Use of Different Copyrighted or Trademarked Materials on Separate Occasions Prevents Triggering of the "Knowing Violation" Exclusion

Posted on August 14, 2008 by David Gauntlett

Wausau Business Ins. Co. v. Fisher Printing Co., Inc., 2008 WL 2704874 (N.D. Ill. July 8, 2008) (Kennelly)

The underlying suit asserted unlawful intentional copying of copyrighted images and repeated use of Ashley’s protected trademarks and images. The court, applying Illinois law, focused principally on the exclusions.
The court found the exclusion inapplicable, following Taco Bell Corp. v. Continental Cas. Co., 388 F.3d 1069 (7th Cir. (Ill.) 2004):

Ashley's description of Fisher's activity indicates the use of separate and distinct protected images without authorization, not (as in Taco Bell ) different permutations of a general concept. . . . The exhibits in Ashley's complaint also show separate copyright or trademark applications for each image that Fisher allegedly used without authorization. . . . Rather than one continuous use of a general idea with uncertain boundaries, see Taco Bell, 388 F.3d at 1074, publishing copyrighted or trademarked works involves, as least as characterized in Ashley's suit against Fisher, the use of separate images with “pretty definite metes and bounds,” not an ongoing use of a single general idea with uncertain boundaries. Id. If an infringer uses different copyrighted or trademarked material on separate occasions, he commits a set of “fresh wrongs” each time, and each occasion represents a separate publication, not simply a repetition of an earlier infringement. Id. at 1073.
Id. at *3.

If some of the issues allegedly used by Fisher without authorization were published after policy inception, a defense for the suit arises. The court found the “knowing violation” exclusion inapplicable because

A complaint that alleges, but does not require, proof of intent as a predicate for liability does not “plainly predicate liability on a theory of intentional misconduct.” To establish an infringement of copyright, a plaintiff needs to show only ownership of the copyright and copying of protected expression by the defendant. See Microsoft Corp. v. V3 Solutions, Inc., No. 01 C 4693, 2003 WL 22038593, at *9 (N.D.Ill. Aug.28, 2003) (citing Feist Publ'ns, Inc. v. Rural Tel. Serv. Co., 499 U.S. 340, 361, 111 S.Ct. 1282, 113 L.Ed.2d 358 (1991)). The plaintiff's ability to prevail does not depend on whether the defendant acted knowingly or intentionally. Id. (“Neither lack of knowledge nor intent are defenses to a copyright infringement claim”).
Id. at *5.

The court did not, however, find that Wausau’s conduct met the standard for vexatious and unreasonable conduct under 215 ILCS 5/155. Id. at *6.
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