The Donnelly Act, N.Y. Gen. Bus. L. § 340 (McKinneys 1991), was modeled on the Sherman Act, see State v. Mobil Oil Corp., 38 N.Y.2d 460, 381 N.Y.S.2d 426, 344 N.E.2d 357 (1976), and generally is construed in accordance with the federal Act. Anheuser-Busch, Inc. v. Abrams, 71 N.Y.2d 327, 335, 520 N.E.2d 535, 539, 525 N.Y.S. 2d 816, 820 (1988). Plaintiff has failed to identify any "State policy [or] differences in the statutory language or the legislative history" that would justify construing the Donnelly Act differently from the Sherman Act in this case. See id. In fact, New York courts also have recognized the necessity of identifying the relevant product market. See, e.g., Creative Trading Co. v. Larkin-Pluznick-Larkin, Inc., 136 A.D.2d 461, 462, 523 N.Y.S.2d 102, 103 (1st Dep't. 1988). Therefore, plaintiff's claim under New York law is dismissed also for the reasons outlined above.
Re-Alco's copyright claim alleges that plaintiff is about to go into the business of publishing Growing Healthy manuals, apparently identical copies of defendants' manuals, and seeks a declaration that plaintiff would not be infringing defendant's copyright. Plaintiff relies rather imprecisely on the theory that the manuals were in the public domain and that NCHE improperly obtained a copyright on them.
Plaintiff has failed to allege that NCHE is not the author of the Growing Healthy curriculum as copyrighted or that its contributions to that curriculum were either nonexistent or trivial within the meaning of copyright case law. Therefore, plaintiff fails to state a cognizable claim. Even if plaintiff had stated a valid claim for copyright invalidation, plaintiff would not be entitled to a declaratory judgment because it has failed to allege the imminence of its production. Moreover, because plaintiff has failed to plead adequately its claim for copyright invalidity, it cannot now get a declaratory judgment that its manuals, which apparently will be identical copies of NCHE's Growing Healthy books, will not infringe defendant NCHE's copyright.
Plaintiff bears the burden proof to overcome the prima facie validity of NCHE's copyright. See Plymouth Music Co. v. Magnus Organ Corp., 456 F. Supp. 676, 679 (S.D.N.Y. 1978). Plaintiff bears a heavy burden because copyright law, unlike patent law, recognizes protectable originality at a very low threshold, including works that reproduce or derive from information, material, or previous works in the public domain. Alfred Bell & Co. v. Catalda Fine Arts, Inc., 191 F.2d 99, 102-103 (2d Cir. 1951). The Court in Alfred Bell specifically noted that compilations are "noticeable examples" of the fact that "originality . . . means little more than a prohibition of actual copying." Id. Therefore, "[a] copy of something in the public domain will support a copyright if it is a distinguishable variation." Id.
Although Alfred Bell involved a reproduction of a mezzotint, the principles enunciated there by the Second Circuit are applicable to compilations and derivative works such as the books at issue in the case at hand. A copyright is invalid only if the subject work shows no originality -- that is, if the copyrighted work is in no way a "distinguishable variation" on something already in the public domain. Alfred Bell, 191 F.2d at 102-103. "All that is needed for a finding of sufficient originality is a 'distinguishable variation' that is not merely trivial, even if the copyrighted work is based on prior copyrighted or public domain works." Merritt Forbes & Co. v. Newman Invest. Secur., Inc., 604 F. Supp. 943, 951 (S.D.N.Y. 1985) (citations omitted). Further, the "selection and ordering of particular facts or elements" can provide the basis for a finding of originality. Id. (citations omitted). See also Weissmann v. Freeman, 868 F.2d 1313, 1321 (2d Cir. 1989), (holding district court erred in finding copyright invalid where derivative work that evolved from prior works jointly authored involved rearrangement and a few new additions), cert. denied, 493 U.S. 883, 107 L. Ed. 2d 172, 110 S. Ct. 219 (1989), citing Wainwright Secur., Inc. v. Wall Street Transcript Corp., 558 F.2d 91, 95-96 (2d Cir. 1977), cert. denied, 434 U.S. 1014, 54 L. Ed. 2d 759, 98 S. Ct. 730 (1978); Key Publications, Inc. v. Chinatown Today Pub. Enterprises, Inc., 945 F.2d 509 (2d Cir. 1991) (holding sufficient originality existed in selection and ordering of information in Chinese-American telephone directory).
In view of the low threshold of originality necessary to protect variations on works in the public domain, it is not unreasonable to require that a plaintiff allege that disputed works are indistinguishable in other than trivial ways from unprotectable material in the public domain, particularly when plaintiff has alleged that defendant NCHE was responsible for revising the materials at issue. (Amd Complt P 29-30, 41(a)) Therefore, taking plaintiff's allegations as true that the Growing Healthy's predecessor materials were in the public domain, arguably a conclusion of law not entitled to a presumption of truth, plaintiff still has failed to plead its case because it has not asserted that NCHE's copyrighted version is not a distinguishable variation. In fact, despite the vagueness of the Amended Complaint as regards the material at issue, it appears reasonably clear even from the complaint that NCHE did indeed produce a distinguishable, revised, renamed program. For example, plaintiff states that NCHE has had responsibility for the Growing Healthy program from the late 1970's to date. (Amd Complt PP 29-30) Plaintiff states that revisions to the program occurred several times during this period, and that "NCHE was a part of the revision process, but by no means developed the contents or managed the process of creating the revised . . . programs." (Amd Complt P 41(a))
Plaintiff's claim that NCHE did not manage the process or develop the program is inconsistent with its allegation that NCHE had responsibility for the program. Plaintiff apparently wants the court to find that NCHE controlled the program, thereby shutting plaintiff out of the market in violation of the antitrust laws, but that at the same time NCHE did not direct or control the program sufficiently to warrant its obtaining a copyright. Because of the low threshold set by copyright law for originality in authorship, plaintiff's allegations are inconsistent and insufficient. Although plaintiff states that the revisions in 1986 were "minor," it also states that the two previous programs were renamed as one joint program. (Amd Complt P 41(b)) Plaintiff does not allege facts that would allow a fact finder to conclude that the "minor" revisions were in fact "trivial" within the meaning of copyright law. Plaintiff states in its memorandum to the court that neither defendant was an author of the materials and that neither contributed even a trivial variation to the program's structure or content. (Pl. Mem. at 36) That statement is inconsistent with the language and logic of the Amended Complaint and, in any event, is not part of the pleadings and may not be considered. Cf. Ortiz v. Regan, 749 F.Supp 1254, 1263 (S.D.N.Y. 1990) (statements in a brief are not evidence).
Plaintiff maintains somewhat mysteriously that the program was actually the result of the work of the "creators." (Amd Complt P 9(b)) The Amended Complaint is vague about the manner in which the current Growing Healthy program developed, especially in light of its attempt to claim that defendant NCHE had next to nothing to do with it, but what is fairly clear is that the program evolved over a number of years, with the input of different authors. Therefore, Weissmann provides useful guidance, as that case also involved the validity of a copyright on a derivative work that had evolved from collective efforts over a number of years. In Weissmann, 868 F.2d 1313, the validity of the copyright was challenged by another legitimate author. The Second Circuit in that case made clear that minor revisions to someone else's work could result in a new valid copyright. Id. at 1321. In the case at hand, plaintiff does not even complain of the appropriation of its own work and acknowledges defendant's role of "responsibility" in the development of previous incarnations of the program as well as the current trademarked Growing Healthy curriculum. Plaintiff simply asserts no basis on which to invalidate NCHE's copyright.
In addition to plaintiff's claim that NCHE's copyright is invalid, plaintiff seeks a declaration that publication of its own manuals would not infringe NCHE's copyright. This claim necessarily depends on a finding that the copyright is invalid because plaintiff wants to publish identical manuals. The Declaratory Judgment Act requires that an "actual controversy" exist before a federal court can grant declaratory relief. 28 U.S.C. § 2201. See Aetna Life Ins. Co. v. Haworth, 300 U.S. 227, 239-41, 81 L. Ed. 617, 57 S. Ct. 461 (1937). Defendant cites several patent cases in support of its contention that plaintiff has failed to allege the existence of an actual controversy at this stage.
Because plaintiff wants to publish identical copies of defendant's manuals, declaratory judgment of noninfringement would be inconsistent with my determination that plaintiff has failed to allege that defendant's copyright is invalid. Although copyright law provides a low threshold for originality, it does prevent outright copying. See, e.g., Alfred Bell, 191 F.2d at 102-103. Further, even if plaintiff had stated a claim for copyright invalidation, a declaratory judgment would be inappropriate in this case because plaintiff has failed to meet the requirements for obtaining declaratory relief.
In International Harvester Co. v. Deere & Co., 623 F.2d 1207 (7th Cir. 1980) the court laid out two requirements for the existence of a justiciable controversy in this setting: 1) "the defendant must have engaged in conduct giving rise to a reasonable apprehension on plaintiff's part that it will face an infringement suit or threat of one if it commences or continues the activity in question;" and 2) "the plaintiff must have actually produced the accused article or have engaged in preparations for production such that [plaintiff could begin production immediately]." Id. at 1210. See also Wembley, Inc. v. Superba Cravats, Inc., 315 F.2d 87, 90 (2d Cir. 1963) (holding that "where there is no actual manufacture, use, or sale, and no immediate intention and ability to practice the invention, there is no justiciable controversy").
Intention and ability must be decided on a case by case basis. International Harvester, 623 F.2d at 1215. The burden is on the plaintiff to support its allegation that the court has jurisdiction under the Declaratory Judgment Act. Id. at 1210. Even if I were to hypothesize that defendant's copyright ultimately would be invalidated, although not through the Amended Complaint in the case at bar, plaintiff has failed to plead a justiciable controversy because it has not established that it would immediately begin production. Plaintiff's submission of estimates from printers (See Att. to Sinnreich Aff.) is insufficient to prove that it would immediately begin production. Indeed, one of the letters submitted by plaintiff from a publisher states that "to the best of my knowledge the project was put on hold due to costs in excess of one million dollars." (Ltr fr. K. Beers att. to Sinnreich Aff.) Further, the "contract" with Focus on Education that plaintiff attaches to its submission is meaningless as it has not been signed by either party.
Therefore, plaintiff's action for a declaratory judgment and invalidation of defendant's copyright is dismissed.
Because I dismiss plaintiff's claims under the federal antitrust and copyright laws, plaintiff's state law claims, jurisdiction over which is alleged to arise through principles of pendency and by virtue of the governing federal statutes, will be dismissed. Even if this court had jurisdiction over those claims, they fail as a matter of law. Plaintiff's claims of breach of constructive trust and promissory estoppel stretch the bounds of law and of reason.
Plaintiff sues for "breach" of a constructive trust. Constructive trust is a remedy. Even liberally construed as a claim for imposition of such a trust, however, plaintiff's claim fails. Constructive trust is a remedy to rectify fraud and prevent unjust enrichment. Bankers Secur. Life Ins. Soc. v. Shakerdge, 49 N.Y.2d 939, 940, 406 N.E.2d 440, 441, 428 N.Y.S.2d 623, 624 (1980). A constructive trust is imposed in the context of the breach of a fiduciary relationship. Generally, in New York, one is imposed only where there is: "1) a confidential or fiduciary relation, 2) a promise, express or implied, 3) a transfer made in reliance on that promise, and 4) unjust enrichment." Id. (citations omitted).
Plaintiff has failed to allege facts on which to find a breached fiduciary relationship warranting the imposition of a constructive trust. That doctrine is simply not applicable here. NCHE's copyright and exclusive distribution agreement for the Growing Healthy materials do not constitute fraud or the breach of some duty owed to plaintiff, who entered the market as a supplier of peripherals for the Growing Healthy program two years after NCHE copyrighted the program and while NCHE already had an exclusive distribution agreement in place with another company. Therefore, plaintiff's claim seeking imposition of a constructive trust, liberally construed, must be dismissed.
The elements of promissory estoppel under New York law are: "a clear and unambiguous promise; a reasonable and foreseeable reliance by the party to whom the promise is made; and an injury sustained by the party asserting the estoppel by reason of his reliance." Ripple's of Clearview, Inc. v. Le Havre Associates, 88 A.D.2d 120, 452 N.Y.S.2d 447, 449 (2d Dep't. 1982). It is not clear on the face of the Amended Complaint what promise defendant made to plaintiff. Plaintiff complains that NCHE "impliedly covenanted [inter alia] to maintain the Growing Healthy program in the best interests of the program and its beneficiaries." (Amd Complt P 112) Plaintiff apparently means by this that NCHE owed some duty to plaintiff to allow plaintiff to compete in the market. Re-Alco claims that "plaintiff realized a second distributor would further disseminate Growing Healthy and benefit the program's operation, by adding, inter alia, quality, ingenuity and price competition." (Amd Complt P 114) This language does not state a claim. Plaintiff has alleged no facts supporting its contention that it relied reasonably and foreseeably on any sort of promise, much less a clear and unambiguous promise by defendant. Therefore, plaintiff's claim of promissory estoppel also is dismissed.
* * *
For the reasons discussed above, and in view of the fact that plaintiff has already had one opportunity to replead, plaintiff's Amended Complaint is dismissed in its entirety with prejudice.
Dated: New York, New York
January 29, 1993
Michael B. Mukasey,
U.S. District Judge