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Sophia & Chloe, Inc. v. Brighton Collectibles, Inc.

United States District Court, S.D. California

August 1, 2016

SOPHIA & CHLOE, INC., a California Corporation, Plaintiff,
BRIGHTON COLLECTIBLES, INC., a California Corporation, Defendant.


          Hon. Anthony J. Battaglia, United States District Judge

         Presently before the Court is Defendant Brighton Collectibles, Inc.’s (“Defendant”) motion for reconsideration, (Doc. No. 222), of the Court’s remittitur, which permitted Plaintiff to elect wrongful profits[1] after the Court concluded the jury’s award of statutory damages was excessive, (Doc. No. 218 at 11-17). Plaintiff opposes the motion. (Doc. No. 228.) The Court finds the matter suitable for decision on the papers, without oral argument, pursuant to Local Civil Rule 7.1.d.1. For the reasons set forth below, the Court DENIES Defendant’s motion.


         This dispute arose from Defendant’s willful infringement of Plaintiff’s jewelry.[2]Beginning November 10, 2015, the Court presided over a four-day jury trial on Plaintiff’s copyright infringement claim. (Doc. No. 148.) On November 18, 2015, the jury returned a special verdict. (Doc. Nos. 156, 161.) Out of six of Defendant’s designs, the jury found one design, the Toledo Statement Earrings, infringed two of Plaintiff’s thirteen copyrights protecting two versions of the Buddha’s Kiss Earrings. (Doc. No. 161.) The jury found Defendant’s infringement was willful. (Id. at 7.) The jury awarded Plaintiff $176, 890 in Defendant’s wrongful profits and $203, 571 in statutory damages. (Id. at 7.) Plaintiff elected to receive statutory damages, and the Court entered judgment. (Doc. No. 162.)

         Amongst a slew of post-trial motions, Defendant moved for judgment as a matter of law, or, alternatively, a new trial. (Doc. No. 175.) As relevant to its instant motion, Defendant argued that the jury’s statutory damages award was excessive because only one work had been infringed, notwithstanding the two copyrights. (Id. at 24-25.) In its order ruling on the post-trial motions, the Court agreed with Defendant that only one of Plaintiff’s works was infringed and that the statutory damages award was thus excessive. (Doc. No. 218 at 15-16.) In light of that finding, the Court gave Plaintiff a choice: accept a remittitur to the jury’s award of wrongful profits in the amount of $176, 890 or retry its damages case. (Id. at 16-17.) Plaintiff opted for the former. (Doc. No. 220.) Following this election, the judgment was amended on April 6, 2016, to reflect judgment in favor of Plaintiff in the amout of $176, 890. (Doc. No. 221.)

         On May 4, 2016, Defendant filed the instant motion, seeking reconsideration of Plaintiff’s reelection of wrongful profits and to amend the judgment. (Doc. No. 222.) Plaintiff filed an opposition, (Doc. No. 228), and Defendant replied, (Doc. No. 229). The Court took the matter under submission on July 28, 2016. (Doc. No. 232.) This order follows.

         Legal Standard

         Rule 59(e) of the Federal Rules of Civil Procedure[3] provides that, after entry of judgment, a court may alter or amend the judgment.[4] “[T]he district court enjoys considerable discretion in granting or denying [a Rule 59(e)] motion.” Allstate Ins. Co. v. Herron, 634 F.3d 1101, 1111 (9th Cir. 2011) (quoting McDowell v. Calderon, 197 F.3d 1253, 1255 n.1 (9th Cir. 1999) (en banc) (per curiam)). However, because “the rule offers an extraordinary remedy, [it should] be used sparingly in the interests of finality and conservation of judicial resources.” Kona Enters., Inc. v. Estate of Bishop, 229 F.3d 877, 890 (9th Cir. 2000) (citation and internal quotation marks omitted). As such, a Rule 59(e) motion generally should not be granted absent highly unusual circumstances, 389 Orange St. Partners v. Arnold, 179 F.3d 656, 665 (9th Cir. 1999), such as an intervening change in controlling law, the availability of newly discovered or previously unavailable evidence, or the need to correct a clear error or prevent a manifest injustice, Allstate Ins. Co., 634 F.3d at 1111; see also McDowell, 197 F.3d at 1255 n.4 (finding no abuse of discretion “merely because the underlying order is erroneous, rather than clearly erroneous”).


         The parties’ respective positions are straightforward. Defendant argues that permitting Plaintiff to change its election from statutory damages to wrongful profits was clearly erroneous because once an election has been made, the plaintiff cannot reelect.[5](Doc. No. 222 at 8-10.) As such, Defendant concludes the award of $176, 890 is excessive given the Court’s finding that only one work was infringed, (see Doc. No. 218 at 15-16), and that 17 U.S.C. § 504(c)(2) limits statutory damages to $150, 000 per work infringed, (Doc. No. 222 at 10-13). Plaintiff counters that no grounds for reconsideration are present to justify disturbing the Court’s decision. (Doc. No. 228 at 3-4.) Plaintiff further argues that even when considering the merits of Defendant’s position, the reelection occurred prior to entry of final judgment and was thus proper under § 504(c)(2).[6] (Id. at 5-6.)

         Having reviewed the parties’ arguments in light of the unique circumstances of this case, the Court concludes that the extraordinary remedy of granting reconsideration is not warranted. Defendant first relies on the plain language of the Copyright Act as supporting its interpretation. 17 U.S.C. § 504(c)(1) permits the copyright owner to “elect, at any time before final judgment is rendered, to recover, instead of actual damages and profits, an award of statutory damages . . . .” Defendant reads this section as unequivocally providing that a copyright owner may not reelect the form of damages once an election has been made. (See Doc. No. 222 at 10; Doc. No. 229 at 7.) However, nothing on the statute’s face suggests a reelection may never occur under any circumstances.

         Defendant further relies on two out-of-circuit decisions to support its position. In Twin Peaks Productions, Inc. v. Publications International, Ltd., the district court, following an evidentiary hearing on the issue of damages, awarded the plaintiff (“TPP”) $120, 000 in statutory damages or $125, 000 in actual damages. 996 F.2d 1366, 1371 (2d Cir. 1993). TPP exercised its right to elect statutory damages against the defendant (“PIL”), presumably because TPP determined it was the award most likely to withstand appellate review. Id. at 1380. On appeal, the parties disputed issues relating to both statutory and actual damages; however, the Second Circuit found any issues relating to actual damages mooted by TPP’s election of statutory damages. Id. at 1380, 1382. The Second Circuit noted,

We do not think the election [between statutory and actual damages] continues into the appellate stage. Once a plaintiff has elected statutory damages, it has given up the right to seek actual damages and may not renew that right on appeal by cross-appealing to seek an increase in the actual damages.

Id. at 1380. Relying on Twin Peaks, the Eleventh Circuit held similarly in Jordan v. Time,Inc. There, the jury awarded the plaintiff (“Jordan”) actual damages. 111 F.3d 102, 104 (11th Cir. 1997). Apparently unsatisfied with that award, Jordan timely elected-after the jury verdict but before final entry of judgment-to recover statutory damages. Id. On appeal, Jordan sought to challenge certain instructions given by the trial court to the jury that related to actual damages. Id. Relying on Twin Peaks, the Eleventh ...

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