In Jarvis v. K2 Inc. (April 30, 2007), the Ninth Circuit held that a retailer’s use of collage advertisements containing copyrighted photos was not covered by the “collective works” privilege and, thus, the retailer could be liable for copyright infringement.
Jarvis, a professional photographer, and K2, a sporting goods maker, entered into a series of agreements from 1999 to 2002. Under these agreements, Jarvis submitted photographs to K2 in exchange for compensation. K2 could publish the images provided by Jarvis in its marketing materials and on its website so as to market its business. The agreement called for K2 to include an attribution credit for each use of Jarvis’ images. Under the last agreement between Jarvis and K2, K2’s rights to use the photos expired in May 2003.
Jarvis provided more than 4,000 slides to K2, the bulk of them during 2000-2001. 24 of Jarvis’ images were incorporated into four “collage” advertisements that were initially published as magazine inserts prior to May 2003. These collage ads combined edited versions of Jarvis’ images with other images, marketing graphics and promotional slogans.
The relationship between Jarvis and K2 eventually soured and K2’s contractual rights to use Jarvis’ images expired. Nevertheless, K2 scanned the previously used collage ads and displayed them on its website after May 2003. Jarvis filed a lawsuit against K2 alleging, among other things, copyright infringement for the use on its website of the 24 photographs in K2’s collage advertisements.
The trial court granted summary judgment in Jarvis’ favor as to most of his other claims and awarded him damages. However, the trial court ruled that the collage advertisements, which contained 24 images that would have otherwise infringed on Jarvis’ copyrights, constituted “collective works” and thus were privileged under 17 U.S.C. section 201(c). Jarvis appealed this finding to the Ninth Circuit.
Jarvis argued that a 2001 agreement with K2 applied to the images in the collage ads and did not permit the images to be used in any way by K2 after May 2003. He argued that the trial court erred in ruling that the collage ads were protected as “collective works.”
The Ninth Circuit recognized that the 2001 agreement authorized K2 to “publish” Jarvis’ images and that K2 acted within its rights when it first used the collage ads prior to May 2003 for the magazine inserts. Although K2 conceded that its display of the collage ads after the May 2003 termination date was not authorized by the agreement, K2 argued that the collage ads fell under the “collective works” privilege of section 201(c).
Section 201(c) provides in pertinent part: “In the absence of an express transfer of the copyright or of any rights under it, the owner of copyright in the collective work is presumed to have acquired only the privilege of reproducing and distributing the contribution as part of that particular collective work, any revision of that collective work, and any later collective work in the same series.” The Ninth Circuit, however, rejected K2’s argument (and the finding of the trial court) and held that the ads were not “collective works,” but rather, improper “derivative works.”
The Ninth Circuit recognized that section 201(c) protects only collective works. A “collective work” is defined as “a work, such as a periodical issue, anthology, or encyclopedia, in which a number of contributions, constituting separate and independent works in themselves, are assembled into a collective whole.” (See 17 U.S.C. §101.) A “derivative work,” on the other hand, is defined as “a work based upon one or more preexisting works, such as a translation, musical arrangement . . . art reproduction, abridgment, condensation, or any other form in which a work may be recast, transformed, or adopted. A work consisting of editorial revisions, annotations, elaborations, and other modifications which, as a whole, represent an original work of authorship, is a `derivative work’.” (Id.)
Using these statutory definitions, the Ninth Circuit found that the collage ads were derivative in nature rather than collective works. Jarvis delivered all of his images to K2 in the form of identical square slides. K2’s collage ads did not merely compile these slides as a typical album might. Rather, K2 “shrank, expanded, distorted, overlaid and otherwise edited the original images, while also combining them with photos taken by other photographers, additional graphics, the K2 logo and marketing slogans.”
The Ninth Circuit found that the changes K2 made to Jarvis’ images were examples of “recasting, transforming or adopting” and “editorial revisions, annotations, elaborations or other modifications” that define “derivative works.” The Ninth Circuit recognized that Jarvis delivered the images to K2 in one form and they were subsequently used in the collage ads in a different (though still recognizable) form. K2’s ads did not simply compile or collect Jarvis’ images, but rather, altered and infused them with other images and artistic elements into new works that were based on, i.e., derivative, of Jarvis’ original images.
K2 attempted to argue that its collage ads “in no way transformed or altered [Jarvis’] preexisting photographs.” The Ninth Circuit rejected this argument by finding that “even a cursory look at the ads which `transformed or altered’ Jarvis’ photographs in a variety of ways, demonstrates the weakness of this claim.”
K2 also argued that the collage ads that appeared on its website were the same ones that had been used as original magazine inserts. The Ninth Circuit found this to be irrelevant since “a derivative work remains derivative when it is scanned and placed on line just as a collective work would remain collective if it were transferred from one medium to another.”
Having found that K2’s four collage ads were derivative rather than collective works, the Ninth Circuit ruled that K2 had infringed on Jarvis’ copyrights as to the 24 images that were used in K2’s collage ads. The Court remanded the matter to the trial court to determine the amount of Jarvis’ damages. The Ninth Circuit further noted that because some of the images used in the collage ads appeared to have been registered by Jarvis before their infringement, Jarvis may be entitled to statutory damages and attorney’s fees under sections 412 and 504(c)(1). Jarvis could also show that K2’s infringement was “willful” under section 504(c)(2) thereby increasing the amount of available statutory damages.
The Ninth Circuit’s ruling in the Jarvis case requires that advertisers pay special attention to their use of copyrighted images in “collage” type advertisements. If copyrighted images are modified, transformed or included with other artists images, the advertiser may be unable to take advantage of the collective works privilege of section 201(c). This could expose the advertiser to substantial damages for copyright infringement.
James Kachmar is a Senior Associate in Weintraub Genshlea Chediak Tobin & Tobin’s litigation section. He represents corporate and individual clients in both state and federal courts and various business litigation matters, including trade secret misappropriation, unfair business competition, stockholder disputes, and intellectual property disputes. For additional articles on intellectual property issues, please visit Weintraub’s law blog at www.theiplawblog.com.