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Art of Design, Inc. v. Pontoon Boat, LLC

United States District Court, N.D. Indiana, South Bend Division

June 18, 2018

THE ART OF DESIGN, INC., Plaintiff,
v.
PONTOON BOAT, LLC, d/b/a Bennington and Bennington Marine, and HAWKEYE BOAT SALES, INC., Defendants.

          OPINION AND ORDER

          JON E. DEGUILIO JUDGE

         Plaintiff The Art of Design, Inc. (“TAOD”) filed its original complaint in this lawsuit on September 6, 2016. [DE 1] On motion of Defendants Bennington and Hawkeye Boat Sales (collectively “Defendants”), the Court dismissed that complaint in August 2017. [DE 19] Shortly thereafter, TAOD filed its first amended complaint (the “FAC”) alleging copyright infringement against both Defendants (Count II), and alleging breach of contract and induced infringement against Bennington (Counts I and III, respectively). [DE 23] Now before the Court is Defendants' Motion to Dismiss the FAC. [DE 28] For the reasons stated herein, the Court will grant in part and deny in part said motion.

         FACTUAL ALLEGATIONS

         TAOD designs custom artwork that can be applied to a variety of “canvases, ” such as boats and motorcoaches. [DE 23 ¶ 7] TAOD alleges that it is the sole author of, or the assignee of the two visual designs at issue here, known collectively as the “shatter graphics.” Id. ¶ 12. The shatter graphics are registered with the U.S. Copyright Office under registration numbers VA 1- 979-388 (the “‘388 design”) and 1-982-002 (the “‘002 design”). Id. ¶ 13. The registrations, which include the graphics themselves, are attached to the FAC.

         Defendants sell products in the marine industry, including pontoon boats. Id. ¶ 15. In or around 2011, Bennington reached out to TAOD and requested that TAOD propose a design for application to a limited number of Bennington pontoon boats. Id. ¶ 18. TAOD provided Bennington with samples of its artwork, and Bennington selected the designs depicted in the shatter graphics to be placed on the exterior of its boats. Id. ¶ 19. TAOD alleges that it entered into the following agreement with Bennington to govern their conduct moving forward:

[I]n exchange for payment by Bennington 1) TAOD would apply the Shatter Graphics to the exterior of a limited number of Bennington boats and 2) Bennington would not reproduce, copy, or distribute the Shatter Graphics to anyone without written permission.

Id. ¶ 20. Nowhere does TAOD allege that this agreement was reduced to writing, nor does it attach any written contract to the FAC.

         Sometime after Bennington paid TAOD for the requested paint job, TAOD alleges that Bennington sold, advertised, and distributed products (other than the boats covered by the agreement) incorporating either the shatter graphics or designs that are substantially similar to the shatter graphics, without TAOD's authorization. Id. ¶ 22. TAOD further alleges that Bennington provided the shatter graphics or substantially similar designs to Hawkeye, again without TAOD's authorization. Id. ¶ 23. Hawkeye then allegedly began selling, advertising, and distributing its own products incorporating these designs without TAOD's authorization. Id. ¶ 24. TAOD alleges that Defendants continue to engage in the alleged infringing conduct. Id. ¶¶ 22, 24.

         STANDARD

         In reviewing a motion to dismiss for failure to state a claim upon which relief can be granted under Federal Rule of Civil Procedure 12(b)(6), the Court construes the complaint in the light most favorable to the plaintiff, accepts the factual allegations as true, and draws all reasonable inferences in the plaintiff's favor. Reynolds v. CB Sports Bar, Inc., 623 F.3d 1143, 1146 (7th Cir. 2010). A complaint must contain only a “short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). That statement must contain sufficient factual matter, accepted as true, to state a claim for relief that is plausible on its face, Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009), and raise a right to relief above the speculative level. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). However, a plaintiff's claim need only be plausible, not probable. Indep. Trust Corp. v. Stewart Info. Servs. Corp., 665 F.3d 930, 935 (7th Cir. 2012). Evaluating whether a plaintiff's claim is sufficiently plausible to survive a motion to dismiss is “‘a context-specific task that requires the reviewing court to draw on its judicial experience and common sense.'” McCauley v. City of Chicago, 671 F.3d 611, 616 (7th Cir. 2011) (quoting Iqbal, 556 U.S. at 678).

         DISCUSSION

         Defendants move to dismiss the infringement and breach of contract claims.[1] For the following reasons, the Court will deny Defendants' motion to dismiss the copyright infringement claim (Count II), but will dismiss TAOD's breach of contract allegations (Count I).

         A. Copyright Infringement Claim

         Defendants argue for dismissal of TAOD's copyright infringement claim on two distinct theories. First, Defendants suggest that any alleged infringement of the ‘002 design should be dismissed under the “useful article” exception found at 17 U.S.C. § 113(b). Second, Defendants maintain that the ‘388 design depicts nothing but unprotectable lines and geometric shapes, and that therefore, there exists no substantial similarity between the ‘388 design and the alleged ...


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