The US Court of Appeals for the Ninth Circuit affirmed a district court decision invalidating a copyright registration because the registration contained knowingly inaccurate information. Gold Value Int’l Textile v. Sanctuary Clothing, LLC, et al., Case No. 17-55818 (9th Cir. June 4, 2019) (Steeh, J).
Fiesta Fabric, also known as Gold Value International Textile, is a textile designer and fabric manufacturer. In 2013, Fiesta registered a textile design called the 1461 Design, along with 32 other fabric designs, as part of its spring/summer 2014 collection. Although the designs were registered as an unpublished collection, prior to the registration Fiesta had sold samples of the 1461 Design to a limited number of existing and potential customers to secure full production orders.
Fiesta sued Sanctuary, a clothing manufacturer, for copyright infringement. Sanctuary filed a motion for summary judgment, alleging that Fiesta did not own a valid copyright registration in the 1461 Design because the design had been sold prior to registration and therefore published, and Fiesta’s identification of the 1461 Design as unpublished in the copyright application was inaccurate. After inquiring with the US Copyright Office, the district court found that because Fiesta knew that the fabric had been previously sold, Fiesta included inaccurate information in its copyright application. The Copyright Office also confirmed that it would have refused registration of that work using the unpublished collections option because the work in fact had been published. The district court granted Sanctuary’s motion for summary judgment, finding Fiesta’s copyright registration invalid as to the 1461 Design and dismissing Fiesta’s claims with prejudice. Fiesta appealed.
On appeal, the Ninth Circuit found that the district court did not err in finding that the registration application contained an inaccuracy. The Court noted, however, that under 17 USC § 411(b)(1), an inaccuracy does not necessarily invalidate a copyright registration. The requirement holds that the inaccurate information must have been included in the application for copyright registration “with knowledge that it was inaccurate,” and that “the inaccuracy of the information, if known, would have caused the Register of Copyrights to refuse registration.”
Fiesta argued that it did not know the sales of samples constituted a publication and it had no intent to deceive the Copyright Office. The Ninth Circuit rejected Fiesta’s argument, finding it foreclosed by the plain language of § 411(b), which does not require a showing of fraud, but only that inaccurate information was included on the application “with knowledge that it was inaccurate.” The Court noted that since Fiesta was aware of the facts regarding the fabric sale, its action cannot be characterized as inadvertent or a good faith mistake. As a result, the Court found that the requirements of § 411(b)(1)(B) were met and the inaccuracy in the copyright registration rendered the registration invalid as to the 1461 Design.
