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For allegedly using stolen technology to market realistic CG characters, Disney faces the prospect of losing a portion of its profits on three of its blockbuster movies — Deadpool, Guardians of the Galaxy and Beauty and the Beast. On Tuesday, a California federal judge denied a summary judgment motion made by Disney with respect to these three films.
The case has a complicated genesis, but it’s being brought by Rearden, a Silicon Valley company asserting ownership over a visual effects technology called MOVA that captures the facial performance of an actor wearing makeup and processes the data into computer-generated imagery. The judge has allowed Rearden to move forward with a copyright claim based on alleged theft of software on the VFX vendor’s computers.
The summary judgment motion pertained to damages available to Rearden in this case. Could Rearden establish a causal nexus between intellectual property infringement and Disney’s profits? Meaning is there a link between the use of special effects software and why consumers buy movie tickets? And does it matter for purposes of the law?
U.S. District Court Judge Jon Tigar points Rearden’s arguments that Disney promoted MOVA as part of its advertising strategies for the movies, that movie directors and actors pushed the cutting-edge technology when doing promotion, and how defendant posted YouTube videos about the making of CG characters like the Beast in Beauty and the Beast. Additionally, the judge recognizes Rearden’s argument that the software was used to create more empathetic characters, which contributed to the film’s box office.
“This non-speculative evidence supports Rearden’s theory of a causal nexus between the infringement and profits from Beauty and the Beast, Guardians of the Galaxy, and Deadpool,” writes the judge. “As to these films, it would be reasonable for the jury to infer from Rearden’s evidence that Defendants advertised their use of MOVA and used MOVA-based clips in the film trailer in order to drive interest in the films and thereby increase film profits.”
The judge adds “To show a causal nexus to indirect profits, there must be evidence that the infringing product is a causal factor, but it ‘need not be the sole causal factor.’”
Disney challenged the causal nexus theory as a whole, arguing that there was no support in copyright law for an attainment of indirect profits via these means. In rejecting Disney’s challenge, Tigar points to what happened during Oracle v. Google before that case got to the Supreme Court and helped define copyright issues with respect to computer code. The trial judge in that case considered Google’s attempt to preclude a damages expert from testifying about its copying of certain code in the Java API for the Android operating system. The judge ruled at the time that Oracle had proffered sufficient evidence of a causal nexus — a small piece of precedent that informs today’s decision.
While Rearden does get to shoot for profits from three films, the judge won’t allow the plaintiff to go after the spoils from Terminator: Genisys, Avengers: Age of Ultron, Night at the Museum: Secret of the Tomb and Fantastic Four.
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