issue, and
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`therefore concede the issue of ownership.”); see generally Def. Lowrey’s Aff. and Exs.
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`[Entry #142] (providing no argument or evidence as to ownership issue). Accordingly,
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`the court finds that Sater has established its prima facie case as to the first of the two
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`elements of an infringement claim ownership of valid copyrights of original works.
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`2.
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`Copying of Constituent Elements of the Work that Are Original
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`To establish an infringement claim, Sater must also satisfy the second element of
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`an infringement action; i.e., that Defendants copied the constituent elements of the
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`designs at issue that are original. This element of copyright infringement is commonly
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`referred to as “copying” and may be proved by direct or circumstantial evidence. Donald
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`Frederick Evans & Assoc. v. Cont’l Homes, Inc., 785 F.2d 897, 904 (11th Cir. 1986). If
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`“there is clear proof of actual copying by the defendants, that is the end of the case. M.
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`Kramer Mfg., 783 F.2d at 445. However, because copyright owners often cannot provide
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`direct evidence of copying, this element is typically “established by proof that the
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`defendant had access to the plaintiff’s work and produced a work that is substantially
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`similar to the plaintiff’s work.” Id. Once a copyright holder provides such proof of
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`copying, it has raised a “presumption of copying.” Keeler Brass Co. v. Cont’l Brass Co.,
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`862 F.2d 1063, 1065 (4th Cir. 1988). A defendant may then provide evidence to rebut the
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`presumption of copying. Id. If a defendant rebuts the presumption of copying, “the
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`function of the fact finder then is to weigh all the evidence, keeping in mind that the
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`4:08-cv-04101-TLW Date Filed 02/28/11 Entry Number 159 Page 8 of 29
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`plaintiff has the ultimate burden of persuading it that the defendant copied the material.”
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`Id.
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`a.
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`Plaintiff Has Not Provided Undisputed Direct Evidence of
`Copying to Support Granting Summary Judgment.
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`Here, Sater argues it has sufficient direct evidence of copying to permit the court
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`to find Defendants “copied” the plans at issue and to grant summary judgment for Sater
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`as to copyright infringement liability. Pl.’s Mem. at 8 10. Citing M. Kramer
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`Manufacturing, 783 F.2d at 445, Sater argues that because it has direct evidence of
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`copying, the court need not consider whether the copyrighted works and the allegedly
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`infringing plans are “substantially similar.” Pl.’s Mem. at 8 10. Although Sater suggests
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`it should be granted summary judgment as to all of the plans at issue “on the basis of
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`direct copying alone” (id. at 12), it proffers direct evidence of copying as to only as to
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`Plan 6746. See id. at 9 10.
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`Sater offers as direct evidence the affidavit of former defendant Steve Schwartz,
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`who owned one of the homes Wingard built allegedly using one of Sater’s copyrighted
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`plans. Sater argues that Dr. Schwartz “admitted that the 6746 plan was the basis for the
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`plan that was used to design and construct” the allegedly infringing home. Dr. Schwartz
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`testified that Sater’s Plan 6746 “has the exact floor plan, picture of the front elevation and
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`square footage of each of the floors of the advertisement that my wife and I were shown
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`at Mr. Wingard’s office prior to the design for our home being created.” Pl.’s Mem. at 9,
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`citing Schwartz Aff. ¶ 4 [Entry #129-1; Entry #129-3].
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`Sater argues that this affidavit testimony and Dr. Schwartz’s deposition testimony
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`in which he called Sater Plan 6746 the “template” for plans for his home provide clear
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`direct evidence of Defendants’ copying of Plan 6746. Sater offers no direct evidence or
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`specific argument that it has direct evidence to establish the element of copying as to the
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`other plans at issue
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`Plans 6910, 6653, 6721, 6719, or 6756.
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`In response, Defendants argue that Dr. Schwartz’s affidavit testimony regarding
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`the meeting at Mr. Wingard’s office when he and his wife were presented house plans is
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`inadmissible hearsay because Dr. Schwartz testified at his deposition that his wife
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`attended that meeting, but he did not. Wingard Defs.’ Mem. at 2 3 (citing Dep. of Steven
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`Schwartz, at 31:2 13 [Entry #140-1]. They argue that, at best, Dr. Schwartz has given
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`conflicting testimony, creating genuine issues of fact that preclude summary judgment.
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`Further, Defendants point to deposition testimony in which Defendant James Wingard
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`indicated that Dr. Schwartz made determinations regarding the design of his home.
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`Wingard Defs.’ Mem. at 4 (citing Dep. of James Wingard, 81:1 84:20 [Entry #140-2]).
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`Defendants argue that these competing facts preclude summary judgment on Sater’s
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`claim it has proved copying of Plan 6746 by direct evidence. On reply, Sater argues that
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`Defendants mischaracterize Dr. Schwartz’s deposition testimony and that no issue of fact
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`exists.
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`The court agrees with Defendants. Sater has not provided uncontroverted direct
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`evidence that Defendants copied Plan 6746. At best, Sater has proffered testimony of
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`such copying that is contradicted by other record evidence. For the remaining plans at
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`4:08-cv-04101-TLW Date Filed 02/28/11 Entry Number 159 Page 10 of 29
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`issue, Sater has offered no direct evidence that satisfies its burden of showing Defendants
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`copied its copyrighted works. The undersigned recommends finding Sater has not
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`established its right to relief as a matter of law pursuant to direct evidence of copying.2
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`b.
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`Plaintiff Has Not Provided Sufficient Undisputed Indirect
`Evidence of Copying to Merit Summary Judgment.
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`Sater also argues that it has set forth sufficient undisputed indirect evidence that
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`Defendants copied each of its plans at issue. See Pl.’s Mem. at 10 13. To establish
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`infringement through indirect, circumstantial evidence, Sater must prove the following: 1)
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`that Defendants had access to the copyrighted works; and 2) that Defendants’ works are
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`“substantially similar” to Sater’s copyrighted plans. If Sater presents undisputed indirect
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`evidence of access and substantial similarity, it creates a rebuttable presumption that
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`Defendants infringed. Defendants then have the opportunity to rebut that presumption.
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`See generally Keeler Brass, 862 F.2d at 1065 (noting plaintiff that shows alleged copier
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`had access to protected material and that protected material and alleged copy are
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`substantially similar creates rebuttable presumption of copying).
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`2
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` Because Plaintiff has not provided undisputed direct evidence of copying, the
`court need not consider Sater’s argument that, in the face of direct evidence of copying,
`there is never a need for the fact-finder to consider whether a copyrighted work is
`“substantially similar” to the allegedly infringing work. See Pl.’s Mem. at 8 9. Cf. Sater
`Design Collect., Inc. v. Waccamaw Constr., Inc., 4:08-4133-TLW, Entry #122 at 9 13
`(D.S.C. Feb. 14, 2011) (discussing need for consideration of substantial similarity even in
`face of direct evidence of copying). In considering indirect evidence of infringement,
`determining such substantial similarity is unquestionably part of the analysis. See Keeler
`Brass Co., 862 F.2d at 1065 (noting plaintiff may establish rebuttable presumption of the
`copying element by showing defendant had access to the copyrighted work and that the
`allegedly infringing work and the protected work are substantially similar).
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`4:08-cv-04101-TLW Date Filed 02/28/11 Entry Number 159 Page 11 of 29
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`i.
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`Access
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`To prove access, Sater must show that Defendants had “reasonable opportunity to
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`view” or “opportunity to copy” the copyrighted works at issue. Pl.’s Mem. at 11 (quoting
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`3 Melville B. Nimmer & David Nimmer, Nimmer on Copyright § 13.01[A] & n.5, at
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`13 15, 13 16. Sater points to record evidence that the Wingard Defendants had access to
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`the plans at issue because they purchased design books containing the plans. See Pl.’s
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`Mem. at 11 12; deposition testimony of Individual Wingard Defs., exs. 5, 6 (regarding
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`Wingards’ purchasing books containing plans) [Entry #130-4, #130-5]; Robert Lowrey
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`Dep. at 61 (agreeing all plans at issue in litigation found in “Luxury Book” ordered by
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`Defendants) [Entry #130-3]). The Wingard Defendants do not dispute that they had
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`access to design books that contained Sater’s plans at issue in this matter, but they
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`provide the caveat that Deborah Wingard testified that she purchased the books to assist
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`in the interior-design portion of the business. Wingard Defs.’ Mem. at 4 (citing D.
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`Wingard Dep. at 10 [Entry #140-3].
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`The undersigned recommends finding Sater has established that Defendants had
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`access to the plans at issue, thereby satisfying the first of two elements required to
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`establish a presumption of copying using indirect evidence. That does not end the
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`analysis, however. Sater satisfies the requirements of the copying presumption only if it
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`also demonstrates substantial similarity between the protected plans at issue and the
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`accused works of Defendants.
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`ii.
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`Substantial Similarity
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`Sater argues that it is has provided sufficient indirect evidence of infringement to
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`prevail on summary judgment because the homes at issue are “substantially similar” to its
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`plans. Pl.’s Mem. at 12. Sater acknowledges that the question of whether allegedly
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`infringing material is substantially similar to protected works is customarily one of fact.
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`Id. Nonetheless, Sater argues that summary judgment is appropriate when the “degree of
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`substantial similarity is overwhelming.” Id. (citing HRH Architects, Inc. v. Lansing, 1:08-
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`1479-RLV, 2009 WL 1421217, *6 (N.D. Ga. Apr. 22, 2009). Sater submits that an
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`“overall comparison of the two works” will determine whether the works are substantially
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`similar in this context. Pl.’s Mem. at 10 (citing Orig. Appalachian Artworks, Inc. v. Toy
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`Loft, Inc., 684 F.2d 821, 829 (11th Cir. 1982); Intervest Constr., Inc. v. Caterbury Estate
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`Homes, Inc., 554 F.3d 914, 920 (11th Cir. 2008)).
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`Sater focuses on Intervest Construction, which provides that protection for
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`architectural works derives from the “protected arrangement and coordination of spaces,
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`elements, and building components, as well as the total selection and arrangement of
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`those items.” Pl.’s Mem. at 10 (citing Intervest Constr.). Sater also emphasizes that,
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`when considering architectural works, the “totality of the selection and arrangement of
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`spaces, elements and components must be compared” when determining substantial
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`similarity. Id. Further, Sater urges that isolated dissimilarities between the works do not
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`prevent it from showing substantial similarity. Id. at 11 (citing Sid & Marty Kroft
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`Television Prods., Inc. v. McDonalds Corp., 562 F.2d 1157, 1166 77 (9th Cir. 1977)).
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`Sater concludes this portion of its argument by claiming that it has pointed out sufficient
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`substantial similarities to satisfy its “lesser burden of similarity [that is permitted] where
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`access is proven.” Pl.’s Mem. at 13. “[G]iven the absence of almost any difference
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`between the subject plans, a finding of copying based solely on a finding of striking
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`similarity would also be appropriate on summary judgment here.” Id.
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`Sater’s memorandum does not include any detailed analysis of how the plans at
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`issue are allegedly substantially similar. In the affidavit of its president, Sater offers some
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`evidence of the similarities between the plans at issue and the homes. For example, he
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`attaches a copy of Plan 6810 and a copy of the plan Defendants used to construct a home
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`on Lot 38, Grande Dunes, testifying that he has compared those plans and “determined
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`that the house and its design are infringements of the 6910.” Sater Aff. ¶¶ 6, 10 [Entry
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`#129-2]. Sater provides no further detailed comparison beyond President Sater’s
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`conclusions that each Plan has been infringed by Defendants’ drawings and homes built
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`using those designs.
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`In response, Defendants point out that, even if Sater establishes “substantial
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`similarity,” Defendants could then submit evidence to rebut the presumption of copying.
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`Wingard Defs.’ Mem. at 4. Focusing on substantial similarity, the Wingard Defendants
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`agree with Sater’s general citation of Intervest Construction for the proposition that, in
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`considering architectural works, it is the arrangement and coordination of spaces,
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`elements, and building components, as well as the total selection and arrangement of such
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`items that may be protected. Id. at 4 (citing Intervest Construction, 554 F.3d 914).
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`Defendants do not agree with Sater’s argument that the court should look to the
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`similarities, not the differences, between works when considering substantial similarity.
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`Wingard Defs.’ Mem. at 6. Rather, Defendants argue that, the differences in the works
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`must be considered, as they were in Intervest Construction. This is so, Defendants argue,
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`because architectural works are largely considered to be compilations, which the
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`Copyright Act defines as being “a work formed by the collection and assembling of
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`preexisting materials or of data that are selected, coordinated, or arranged in a way that
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`the resulting work as a whole constitutes an original work of authorship.” 17 U.S.C. §
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`101. This, Defendants argue, makes copyright protection of a compilation “thin.”
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`Wingard Defs.’ Mem. at 6 (quoting Feist, 499 U.S. 340)).
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`Defendants argue
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`that review of
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`the plans at
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`issue reveals numerous
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`dissimilarities, making the court unable to rule that Sater has established substantial
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`similarity as a matter of law. Wingard Defs.’ Mem. at 6 7. The Intervest court made
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`numerous comparisons of details of the homes, including the bathroom sinks, and found
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`the plans were not substantially similar. Defendants then devote several pages of their
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`memorandum to providing a sample of dissimilarities from each set of plans. Wingard
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`Defs.’ Mem. at 7 12. They indicate that a line-by-line comparison would not be helpful
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`at this stage, claiming that the comparisons are too fact-intensive and the differences too
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`many to support summary judgment at this time. Id. at 12 & n.5.
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`The undersigned agrees with Defendants and recommends that the court deny
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`summary judgment because Sater has not established “substantial similarity” between its
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`4:08-cv-04101-TLW Date Filed 02/28/11 Entry Number 159 Page 15 of 29
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`plans and the accused works as a matter of law. Sater argues that there is an “absence of
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`almost any differences between
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`the subject plans,” making summary
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`judgment
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`appropriate because the works are substantially similar. Pl.’s Mem. at 13. The
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`undersigned has reviewed the plans and the detailed comparison of the plans by the
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`Wingard Defendants and recommends finding Sater has not proven “substantially
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`similarity” as a matter of law. See Keeler Brass, 862 F.2d at 1065. This detailed factual
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`analysis is one for the fact finder. Further, even if Sater established “substantial
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`similarity” between the plans, Defendants would still have the opportunity to rebut the
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`presumption of copying.
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`2.
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`Damages
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`Sater also seeks partial summary judgment as to damages against all Defendants.
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`See Pl.’s Mem. at 13 24. The Copyright Act permits an aggrieved copyright owner to
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`recover from the infringer either the copyright owner’s actual damages and any profits of
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`the infringer or statutory damages. See 17 U.S.C. § 504(a). Because the undersigned
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`recommends finding Sater has not established liability at this summary judgment phase,
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`the undersigned need not consider damages at
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`this
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`juncture. The undersigned
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`recommends the court deny Sater’s request for summary judgment as to damages.
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`15
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`4:08-cv-04101-TLW Date Filed 02/28/11 Entry Number 159 Page 16 of 29
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`3.
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`Defenses
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`Finally, Sater seeks summary judgment as to the Wingard Defendants’ 20
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`3
`affirmative defenses to Sater’s Second Amended Complaint. Pl.’s Mem. at 24 34; see
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`Answer to Pl.’s 2d Am. Compl. (“Answer”) ¶¶ 22 75. In their response to Sater’s motion
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`for summary judgment, the Wingard Defendants did not focus on this portion of Sater’s
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`motion, and Sater argues on reply that summary judgment should be granted as to the
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`defenses Defendants did not specifically address. Pl.’s Reply, at 2. The undersigned
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`considers these defenses in turn.
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`
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`a.
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`Failure to State a Cause of Action
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`Defendants’ second defense is that Sater failed to state a cause of action upon
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`which relief may be granted as to the Wingard Defendants. Answer, ¶¶ 22 23. Sater
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`asserts that it has sufficiently set forth a cause of action and summary judgment should be
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`entered against the Wingard Defendants on this issue. Pl.’s Mem. at 24 25. Based on the
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`undersigned’s review of the case as discussed above, it agrees that Sater has set forth a
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`cause of action sufficient to survive this challenge and recommends that Sater’s request
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`for summary judgment as to this defense be granted.
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`b.
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`Statute of Limitations, Statute of Repose, Doctrine of Laches
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`In their third defense, the Wingard Defendants aver that Sater’s claims are barred
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`by the applicable statute of limitations, statute of repose, and the doctrine of laches. Sater
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`3
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`Although Sater calls Defendants’ enumerated defenses “affirmative,” Defendants
`do not so nominate them in their answer.
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`16
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`4:08-cv-04101-TLW Date Filed 02/28/11 Entry Number 159 Page 17 of 29
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`seeks summary judgment as to these issues. Answer, ¶¶ 24 25. The undersigned
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`recommends Sater be awarded summary judgment as to these defenses.
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`The Copyright Act provides that provides that “[n]o civil action shall be
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`maintained under the provisions of this title unless it is commenced within three years
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`after the claim accrued.” 17 U.S.C. § 507(b). Through the affidavit of its president, Sater
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`asserts that it first discovered the alleged infringing homes at Grande Dunes in May 2008.
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`Sater Aff. ¶ 4 [Entry #129 2]. Sater filed this action in December 2008. Other than
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`setting out the statute-of-limitations defense in its answer, Defendants have not argued
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`that these claims are statutorily barred.
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`Similarly, other than pleading laches and the statute of repose as defenses,
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`Defendant has not submitted argument or evidence that Sater’s claims would be barred by
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`either. Nowhere do Defendants point to any particular statute of repose. Further, there is
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`no evidence that Sater waited unnecessarily to permit the equitable doctrine of laches be
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`invoked. See also Lyons P’ship, L.P. v. Morris Costumes, Inc., 243 F.3d 789, 798 (4th
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`Cir. 2001) (finding equitable doctrine such as laches should not be applied to shorten the
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`statutory limitations period Congress established for bringing claims under the Copyright
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`Act). Sater should receive summary judgment as to this defense.
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`c.
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`Defenses that Sater’s Copyrights are Invalid and/or Are Not
`Original Creations
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`The Wingard Defendants assert several defenses in their answer to Sater’s
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`Second Amended Complaint that relate to issues of validity and originality. See Answer
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`17
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`4:08-cv-04101-TLW Date Filed 02/28/11 Entry Number 159 Page 18 of 29
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`[Entry #93]. In their Fourth Defense, the Wingard Defendants allege that the designs at
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`issue are not sufficiently original to be entitled to copyright protection. Similarly, their
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`Fifth Defense indicates the designs are commonly known and commonly used to such an
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`extent that they lack a reasonable level of originality. They claim in their Sixth Defense
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`that few, if any elements in the works at issue are original to Sater and that such elements
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`are not substantially similar to Defendants’ works. Their Seventh Defense asserts that the
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`elements of the designs at issue are “functional and/or common ideas of a general style,
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`and therefore are not protected by copyright.” In their Eighth Defense, Defendants aver
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`that Sater’s design is not entitled to copyright protection because of the “merger
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`doctrine.” Their Ninth Defense alleges that Sater’s design is not entitled to copyright
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`protection because of the “scenes à faire principle.” Their Tenth Defense alleges that the
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`“ordinary observer” test does not apply to Sater’s cause of action and that the “more
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`discerning observer” test should be applied, under which no infringement exists. Their
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`Twelfth Defense asserts that Sater’s copyright registrations are “invalid, unenforceable
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`and not capable of sustaining an infringement action.” Their Fourteenth Defense alleges
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`that Sater’s “claims for infringement are barred to the extent plaintiff incorporated others’
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`works in its alleged ‘6910,’ 6746,’ 6653,’ 6721,’ 6719,’ and ‘6756’ designs and did not
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`provide names of such others as contributors to the work, or did not otherwise procure the
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`prior consent of said others.” Sater seeks summary judgment on these defenses. See Pl.’s
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`Mem. at 27 28.
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`18
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`4:08-cv-04101-TLW Date Filed 02/28/11