Dereck Seltzer v. Green Day, Inc.

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

DERECK SELTZER, No. 11-56573

Plaintiff-Appellant,

D.C. No.

v. 2:10-cv-02103-

PSG-PLA

GREEN DAY , INC., a corporation;

GREEN DAY TOURING , INC., a

corporation; GREEN DAY , a

partnership; BILLIE JOE

ARMSTRONG , an individual; FRANK

EDWIN WRIGHT , III, an individual,

AKA Tre Cool; MICHAEL RYAN

PRITCHARD , an individual, AKA

Dirnt Mike; WARNER BROS.

RECORDS, INC., a corporation;

INFECT PRODUCTIONS, a partnership;

ROGER STAUB, an individual;

PERFORMANCE ENVIRONMENTAL

DESIGN , a business entity (form

unknown),

Defendants-Appellees.

2 SELTZER V . GREEN DAY , INC.

DERECK SELTZER, No. 11-57160

Plaintiff-Appellant,

D.C. No.

v. 2:10-cv-02103-

PSG-PLA

GREEN DAY , INC., a corporation;

GREEN DAY TOURING , INC., a OPINION

corporation; GREEN DAY , a

partnership; BILLIE JOE

ARMSTRONG , an individual; FRANK

EDWIN WRIGHT , III, an individual,

AKA Tre Cool; MICHAEL RYAN

PRITCHARD , an individual, AKA

Dirnt Mike; WARNER BROS.

RECORDS, INC., a corporation;

INFECT PRODUCTIONS, a partnership;

ROGER STAUB, an individual;

PERFORMANCE ENVIRONMENTAL

DESIGN , a business entity (form

unknown),

Defendants-Appellees.

Appeal from the United States District Court

for the Central District of California

Philip S. Gutierrez, District Judge, Presiding

Argued and Submitted

February 5, 2013—Pasadena, California

Filed August 7, 2013

SELTZER V . GREEN DAY , INC. 3

Before: Diarmuid F. O’Scannlain, Stephen S. Trott,

and Richard R. Clifton, Circuit Judges.

Opinion by Judge O’Scannlain

SUMMARY*

Copyright / Fair Use

The panel affirmed the district court’s summary judgment

in favor of the defendants but vacated the district court’s

award of attorneys’ fees in an artist’s action alleging

violations of the Copyright Act and the Lanham Act in a rock

band’s unauthorized use of an illustration in the video

backdrop of its stage show.

The panel held that the video backdrop was a fair use

under the Copyright Act. First, the purpose and character of

the use was transformative because the video altered the

expressive content or message of the illustration, and the use

was not overly commercial. Second, the illustration was a

creative work, but its nature included its status as a widely

disseminated work of street art. Third, the defendants copied

most of the illustration, but it was not meaningfully divisible.

Fourth, the video backdrop did not affect the value of the

illustration.

*

This summary constitutes no part of the opinion of the court. It has

been prepared by court staff for the convenience of the reader.

4 SELTZER V . GREEN DAY , INC.

The panel affirmed the grant of summary judgment on

Lanham Act claims on the basis that the artist failed to

establish any trademark rights.

Vacating the district court’s award of attorneys’ fees to

the defendants under the Copyright Act, the panel held that,

despite the defendants’ success on the fair use defense, the

plaintiff did not act objectively unreasonably.

COUNSEL

William Nathan Canby, Rosenfeld, Meyer & Susman, LLP,

Beverly Hills, California argued the cause and filed a brief for

the appellant. With him on the briefs were Todd W. Bonder

and Ryan M. Lapine, Rosenfeld, Meyer & Susman, LLP,

Beverly Hills, California.

Peter J. Anderson, Law Offices of Peter J. Anderson, a P.C.,

Santa Monica, CA, argued the cause and filed a brief for

appellees. With him on the briefs were Bruce Isaacs, Wyman

& Isaacs, LLP, Los Angeles, CA, and Lee S. Brenner and

Keri E. Campbell, Kelley Drye & Warren LLP, Los Angeles,

CA.

OPINION

O’SCANNLAIN, Circuit Judge:

We must decide whether a rock band’s unauthorized use

of an artist’s illustration in the video backdrop of its stage

show was a “fair use” under copyright law.

SELTZER V . GREEN DAY , INC. 5

I

A

Plaintiff Derek Seltzer is an artist and illustrator. In 2003,

he created Scream Icon, a drawing of a screaming, contorted

face. Seltzer made copies of Scream Icon, including large

posters and smaller prints with adhesive backs, which he has

sold and given away. See Appendix A. Many Scream Icon

posters have been plastered on walls as street art in Los

Angeles and elsewhere. Since then, Seltzer has moved on to

other projects, but at times he has used Scream Icon to

identify himself and his work’s presence by placing it on

advertisements for his gallery appearances, and at some point

he licensed it for use in a music video.

Defendant Roger Staub is a photographer and

professional set-lighting and video designer. In 2008, Staub

photographed a brick wall at the corner of Sunset Boulevard

and Gardner Avenue in Los Angeles which was covered in

graffiti and posters—including a weathered and torn copy of

Scream Icon. See Appendix B. Staub found it “interesting”

and saved this picture in his personal library.

Defendant Green Day is a rock band, and defendants

Billie Joe Armstrong, Michael Pritchard, and Frank Wright

are its musicians. Green Day has sold over 70 million records

worldwide since its debut in 1987. In May of 2009, Green

Day released its eighth studio album, 21st Century

Breakdown. In anticipation of the 2009–10 tour in support of

this album, Green Day engaged defendant Performance

Environment Design (“PED”) to create the lighting,

pyrotechnic effects, and video backdrops for the concert.

6 SELTZER V . GREEN DAY , INC.

Subsequently, PED arranged for Staub to create the video

backdrops for Green Day’s performances.

B

Staub created a video backdrop for each of the thirty-two

songs on Green Day’s set list. Before making these

backdrops, Staub repeatedly listened to 21st Century

Breakdown and studied the album art, which uses graffiti and

street art as significant visual elements.

One of the songs for which Staub created a backdrop was

the eighth song on the album, entitled “East Jesus Nowhere.”

Staub’s stated goal was to convey the song’s “mood, tone or

themes.” According to Staub, the theme of the song is “the

hypocrisy of some religious people who preach one thing but

act otherwise. . . . The song is about the violence that is done

in the name of religion.”

What Staub ultimately created for this song is the

allegedly-infringing work at the heart of this case, an

approximately four-minute-long video. The video depicts a

brick alleyway covered in graffiti. As “East Jesus Nowhere”

is performed, several days pass at an accelerated pace and

graffiti artists come and go, adding new art, posters, and tags

to the brick alleyway. The graffiti includes at least three

images of Jesus Christ, which are defaced over the course of

the video. Throughout the video, the center of the frame is

dominated by an unchanging, but modified, Scream Icon.

Staub used the photograph he had taken at Sunset and

Gardner, cut out the image of Scream Icon and modified it by

adding a large red “spray-painted” cross over the middle of

the screaming face. He also changed the contrast and color

and added black streaks running down the right side of the

SELTZER V . GREEN DAY , INC. 7

face. Staub’s image further differs from Scream Icon because

Staub’s original photograph was of a weathered, slightly

defaced, and torn poster. Scream Icon is nonetheless clearly

identifiable in the middle of the screen throughout the video.

Staub’s video backdrop was played behind Green Day

during the performance of “East Jesus Nowhere” at

approximately seventy concerts from July 3, 2009, through

November 12, 2009, and also during Green Day’s

performance of the song at the MTV Video Music Awards on

September 13, 2009. At some point, Seltzer became aware

that Green Day was using his art and on September 24, 2009

he wrote the band an e-mail alerting them to their

unauthorized use stating that he would like to “work out a

resolution to this issue.” Apparently no resolution was

possible, because on November 19, 2009, Seltzer registered

a copyright in Scream Icon, and his counsel sent Green Day

a cease-and-desist letter. Green Day subsequently stopped

using the video backdrop.

C

In March 2010, Seltzer filed the instant action. His First

Amended Complaint alleges direct and contributory copyright

infringement, violations of the Lanham Act, and various state

law claims. After discovery, defendants (collectively, “Green

Day”) moved for summary judgment. They primarily argued

that Staub’s video backdrop was fair use under 17 U.S.C.

§ 107. The district court agreed and granted summary

judgment on all claims.

Green Day then moved for attorneys fees under 17 U.S.C.

§ 505. The district court found that Seltzer’s claims had been

objectively unreasonable and granted the motion in full,

8 SELTZER V . GREEN DAY , INC.

awarding the defendants a total of $201,012.50. Seltzer

timely appeals both the grant of summary judgment and the

grant of attorney’s fees.

II

The fair use doctrine “permits and requires courts to avoid

rigid application of the copyright statute when, on occasion,

it would stifle the very creativity which that law is designed

to foster.” Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569,

577 (1994) (internal quotation marks omitted).

Consequently, 17 U.S.C. § 107 establishes that fair use of a

copyrighted work is not an infringement of copyright and lays

out four factors to apply when considering whether the use of

a work is “fair”:

(1) the purpose and character of the use,

including whether such use is of a commercial

nature or is for non-profit educational

purposes; (2) the nature of the copyrighted

work; (3) the amount and substantiality of the

portion used in relation to the copyrighted

work as a whole; and (4) the effect of the use

on the potential market for or value of the

copyrighted work.

17 U.S.C. § 107. These four factors must all be explored, and

all the results evaluated together, in light of the purposes of

copyright. Campbell, 510 U.S. at 578.

Whether Green Day’s use of Seltzer’s Scream Icon

constituted fair use is a mixed question of law and fact that

we review de novo. SOFA Entm’t, Inc. v. Dodger Prods.,

Inc., 709 F.3d 1273, 1277 (9th Cir. 2013). Where no

SELTZER V . GREEN DAY , INC. 9

material, historical facts are at issue and the parties dispute

only the ultimate conclusions to be drawn from those facts,

we may draw those conclusions without usurping the function

of the jury. Fisher v. Dees, 794 F.2d 432, 436 (9th Cir.

1986). As the Supreme Court held in Harper & Row

Publishers, Inc. v. Nation Enter., “[w]here the district court

has found facts sufficient to evaluate each of the statutory

factors, an appellate court need not remand for further

factfinding but may conclude as a matter of law that the

challenged use does not qualify as a fair use of the

copyrighted work.” 471 U.S. 539, 564 (1985) (internal

alterations and quotation marks omitted). As in Fisher, “[n]o

material historical facts are at issue in this case. The parties

dispute only the ultimate conclusion to be drawn from the

admitted facts.” 794 F.2d at 436.

A

The first factor in the fair use inquiry is “the purpose and

character of the use, including whether such use is of a

commercial nature or is for nonprofit educational purposes.”

§ 107(1). The Supreme Court has stated that the “central

purpose” of this factor is to see “whether and to what extent

the new work is transformative.” Campbell, 510 U.S. at 579.

Works of this type “lie at the heart of the fair use doctrine’s

guarantee of breathing space within the confines of copyright,

and the more ‘transformative’ the new work, the less will be

the significance of other factors.” Id. (internal citations

omitted).

Although transformation is a key factor in fair use,

whether a work is transformative is a often highly contentious

topic. See, e.g., Cariou v. Prince, 714 F.3d 694, 713–14 (2d

Cir. 2013) (Wallace, J., concurring in part and dissenting in

10 SELTZER V . GREEN DAY , INC.

part) (disagreeing with majority as to whether artists’ use of

certain copyrighted photographs was transformative; would

remand for further fact finding); Monge v. Maya Magazines,

Inc., 688 F.3d 1164, 1185–88 (9th Cir. 2012) (M. Smith, J.,

dissenting) (disagreeing with majority as to whether a

magazine’s publication of wedding photographs was

transformative); Bouchat v. Balt. Ravens Ltd. P’ship,

619 F.3d 301, 320–21 (4th Cir. 2010) (Niemeyer, J.,

dissenting) (disagreeing with majority as to whether the

Baltimore Ravens football team’s use of a “Flying B” logo

was transformative). A leading treatise on this topic has

lamented the frequent misuse of the transformation test,

complaining that it has become a conclusory label which is

“all things to all people.” Melville B. Nimmer & David

Nimmer, 4 Nimmer on Copyright § 13.05[A][1][b], 13-

168–70 (2011) (internal quotation marks omitted); see also

id. at 13-168–69 (listing cases which have “erroneous[ly]

with[held]” the transformative label).

The plethora of cases addressing this topic means there is

no shortage of language from other courts elucidating (or

obfuscating) the meaning of transformation. To navigate

these treacherous waters, we turn to the most definitive

formulation of the test. The Supreme Court in Campbell

stated that one work transforms another when “the new work

. . . adds something new, with a further purpose or different

character, altering the first with new expression, meaning or

message.” Campbell, 510 U.S. at 579. This understanding

was drawn by the Court in large part from Second Circuit

Judge Pierre Leval’s 1990 article in the Harvard Law Review,

Toward a Fair Use Standard, 103 Harv. L. Rev. 1105 (1990).

In that article, Judge Leval further clarified his understanding

of “transformative” works:

SELTZER V . GREEN DAY , INC. 11

The use must be productive and must employ

the quoted matter in a different manner or for

a different purpose from the original. A

quotation of copyrighted material that merely

repackages or republishes the original is

unlikely to pass the test; in Justice Story’s

words, it would merely “supersede the

objects” of the original. If, on the other hand,

the secondary use adds value to the

original—if the quoted matter is used as raw

material, transformed in the creation of new

information, new aesthetics, new insights and

understandings—this is the very type of

activity that the fair use doctrine intends to

protect for the enrichment of society.

Id. at 1111.

Applying this understanding, Green Day’s use of Scream

Icon is transformative. Green Day used the original as “raw

material” in the construction of the four-minute video

backdrop. It is not simply a quotation or a republication;

although Scream Icon is prominent, it remains only a

component of what is essentially a street-art focused music

video about religion and especially about Christianity (images

of Jesus Christ appear—and are defaced—several times

during the course of the video).

The message and meaning of the original Scream Icon is

debatable. To us, it appears to be a directionless anguished

screaming face. Seltzer himself testified to his view of the

meaning of the original piece: “It addresses themes of youth

culture, skateboard culture, insider/outsider culture, . . . it’s an

iconic reference to a culture and time in Los Angeles when

12 SELTZER V . GREEN DAY , INC.

the image was made.” But regardless of the meaning of the

original, it clearly says nothing about religion. With the

spray-painted cross, in the context of a song about the

hypocrisy of religion, surrounded by religious iconography,

Staub’s video backdrop using Scream Icon conveys “new

information, new aesthetics, new insights and

understandings” that are plainly distinct from those of the

original piece. At his deposition, Seltzer seemed to

acknowledge as much, when he stated that Staub’s backdrop

“tainted the original message of the image and [] made it now

synonymous with lyrics, a video, and concert tour that it was

not originally intended to be used with.”

Although the law in this area is splintered, as discussed

above, our conclusion on transformation is generally in line

with other appellate authority on transformative use. In the

typical “non-transformative” case, the use is one which

makes no alteration to the expressive content or message of

the original work. See, e.g., Monge, 688 F.3d at 1176

(magazine publication of photos of secret wedding of

celebrity was not transformative because it did not “alter[] the

first [work] with new expression, meaning or message”)

(second alteration in original); Elvis Presley Enters., Inc. v.

Passport Video, 349 F.3d 622, 629 (9th Cir. 2003) (use of

copyrighted clips of Elvis’s television appearances was not

transformative when the clips were “played without much

interruption, if any, . . . [and] serve[d] the same intrinsic

entertainment value that is protected by Plaintiffs’

copyrights.”), overruled on other grounds as stated in

Flexible Lifeline Sys., Inc. v. Precision Lift, Inc., 654 F.3d

989, 995 (9th Cir.2011) (per curiam); L.A. News Serv. v. CBS

Broad., Inc., 305 F.3d 924, 938 (9th Cir. 2002) (“Merely

plucking the most visually arresting excerpt from LANS’s

nine minutes of footage cannot be said to have added

SELTZER V . GREEN DAY , INC. 13

anything new.”), as amended 313 F.3d 1093 (9th Cir. 2002);

Ringgold v. Black Entm’t Television, Inc., 126 F.3d 70, 79 (2d

Cir. 1997) (use of a poster as decoration on a TV show not

transformative because it was used for “precisely a central

purpose for which it was created” and defendants had done

nothing with the poster to add anything new).

In contrast, an allegedly infringing work is typically

viewed as transformative as long as new expressive content

or message is apparent. This is so even where—as here—the

allegedly infringing work makes few physical changes to the

original or fails to comment on the original. See, e.g.,

Cariou, 714 F.3d at 708 (artist who altered and incorporated

several copyrighted photographs into a series of paintings and

collages engaged in transformative use as to most of the

paintings because the images were presented with

“fundamentally different aesthetic”); Bill Graham Archives

v. Dorling Kindersley Ltd., 448 F.3d 605, 608–09 (2d Cir.

2006) (use of concert posters in a timeline in a book on the

history of the Grateful Dead was transformative; their use

was as “historical artifacts” rather than for “artistic

expression and promotion”); Blanch v. Koons, 467 F.3d 244,

252–53 (2d Cir. 2006) (artist who incorporated and altered

copyrighted fashion photograph of a pair of women’s legs as

part of a larger work of art engaged in a transformative use);

Kelly v. Arriba Soft Corp., 336 F.3d 811, 818–20 (9th Cir.

2003) (use of exact replicas of artist’s photographs as

“thumbnail images” in a search engine was transformative

because their purpose was completely transformed from their

original use as fine art); L.A. News Serv., 305 F.3d at 938–39

(inclusion of copyrighted clip in video montage, using editing

to increase dramatic effect, was transformative).

14 SELTZER V . GREEN DAY , INC.

We conclude, therefore, that Green Day’s use of Scream

Icon was transformative. Furthermore, although the statute

instructs us to consider the “commercial nature” of a work

(and Green Day’s concert was undoubtedly commercial in

nature) “the degree to which the new user exploits the

copyright for commercial gain—as opposed to incidental use

as part of a commercial enterprise—affects the weight we

afford commercial nature as a factor.” Elvis Presley Enters.,

349 F.3d at 627. Green Day’s use of Scream Icon was only

incidentally commercial; the band never used it to market the

concert, CDs, or merchandise. Under these circumstances,

the first fair use factor weighs in Green Day’s favor.

B

The second factor that § 107 instructs us to consider is

“the nature of the copyrighted work” which recognizes the

fact that “some works are closer to the core of intended

copyright protection than others.” Campbell, 510 U.S. at 586.

Scream Icon is a creative work, meriting strong protection

under this factor.

Mitigating this factor in favor of Green Day is that we are

instructed to consider the extent to which a work has been

published. Harper & Row Publishers, Inc., 471 U.S. at 564

(“The fact that a work is unpublished is a critical element of

its ‘nature.’”); Kelly, 336 F.3d at 820. “Published works are

more likely to qualify as fair use because the first appearance

of the artist’s expression has already occurred.” Kelly,

336 F.3d at 820. Here, as in Kelly, Scream Icon was widely

disseminated, both on the internet and on the streets of Los

Angeles before Green Day used it in their concerts.

Accordingly, Seltzer controlled the “first public appearance”

SELTZER V . GREEN DAY , INC. 15

of his work. See Harper & Row Publishers, Inc., 471 U.S. at

564. This tends to weigh in favor of the fair use of that work.

Considering this factor as a whole, it weighs only slightly

in Seltzer’s favor.

C

The third factor looks to the quantitative amount and

qualitative value of the original work used in relation to the

justification for that use. SOFA Entm’t, 709 F.3d at 1279; see

also Campbell, 510 U.S. at 586. This factor captures the fact

that an allegedly infringing work that copies little of the

original is likely to be a fair use. See, e.g., SOFA Entm’t,

709 F.3d at 1279 (holding that Ed Sullivan’s seven-second

introduction of the Four Seasons band was both qualitatively

and quantitatively insignificant). Here, Green Day copied

most of Scream Icon, both quantitatively and qualitatively.

However, unlike an episode of the Ed Sullivan show or a

book manuscript, Scream Icon is not meaningfully divisible.

Given that fact, this court has acknowledged that this factor

will not weigh against an alleged infringer, even when he

copies the whole work, if he takes no more than is necessary

for his intended use. Kelly, 336 F.3d at 820–21. As the

Supreme Court has recognized, this factor necessarily

overlaps somewhat with the first factor—the “extent of

permissible copying varies with the purpose and character of

the use.” Campbell, 510 U.S. at 586–87. Here, as in Kelly,

the use of the entire work was necessary to achieve Green

Day’s “new expression, meaning or message.” Id. at 579; see

also Kelly, 336 F.3d at 821.

Thus, this factor does not weigh against Green Day.

16 SELTZER V . GREEN DAY , INC.

D

The fourth factor asks what effect the allegedly infringing

use has on the “potential market for or value of the

copyrighted work.” 17 U.S.C. § 107(4). This factor should

consider “the extent of market harm caused by the particular

actions of the alleged infringer [and] also whether

unrestricted and widespread conduct of the sort engaged in by

the defendant would result in a substantially adverse impact

on the potential market for the original.” Campbell, 510 U.S.

at 590 (internal quotation marks and citations omitted).

Where the allegedly infringing use does not substitute for the

original and serves a “different market function,” such factor

weighs in favor of fair use. Id. at 591; SOFA Entm’t,

709 F.3d at 1280.

At Seltzer’s deposition, he repeatedly testified that the

value of his work was unchanged, but that he subjectively did

not care for Green Day’s use of his art. He admitted that no

one had ever told him that he would not buy his work as a

result of Green Day’s use; instead, he claimed that Scream

Icon was “tarnished” for him personally, but he did not view

the piece as having lost any value.

Additionally, Green Day presented evidence that its video

backdrop did not perform the same “market function” as the

original. The original, created six years before Green Day’s

use, was primarily intended as street art. Green Day’s

allegedly infringing use, on the other hand, was never placed

on merchandise, albums, or promotional material and was

used for only one song in the middle of a three hour touring

show. In this context, there is no reasonable argument that

conduct of the sort engaged in by Green Day is a substitute

for the primary market for Seltzer’s art.

SELTZER V . GREEN DAY , INC. 17

This factor also considers any impact on “traditional,

reasonable, or likely to be developed markets.” Ringgold,

126 F.3d at 81. At some point, according to Seltzer’s

declaration, Scream Icon was used in a music video by a band

named “People.” Seltzer provides no additional information

about this licensing, including how much revenue he earned

as a result, how the music video was used by the band, or

how the music video used Scream Icon. Without further

context, this fact does not suffice to show that Green Day’s

use harmed any existing market or a market that Seltzer was

likely to develop.

Thus, this factor weighs in Green Day’s favor as well.

E

Our evaluation of all four factors inclines us to the

ultimate conclusion that Green Day’s use of Seltzer’s Scream

Icon was fair. The purpose and character of the use was

transformative and not overly commercial. The nature of the

work includes its status as a widely disseminated work of

street art. Green Day’s use of the work was not excessive in

light of its transformative purpose. And Green Day’s use did

not affect the value of the piece or of Seltzer’s artwork in

general. Additionally, we note that factor one and factor four

have “dominated the case law” and are generally viewed as

the most important factors; Green Day wins on both of these

key points. Monge, 688 F.3d at 1171. Therefore, we are

satisfied that the district court did not err in granting

summary judgment on Seltzer’s copyright infringement

claims.

18 SELTZER V . GREEN DAY , INC.

III

The district court also granted summary judgment to

Green Day on Seltzer’s Lanham Act claims. The Lanham

Act extends liability to any person who “uses in commerce

any word, term, name, symbol, or device . . . which is likely

to cause confusion, or to cause mistake, or to deceive as to the

affiliation, connection or association of such person with

another person . . . .” 15 U.S.C. § 1125(a).

The district court concluded that Seltzer failed to present

evidence showing that he used the image as a mark in the sale

of goods or services—that is, that he failed to establish

trademark rights at all. In order to acquire trademark rights,

the mark must be used in the “ordinary course of trade” on

goods or containers, or, if the nature of the goods makes that

impractical, on documents associated with the goods or their

sale. Brookfield Commc’ns v. West Coast Entm’t Corp.,

174 F.3d 1036, 1051–52 (9th Cir. 1999) (citing 15 U.S.C.

§ 1127).

Seltzer argues that Scream Icon’s placement on certain

advertisements for his appearance at an art gallery show was

sufficient to establish trademark rights. But Seltzer has not

presented any evidence that the use of the mark was

“sufficiently public to identify or distinguish the marked

goods in an appropriate segment of the public mind.” Id. at

1052 (quoting New West Corp. v. NYM Co. of Cal., Inc.,

595 F.2d 1194, 1200 (9th Cir. 1979)). Seltzer has failed to

explain how these advertisements were distributed, who

might have seen them, when they were distributed, to what

shows they were connected and what was sold at those shows,

or any other facts which might be necessary to evaluate

whether Scream Icon is deserving of trademark protection.

SELTZER V . GREEN DAY , INC. 19

Therefore the district court correctly granted summary

judgment to Green Day on Seltzer’s Lanham Act claims.1

IV

Finally, the district court awarded Green Day over

$200,000 in attorneys fees. A district court’s award of

attorneys fees under 17 U.S.C. § 505 is reviewed for abuse of

discretion. Fantasy, Inc. v. Fogerty, 94 F.3d 553, 556 (9th

Cir. 1996). Under the abuse of discretion standard, the

district court’s findings of fact or its application of the legal

standard to those findings of fact must be “illogical,

implausible, or without support in inferences that may be

drawn from facts in the record.” U.S. v. Hinkson, 585 F.3d

1247, 1251 (9th Cir. 2009) (en banc).

The question presented in a case where a defendant makes

a winning fair use defense is whether the successful defense

of the action furthered the purposes of the Copyright Act.

Mattel Inc. v. Walking Mountain Prods., 353 F.3d 792, 816

(9th Cir. 2003). It is important to recall that the Supreme

Court rejected the so-called British Rule where the loser pays;

rather, attorneys fees are left up to the discretion of the

district court. See Fogerty v. Fantasy, 510 U.S. 517, 533

(1994) (citing 17 U.S.C. § 505). As the district court correctly

recited, courts deciding whether to award attorneys fees can

look to five non-exclusive factors: (1) the degree of success

1

This court has “consistently held that state common law claims of

unfair competition and actions pursuant to California Business and

Professions Code § 17200 are ‘substantially congruent’ to claims made

under the Lanham Act.” Cleary v. News Corp., 30 F.3d 1255, 1262–63

(9th Cir. 1994). W e similarly affirm the district court’s grant of summary

judgment on these claims.

20 SELTZER V . GREEN DAY , INC.

obtained; (2) frivolousness; (3) motivation; (4) the objective

unreasonableness of the losing party’s factual and legal

arguments; and (5) the need, in particular circumstances, to

advance considerations of compensation and deterrence. See

Fogerty, 510 U.S. at 534 n.19.

Significantly, the district court found that Seltzer’s claim

was objectively unreasonable. In making this finding, the

district court relied on the facts that Seltzer lost at summary

judgment, that three of the four fair use factors were in Green

Day’s favor, and that Seltzer’s deposition testimony

“effectively conceded that the use was transformative.” This

is in reference to Seltzer’s statement at his deposition,

referenced above, that the new work “tainted the original

message” and “devalue[d] the original intent” of Scream

Icon.

But, the mere fact that Seltzer lost cannot establish his

objective unreasonability. See Harris Custom Builders, Inc.

v. Hoffmeyer, 140 F.3d 728, 730 (7th Cir. 1998) (“How the

court ruled, simply put, is not a proper concern [in

determining the availability of § 505 fees].”). Further, we

conclude that Green Day only won on two of the four fair use

factors, rather than three as the district court concluded. And

in any event, Seltzer’s statement at his deposition—which the

district court viewed as a “concession”—only expressed his

opinion and could not concede the transformative nature of

Green Day’s work. See Cariou, 714 F.3d at 707 (“What is

critical is how the work in question appears to the reasonable

observer, not simply what an artist might say about a

particular piece or body of work . . . . Rather than confining

our inquiry to [the artist’s] explanations of his artwork, we

instead examine how the artworks may ‘reasonably be

perceived’ . . .”). Thus, the facts relied on by the district

SELTZER V . GREEN DAY , INC. 21

court do not lend any meaningful support to the notion that

Seltzer’s case was objectively unreasonable when he brought

it.

This was a close and difficult case. We concluded that

Seltzer’s work was transformed by Green Day’s use. But that

transformation was far from obvious given Green Day’s only

slight alterations to the original. Furthermore, of the

remaining three factors, one was in Seltzer’s favor, one was

in Green Day’s favor, and one was neutral. There is simply

no reason to believe that Seltzer “should have known from

the outset that [his] chances of success in this case were slim

to none.” SOFA Entm’t, 709 F.3d at 1280.

Therefore, we conclude that the district court clearly erred

in finding that Seltzer acted objectively unreasonably, and

vacate the award of attorneys fees.

No. 11-56573 AFFIRMED; No. 11-57160 VACATED

AND REMANDED. All parties to bear their own costs on

appeal.

22 SELTZER V . GREEN DAY , INC.

APPENDICES

Appendix A

Appendix B