Klauber Brothers, Inc. v. Badgley Mischka, LLC

Background

Klauber Brothers alleged that it owned a United States copyright registration for a lace design identified internally as design number 39092 X. It claimed that M.J.C.L.K., LLC, doing business as Badgley Mischka, Saks Inc., and unidentified Doe defendants created, sold, manufactured, imported, or distributed fabric and products bearing artwork identical or substantially similar to that design. The accused products included products sold by Saks under the Badgley Mischka label.

Klauber asserted direct copyright infringement and indirect claims for contributory and vicarious copyright liability. M.J.C.L.K. and Saks moved to dismiss the amended complaint under Federal Rule of Civil Procedure 12(b)(6), which tests whether a complaint alleges enough facts to state a legally plausible claim. Klauber requested permission to amend if the motion was granted.

Direct Copyright Infringement

The court explained that a direct infringement claim requires allegations that the plaintiff owns a valid copyright and that the defendant infringed it. In the absence of direct evidence, copying may be shown through access to the copyrighted work and substantial similarity. If the works are exceptionally similar, sometimes called “strikingly similar,” copying may be inferred without separately showing access.

The court held that Klauber had not adequately alleged access. Klauber alleged that it sold more than 23,881 yards of lace bearing the design to parties in the retail and apparel industries, including customers in New York City. But it did not identify the recipients or provide a specific connection between those sales and the defendants. The court also found insufficient Klauber’s general allegation that Badgley Mischka had a business relationship with Klauber, accessed its design library, and received design samples. Klauber did not allege when that relationship occurred or whether the design was in the library when Badgley Mischka allegedly accessed it. Its additional allegations made “on information and belief” were unsupported by defendant-specific facts.

The court also held that Klauber had not shown striking similarity. Although Klauber identified similarities involving diamond shapes, geometric patterns, and curlicues, the court found significant differences in the elements, arrangement, and overall layout of the two designs. Because Klauber had not adequately alleged access or shown striking similarity, the court did not decide whether the designs were substantially similar or whether some similarities were unprotectible features common to lace patterns.

Indirect Copyright Liability

The court dismissed Klauber’s contributory and vicarious copyright claims. It found that Klauber’s allegations grouped the defendants together with unidentified Doe defendants and lacked enough factual support for the required elements. The court further held that these claims failed because Klauber had not adequately alleged an underlying act of copyright infringement by the defendants or by a third party.

Leave to Amend and Disposition

Although Klauber had already amended its complaint once, the court granted leave to amend. The court stated that any motion for leave to file a second amended complaint had to be submitted by October 17, 2022, with the proposed complaint attached. The court’s September 30, 2022 order granted the defendants’ motion to dismiss; the October 4 memorandum opinion explained that ruling.