SOFTMAN PRODUCTS COMPANY, LLC, Plaintiff, v. ADOBE SYSTEMS
INC.; et al., Defendants, AND RELATED COUNTERCLAIMS.
Case No. CV 00-04161 DDP (AJWx)
UNITED STATES DISTRICT COURT FOR THE CENTRAL DISTRICT OF
CALIFORNIA
171 F. Supp. 2d 1075; 2001 U.S. Dist. LEXIS 17723; 45
U.C.C. Rep. Serv. 2d (Callaghan) 945
October 19, 2001, Decided
ORDER RE APPLICATION FOR PRELIMINARY INJUNCTION
[Motion filed on 8/27/01]
This matter comes before the Court on the counter-claimant Adobe's
application for a preliminary injunction. After reviewing and [**2] considering
the materials submitted by the parties, and hearing oral argument, the Court
adopts the following order.
I. Background
The counter-claimant Adobe Systems Inc. ("Adobe") is a leading software
development and publishing company. The counter-defendant SoftMan Products
Company ("SoftMan") is a Los Angeles-based company that distributes computer
software products primarily through its website, [*1080]
www.buycheapsoftware.com. Adobe alleges that since at least November 1997,
SoftMan has distributed unauthorized Adobe software, including Adobe Educational
software n1 and unbundled Adobe "Collections." n2 By distributing the individual
pieces of Adobe Collections, Adobe contends that SoftMan is infringing Adobe's
copyright in these products and violating the terms of Adobe's licenses. While
SoftMan agrees that it is breaking apart various Adobe Collections and
distributing the individual pieces of them as single products, SoftMan claims
that it is entitled to distribute Adobe software in this manner. There is no
direct contractual relationship between Adobe and SoftMan.
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n1 SoftMan agrees that, at one point, it sold Adobe Educational software, but
disputes that it has done so within the past year. (SoftMan Opp. at 6.) [**3]
n2 "Collections" are sets of individual Adobe products, such as Adobe
Photoshop or Illustrator on separate CD's, that are sold together in a larger
Adobe Retail Box. These Collections are offered by Adobe at a discount from the
individual retail products comprising the Collection. (Adobe Mot. at 3.) "An
example of an Adobe Collection is the Adobe Publishing Collection, comprised of
Adobe PageMaker, Acrobat, Photoshop and Illustrator, for $ 999. Separately,
these products retails as follows: Pagemaker - $ 499, Acrobat - $ 249, Photoshop
- $ 609 and Illustrator - $ 399." (Id.)
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Adobe distributes its products through "licensing" agreements with
distributors. n3 Each piece of Adobe software is also accompanied by an End User
License Agreement ("EULA"), which sets forth the terms of the license between
Adobe and the end user for that specific Adobe product. The EULA is
electronically recorded on the computer disk and customers are asked to agree to
its terms when they attempt to install the software. (SoftMan Opp. at 4.)
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n3 Specific agreements include the Adobe Authorized Reseller Agreement (for
distribution of full Retail versions of Adobe software), the Adobe Off-Campus
Educational Reseller Agreement ("OCRA") for distribution of Educational
software, and the Original Equipment Manufacturer Agreements ("OEM") (for
distribution of Adobe software coupled to hardware such as a scanner). (Snyder
Decl. P 7, Ex. 2; Williams Decl. P 3, Ex. 1.)
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Adobe alleges, among other things, that SoftMan has infringed on Adobe's
trademark by distributing incomplete versions of Adobe software. The central
difference between these allegedly incomplete products and the genuine Adobe
software is that when SoftMan unbundles a Collection and resells its component
parts, such individual pieces of software may not be accompanied by the
registration information which would entitle the bearer access to Adobe's
customer support and technical services. Adobe alleges that customers may be
confused about the connection between authentic Adobe software and the
unauthorized versions distributed by SoftMan because a consumer may acquire a
product from SoftMan as a "Retail" version when, in fact, it is a piece of an
unbundled Adobe Collection.
On August 27, 2001, this Court granted a temporary restraining order and
seizure order against SoftMan. On September 10, 2001, the Court entered a
preliminary injunction, to be in effect for the duration of the Court's review
of the supplemental briefing submitted by the parties following oral argument.
II. Legal Standard
"A party seeking a preliminary injunction must show 'either a likelihood of
success [**5] on the merits and the possibility of irreparable injury, or that
serious questions going to the merits were raised and the balance of hardships
tips sharply in its favor.'" Micro Star v. Formgen Inc., 154 F.3d 1107, 1109
[*1081] (9th Cir. 1998) (quoting Johnson Controls, Inc. v. Phoenix Control
Sys., Inc., 886 F.2d 1173, 1174 (9th Cir. 1989)). In granting a preliminary
injunction, a district court must find that the movant demonstrated either: (1)
a combination of probable success on the merits and the possibility of
irreparable injury if relief is not granted, or (2) the existence of serious
questions going to the merits and that the balance of hardships tips sharply in
its favor. Brookfield Communications, Inc. v. West Coast Entm't Corp., 174 F.3d
1036, 1046 (9th Cir. 1999). Irreparable injury may be presumed from a showing of
likelihood of success on the merits of a trademark infringement claim. Id. 174
F.3d at 1066 (citing Metro Publ'g v. San Jose Mercury News, 987 F.2d 637, 640
(9th Cir. 1993)). The traditional test for granting preliminary injunctive
relief also applies in the context of a trademark action. This [**6] test
requires the plaintiff to demonstrate: (1) a likelihood of success on the
merits; (2) a significant threat of irreparable injury; (3) that the balance of
hardships favors the plaintiff; and (4) whether any public interest favors
granting an injunction. Dollar Rent A Car v. Travelers Indem. Co., 774 F.2d
1371, 1374 (9th Cir. 1985); see also Schwarzer, et al., Federal Civil Procedure
Before Trial, § 13:44 (1999). The Ninth Circuit also uses an alternative test
which requires the plaintiff to demonstrate "serious questions going to the
merits and that the balance of hardships tips sharply in its favor." See First
Brands Corp. v. Fred Meyer, Inc., 809 F.2d 1378, 1381 (9th Cir. 1987).
III. Discussion
A. Copyright Infringement Claim
1. Likelihood of Success on the Merits
To prevail on its copyright infringement claim, Adobe must show (1) that it
owns the copyright to the product at issue, and (2) that SoftMan infringed Adobe
's copyrights in these products. Johnson Controls, 886 F.2d at 1175. With
respect to the second element, Adobe may prove infringement by showing that
SoftMan has violated one of Adobe's [**7] exclusive rights guaranteed to
copyright holders under 17 U.S.C. § 106(3). n4 Sony Corp. of Am. v. Universal
City Studios, Inc., 464 U.S. 417, 433, 78 L. Ed. 2d 574, 104 S. Ct. 774 (1984).
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n4 Title 17 U.S.C. § 106(3) provides that the owner of a copyright has "the
exclusive rights . . . to distribute copies or phonorecords of the copyrighted
work to the public by sale or other transfer of ownership, or by rental, lease,
or lending." 17 U.S.C. § 106(3).
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a. Copyright Ownership
Adobe's products consist of original material which is copyrightable subject
matter under 17 U.S.C. § 102. There is no dispute that Adobe is the registered
owner of the copyrights for all the products in question in this action.
b. Unauthorized Copying of a Protected Work
Copyright infringement exists when any of the rights granted under 17 U.S.C.
§ 106 are violated. Buck v. Jewell-La Salle Realty, 283 U.S. 191, 75 L. Ed.
971, 51 S. Ct. 410 (1931). [**8] Title 17 U.S.C. § 106(3) grants a copyright
holder the exclusive right to distribute, and to authorize distribution of, its
copyrighted work. Adobe chooses to distribute copies of its products through
licensing agreements with various distributors and dealers. n5 It [*1082] is
not disputed that SoftMan has no licensing agreement with Adobe.
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n5 These agreements are signed licenses between Adobe and the named
distributor. Adobe's general distribution agreement provides in part:
"Distributor acknowledges that the Software Products are to be licensed to End
Users in accordance with the terms and conditions of the current End User
License Agreement. . . . Distributor shall distribute the Software Products
solely in the form and packaging in which they were obtained from Adobe."
(Soriano Decl., Ex. 1 at p. 7.) Adobe's Reseller Agreement states that:
"Reseller acknowledges that the structure and organization of the Software is
proprietary to Adobe and that Adobe retains exclusive ownership of the Software
and the Trademarks." (Navarro Suppl. Decl., at p. 3, P 9.)
Most computer program and database product copies are distributed with
standard form terms in a document characterized as a "license". The standard
terms purport, among other things: to specify permitted uses of a copy, e.g.,
consumer or personal versus commercial; to prohibit certain uses of a computer
program copy, e.g., reverse engineering of the computer program code; to forbid
any use that is not expressly authorized, e.g., commercial processing of third
party data or business records; and to bar transfer of a copy and the "license"
to another person. (Rice Decl. P 5.)
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In addition, each piece of Adobe software is accompanied by the EULA. n6 Once
the products are distributed to the end-user, the EULA prohibits the individual
distribution of software that was originally distributed as part of a
Collection. Specifically, the Adobe EULA provides that the end user may
"transfer all [his] rights to the Use of the Software to another person or legal
entity provided that (a) [he] also transfer this Agreement, the Software and all
other software or hardware bundled or pre-installed with the Software." n7
(Palma Decl., Ex. 1.)
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n6 The EULA states in part: "The receiving party accepts the terms and
conditions of this Agreement (EULA) and any other terms and conditions upon
which [the end user] legally purchased a license to the Software." (Adobe EULA P
4, attached to Palma Decl., Ex. 1.) Adobe's EULA permits an end user, subject to
certain restrictions, to transfer the software, media, and documentation to
another end user. The restrictions relating to an end user's ability to transfer
include that the EULA must also be transferred and that "the Software and all
other software or hardware bundled or pre-installed with the Software, including
all copies, Updates, and prior version, and all copies of font software
converted into other formats." (Id.) [**10]
n7 The parties have made much of the change to Adobe's EULA that occurred in
April 2000. The Court finds that, under the current language of the EULA, Adobe
's clear intent is to prohibit the unbundling activity. Therefore, assuming
arguendo that the prior agreement did not prohibit the conduct at issue, the
current EULA does clearly state that the "unbundling activities" are barred.
(See Maier Decl. P 3.)
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In this case, Adobe alleges that by distributing unbundled Collections,
SoftMan has exceeded the scope of the EULA and has infringed Adobe's copyrights,
specifically Adobe's § 106 right to distribute and control distribution. SoftMan
contends that the first sale doctrine allows for the resale of Adobe's
Collection software.
(1) First Sale Doctrine
The "first sale" doctrine was first analyzed by the United States Supreme
Court in Bobbs-Merrill Co. v. Straus, 210 U.S. 339, 52 L. Ed. 1086, 28 S. Ct.
722 (1908). The Court held that the exclusive right to "vend" under the
copyright statute applied only to the first sale of the copyrighted work. The
doctrine has been codified [**11] at 17 U.S.C. § 109(a). It states in relevant
part: "the owner of a particular copy . . . lawfully made under this title . . .
is entitled, without the authority of the copyright owner, to sell or otherwise
dispose of the possession of that copy." 17 U.S.C. § 109(a). One significant
effect of § 109(a) is to limit the exclusive right to distribute copies to their
first voluntary disposition, and thus negate copyright owner control over
further or "downstream" transfer to a third party. Quality King Distrib. v. L
'Anza Research Int'l, Inc., 523 U.S. 135, 142-44, 118 S. Ct. 1125, 140 L. Ed. 2d
254 (1998). (See Rice Decl. P 11.) The first sale doctrine vests the copy owner
with statutory privileges under the Act which operate as [*1083] limits on the
exclusive rights of the copyright owners.
Adobe argues that the first sale doctrine does not apply because Adobe does
not sell or authorize any sale of its software. Adobe characterizes each
transaction throughout the entire stream of commerce as a license. n8 Adobe
asserts that its license defines the relationship between Adobe and any
third-party such that a breach of the license constitutes copyright
infringement. [**12] This assertion is not accurate because copyright law in
fact provides certain rights to owners of a particular copy. This grant of
rights is independent from any purported grant of rights from Adobe. The Adobe
license compels third-parties to relinquish rights that the third-parties enjoy
under copyright law. n9
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n8 "From Adobe's distributors through the end users, every party along the
way receives only a license. Since no party can transfer more rights than it
acquired, it follows that there was no "first sale" in the transfer to SoftMan,
and SoftMan's unbundling of Adobe software is copyright infringement as a matter
of law." (Adobe Suppl. Brief at 5.)
n9 See, e.g., Mark A. Lemley, Intellectual Property and Shrinkwrap Licenses,
68 S. Cal. L. Rev. 1239 (1995) ("Software vendors are attempting en masse to
'opt out' of intellectual property law by drafting license provisions that
compel their customers to adhere to more restrictive provisions than copyright
law would require.").
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In short, [**13] the terms of the Adobe EULA at issue prohibit licensees
from transferring or assigning any individual Adobe product that was originally
distributed as part of a Collection unless it is transferred with all the
software in the original Collection. This license provision conflicts with the
first sale doctrine in copyright law, which gives the owner of a particular copy
of a copyrighted work the right to dispose of that copy without the permission
of the copyright owner.
(2) Sale v. License
(a) Historical Background
Historically, the purpose of "licensing" computer program copy use was to
employ contract terms to augment trade secret protection in order to protect
against unauthorized copying at a time when, first, the existence of a copyright
in computer programs was doubtful, and, later, when the extent to which
copyright provided protection was uncertain. (See Rice Decl. P 6.) Computer
program copy use "licensing" continued after federal courts interpreted the
Copyright Act to provide substantial protection for computer programs as
literary works. (Id. at P 7.) In Step-Saver Data Systems, Inc. v. Wise
Technology, the Third Circuit examined the historical development [**14] of the
use of licensing in the software industry and concluded that subsequent changes
to the Copyright Act had rendered the need to characterize the transaction as a
license "largely anachronistic." 939 F.2d 91, 96 n.7 (3d Cir. 1991). n10
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n10 The court in Step-Saver explained: "When these form licenses were first
developed for software, it was, in large part, to avoid the federal copyright
law first sale doctrine. . . . Under this doctrine, one could purchase a copy of
a computer program, and then lease it or lend it to another without infringing
the copyright on the program. . . . Consumers, instead of purchasing their own
copy of the program, would simply rent a copy of the program, and duplicate it.
. . . Software producers wanted to sue the companies that were renting the
copies of the program to individual consumers, rather than the individual
consumers. The first sale doctrine, though, stood as a substantial barrier to
successful suit against these software rental companies, even under a theory of
contributory infringement. By characterizing the original transaction between
the software producer and the software rental company as a license, rather than
a sale, and by making the license personal and non-transferable, software
producers hoped to avoid the reach of the first sale doctrine and to establish a
basis in state contract law for suing the software rental companies directly.
Questions remained, however, as to whether the use of state contract law to
avoid the first sale doctrine would be preempted either by the federal copyright
statute (statutory preemption) or by the exclusive constitutional grant of
authority over copyright issues to the federal government (constitutional
preemption). [Citations.] Congress recognized the problem, and, in 1990, amended
the first sale doctrine as it applies to computer programs and phonorecords.
[Citations.] As amended, the first sale doctrine permits only non-profit
libraries and educational institutions to lend or lease copies of software and
phonorecords. [citations.] (Under the amended statute, a purchaser of a copy of
a copyrighted computer program may still sell his copy to another without the
consent of the copyright holder.)." 939 F.2d at 96, n.7.
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[*1084] (b) Adobe Sells its Software
A number of courts have held that the sale of software is the sale of a good
within the meaning of Uniform Commercial Code. Advent Sys. Ltd. v. Unisys
Corp., 925 F.2d 670, 676 (3d Cir. 1991); Step-Saver, 939 F.2d at 99-100;
Downriver Internists v. Harris Corp., 929 F.2d 1147, 1150 (6th Cir. 1991). It is
well-settled that in determining whether a transaction is a sale, a lease, or a
license, courts look to the economic realities of the exchange. Microsoft Corp.
v. DAK Indus., 66 F.3d 1091 (9th Cir. 1995); United States v. Wise, 550 F.2d
1180 (9th Cir. 1977). In DAK, Microsoft and DAK entered into a license agreement
granting DAK certain nonexclusive license rights to Microsoft's computer
software. The agreement provided that DAK would pay a royalty rate per copy of
computer software that it distributed. Subsequently, DAK filed a petition for
bankruptcy, and failed to pay the final two out of a total of five installments.
Microsoft filed a motion for the payment of an administrative expense, claiming
that it should be compensated for DAK's post-bankruptcy petition [**16] use of
the license agreement. On appeal, the Ninth Circuit held that the economic
realities of the agreement indicated that it was a sale, not a license to use.
Thus, Microsoft simply held an unsecured claim and not an administrative
expense. The court found that the agreement was best characterized as a lump sum
sale of software units to DAK, rather than a grant of permission to use an
intellectual property. The court in DAK noted:
Because we look to the economic realities of the agreement, the fact
that the agreement labels itself a "license" and calls the payments
"royalties," both terms that arguably imply periodic payment for the
use rather than sale of technology, does not control our analysis.
DAK, 66 F.3d at 1095, n.2. Other courts have reached the same conclusion:
software is sold and not licensed. See, e.g., RRX Indus., Inc. v. Lab-Con Inc.,
772 F.2d 543, 546 (9th Cir. 1985); Applied Info. Mgmt., Inc. v. Icart, 976 F.
Supp. 149, 155 (E.D.N.Y. 1997) (finding that whether a transaction denominated a
"license" was in fact a sale conveying ownership was a disputed question of
fact); Novell, Inc. v. CPU Distrib., Inc., 2000 U.S. Dist. LEXIS 9975 (S.D. Tex.
2000). [**17] In Novell, a software manufacturer was pursuing a discount
retailer for copyright infringement. Like Adobe, CPU argued that it purchased
the software from an authorized source and was entitled to resell it under the
first sale doctrine. Novell claimed that it did not sell software but merely
licensed it to distribution partners. The court held that these transactions
constituted sales and not a license, and therefore that the first sale doctrine
applied. 2000 U.S. Dist. LEXIS 9975 at *18.
Adobe frames the issue as a dispute about the ownership of intellectual
property. In fact, it is a dispute about the ownership of individual pieces of
Adobe software. Section 202 of the Copyright Act recognizes a distinction
between tangible [*1085] property rights in copies of the work and intangible
property rights in the creation itself. n11 In this case, no claim is made that
transfer of the copy involves transfer of the ownership of the intellectual
property within. (See SoftMan's Suppl. Brief at 9-10) ("Adobe has ownership
rights in the copyright of [its] software.").) What is at stake here is the
right of the purchaser to dispose of that purchaser's particular copy of the
software. [**18]
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n11 "Ownership of a copyright, or of any of the exclusive rights under a
copyright, is distinct from ownership of any material object in which the work
is embodied." 17 U.S.C. § 202.
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The Court finds that the circumstances surrounding the transaction strongly
suggests that the transaction is in fact a sale rather than a license. For
example, the purchaser commonly obtains a single copy of the software, with
documentation, for a single price, which the purchaser pays at the time of the
transaction, and which constitutes the entire payment for the "license." The
license runs for an indefinite term without provisions for renewal. In light of
these indicia, many courts and commentators conclude that a "shrinkwrap license"
transaction is a sale of goods rather than a license. n12
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n12 The term "shrinkwrap license" refers to the fact that the license begins
when the purchaser reads its terms and tears open the transparent plastic
wrapping, or "shrinkwrap," that encloses the software product. "Although early
shrinkwrap licenses often were visible prior to purchase, and could be read
before the purchaser tore open the software's wrapping, more recent variants
place the license within the software's packaging or on the disk itself."
Stephen P. Tarolli, The Future of Information Commerce under Contemporary
Contract and Copyright Principles, 46 Am. U.L. Rev. 1639, 1647-48 (1997)
(footnote omitted); see also ProCD, Inc. v. Zeidenberg, 86 F.3d 1447, 1450 (7th
Cir. 1996) ("The 'shrinkwrap license' gets its name from the fact that retail
software packages are covered in plastic or cellophane 'shrinkwrap' . . .
vendors . . . have written licenses that become effective as soon as the
customer tears the wrapping from the package. Vendors prefer 'end user license'
. . .").
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The reality of the business environment also suggests that Adobe sells its
software to distributors. Adobe transfers large amounts of merchandise to
distributors. The distributors pay full value for the merchandise and accept the
risk that the software may be damaged or lost. n13 The distributors also accept
the risk that they will be unable to resell the product. n14 The distributors
then resell the product to other distributors in the secondary market. The
secondary market and the ultimate consumer also pay full value for the product,
and accept the risk that the product may be lost or damaged. This evidence
suggests a transfer of title in the good. The transfer of a product for
consideration with a transfer of title and risk of loss generally constitutes a
sale. VWP of Am., Inc. v. United States, 175 F.3d 1327, 1338-39 [*1086] (Fed.
Cir. 1999). Professor Raymond Nimmer writes:
Ownership of a copy should be determined based on the actual
character, rather than the label, of the transaction by which the user
obtained possession. Merely labeling a transaction as a lease or
license does not control. If a transaction involves a single payment
giving the buyer an unlimited [**20] period in which it has a right
to possession, the transaction is a sale. In this situation, the buyer
owns the copy regardless of the label the parties use for the
contract. Course of dealing and trade usage may be relevant, since
they establish the expectations and intent of the parties. The
pertinent issue is whether, as in a lease, the user may be required to
return the copy to the vendor after the expiration of a particular
period. If not, the transaction conveyed not only possession, but also
transferred ownership of the copy.
Raymond Nimmer, The Law of Computer Technology § 1.18[1] p. 1-103 (1992). The
Court agrees that a single payment for a perpetual transfer of possession is, in
reality, a sale of personal property and therefore transfers ownership of that
property, the copy of the software.
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n13 "In purchasing Adobe software from authorized distributors, I always
understood that SoftMan was obtaining title to the particular copies it
purchased. . . . SoftMan paid fair value for the product and assumes the risk of
loss or damage upon receipt. SoftMan also assumed the risk of loss if it was
unable to resell the software." (Dracup Decl. P 8.) [**21]
n14 SoftMan points to the language of Adobe's distribution agreements, which
includes sale terms and states that the distributor assumes the risk of loss or
damage of the product. (Soriano Decl., Ex. 1 at 5.7-5.14.) Therefore, SoftMan
argues, Adobe transfers title in the software to its distributors subject to a
license restricting the distributor's rights and the manner in which the
distributor may sell the software. In addition, SoftMan argues that even if
title does not pass to the distributors, the distributors may still transfer
title in individual copies subject to the terms of the EULA. A consumer may
obtain good title from a distributor who has not perfected title. Unif. Comm.
Code § 2-403(2).
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Other commentators have urged courts to look at the substance rather than the
form of licensing agreements. See, e.g., David A. Rice, Licensing the Use of
Computer Program Copies and the Copyright Act First Sale Doctrine, 30
Jurimetrics J. 157 (1990). In particular, the following factors require a
finding that distributing software under licenses transfers individual copy
ownership: [**22] temporally unlimited possession, absence of time limits on
copy possession, pricing and payment schemes that are unitary not serial,
licenses under which subsequent transfer is neither prohibited nor conditioned
on obtaining the licensor's prior approval (only subject to a prohibition
against rental and a requirement that any transfer be of the entity), and
licenses under which the use restrictions principal purpose is to protect
intangible copyrightable subject matter, and not to preserve property interests
in individual program copies. Id. at 172.
Adobe relies primarily on two cases to support its proposition that software
is licensed and not sold. In Microsoft Corp. v. Harmony Computers & Elecs.,
Inc., 846 F. Supp. 208, 212 (E.D.N.Y. 1994), the court assumed without analysis
that the transaction was a license rather than a sale and held that distribution
outside the scope of a license agreement constituted copyright infringement. The
Court finds Harmony's facts to be distinguishable. In that case, the defendants
were selling counterfeit Microsoft products. Here, Adobe does not allege that
SoftMan sells counterfeit Adobe software.
Adobe also [**23] relies on Adobe Sys. Inc. v. One Stop Micro, Inc., 84 F.
Supp. 2d 1086, 1093 (N.D. Cal. 2000). The court held that One Stop's
distribution of Educational versions of Adobe software to non-educational end
users was outside the scope of Adobe's license and in violation of Adobe's
exclusive right to distribute under § 106(3). In One Stop, an unlicensed
reseller admitted to adulterating the packaging for Adobe Educational software
and transferring it as retail Adobe products for prices below the street price
of the retail product. Id. The court further held that One Stop could not claim
to have title for first sale purposes while the end user only obtained a
license. The Court finds the facts of One Stop to be distinguishable from the
instant case. In One Stop, the issue was peeling off and destroying the
"Education version" stickers on software, as well as destroying bar code and
serial numbers on the software, and then reselling it as commercial software.
Id. 84 F. Supp. 2d at 1088. To the extent that the court in One Stop found that
the transaction at issue was in fact a license, and not a [*1087] sale, this
Court simply declines to adopt that analysis. [**24] In One Stop, the court
placed great weight on the declarations of Adobe's experts that licensing is the
preferred method of distributing software. The Court understands fully why
licensing has many advantages for software publishers. However, this preference
does not alter the Court's analysis that the substance of the transaction at
issue here is a sale and not a license.
(c) EULA Terms
Adobe argues that the EULA requires construction of the transaction as a
license rather than a sale. The Court finds that SoftMan is not bound by the
EULA because there was no assent to its terms.
i) Assent
Adobe contends that the EULA limits the consumer's ability to transfer the
software after buying it. According to SoftMan, a hard copy of the EULA
agreement is not enclosed with the individual Adobe software disk. Instead,
consumers are asked to agree to its terms as part of the installation process.
(Dracup Decl. P 7.)
Courts have required that assent to the formation of a contract be manifested
in some way, by words or other conduct, if the contract is to be effective. E.
Allan Farnsworth, Farnsworth on Contracts § 3.1 (2d ed. 2000). As the court
noted in Specht v. Netscape Communications Corp., 150 F. Supp. 2d 585 (S.D.N.Y.
2001): [**25] "The case law on software licensing has not eroded the importance
of assent in contract formation. Mutual assent is the bedrock of any agreement
to which the law will give force. Defendants' position, if accepted, would so
expand the definition of assent as to render it meaningless." Id. 150 F. Supp.
2d at 596.
In the instant case, the Court finds that there is only assent on the part of
the consumer, if at all, when the consumer loads the Adobe program and begins
the installation process. It is undisputed that SoftMan has never attempted to
load the software that it sells. Consequently, the Court finds that SoftMan is
not subject to the Adobe EULA.
Adobe fails to offer a compelling rationale for how SoftMan becomes subject
to Adobe's licenses if SoftMan never loads the software onto computers. Adobe
claims that the EULA is enforceable against SoftMan because the boxes containing
Adobe software (including Collections) clearly indicate that use is subject to
the consumer's agreement to the terms contained in EULA inside. See, e.g.,
ProCD, 86 F.3d at 1451. Like the CD boxes in ProCD, Adobe's EULAs state that the
product can be returned if the terms are not agreed [**26] to by the end user.
The Adobe Collections boxes state: "NOTICE TO USERS: This product is offered
subject to the license agreement included with the media." (Navarro Decl. at p.
2.) However, the existence of this notice on the box cannot bind SoftMan.
Reading a notice on a box is not equivalent to the degree of assent that occurs
when the software is loaded onto the computer and the consumer is asked to agree
to the terms of the license.
Adobe further asserts that whether SoftMan is characterized as a distributor
or reseller, SoftMan would be bound by the terms of these license agreements,
which state that Adobe retains ownership of its software products, as well as
the media upon which these software products are distributed. It is undisputed
that SoftMan is not a signatory to any licensing agreements. Yet Adobe claims
that although SoftMan has never signed an agreement with Adobe, the terms of
Adobe's distribution agreements all apply to SoftMan.
In One Stop, the court stated that although One Stop was not a signatory to
an [*1088] Adobe licensing agreement, it was nevertheless subject to the
restrictions of those agreements. 84 F. Supp. 2d at 1092. The court found that
[**27] by obtaining Adobe software from a party to an Adobe licensing
agreement, One Stop was bound by any restrictions imposed by that agreement.
Id. 84 F. Supp. 2d at 1093. In Harmony, the court found that "to the extent that
defendants bought their Microsoft Products from authorized Microsoft licensees,
they were subject to the same licensing restrictions under which those licensees
operated." Harmony, 846 F. Supp. at 213. The Court declines to adopt the
analysis of these cases.
The Court finds that Adobe's EULA cannot be valid without assent. Therefore,
SoftMan is not bound by the EULA because it has never loaded the software, and
therefore never assented to its terms of use.
ii) Shrinkwrap Licenses In General
Whether contracts such as Adobe's EULA, often referred to as "shrinkwrap"
licenses, are valid is a much-disputed question. n15 A number of courts that
have addressed the validity of the shrinkwrap license have found them to be
invalid, characterizing them as contracts of adhesion, unconscionable, and/or
unacceptable pursuant to the Uniform Commercial Code. Step-Saver, 939 F.2d 91;
Vault Corp. v. Quaid Software Ltd., 847 F.2d 255 (5th Cir. 1988). [**28] These
courts have refused to recognize a bargain in shrinkwrap license that is not
signed by the party against whom it is enforced. In Step-Saver, the Third
Circuit found that the terms of a contract were formed when the parties shipped,
received and paid for the product. Therefore, the software shrinkwrap agreement
constituted additional terms to the contract, and under Uniform Commercial Code
§ 2-207 (governing commercial counter-offers), these terms were invalid without
express assent by the purchaser. In contrast, other courts have determined that
the shrinkwrap license is valid and enforceable. ProCD, 86 F.3d at 1453;
Harmony, 846 F. Supp. at 212.
- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n15 The enforceability of use restrictions and transfer prohibitions set
forth in standard form, non-negotiated, computer program copy "licenses" has
been the subject of substantial academic and other controversy. (Rice Decl. P
28.)
- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - -
The Court finds it unnecessary to reach the question of the general validity
of shrinkwrap [**29] licenses at this stage because the Court has determined
that SoftMan is not bound by the EULA because there was no assent to its terms.
2. New York Times Co., Inc. v. Tasini
Adobe claims that even if there was a first sale of the Adobe Collections,
SoftMan's unbundling of the Collections and redistribution of the individual
component parts still constitutes copyright infringement. Adobe cites New York
Times Co. Inc. v. Tasini, 533 U.S. 483, 150 L. Ed. 2d 500, 121 S. Ct. 2381
(2001), for the proposition that the distribution of an individual component of
a collective work infringes the copyright in the underlying individual work.
In Tasini, the Court held that print and electronic publishers infringed on
the copyrights of freelance authors when the publishers placed the authors'
articles in electronic databases. The Court rejected the publishers' assertions
that they were protected by the reproduction and distribution privilege accorded
collective work copyright owners by 17 U.S.C. § 201(c). n16 [*1089] Adobe's
reliance on Tasini is misplaced. The critical distinction is that Tasini does
not address, as does the instant case, the fate of an individual [**30] copy of
any work under the first sale doctrine. The Tasini Court reaffirmed that the
owner of the copyright in the collective work is presumed to have acquired only
the privilege of distributing the contribution as part of that particular
collective work. n17
- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n16 "Copyright in each separate contribution to a collective work is distinct
from copyright in the collective work as a whole, and vests initially in the
author of the contribution. In the absence of an express transfer of the
copyright or of any rights under it, the owner of copyright in the collective
work is presumed to have acquired only the privilege of reproducing and
distributing the contribution as part of that particular collective work, any
revision of that collective work, and any later collective work in the same
series." 17 U.S.C. § 201(c).
n17 The Court held: "The publishers are not sheltered by § 201(c) . . .
because the databases reproduce and distribute articles standing alone and not
in context, not 'as part of that particular collective work' to which the author
contributed, 'as part of . . . any revision' thereof, or 'as part of . . . any
later collective work in the same series.' Both the print publishers and the
electronic publishers, we rule, have infringed the copyrights of the freelance
authors." Tasini, 121 S. Ct. at 2384-85.
- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - - [**31]
In contrast, what Adobe alleges here is quite different. In this case, Adobe
seeks to control the resale of a lawfully acquired copy of its software. Adobe's
position in this action would be more akin to a journalist who claimed that
ownership of the copyright to an article allowed him or her to control the
resale of a particular copy of a newspaper that contained that article. The
Court finds that Tasini is not applicable to the facts at issue.
3. Copyright Infringement Conclusion
In short, the transfer of copies of Adobe software making up the distribution
chain from Adobe to SoftMan are sales of the particular copies, but not of Adobe
's intellectual rights in the computer program itself, which is protected by
Adobe's copyright. SoftMan is an "owner" of the copy and is entitled to the use
and enjoyment of the software, with the rights that are consistent with
copyright law. The Court rejects Adobe's argument that the EULA gives to
purchasers only a license to use the software. The Court finds that SoftMan has
not assented to the EULA and therefore cannot be bound by its terms. Therefore,
the Court finds that Adobe has not demonstrated a likelihood of success on the
merits [**32] of its copyright infringement claim.
a. Irreparable Injury
Since the Court finds that Adobe has not made a showing of a likelihood of
success on the merits of its copyright claim, no presumption of irreparable harm
is raised. See Micro Star, 154 F.3d at 1109. Parties seeking pretrial
injunctive relief must demonstrate they will be exposed to some "significant
risk of irreparable injury" if such relief is denied. Associated Gen.
Contractors of Cal. v. Coalition for Econ. Equity, 950 F.2d 1401, 1410 (9th Cir.
1991). Before a preliminary injunction may issue, the court must identify the
harm which a preliminary injunction might cause the defendant and balance it
against plaintiff's threatened injury. Armstrong v. Mazurek, 94 F.3d 566, 568
(9th Cir. 1996).
Adobe contends it will suffer irreparable injury for the following reasons:
dilution of customer goodwill, price erosion of Adobe software due to SoftMan's
resale activities, the Adobe name will be tarnished and consumers may stop
acquiring Adobe products, loss of annual sales, n18 and dilution of trademarks.
Adobe also contends that it is faced with a "Hobson's Choice" between [**33]
upholding distribution agreements and denying consumers Adobe [*1090] services
(satisfying Adobe's "legitimate" distribution partners at the expense of
customer goodwill), or providing services to consumers holding so-called
"pirated" products.
- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n18 Adobe alleges that SoftMan grossed $ 700,000 from the sale of Adobe
products between October 2000 and May 2001. (Van Voorhis Decl. P 7, Ex. 7.)
- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - -
Irreparable injury and probability of success on the merits "are not really
two entirely separate tests, but that they are merely extremes of a single
continuum." Benda v. Grand Lodge of Int'l Ass'n of Machinists & Aerospace
Workers, 584 F.2d 308, 315 (9th Cir. 1978). In this case, the Court finds that
Adobe has not demonstrated probable success on the merits of its copyright
claim. Nor has Adobe made a showing of irreparable injury sufficient to obtain
preliminary injunctive relief. Adobe presents no specific evidence relating to
dilution of customer goodwill or the direct loss of annual sales. There must be
evidence [**34] of actual injury to support claims of "irreparable injury."
Speculative losses are insufficient. Goldie's Bookstore, Inc. v. Superior
Court, 739 F.2d 466, 472 (9th Cir. 1984); Caribbean Marine Serv. Co. v.
Baldridge, 844 F.2d 668, 674 (9th Cir. 1988). Significantly, Adobe also admits
that it discovered SoftMan's allegedly unauthorized distribution of Adobe
software in November 1997. (Adobe Mot. at 6.) This delay further supports the
Court's conclusion that Adobe has failed to demonstrate immediate threatened
harm. The Court finds that Adobe has failed to show that it will suffer
irreparable injury in the absence of preliminary injunctive relief.
b. Balance of Hardships
In deciding whether to grant a preliminary injunction, the Court may also
balance the potential hardships that each party may suffer if the Court grants
or denies Adobe's motion. See International Jensen, Inc. v. Metrosound U.S.A.,
4 F.3d 819, 827 (9th Cir. 1993). Given that neither Adobe nor SoftMan has
submitted any evidence of economic loss except broad, general statements, the
Court considers the balance of hardships to be a neutral factor.
c. Public Interest [**35]
Traditionally, courts have looked to public policy considerations in
determining whether to grant preliminary injunctive relief. Chalk v. United
States Dist. Court, Cent. Dist. of Cal., 840 F.2d 701, 711 (9th Cir., 1988) ("We
recognize that the public interest is one of the traditional equitable criteria
which a court should consider in granting injunctive relief."). In this case,
the Court finds that important public policy considerations weigh on each side.
The Court finds that the provisions contained in Adobe's EULA purport to
diminish the rights of customers to use the software in ways ordinarily enjoyed
by customers under copyright law. Therefore, these restrictions appear to be
inconsistent with the balance of rights set forth in intellectual property law.
n19 Commentators have noted that the arguments for enforcing this balance are
particularly persuasive in the context of shrinkwrap licenses because the
balance of rights in intellectual [*1091] property law is already tilted
heavily in favor of the intellectual property owner. "The only countervailing
forces favoring users are those rights specifically granted to users by federal
law. In this context more than any [**36] other, therefore, it is justifiable
to fear that removing or eviscerating those user rights may bring the whole
edifice crumbling down." n20
- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n19 Scholars have suggested that Congress contemplated that parties might
attempt to contract out of a first sale right. "Congress was explicit in the
context of section 109(a) that it intended for vendors who 'contract around' the
first sale doctrine to be limited to contract remedies. The approach of
shrinkwrap licenses - to attempt to extend vendor rights by contract while
retaining the panoply of copyright remedies - was explicitly disavowed by the
Committee Note." Mark A. Lemley, Intellectual Property and Shrinkwrap Licenses,
68 S. Cal. L. Rev. 1239, 1283 (1995) (citing H.R. Rep. 94-1476 (1976) (providing
that the parties may contract around the first sale doctrine in 17 U.S.C. 109
(a), but limiting the copyright owner to contract rather than copyright remedies
if they do so)).
n20 Lemley, Intellectual Property, at 1283.
- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - - [**37]
This is an area fraught with conflicting policy considerations. Software
publishers are desirous of augmenting the protections offered under copyright
law. In this case, through the use of licensing; Adobe seeks a vast and
seemingly unlimited power to control prices and all channels of distribution. On
the other hand, in the absence of copyright law violations, the market can often
best regulate prices and all subsequent transactions that occur after the first
sale. Sound policy rationales support the analysis of those courts that have
found shrinkwrap licenses to be unenforceable. A system of "licensing" which
grants software publishers this degree of unchecked power to control the market
deserves to be the object of careful scrutiny.
For the reasons stated above, the Court finds that this factor weighs in
favor of the counter-defendants.
B. Trademark Claims
1. Likelihood of Success on the Merits
To prevail on its trademark infringement claims under the Lanham Act, Adobe
must prove: (1) that it is the owner of a protectible trademark, and (2) a
likelihood of consumer confusion as to the source, sponsorship, or origin of the
goods. Ocean Garden, Inc. v. Marktrade Co., Inc., 953 F.2d 500, 506 (9th Cir.
1991). [**38]
a. Validity of Adobe's Marks
Under the Lanham Act, registration of a trademark "shifts the burden of proof
from the plaintiff, who would have to establish his right to exclusive use," to
the defendant, who must rebut the presumption of the plaintiff's right to
protected use. Vuitton et Fils S.A. v. J. Young Enters., Inc., 644 F.2d 769,
775 (9th Cir. 1981). All of Adobe's trademarks at issue in this suit are
registered with the U.S. Patent and Trademark Office. SoftMan does not dispute
that the Adobe trademarks are valid, protectible marks.
b. Likelihood of Confusion
Courts apply an eight-factor test in determining whether a likelihood of
confusion exists between the plaintiff's mark and the allegedly infringing mark.
The relevant factors may include:
1. strength of the mark;
2. proximity of the goods;
3. similarity of the marks;
4. evidence of actual confusion;
5. marketing channels used;
6. type of goods and the degree of care likely to be exercised by the
purchaser;
7. defendant's intent in selecting the mark; and
8. likelihood of expansion of the product lines.
AMF Inc. v. Sleekcraft Boats, 599 F.2d 341, 348-49 (9th Cir. 1979). [**39] In
applying the Sleekcraft factors, the Ninth Circuit has cautioned that although
all of the factors are relevant, some factors may be more significant depending
upon the facts of the case at bar. See Brookfield, 174 F.3d at 1053. Further,
the Sleekcraft court noted that it did not provide an exhaustive list of
relevant factors. "Other variables may come into play depending on the
particular facts presented." Sleekcraft, 599 F.2d at 348 n.11.
Evidence of actual confusion is not necessary in order to establish a
likelihood of confusion. See id. 599 F.2d at 353 (stating that failure to prove
actual confusion is not dispositive); Lois Sportswear, U.S.A., Inc. v. Levi
Strauss & Co., 799 F.2d 867, 874 (2d Cir. 1986). "In assessing the likelihood of
confusion to the public, the standard used by the courts is the typical buyer
exercising ordinary caution." Sleekcraft, 599 F.2d at 353. As the Sleekcraft
court explained, "when the alleged infringer knowingly adopts a mark similar to
another's, reviewing courts presume that the defendant can accomplish his
purpose: that is, that the public will be deceived. [**40] " Id. 599 F.2d at
354. The court also noted that, "good faith is less probative of the likelihood
of confusion, yet may be given considerable weight in fashioning a remedy." Id.
In the instant case, the parties do not dispute that SoftMan is reselling
genuine, albeit repackaged, Adobe software. The resale of genuine trademarked
goods generally does not constitute infringement. See, e.g., NEC Elecs. v. CAL
Circuit Abco, 810 F.2d 1506, 1509 (9th Cir. 1987). Under the first sale
doctrine, resale by the first purchaser of the original article under the
producer's trademark is generally neither trademark infringement nor unfair
competition. See Sebastian Int'l, Inc. v. Longs Drug Stores Corp., 53 F.3d
1073, 1074 (9th Cir. 1995). The rationale behind the rule is that "trademark law
is designed to prevent sellers from confusing or deceiving consumers about the
origin or make of a product, which confusion ordinarily does not exist when a
genuine article bearing a true mark is sold." NEC Elecs., 810 F.2d at 1509 (sale
of genuine trademarked product by seller unauthorized to sell not a violation of
Lanham Act). Moreover, "the 'first [**41] sale' rule is not rendered
inapplicable merely because consumers erroneously believe the reseller is
affiliated with or authorized by the producer." Sebastian, 53 F.3d at 1076.
The first sale doctrine does not apply, however, when an alleged infringer
sells trademarked goods that are materially different than those sold by the
trademark owner. When the reseller's conduct goes beyond the mere resale of
trademarked goods, such conduct may be sufficient to support a cause of action
for infringement. Id. A materially different product is not genuine, and
therefore its unauthorized sale constitutes trademark infringement. See Enesco
Corp. v. Price/Costco Inc., 146 F.3d 1083, 1087 (9th Cir. 1998) (noting that a
non-conforming product is not genuine and "'. . . its distribution constitutes
trademark infringement'" (quoting Warner-Lambert Co. v. Northside Dev. Corp., 86
F.3d 3, 6 (2d Cir. 1996))). In this case, SoftMan's conduct goes beyond the mere
resale of trademarked goods.
Clearly, not just any difference will cause consumer confusion. A material
difference is one that consumers consider, on average, relevant to a decision
about [**42] whether to purchase a product. See Martin's Herend Imps., Inc. v.
Diamond & Gem Trading USA, Co., 112 F.3d 1296 (5th Cir. 1997). In this case, the
sale of software without access to customer support and technical services is a
difference that an average consumer would consider relevant to a decision about
whether to purchase a product.
According to both parties, the copies of Adobe software that SoftMan
distributes are identical to lawful copies of these products. Adobe claims that
SoftMan repackages and resells the Adobe software without "crucial registration
elements such as a registration card." (Adobe Mot. at 13.) Adobe further argues
that the copies lack customer support and technical support [*1092]
information. Even if the software does contain these documents, Adobe claims,
"customer service and technical support may be denied." (Id. at 17.) In short,
Adobe contends that the crucial difference between the Adobe-packaged software
and the SoftMan-packaged Adobe software is that the SoftMan version lacks the
necessary registration capabilities. Adobe has submitted evidence that its
investigators purchased Adobe products from SoftMan that lacked a registration
and [**43] quick reference card. (Palma Decl. P 12.) Without the ability to
register a product, Adobe states that customers cannot receive technical
support. Therefore, Adobe argues, customers who buy unbundled Adobe software
from SoftMan may be deceived or confused as to whether they are entitled to the
customer support and technical services normally associated with the purchase of
software.
SoftMan disputes that unbundled collections of Adobe software are ineligible
for support. According to SoftMan:
In fact, the registration process is individual to each program in the
collection. Each program has an individual serial number. The number
is the only thing required to register a program and become eligible
for customer support. A consumer who purchases a collection can
register the programs contained therein by listing each serial number
on a registration card or by going on-line and entering each serial
number at the designated web site. A consumer who purchases a single
program from SoftMan can similarly register that program by entering
the serial number contained on each disk in the designated web site.
(SoftMan Suppl. Brief at 13-14.)
The Court finds that customer support [**44] and technical services are
intertwined functions that may be required to insure a "genuine" Adobe product.
If the software sold by SoftMan lacked the capacity for registration, then the
copies sold by SoftMan would not be "genuine" insofar as they failed to include
access to Adobe's technical support and customer service. In such a case, when
the altered products bear Adobe's name and are in fact actual Adobe-manufactured
software, the Court concludes that these end-products, re-shrinkwrapped by
SoftMan, could create customer confusion and could infringe Adobe's trademarks.
There are a number of factual disputes to be resolved, however, before the
question of whether a material difference exists between SoftMan's repackaged
Adobe software and Adobe's standard software. Whether consumers in fact can and
do access Adobe customer support when they buy Adobe software from SoftMan is
disputed. At oral argument, Adobe's counsel seemed to indicate that customer
service and support might be unavailable to consumers who purchased Adobe
software from SoftMan, but that such decisions were made on an ad hoc basis.
Adobe does not demonstrate a likelihood of success on the merits of this claim
[**45] because questions of fact predominate as to the central issue. In a
situation where each party makes opposing representations as to a disputed fact
going directly to Adobe's likelihood of success on the merits, the Court will
assign no weight to this factor.
2. Irreparable Injury
The Court will not presume irreparable injury to Adobe in this case because
Adobe fails to make a showing of likelihood of success on the merits of its
trademark infringement claim. Brookfield, 174 at 1066. For the reasons stated
above, the Court finds that preliminary injunctive relief is not necessary in
this case to prevent to irreparable injury in the form of harm to Adobe's
trademark. n21
- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n21 Adobe also brings claims for Unfair Competition under Section 43(a) of
the Lanham Act and Unfair Competition under California Business & Professional
Codes Section 17200 et seq. Section 43(a) of the Lanham Act prohibits the use of
any false designation of origin which is likely to cause confusion as to the
origin of the goods. 15 U.S.C. § 1125(a). Section 43(a) protects qualifying
registered trademarks. Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 768,
120 L. Ed. 2d 615, 112 S. Ct. 2753 (1992). Adobe asserts that by unbundling
Collections software and then re-shrinkwrapping them and distributing them as
individual pieces of Retail software, SoftMan is using Adobe's trademarks in a
manner calculated to mislead and to deceive consumers concerning the
affiliation, connection, or association of SoftMan with the true owner of the
Adobe trademarks. For the reasons stated above relating to the existence of
factual disputes on the question of consumer confusion (questions that preclude
a finding that Adobe has demonstrated a likelihood of success on the merits of
its trademark infringement claim), the Court finds that Adobe has not
demonstrated a likelihood of success on the merits or irreparable injury on
these additional claims. The Court denies Adobe's request for preliminary
injunctive relief on these additional grounds.
- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - - [**46]
[*1093] 3. Public Policy
The Ninth Circuit has held that public policy favors granting an injunction
when an infringing product is likely to cause consumer confusion. See
Anti-Monopoly, Inc. v. General Mills Fun Group, 611 F.2d 296, 300-02 (9th Cir.
1979), cert. denied, 459 U.S. 1227 (1983). As discussed above, the Court does
not find that Adobe has demonstrated a likelihood of success on the merits of
the question of consumer confusion. Therefore, public policy considerations do
not weigh in favor of granting Adobe's request for a preliminary injunction.
IV. Conclusion
As set forth above, the Court finds that Adobe has not demonstrated a
likelihood of success on the merits of its trademark or copyright claims. The
Court finds that Adobe has not demonstrated that it will suffer irreparable
injury in the absence of preliminary injunctive relief, particularly in light of
Adobe's own admissions that it has known about SoftMan's activities since 1997.
The Court denies Adobe's application for a preliminary injunction. The Court
hereby ORDERS that the preliminary injunction entered by this Court on September
10, 2001 be VACATED.
IT IS SO ORDERED. [**47]
Dated: October 19, 2001
DEAN D. PREGERSON
United States District Judge