Copyright Case on Photos and Descriptions

SMC Promotions, Inc. v. SMC Promotions, 2005 WL 292492 (C.D. Cal. Feb. 7, 2005). Plaintiff is a product distributor that relies on affiliate marketing. Plaintiff grants a copyright license to affiliates to use catalog photos and descriptions on the affiliates’ websites, but restricts the licensee’s ability to delegate or authorize another person to exercise the right.

Defendant offers to build websites for plaintiff’s affiliates. To make it easy for the affiliates, the defendant creates a database of plaintiff’s copyrighted photos and descriptions that it will integrate into each affiliate’s website. To avoid the obvious copyright problem when it aggregated the photos and descriptions, its user agreement with each affiliate says that defendant is acting as the affiliate’s agent for purposes of operating the affiliate’s website.

Thus, the argument goes, the user has a license to the photos and descriptions, and the defendant can merely rely upon that. This contract appears to position the defendant as a passive implementer of its users’ instructions. Unfortunately, this type of legal jujitsu rarely works, and it failed here. The court says that the plaintiff’s license to affiliates can’t be stretched that far, so the defendant loses the copyright claim.

The court also finds that defendant engaged in trademark infringement. The domains sellsmc.com, smcforums.com and smcpromotions.com are all deemed to create initial interest confusion, irrespective of the content or any disclaimers at the websites.

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