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Great Minds v. FedEx Office and Print Services, Inc.

United States Court of Appeals, Second Circuit

March 21, 2018

Great Minds, Plaintiff-Appellant,
v.
Fedex Office and Print Services, Inc., Defendant-Appellee.

          Submitted: October 3, 2017

          Appeal from a judgment entered in the Eastern District of New York (Hurley, J.) dismissing this copyright infringement action filed by Plaintiff-Appellant Great Minds against Defendant-Appellee FedEx Office and Print Services, Inc. ("FedEx"). FedEx allegedly violated Great Minds' copyright by reproducing Great Minds' educational materials at the request of school districts, which sought to use the materials for noncommercial purposes under Great Minds' non-exclusive public license. The public license does not explicitly address whether licensees may engage third parties to provide commercial services that assist the licensees in furthering their own noncommercial uses. We hold that a copyright holder must state in its license any limitation it might wish to impose precluding such an engagement. We decline to infer any such limitation in Great Minds' public license, and therefore AFFIRM the District Court's judgment.

          Rhett O. Millsaps II, Law Office of Rhett O. Millsaps II, New York, New York; Eric M. Lieberman, Rabinowitz, Boudin, Standard, Krinsky & Lieberman, P.C., New York, New York, for Plaintiff-Appellant.

          Mark D. Taylor & Nicholas O. Kennedy, Baker & McKenzie LLP, Dallas, Texas; Michael A. Pollard, Baker & McKenzie LLP, Chicago, Illinois, for Defendant- Appellee.

          Before: Raggi, Hall, and Carney, Circuit Judges.

          SUSAN L. CARNEY, CIRCUIT JUDGE:

         Plaintiff-Appellant Great Minds appeals from the March 21, 2017 dismissal under Federal Rule of Civil Procedure 12(b)(6) of its copyright infringement action against FedEx Office and Print Services, Inc. ("FedEx") in the United States District Court for the Eastern District of New York (Hurley, J.). We find that Great Minds' public license does not explicitly address whether licensees may engage third parties to assist them in exercising their own noncommercial use rights under the license. We hold that, in view of the absence of any clear license language to the contrary, licensees may use third-party agents such as commercial reproduction services in furtherance of their own permitted noncommercial uses. Because FedEx acted as the mere agent of licensee school districts when it reproduced Great Minds' materials, and because there is no dispute that the school districts themselves sought to use Great Minds' materials for permissible purposes, we conclude that FedEx's activities did not breach the license or violate Great Minds' copyright. We therefore AFFIRM the District Court's judgment.

         BACKGROUND[1]

         Great Minds is a non-profit organization that designs educational materials. These include a copyrighted curriculum called "Eureka Math" (the "Materials"). Great Minds sells the Materials in book form and also releases them to the public without charge but subject to a "public license" (the "License"), using a template that is made available by a group called Creative Commons.[2] The License allows "[a]ny member of the public [to] download, reproduce, and distribute [the Materials] pursuant to the terms of the [] License, which is made available to all on the same terms without the need to negotiate." Appellant's Br. 2.

         The License provides that "[e]very recipient of the [Materials] automatically receives an offer from the Licensor to exercise the Licensed Rights under the terms and conditions of this [] License, " and grants each "individual or entity exercising the Licensed Rights" what it describes as a "worldwide, royalty-free, non-sublicensable, non-exclusive, irrevocable license to . . . reproduce and Share the [Materials], in whole or in part, for NonCommercial purposes only." App'x 30-31. It defines "NonCommercial purposes" to mean purposes "not primarily intended for or directed towards commercial advantage or monetary compensation." Id. at 30.

         In the complaint, Great Minds characterizes these provisions as amounting to an "explicit limitation of the License to noncommercial use requir[ing] that commercial print shops . . . negotiate a license and pay a royalty to Great Minds if they wish to reproduce the Materials . . . at the request of their [paying] customers." Id. at 10 ¶ 14. Great Minds incidentally avers that it uses the revenue that it receives from royalties and direct sales to fund the development of new curricular materials. Id.

         In late 2015 and early 2016, Great Minds discovered that FedEx stores in Michigan and New York reproduced the Materials, without Great Minds' authorization, in the course of their ordinary, for-profit business. After each such discovery, Great Minds sent a letter to FedEx demanding that FedEx either negotiate a royalty-bearing license with it or cease commercial reproduction of the Materials. FedEx refused, arguing that it had permissibly reproduced the Materials at the request of school districts, which sought to use the Materials for noncommercial purposes under the License.

         Great Minds filed the instant lawsuit in March 2016, asserting a single claim of copyright infringement against FedEx. The District Court dismissed the action under Rule 12(b)(6), concluding that the unambiguous terms of the License permit FedEx to provide for-profit copying services on behalf of a school district exercising noncommercial use rights under the License. Great ...


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