Judge Delivers Setback to DreamWorks in 'Kung Fu Panda' Lawsuit

4. Kung Fu Panda 2

Worldwide Gross: $663 million

The DreamWorks Animation and Paramount animated film had a strong showing overseas, breaking box office records in China and grossing, to date, $497 million in foreign markets.

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Hollywood studios are sued left and right for stealing ideas to create films and TV shows. These copyright-infringement lawsuits nearly always are dismissed before they ever get to trial thanks to the high bar in demonstrating "substantial similarity" between works.

But one plaintiff actually might get to trial.

Late last week, a federal judge denied a summary judgment motion made by DreamWorks Animation and Paramount Pictures over an artist's claim of having his work taken for the 2008 hit film Kung Fu Panda, which grossed more than $630 million worldwide. (Read the full ruling here.)

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What's even more extraordinary is not only did the artist, Jayme Gordon, survive a summary judgment motion but also a judge's pronouncement that he spoiled evidence in the case. The judge's decision potentially sets the stage for an uncommon occurrence in Hollywood: a trial concerning a major studio in which a jury would determine whether the plaintiff's work was stolen or the studio independently created its hit film.

Gordon brought the lawsuit in Massachusetts federal court in February 2011 and is looking for statutory damages and any profits obtained from allegedly wrongful acts.

According to his amended complaint, Gordon has spent much of his lifetime creating characters and storylines including the "Kung Fu Panda property," which he says was developed in the 1990s. He says his work featured "a Kung Fu fighting giant panda who likes to eat; his companion, a rare small red panda who also is a Kung Fu fighter; and a Kung Fu fighting super group known as the “Five Fists of Fury” that consists of a tiger, crane, mantis, monkey and a venomless snake."

The plaintiff said he registered the work with the Copyright Office in 2000 and had submitted multiple packages of his work to studios including the Walt Disney Co. His complaint contained all sorts of illustrations and pictures. For example, he includes a picture of himself with former Disney president Michael Eisner. He also included side-by-side comparisons of his work and DreamWorks'. Here's an example:

Screen shot 2013-04-02 at 3.13.12 PM

DreamWorks had asserted that Gordon has failed to provide any evidence of access by anyone at DreamWorks to his art. But last week, U.S. District Judge Joseph Tauro said genuine issues of fact remain as to the issue of access.

Gordon testified that he sent his “Panda Power” materials to Jeffrey Katzenberg at DreamWorks in October 1999.

"Although DreamWorks’s policy required prompt return of unsolicited materials with a rejection letter, Gordon received only a letter, which made no mention of his submissions," Tauro wrote.

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"Katzenberg appears to have provided conflicting testimony regarding his procedures for handling unsolicited submissions," the judge continued. "At his initial deposition, he indicated that he sometimes opened submissions and skimmed the opening paragraphs before concluding they were unsolicited materials and forwarding them to the legal department. Later he maintained that he never opened unsolicited submissions at his office but sometimes opened them if they came to his home. All of these discrepancies must be resolved by the trier of fact, and summary judgment is therefore inappropriate."

The judge also rejected attempts by DreamWorks to find in its favor on the issue of substantial similarity.

"Gordon’s 2000 and 2011 copyright registrations provide evidence of similarities between the overall works and the two main panda characters that would allow rational jurors to reach differing conclusions," the judge wrote.

But that's not all.

DreamWorks also argued that regardless of the similarity, Kung Fu Panda was an independent creation, which would bar an infringement lawsuit. The judge concluded that it is too early to determine this on summary judgment.

"Gordon claims to have sent his 'Panda Power' materials to DreamWorks before the studio commenced work on the film," he wrote. "The trier of fact must decide whether DreamWorks subsequently independently developed the film or whether Gordon’s submissions influenced the process."

As a result, DreamWorks' motion for summary judgment was denied.

Gordon has gone further than many other copyright plaintiffs, including those suing Angelina Jolie over In the Land of Blood and Honey, James Cameron over Avatar, Fox over the TV series Touch and Emma Thompson over Effie, just to name a few recent examples.

And it all happened despite conduct by Gordon that Tauro finds troubling.

In early 2008, Gordon saw a promotional trailer for Kung Fu Panda. He then took all of his pre-existing "Panda Power" materials and compiled them into a book entitled Book of P.U. and shredded all pre-existing materials. The book then was registered at the U.S. Copyright Office.

Gordon later was asked at a deposition why he shredded the material. "I make a practice to shred everything," he responded. "If I make a new book, I shred the old stuff."

The judge commented, "Whether he acted in bad faith or simply as part of his artistic process does not render the destruction any less intentional, though it may affect the appropriate sanction."

Tauro says that at the time of the shredding, Gordon was "under a duty to preserve relevant evidence," having seen the Kung Fu Panda trailer. While Gordon said he wasn't contemplating litigation, he also filed a copyright registration. He also acknowledged making potentially significant changes to materials after viewing the movie trailer. Other evidence submitted in the case suggested that Gordon used commercial deletion software to permanently remove relevant files from his computer, and there's an email to a potential witness supposedly instructing that individual to delete relevant files.

But despite all of this, the judge won't go so far as to accept DreamWorks' demand to dismiss the case. The judge says the evidence "is not sufficiently clear to justify the harsh and disfavored sanction of dismissal."

As a result, the case moves forward, and Gregory Madera at Fish & Richardson, the attorney for Gordon, is seeking a trial in September or October.

DreamWorks says it can't comment on pending legal matters.

Email: eriq.gardner@thr.com; Twitter: @eriqgardner