John Wiley & Sons, Inc. v. Book Dog Books, LLC
327 F. Supp. 3d 606
S.D. Ill.2018Background
- Plaintiffs (four major textbook publishers) sued Book Dog Books and related Smyres-run entities for repeated sale/importation of counterfeit textbooks after an earlier 2007 settlement; cases were consolidated and tried in 2018.
- A jury found willful trademark and copyright infringement and breach of the Settlement Agreement, awarding $34.2 million in statutory damages (maximum for many counts).
- Defendants moved post-trial for renewed judgment as a matter of law (Rule 50), a new trial (Rule 59), remittitur, and a stay pending appeal; Plaintiffs moved for partial final judgment, prejudgment interest, permanent injunction, disposition of infringing materials, and fees/costs.
- The trial record emphasized circumstantial proof of distribution (counterfeit exemplars, supplier relationships, poor recordkeeping, destroyed evidence, adverse-inference instruction) and substantial profits attributed to Defendants.
- The Court denied Defendants’ post-trial relief, granted in part Plaintiffs’ requested equitable relief (permanent injunction, turnover of suspected counterfeits), and awarded Plaintiffs attorneys’ fees and costs (reduced from requested amounts); Court ordered issuance of final judgment totaling $39,031,177.99.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Sufficiency of evidence/distribution for many works (Rule 50) | Circumstantial evidence (counterfeit exemplars, purchases from known counterfeit suppliers, poor records, destroyed books) suffices to infer distribution. | Plaintiffs lacked direct proof of distribution for 116 works; verdict rests on speculation. | Denied: jury reasonably found distribution based on abundant circumstantial evidence and adverse-inference instruction. |
| Ownership/standing for certain titles | Publishers or exclusive licensees proved ownership via registrations, acquisition practice, and witness testimony. | Registrations listed other entities/authors; plaintiffs failed to prove statutory ownership for some works. | Denied: testimony and documentary evidence supported ownership/licensing for disputed titles. |
| Preemption of breach-of-contract claim by Copyright Act | Settlement Agreement creates qualitatively different rights (promises to pay, broader non-assistance clause) and is not preempted. | Breach claim duplicates copyright rights and thus is preempted. | Held: breach claim not preempted. |
| Importation evidence | Plaintiffs relied on PIERS, testimony, and evidence tying Smyres-controlled import entities to shipments from known counterfeit sources. | PIERS doesn't show counterfeits; linking SRockPaper Imports to defendants is tenuous. | Denied: sufficient evidence supported inference of importation/commingling; but importation need not be sole basis for liability. |
| Damages/remittitur and double recovery concerns | Statutory damages appropriate for willful, repeat infringers; Plaintiffs sought trademark and copyright damages for non-overlapping sets of works. | Award is excessive, untethered to profits or losses, and may double-recover under Lanham/Copyright. | Denied remittitur: award within statutory ranges for willful infringement, intended also to deter; no double recovery because claims were for disjoint work sets. |
| Permanent injunction, turnover, and scope | Injunction and turnover needed because Defendants continued selling counterfeits; injunction may bind related Smyres entities; require turnover of suspect inventory. | A broad injunction or compelled cooperation (e.g., reporting suppliers/prices) is overbroad and burdens legitimate conduct; enjoining non-parties improper. | Granted in part: permanent injunction narrowly tailored, binds entities in active concert, requires surrender of suspected counterfeits (but not compelled supplier disclosures); compliance reporting for 5 years. |
| Attorneys’ fees and costs | Fees warranted under Settlement Agreement, Copyright Act (§505), and Lanham Act (exceptional case); seek ~$5.9M fees + $852k costs. | Fees excessive; positions sometimes reasonable; reductions required. | Granted in part: substantial fee award but reduced 30% for billing deficiencies; fees awarded $4,137,081.70 and costs $694,096.29 (expert fee and other costs adjusted). |
| Stay pending appeal / supersedeas bond | Defendants sought stay without bond or with substitute security (warehouse equity). | Bond unnecessary or substitute security adequate. | Denied: bond requirement not waived; proposed substitute inadequate given judgment size and collection concerns. |
Key Cases Cited
- Lavin-McEleney v. Marist Coll., 239 F.3d 476 (2d Cir.) (Rule 50 standard: draw all inferences for the non-movant)
- Provost v. City of Newburgh, 262 F.3d 146 (2d Cir.) (verdict must not rest on sheer surmise or conjecture)
- Fendi Adele S.R.L. v. Ashley Reed Trading, Inc., [citation="507 F. App'x 26"] (2d Cir.) (circumstantial evidence and inadequate records support infringement/willfulness findings)
- Island Software & Computer Servs., Inc. v. Microsoft Corp., 413 F.3d 257 (2d Cir.) (willfulness standard: actual knowledge or reckless disregard/willful blindness)
- Kirtsaeng v. John Wiley & Sons, Inc., 136 S. Ct. 1979 (U.S.) (considerable weight to objective reasonableness when awarding copyright fees; other equitable factors remain available)
- Fogerty v. Fantasy, Inc., 510 U.S. 517 (U.S.) (fee awards in copyright cases are discretionary; Fogerty factors)
- F.W. Woolworth Co. v. Contemporary Arts, Inc., 344 U.S. 228 (U.S.) (purpose of statutory damages includes deterrence and judicial flexibility)
- Nassau Cty. Strip Search Cases, 783 F.3d 414 (2d Cir.) (factors for waiving supersedeas bond)
- Octane Fitness, LLC v. ICON Health & Fitness, Inc., 572 U.S. 545 (U.S.) (exceptional-case standard for fee shifting in patent context and relevance to Lanham Act exceptional-case fees)