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CY Wakeman, Inc. v. Nicole Price Consulting, LLC

United States District Court, D. Nebraska

January 24, 2018

CY WAKEMAN, INC., an Iowa corporation, Individually and as Assignee of John Wiley & Sons, Inc., Plaintiff,
v.
NICOLE PRICE CONSULTING, LLC d/b/a LIVELY PARADOX, a Missouri limited liability company and NICOLE D. PRICE, Defendants.

          MEMORANDUM AND ORDER

          John M. Gerrard, United States District Judge.

         The primary opponents in this case are Cy Wakeman, founder of plaintiff Cy Wakeman, Inc. (collectively, Wakeman), and Nicole Price, who is a defendant along with her eponymous LLC (collectively, Price). Wakeman accuses Price of, among other things, violating copyrights held by Wakeman and misappropriating Wakeman's trade secrets. Filing 1 at 6-7.

         Wakeman seeks to preliminarily enjoin Price from that alleged conduct. See filing 26. The parties have presented evidence, and the Court has conducted an evidentiary hearing at which Wakeman and Price both testified. On the evidence presented, the Court finds that Wakeman has failed to show the necessary likelihood of success on the merits of her claims, and failed to demonstrate that she has been-or will be-irreparably harmed in the absence of a preliminary injunction. So, Wakeman's motion (filing 26) will be denied.

         I. BACKGROUND

         Wakeman is in the business of providing business training and coaching services, with speeches and seminars on business leadership and employee advancement. Filing 28-2 at 1. Wakeman's programs are primarily based on a concept she calls "Reality-Based Leadership." Filing 28-2 at 1. Wakeman is also the author of two books based on that concept: Reality-Based Leadership, published in 2010, and The Reality-Based Rules of the Workplace, published in 2013. Those books, according to Wakeman, have combined sales of approximately 46, 000 copies. Filing 55 at 24.

         Price worked for Wakeman from 2012 until 2016. Filing 28-2 at 1. Price was one of Wakeman's featured speakers, and also assisted in the development of new programs, including a presentation on "Reality-Based Diversity and Inclusion in the Workplace." Filing 28-2 at 1; see filing 28-9. Wakeman terminated Price's employment in 2016; according to Wakeman, she fired Price after she found out about Price's intent to launch a competing business. Filing 28-2 at 2. After her termination, Price started her own consulting business. Filing 34-1 at 1. And she published her own book, Lively Paradox, which she says has sold about 200 copies. Filing 34-1 at 2.

         Wakeman sued Price, alleging in relevant part that Lively Paradox infringed on Wakeman's copyrights in Reality-Based Leadership, The Reality-Based Rules of the Workplace, and the text and images of the PowerPoint presentation associated with "Reality-Based Diversity and Inclusion in the Workplace." Filing 1 at 2-7. Wakeman also alleges that Price has misappropriated Wakeman's trade secrets by publicly revealing some of Wakeman's confidential clients. Filing 1 at 7. Wakeman asks for a preliminary injunction "with regard to the sales, distribution and use of copyrighted materials and references to confidential Wakeman clients on [Price's] real and virtual materials." Filing 26 at 2.

         II. DISCUSSION

         When deciding whether to issue a preliminary injunction, the Court weighs the four Dataphase factors: (1) the threat of irreparable harm to the movant; (2) the state of the balance between this harm and the injury that granting the injunction will inflict on other parties; (3) the probability that the movant will succeed on the merits; and (4) the public interest. Johnson v. Minneapolis Park & Recreation Bd., 729 F.3d 1094, 1098 (8th Cir. 2013); (citing Dataphase Sys., Inc. v. C L Sys., Inc., 640 F.2d 109, 114 (8th Cir. 1981) (en banc)). A preliminary injunction is an extraordinary remedy, and the movant bears the burden of establishing its propriety. Roudachevski v. All-Am. Care Centers, Inc., 648 F.3d 701, 705 (8th Cir. 2011); see also Winter v. Natural Res. Def. Council, Inc., 555 U.S. 7, 20 (2008).

         1. Copyright Claims

         As noted above, Wakeman claims that Price's Lively Paradox infringes on Wakeman's own copyrighted works.

         (a) Likelihood of Success on the Merits

         The Court begins by assessing Wakeman's likelihood of success on the merits of her copyright claim, because in deciding whether to grant a preliminary injunction, likelihood of success on the merits is the most significant factor. Laclede Gas Co. v. St. Charles Cnty., 713 F.3d 413, 419-20 (8th Cir. 2013). A party seeking injunctive relief need not necessarily show a greater than 50 percent likelihood that it will prevail on the merits. Planned Parenthood Minnesota, North Dakota, South Dakota v. Rounds, 530 F.3d 724, 731 (8th Cir. 2008). But the absence of a likelihood of success on the merits strongly suggests that preliminary injunctive relief should be denied. Barrett v. Claycomb, 705 F.3d 315, 320 (8th Cir. 2013).

         The elements of copyright infringement are (1) ownership of a valid copyright and (2) copying original elements of the copyrighted work. Warner Bros. Entm't v. X One X Prods., 644 F.3d 584, 595 (8th Cir. 2011). Copying can be shown either by (1) direct evidence, or (2) access to the copyrighted material and substantial similarity between the copyrighted work and the allegedly infringing work. Id. There is no direct evidence of copying here.[1] So, the question is whether the works are substantially similar.

         Determination of substantial similarity involves a two-step analysis. Rottlund, 452 F.3d at 731. There must be substantial similarity both of ideas and of expression. Id. Similarity of ideas is evaluated extrinsically, focusing on objective similarities in the details of the works. Id. If the ideas are substantially similar, then similarity of expression is evaluated using an intrinsic test depending on the response of the ordinary, reasonable person to the forms of expression. Id. In other words, the Court must first consider whether the general idea of the works is objectively similar (the "extrinsic" portion of the test) and then determine whether there is similarity of expression (the "intrinsic" portion of the test). See Taylor Corp. v. Four Seasons Greetings, LLC, 315 F.3d 1039, 1043 (8th Cir. 2003).[2] Wakeman has not shown a likelihood of success on the merits of either step of that analysis.

         (i) Extrinsic Similarity

         Extrinsically, Wakeman points to several parts of Lively Paradox that, she says, represent content taken "nearly verbatim" from her copyrighted works. Filing 27 at 5-14. She argues that "Lively Paradox violates the 'extrinsic test' by objectively stealing the expression, organization and application of certain ideas from Wakeman-copyrighted works." Filing 35 at 3. But the extrinsic test requires more than that: "[t]he extrinsic inquiry is an objective one, looking to specific and external criteria of substantial similarity between the original elements (and only the original elements) of a protected work and an alleged copy." Copeland v. Bieber, 789 F.3d 484, 489 (4th Cir. 2015) (quotations omitted). Wakeman has done little to categorically identify such external criteria here. Compare filing 35 at 3 with, e.g., Swirsky v. Carey, 376 F.3d 841, 845-49 (9th Cir. 2004).

         And because it is focused only on the original elements of the copyrighted work, a court examining extrinsic similarity must first engage in "analytic dissection, " separating out those parts of the work that are original and protected from those that are not. Id.; see Three Boys Music Corp. v. Bolton, 212 F.3d 477, 485 (9th Cir. 2000); Herzog v. Castle Rock Entm't, 193 F.3d 1241, 1257 (11th Cir. 1999). In other words, extrinsic similarity cannot be shown by cherry-picking common ideas between the works-at least, not without considering whether those common ideas are original, copyrightable elements of the ...


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