A pending action in the Eastern District of Wisconsin serves as a reminder of the need for clarity and specificity in any IP-related deal, and in this case, in a matter involving copyright.
Wayne W. Peterson is a freelance commercial artist who produced various commissioned works for the Harley-Davidson motorcycle company from the mid-1970s through the mid-2000s. Two of Peterson’s works, the “Live to Ride” logo, created in 1985 and the “Harley-Davidson University” logo, created in 1991, are the subject of Peterson’s Complaint.
Peterson asserts that he owns the federally registered copyrights to these works, and that the license he granted to Harley-Davidson for their use was limited; yet Harley-Davidson has used these works without authorization on countless product runs and various packaging and marketing materials since he created them. Peterson is seeking an injunction for this alleged copyright and contributory copyright infringement.
Harley-Davidson responded to the Complaint with a motion to dismiss for failure to state a claim upon which relief can be granted, under Fed. R. Civ. P. 12(b)(6), arguing that Peterson’s action is barred on two dispositive grounds: laches and statute of limitations. As to the former, Harley-Davidson asserted that Peterson’s delay in bringing the suit in 2012 was unreasonable, relative to works created in 1985 and 1991. Regarding the latter, Harley-Davidson argued that the three-year statute of limitations under the Copyright Act of 1976, 17 U.S.C. § 507(b) (“no civil action shall be maintained … unless it is commenced within three years after the claim accrued”) barred any claims by Peterson for alleged acts of infringement occurring before April 25, 2009.
In a recent Decision and Order, Judge Lynn Adelman denied Harley-Davidson’s motion, finding that while laches and the statute of limitations are affirmative defenses, the Complaint alone, while sufficiently pled, did not plead all the ingredients of laches or statute of limitations. That is, the Complaint did not admit all the elements necessary for Harley-Davidson to prevail on its defenses. In particular, the Court found that it was unclear whether Peterson’s delay was unreasonable as a matter of law. In addition, under the “continuing-violation doctrine” as presently applied by the Seventh Circuit to copyright, the statute of limitations does not begin to run on a copyright claim regarding a series of infringements until the entire series is done. At this juncture, the Court viewed Harley-Davidson’s alleged transgressions as a single course of infringement, albeit beginning in the mid-1980s, but left the door open for Harley-Davidson to develop the factual record to counter this and to distinguish the Seventh Circuits governing law.
With this denial, next up procedurally will be Harley-Davidson’s Answer. Recent copyright decisions that were reported here and here, involving Marvel Comics and copyright disputes regarding characters made on a “work for hire” basis, may provide a factual roadmap for Harley-Davidson to consider in its defense of the case. A scheduling conference is set for early September.