(c) ownership claim allows both (c) and Lanham Act claims on motion to dismiss

Estate of Henry Joseph Darger v. Lerner, 2023 WL 2664341, No.
22 C 03911 (N.D. Ill. Mar. 28, 2023)

Darger “was an artist who died in obscurity but whose work
received significant posthumous acclaim.” The Estate alleged that his copyrights
were wrongfully claimed for nearly 50 years by Darger’s landlords. The court
denied a motion to dismiss on copyright and trademark etc. claims; the latter
trouble me for obvious Dastar reasons.

Darger had a tough life, including institutionalization. “From
approximately 1930 until 1973, when he moved to a care facility and shortly
thereafter passed away, Darger lived in a room at 851 West Webster in Chicago’s
Lincoln Park neighborhood. Darger’s landlords from approximately 1960 to the
end of his life in 1973 were Nathan and Kiyoko Lerner.”

When he died intestate, he left
behind in his apartment a 15,000-page epic fantasy novel called In the Realms
of the Unreal, about a civil war between children and abusive adults, which
included approximately 300 pages of watercolor, pastel wash, pencil, and
collage illustrations. He also wrote other expansive works …. Darger’s works
posthumously became well-regarded in the genre of “outsider art” (art by
self-taught artists who have no contact with the mainstream). “His works are
known for using a vibrancy of color and vivid composition.” Today, a single
illustration from In the Realms of the Unreal regularly sells for $200,000 to
$400,000 and has been known to fetch as much as $750,000. His illustrations
have also been featured in books, teaching materials, commercials, films, and
museums around the world.

“Upon Darger’s death, the Lerners took control of his works
under the allegedly false pretense that he had gifted the physical copies of
his works and their associated copyrights to them.” They also used Darger’s
name, identity, and likeness to “exploit” his works and by registering the
domain name “officialhenrydarger.com.”

In 2022, a distant relative was appointed as administrator
of the Estate, which then sued.

Defendants’ primary argument was laches/statute of
limitations, but those are affirmative defenses usually not appropriate for a
motion to dismiss, and it was conceivable that they didn’t apply. “First, under
the separate-accrual rule which applies to the Copyright Act, the statute of
limitations runs from each successive violation.” Thus, defendants were
allegedly currently violating the Copyright Act, Landham Act, and state IUDTPA.

Second, the discovery rule might apply. It was reasonable to
infer that the Estate didn’t have a reasonable basis for learning of
defendants’ conduct until recently, given the allegations of “the difficult
circumstances of Darger’s childhood which cut him off from any extended family;
that he lived a solitary life working “menial” jobs; that he died intestate;
that his art, though posthumously well-regarded, is mainly known in the niche
genre of ‘outsider art,’; and that Sadowski was appointed administrator of the
Estate by the Cook County Probate Court in only 2022.”

Copyright ownership: At this stage, the court accepted as
true the allegation that Darger did not gift his works to the Lerners. Given
that the disputed transfer was pre-1978, it was governed by the common law. “A
transfer of a common law copyright did not need to be in writing.” Still,
though a transfer of the material object could normally evidence an intent to
transfer the underlying common law copyright, the issue was always the intent
of the transferor. Nimmer even uses a relevant example: “if author A submits a
story to editor E at a magazine for consideration … E waits decades until A
is dead; and then E publishes it under a purported grant from A, there is scant
reason to credit the necessary ingredient of A’s intent to convey copyright

Does copyright preempt the Estate’s equitable easement and
IUDTPA claims? The first claim sought physical access to create an alternative
master; this was a substantively different right than copyright, so not
preempted. The second was, according to the court, not a preempted reverse
passing off claim, but instead based on Kiyoko Lerner falsely holding herself
out to consumers as a representative of the Estate. “Making such a
misrepresentation about one’s affiliation, by itself, is not among the
exclusive rights enumerated in § 106 of the Copyright Act.” [But depending on
what she actually said, Dastar or conflict preemption might be quite

Lanham Act false designation of origin, unfair competition,
and cybersquatting: The complaint identified Henry Darger’s name as the
relevant trademark (I don’t see how the Estate can plausibly claim to own it as
a mark, but ok). “[W]hether Kiyoko Lerner has a registered trademark in
Darger’s name is outside the four corners of the Complaint and is therefore a
factual dispute and not properly considered on a motion to dismiss.” And likely
confusion can’t be assessed at the motion to dismiss stage, nor were plaintiffs
required to allege specific facts establishing bad faith for cybersquatting at
the pleading stage. Still seems to me like they’re heading for fatal Dastar

from Blogger http://tushnet.blogspot.com/2023/03/c-ownership-claim-allows-both-c-and.html

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