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UPDATE ART, INC. v. MAARIV ISREAL NEWSPAPER

May 12, 1986

UPDATE ART, INC., Plaintiff, against MAARIV ISREAL NEWSPAPER, INC. d/b/a "MAARIV INTERNATIONAL EDITION" and "MAARIV WEEKEND" (a/k/a MAARIV SOPH SHAVUA"), MAARIV PROMOTIONS, LTD, IRIT SHMAGER, TZI LEVY, TAMAR GUY, YORAM NEEMAN, NETA GREENSPAN, NAHUM HACOHEN, RON DAGONI, "JOHN DOE" and "JANE DOE", Defendants


The opinion of the court was delivered by: EDELSTEIN

OPINION AND ORDER

EDELSTEIN, District Judge:

 Defendant has moved for relief from an order dated March 14, 1986 ("March 14 Order"), in which this court referred this matter to a Magistrate to conduct an inquest regarding the damages sustained by plaintiff. The March 14 Order stated that no issues of fact regarding liability existed and that the sole issue was that of damages. Defendant's motion is granted in part and denied in part. The March 14 Order is amended in accordance with this opinion.

 Plaintiff, Update Art, Inc. ("Update"), is the owner of exclusive interests in the graphic art known as "Ronbo." *fn1" "Ronbo" is a photograph which superimposes President Ronald Reagan's face on a muscular body which is firing a machine gun. The body is intended to mimic the title character form the movie "Rambo." Plaintiff has produced posters containing the "Ronbo" character.

 Defendants publish an Israeli newspaper which is circulated in Isreal under the name Maariv as well as in the United States under the number Maariv International Edition. The February 28, 1986, weekend edition of the newspaper contained a full-page copy of the "Ronbo" poster. Defendants did not have plaintiff's permission to use the copyrighted "Ronbo" artwork nor did Maariv seek plaintiff's permission to use the artwork.

 Plaintiff filed this action on March 3, 1986 and sought an injunction against Maariv's further use of the "Ronbo" artwork, and accountability regarding the location and possession of the remaining copies of the newspaper as well as the plates used to print the copy of the poster. Plaintiff also sought to consolidate the hearing on the injunction with trial on the merits pursuant to Rule 65(a)(2) of the Federal Rules of Civil Procedure. The court conducted a hearing on March 4, 1986 where plaintiff and defendants appeared through counsel. At the hearing, the court questioned counsel regarding a possible stipulation on the accountability of the remaining copies of the paper and printing plates. Counsel, after questioning by the court, noted that a stipulation could be entered into regarding the location and securing of the newspapers and plates. Finally, the court questioned counsel on whether damages would be foregone. While there was some confusion, counsel for plaintiff indicated that damages would not be foregone. (Tr. at 19). The court then stated "Then we [will] have a limited hearing on damages. That's all. And that could be referred to a magistrate with your consent." (Tr. at 20). Plaintiff's counsel then responded "We would agree to a reference." Defendants' counsel did not respond. The court then stated "Go ahead and prepare your papers on damages, you go before a magistrate, I have a consent to do that, and we will wash it out." (Tr. at 20).

 Proposed orders were submitted by plaintiff and defendants which were intended to incorporate the substance of the hearing. The court signed the proposed order submitted by plaintiff with minor alternations. This order provided that trial on the merits was consolidated with the hearing held on March 3, 1986; that defendants were restrained from infringing on plaintiff's copyright and trademark "Ronbo"; that defendants were to deliver copies of the infringing items in their possession to plaintiff; that no material issues of fact remained; that defendants were liable for the claims in the complaint; and that the matter was referred to a Magistrate to determine damages.

 DISCUSSION

 Rule 60 contains two provisions for relief from orders. Rule 60(a) is to be used to make the record "speak the truth" and is not to be used to make the record say something other than what was originally pronounced. 11 C. Wright & A. Miller, Federal Practice and Procedure (Civil) ยง 2854, at 149 (1972); see Dura-Wood Treating Co. v. Century Forest Industries, Inc., 694 F.2d 112, 114 (5th Cir. 1982). Rule 60(b) gives the court discretion to allow relief from an order for mistake, inadvertence surprise or excusable neglect. Both provisions are applicable to defendants' motion.

 A. CLAIMS INCLUDED IN THE MARCH 14 ORDER: RULE 60(a)

 The March 14 Order provides that "defendant's are hereby found jointly and severally liable to plaintiff upon the claims alleged in the complaint and the sole remaining issue for determination shall be damages, costs and attorney's fees which plaintiff shall recover against defendant." The hearing on March 4, 1986, however, focused on plaintiff's copyright claim. Plaintiff's other claims were not even remotely addressed in the papers submitted to the court or at the hearing, Therefore, the March 14 Order should have been limited to plaintiff's copyright claim. The order is hereby amended pursuant to Rule 60(a) to rectify this oversight. The order applies only to the copyright claim. See Chavez v. Balesh, 704 F.2d 774, 776 (5th Cir. 1983) (judgment amended to reflect intention of court as indicated at hearing).

 B. LIABILITY ON COPYRIGHT CLAIM AND REFERRAL TO MAGISTRATE: RULE 60(b)

 Defendants also seek to have the March 14 Order set aside so far as it makes a determination of defendants' liability and the referral to a magistrate to compute damages. *fn2" Defendants present three bases for the motion. First, defendants indicate that they never stipulated to liability at the hearing on March 4, 1986. Defendants contend that the inclusion of a provision relating to a concession of liability in the March 14 Order was the result of mistake, misunderstanding and inadvertence. Second, defendants contend that they have valid defenses to plaintiff's allegations which should be ...


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