IP Law Daily Overwhelming evidence supports $39M award to publishers over sale of counterfeit textbooks
Monday, August 20, 2018

Overwhelming evidence supports $39M award to publishers over sale of counterfeit textbooks

By Brian Craig, J.D.

Finding that the evidence presented to the jury on willfulness was overwhelming in a case involving the sale of counterfeit textbooks, the federal district court in New York City has awarded large book publishers more than $39 million, including more than $4.1 million in attorney fees. In sustaining the jury verdict, the court found ample evidence that book seller Book Dog Books recklessly disregarded or acted willfully blind by infringing copyrights and trademarks owned by John Wiley & Sons, Cengage Learning, Pearson Education, and McGraw–Hill Global Education. Furthermore, the court entered a permanent injunction for the publishers ordering Book Dog topurge all counterfeits currently in its inventory (John Wiley & Sons, Inc. v. Book Dog Books, LLC, August 17, 2018, Pauley, W.).

In a case that began in 2007, a consortium of textbook publishers—John Wiley & Sons, Cengage Learning, Pearson Education, and McGraw–Hill Global Education—brought claims against Book Dog for selling counterfeit textbooks. On April 5, 2018, a jury found Book Dog liable for trademark infringement, copyright infringement, and breach of contract claims and awarded $34.2 million in statutory damages. Both parties filed a variety of post-trial motions.

Judgment as a matter of law. The court first rejected Book Dog’s motion for judgment as a matter of law. The defendants failed to demonstrate the high burden to show that the verdict amounted to sheer surmise and conjecture. The jury was permitted to make inferences based on the totality of the evidence. The court found that the jury’s inferences were within reason and established by a preponderance of the evidence. The evidence was overwhelming, including photographs of the defendants bulldozing counterfeit books at a municipal landfill for fear of a lawsuit. The court also concluded that the publishers were not awarded a double recovery under the Lanham and Copyright Acts. Rather, the publishers sought trademark damages for one set of works and copyright damages for another non-overlapping set. Therefore, the court denied the motion for judgment as a matter of law.

New trial. The court also denied Book Dog’s motion for a new trial. The court held that a new trial on the basis of evidentiary error should not be granted unless theintroduction of inadmissible evidence was a clear abuse of discretion and was clearlyprejudicial to the outcome of the trial. Here, the court held that the evidence presented at trial was properly admitted. The publishers were entitled to offer the prior settlement agreement as evidence of the breach of contract claim and to show notice of possible infringement. The court also properly admitted cease-and-desist letters on cross-examination to show that the defendants were on notice that the publishers believed that there were other counterfeits. Cease-and-desist letters are not hearsay when offered to show bad faith and willful infringement. As such, the court denied the motion for a new trial.

Permanent injunction. The court also found that the publishers were entitled to a permanent injunction to prevent future infringement. The court ordered Book Dog topurge all counterfeits currently in its inventory, which is standard relief under the Copyright Act and Lanham Act. The court also required a sworn declaration of compliance with the court’s injunction within 120 days and annually thereafter for five years. The court, however, declined the request to providence notice of the permanent injunction to other entities such as Amazon, Barnes & Noble, and eBay.

Attorney fees and costs. The court finally addressed whether the publishers were entitled to attorney fees and costs. Because the defendants took unreasonable positions throughout the litigation and the jury’s finding of willful infringement, the court held that the publishers were entitled to attorney fee awards under both the Copyright Act and the Lanham Act. The court, however, exercised its discretion to reduce the total fees sought by 30 percent because of deficiencies found in billing records. The court awarded total attorney fees of $4,137,081.70. This substantial award reflected work performed over five years in three lawsuits in bringing 161 separate claims. The court also awarded $694,096.29 in costs. While the court found the costs for hotel accommodations during the three-week trial of $81,807 to be excessive, the court concluded the other costs were reasonable.

This case is No. 1:16-cv-07123-WHP-GWG.

Attorneys: Jeffrey M. Gould (Oppenheim + Zebrak LLP) for John Wiley & Sons, Inc. and Cengage Learning, Inc. Evan Mandel (Mandel Bhandari LLP) and Janice Berkowitz (Ahmuty Demers & McManus) for Book Dog Books, LLC.

Companies: John Wiley & Sons, Inc.; Cengage Learning, Inc.; Book Dog Books, LLC

MainStory: TopStory Copyright Trademark NewYorkNews

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