Milo & Gabby V Amazon (Fed. Cir.) - Fully Briefed

161290
United States Court of Appeals

for the Federal Circuit
MILO & GABBY LLC, KAREN KELLER,

Plaintiffs - Appellants
v.
AMAZON.COM, INC.,
Defendant - Appellee
DA FANG SUN, aka Seth L, CHONGQIN WORLD FIRST
ELECTRONIC COMMERCE CO., LTD., aka Wotefusi, T. LIU, aka Bin
Deal, FAC SYSTEM, aka FAC System LLC, DINGDING ZOU, aka
Happy Sunday, QIUMEI ZHANG, aka Hitece, CHARLOTTE XIA,
NIMBLE JOY, AMANIALARASHI2165, MONAQO,
Defendants.
Appeal from the U.S. District Court for the Western District of
Washington in Case No. 2:13-cv-01932, Judge Ricardo S. Martinez.
CORRECTED
OPENINGBRIEFOFPLAINTIFFSAPPELLANTS
PHILIP P. MANN
TIMOTHY J. BILLICK
MANN LAW GROUP
1218 Third Avenue, Suite 1809
Seattle, Washington 98101
(206) 436-0900
Attorneys for Plaintiffs-Appellants
Milo & Gabby and Karen Keller
JOHN WHITAKER
WHITAKER LAW GROUP
206-436-8500
Milo & Gabby LLC and Karen Keller
March 7, 2016
CERTIFICATEOFINTEREST
Counsel for Appellants Milo & Gabby LLC and Karen Keller certifies the
following:
1.
The full name of every party or amicus represented by me is:

Milo & Gabby LLC and Karen Keller.
2.
The name of the real party in interest (if the party named in the
caption is not the real party in interest) represented by me is:
3.
The parent companies, subsidiaries (except wholly-owned

subsidiaries), and affiliates that have issued shares to the public, of
the party or amicus represented by me are:
None.
4.
The name of all law firms and the partners or associates that
appeared for the party or amicus now represented by me in the trial
court or agency or are expected to appear in this court are:
MANN LAW GROUP
Philip P. Mann
Timothy J. Billick
WHITAKER LAW GROUP

John Whitaker
Dated:March7,2016.
Respectfullysubmitted,
/s/
JohnWhitaker
JohnWhitaker
TABLEOFCONTENTS
I.
STATEMENT OF RELATED CASES..................................................1
II.
APPELLATE JURISDICTIONAL STATEMENT................................2
III.
STATEMENT OF THE ISSUES...........................................................3
IV.
STATEMENT OF THE CASE..............................................................4
V.
VI.
A.
Introduction..................................................................................4
B.
The Underlying Dispute...............................................................6
C.
The Proceedings Below................................................................9
D.
The Trial Below..........................................................................11
STATEMENT OF THE RELEVANT FACTS.....................................13

A.
Background of Appellants and Associated Intellectual Property.13
B.
Background of the Dispute........................................................15
C.
Amazon's Actions as a Seller.....................................................16
SUMMARY OF THE ARGUMENT....................................................20
VII. ARGUMENTS......................................................................................22
A.
Standard of Review....................................................................22
B.
Amazon Is A Seller Of The Accused Products........................22

1.
2.
Taking Legal Title Is Not Required In Order To Be A

Seller For The Purpose Of Infringement...........................24
(a)
Consignment Sales............................................................25
(b)
Amazon Is A Person In The Position Of A Seller.........26
(c)
Sale or return Transactions...........................................27

This Court Should Find That Amazon Is A Seller Of The
ii
Accused Products As A Matter Of Law................................27

C.
Amazons Liability As The Seller For Patent And Copyright

Infringement...............................................................................29
D.
Amazon Has Committed Copyright Infringement...................29

1.
Amazon Has Already Admitted That The Accused Products

Are Copies Of Milo & Gabbys Protected Products...........31
2.
It Is Undisputed That Amazon Stored and Shipped the

Accused Products...................................................................32
3.
Amazon's Own Witness Admitted That Amazon

Distributes The Accused Products.....................................33
4.
Amazons Distribution Is A Sale Or Other Transfer Of

Ownership.............................................................................34
5.
The DMCA Safe Harbor Provisions Do Not Apply To The

Sale Of Physical Products.....................................................35
E.
The District Court Erred By Dismissing Milo & Gabby's

Passing Off Claim After Being Misled By Amazon..................37
1.
The District Courts Dismissal..............................................37
2.
The Complaint Details The Facts Supporting Milo &

Gabbys Passing Off Claim.................................................38
(a)
The Elements Of Passing Off...........................................39
(b)
Milo & Gabbys Complaint Alleged Sufficient Facts To

Make Out A Claim of Passing Off.................................40
3.
Not Only Was Amazon Put On Fair Notice, Amazon

Admittedly Had Actual Notice...........................................41
4.
The Attorneys Fees Award Should Be Vacated...................43
VIII. CONCLUSION....................................................................................43
iii
TABLEOFAUTHORITIES
TABLEOFCASES
Doe I v. Wal-Mart Stores, Inc., 572 F.3d 677, 681 (9th Cir. 2009).............22
Harry v. Marchant, 237 F.3d 1315, 1317 (11th Cir. 2001).........................22
Jeff D. v. Otter, 643 f.3d 278 (9th Cir. 2011)...............................................22
Casey v. Albertsons Inc., 362 F.3d 1254, 1257 (9th Cir. 2004)..................22
Pfaff v. Wells Elecs. Inc., 525 U.S. 55, 67 (1998)........................................24
Pinter v. Dahl, 486 U.S. 622, 642-43 (1988)................................................24
North Am. Philips Corp. v. American Vending Sales, Inc., 35 F. 3d 1576,
1579-80 (Fed. Cir. 1994)...............................................................................24
Falk v. Brennan, 414 US 190 (1973)............................................................25
Seaboard Lumber Co. v. U.S., 308 F.3d 1283, 1292 (Fed. Cir. 2002).........27
Pinkham v. Sara Lee Corp., 983 F.2d 824, 82829 (8th Cir. 1992)............30
Blue Nile, Inc. v. Ideal Diamond Solutions, Inc., C10-380-TSZ (W.D.
Wash. Aug. 3, 2011)......................................................................................30
Foreverendeavor Music, Inc., v. S.M.B., Inc., 701 F.Supp. 791, 793-4 (W.D.
Wash. 1988)...................................................................................................30
Harbor Motor Co., Inc. v. Arnell Chevrolet-Geo, Inc., 265 F.3d 638, 643
(7th Cir. 2001)...............................................................................................30
Rogers v. Koons, 777 F. Supp. 1, 2 (S.D. N.Y. 1991)...................................30
Hendrickson v. Amazon.com, Inc., 298 F. Supp.2d 914 (C.D. Cal. 2003). .35
Bell Atlantic Corp. v. Twombly, 127 S.Ct. 1955, 1964 (2007)....................38
Smith v. Montoro, 648 F.2d 602 (9th Cir. 1981).........................................39
Norwich Pharmacal Co. v. Sterling Drug, Inc., 271 F.2d 569 (2d Cir. 1959)
.......................................................................................................................41
iv
J. Josephson, Inc. v. General Tire & Rubber Co., 357 F.Supp. 1047
(S.D.N.Y. 1972).............................................................................................41
Bliss v. Gotham Industries, Inc., 316 F.2d 848, 855 (9th Cir. 1963)..........41
TABLEOFSTATUTES
28 U.S.C. 1338(a).........................................................................................2
28 U.S.C. 1331..............................................................................................2
28 U.S.C. 1367...............................................................................................2
28 U.S.C. 1295(a)(1).....................................................................................2
UCC 9-319..................................................................................................25
UCC 2-707A................................................................................................26
UCC 2-326..................................................................................................27
17 U.S.C. 106............................................................................................29
17 U.S.C. 501..............................................................................................30
17 U.S.C. 512..............................................................................................30
17 USC 512(c).............................................................................................33
17 U.S.C. 512(c)..........................................................................................35
17 U.S.C. 512(c)..........................................................................................35
I.
STATEMENTOFRELATEDCASES
Counselisunawareofanyotherappealinorfromthesamecivil
actionorproceedingasthismatterthatwaspreviouslybeforethisor
anyotherappellatecourt.
Therearenoothercasesknowntocounselpendinginthisorany
othercourtthatwilldirectlyaffectorbedirectlyaffectedbythisCourts
decisioninthependingappeal.
II.
(a)
APPELLATEJURISDICTIONALSTATEMENT
Jurisdiction in the District Court was based upon
28U.S.C.1338(a)and28U.S.C.1331becausetheactionaroseunder
acts of Congress relating to patents and copyrights. Supplemental
jurisdictionovertheancillaryclaimsderivesfrom28U.S.C.1367.
(b)
This Court's jurisdiction isbasedon 28U.S.C.1295(a)(1),
thisbeinganappealfromafinaldecisionofaDistrictCourtinacivil
actionarisingunderanActofCongressrelatingtopatents.
(c)
This appeal is timely under Fed. R. App. P. 4. A final
judgmentwasenteredbytheDistrictCourtonNovember3,2015,and
an amended final judgment was entered by the District Court on
November4,2015.ANoticeofAppealtothisCourtwastimelyfiledon
December1,2015.
III. STATEMENTOFTHEISSUES
1.
DidtheDistrictCourterrinholding,asamatteroflaw,that
becauseAmazondoesnottakelegaltitletotheproductssoldthrough
itswebsite,Amazondoesnotsell,offerforsaleorotherwisedistribute
productswithinthemeaningofthepatent,copyright,andLanhamAct
statutes.
2.
Did the District Court err in holding that the Digital
Millenium Copyright Act provides a safe harbor against copyright

infringement as to physical goods distributed from Amazon's
fulfillmentcenters.
3.
DidtheDistrictCourterrindismissingAppellant'sclaimfor
palmingoff,believing,erroneously,thatsuchaclaimwasnottimely
raisedbyAppellants.
4.
Did the District Court abuse its discretion in partially
awardingattorney'sfeestoAmazonbasedontheDistrictCourtsclearly
erroneousviewthatpalmingoffwasnottimelyraisedbyAppellants
intheproceedingsbelow.
IV.
A.
STATEMENTOFTHECASE
Introduction
Thefundamentalissuesinthiscasearesimpleanddirect: Does
Amazon.com,widelyrecognizedasthelargestInternetbasedretailer
in the United States, actually sell anything? Does Amazon offer
productsforsale?DoesAmazondistributeproductstopurchasers?
TheDistrictCourtbelowerroneouslyconcludedthatAmazon.com
doesnotsellproductsanddoesnotevenofferproductsforsale.Asa
resultoftheseconclusions,theDistrictCourtheld,asamatteroflaw,
that Amazon.com bears no liability whatsoever for products sold
throughtheAmazon.comwebsitethatindisputablyinfringeAppellants
designpatents,copyrightsandotherintellectualproperty.Asaresult
of these conclusions, Mrs. Keller and Milo & Gabby (hereinafter
collectively,Milo&Gabby)havenochoicebuttositbackhelplessly
and watch their business be destroyed while anonymous and
unscrupulousoverseasknockoffartistsblatantlycopytheirproducts
anddosowiththeeagerassistanceofAmazon,whoprovidesquickand
easyaccesstotheU.S.market.
Inresponsetothissadstateofaffairs,AmazonandtheDistrict
Courtsayessentially,Suetheforeignmanufacturers.Theproblem,of
course, is that these manufacturers are located far overseas, are
anonymous flybynight fraudsters, and, as a practical matter, are
beyondthereachofU.S.courts.Asestablishedduringtheproceedings
below,evenAmazonitselfdoesnotknow(a)whoitssuppliersreallyare,
(b)wheretheyareactuallylocated,or(c)wheretheycanactuallybe
found.IfAmazonitselfcannotfinditsownaffiliates,howcanMilo&
Gabbybeexpectedto?
Theoperativefactsinthiscasearelargelyundisputed. Amazon
providesaforumthroughwhichvirtuallyanyoneanywhereintheworld
cansetupanaccountandentertheU.S.marketviatheAmazon.com
website,literallywithinminutes. Blatantlyinfringingproductswere
indisputably sold through the Amazon.com website. Pictures of the
infringingproductsweredisplayedontheAmazonwebsite.Ordersfor
theseproductswerereceivedthroughtheAmazon.comwebsitethrough
customer accounts maintained by Amazon. The infringing products
werehousedintheUnitedStatesinwarehousesorfulfillmentcenters
owned,maintainedandoperatedbyAmazon. Theinfringingproducts
5
wereplacedintoboxesclearlymarkedAmazonbyAmazonworkers,
who,inturn,placedtheseboxescontainingtheinfringinggoodswith
UPSforshipmenttopurchasers.Amazon,throughcustomeraccounts
that it, itself, maintains, collected money for the sales through the
Amazon.com website. And Amazon, after deducting its share of the
proceedsformakingthetransactionspossible,passedontheremainder
ofthesemoniestotheoverseassupplierswhosetupsalesaccountswith
Amazon. Despite these largely indisputablefacts,theDistrict Court
heldAmazondoesnot,andcannotselltheinfringingproductsbecause
Amazon never takes legal title to them. As will be demonstrated
herein,theDistrictCourt'simproperfocusonlegaltitleisinconsistent
withapplicablelawandleddirectlytoitsimproperdismissalofMilo&
Gabby'sclaims.
B.
TheUnderlyingDispute
Appellant Karen Keller is a trained, experienced and talented
product designer residing, with her husband, Steve Keller and four
children,intheSeattlearea.Overtheyears,Mrs.Kellerhasdesigned
a number of successful products, and the Kellers have supported
themselvesandtheirfamilylargelythroughsalesoftheseproducts.
6
Inlate2004,Mrs.Kellercreatedaseriesofanimalshapedpillow
casesdesignedandintendedtobeofappealtoyoungchildren. Mrs.
KellerappliedforandreceivedfiveU.S.DesignPatentsandsixU.S.
copyrightsforheruniquepillowcasedesignsthatarethesubjectofthe
underlyingdispute. Mrs.Kellerandherhusband,Steve,thensetup
Milo&GabbyLLCtobringthenewpillowcasestomarketunderthe
names,Milo&GabbyandCozyCompanions.
To market and promote the Cozy Companions line of animal
shapedpillowcases,theKellersusedphotographsoftheirownyounger
children resting their heads on the pillowcases. These photographs
appearprominentlyonmarketingmaterialsfortheCozyCompanions
pillowcasesaswellasonpackagingforthepillowcases.
For business reasons, the Kellers intended for the Cozy
Companionspillowcasestobesoldatasomewhathighpricepointand
tobesoldonlythroughactualbrickandmortarshopsandboutiquee
tailer sites. Importantly, the Kellers never intended for the Cozy
Companions products to be sold through certain Internet websites,
such as Amazon.com, that are wellknown for selling products at
absoluterockbottomprices.
7
In mid2013, the Kellers were shocked to discover that blatant

knockoffsoftheiranimalshapedpillowcaseswerebeingofferedforsale
ontheAmazon.comwebsite.Toaddinsulttoinjury,photographsofthe
Kellers'ownchildrenrestingongenuineMilo&Gabbypillowcaseswere
displayed on Amazon.com websiteandusedtopromotetheknockoff
goods. Toconfirmwhattheyalreadyknew,theKellersplacedorders
fortheknockoffproductsusingtheirownAmazoncustomeraccount.
Sureenough,theproductstheyreceivedprovedtobecheapimitations
ofthegenuineMilo&GabbyCozyCompanionproducts.
TheknockoffproductstheKellersreceivedfromAmazonarrived,
viaUPS,inaboxsealedintapeprominentlybearingtheAmazonlogo
andthatclearlycamefromanAmazonfulfillmentcenter. Attrialit
was established (and never seriously disputed) that the knockoff
products were, in fact, stored in the United States in an Amazon
fulfillmentcenter,wereplacedintheshippingboxbyAmazonpersonnel
in response to the order received by Amazon, were sealed using the
Amazon labeled tape by Amazon personnel, and that Amazon
personnelcreatedtheshippinglabelaffixedtotheboxanddeliveredthe
boxtoUPSforshipment. NorwasitdisputedthatAmazoncollected
themoneypaidbytheKellerstopurchasetheknockoffgoods.
At trial, Ms. Keller testifiedthat,shortly afterdiscovery of the
knockoff products, shecalledAmazonseveraltimestocomplainand
leftavoicemessageexpressingherconcerns.AlthoughAmazondenied
attrialeverreceivingthevoicemessage,thefactremainsthatAmazon
madenoefforttoremovetheknockoffproductsfromitswebsiteuntil
severaldaysaftertheunderlyingactionwasfiled.Indeed,onatleast
twooccasions theknockoffproductsreappearedontheAmazon.com
websiteseveralweeksandmonthsaftertheactionwasfiled. 1
C.
TheProceedingsBelow
AfterreceivingnoreliefinresponsetotheirphonecalltoAmazon,
Mrs.KellerandMilo&Gabbywereforcedtosue.OnOctober24,2013,
Mrs.KellerandMilo&GabbyfiledtheircomplaintagainstAmazonin
the Western District of Washington allegingcounts for,amongother
things, (1) patent infringement, (2) copyright infringement, and (3)
violationsoftheLanhamAct.
1
To avoid any misunderstanding or unfairness, Amazon did
promptly take corrective action after being informed that the knock-off
products had re-appeared on the site.
9
OnApril11,2014,theDistrictCourtgrantedAmazon'smotionto
dismissMrs.KellerandMilo&Gabby'sclaimsforWashingtonState
unfaircompetition,rightofpublicity,andtrademarkcounterfeitingas
wellastheirclaimsforindirectand/orinducedinfringement.A5.On
July16,2015,theDistrictCourtgranted,inpart,Amazon'smotionfor
summary judgment. A24. In particular, the District Court dismissed
Milo&Gabby'scopyrightclaiminitsentirety,findingthatAmazonis
not the seller of the alleged infringing products. A33. While
acknowledging that Amazon stored the infringing products in its
facilities,acceptedordersthroughitswebsite,receivedmoniespaidby
purchasers,andpackagedtheproductsforshipment,theDistrictCourt
concludedtheseactivitiesdidnotconstitutesales. TheDistrictCourt
basedthatconclusiononitsfindingthatthirdpartysellersretainfull
titletoandownershipoftheinventorysoldbythethirdparty.A33.
Based on the District Court's viewthat Amazon does not sell
becauseitdoesnottaketitletothesoldgoods,theDistrictCourtalso
concludedthatMilo&Gabbycouldnotbaseapatentinfringementcase
onactualsales,byAmazon,oftheknockoffproducts. Curiously,the
DistrictCourtpermittedMilo&Gabby'spatentinfringementcasetogo
10
forward on the very narrow, limited question of whether Amazon

offeredtheknockoffproductsforsale.
Finally,theDistrictCourtrefusedtoletMilo&Gabby'spalming
offclaimgoforwardbasedonitsentirelyerroneousviewthatMilo&
Gabby had not raised that claim earlier. A44. In making this gross
error, the District Court simply adopted,withoutchecking,Amazon's
unsupported claim that Milo & Gabby hadn't raised palming off
earlier. However, the billing records of Amazon's counsel clearly
indicatethattheybilledAmazonforresearchandinvestigationintothe
LanhamActpalmingoffclaimtheylaterassertedMilo&Gabbynever
made. Nevertheless, the District Court later awarded Amazon its
attorneysfeesforthisresearchandinvestigation.
D.
TheTrialBelow
Ultimately,theDistrictCourtelectedtoholdajurytrialonthe
limitedquestionofwhetherAmazonofferedtheinfringingknockoff
products for sale. Because the District Court viewed this narrow
questionasoneoflaw,theJurywouldonlyserveinanadvisoryrole,
ratherthanastheultimatedeciderofthisquestion.
11
TrialwasheldbeforeaninepersonjurybetweenOctober2629,
2015. The District Court informed the Jury that, The Court has
previouslydeterminedinthiscasethatcertainThirdParties[]are
responsibleforprovidingtheproductsthatareaccusedofinfringement.
TheCourthasalsopreviouslydeterminedthatAmazonhasnotsoldany
of the allegedly infringing products. A86 (emphasis added). Milo &
GabbywasprecludedfromadvancinganyargumentsthatAmazonhad,
infact,soldtheinfringingknockoffproducts. Withtheirhandsthus
tiedbehindtheirback,Milo&Gabbywereforcedtotrytoproveoffers
forsalewithoutbeingabletopointtoactualsalesasthebestevidence
thatsuchoffersoccurred.
Ultimately,theJuryansweredthequestionspresentedinfavorof
Amazon,andtheDistrictCourtacceptedtheJury'sadvisoryfindings
andenteredjudgmentinfavorofAmazon.Thisappealisaresultofthe
variousfindingsmadebytheDistrictCourtinthecasebelow.
12
V.
A.
STATEMENTOFTHERELEVANTFACTS
BackgroundofAppellantsandAssociatedIntellectual
Property
PlaintiffAppellantMilo&Gabby(Milo&Gabby)was founded
byMrs.KarenKellerandMr.StevenKeller,ahusbandandwifeteam
of product designers. A151. Inspired by their four children and two
belovedfamilypets,theysetout to create anadorablelineofCozy
Companionpillowcases;eightanimalshaped,100%cottonpillowcases
thatblendtwofavoritethingsofchildren:stuffedanimalsandpillows
(the Cozy CompanionProducts). Id.; A194142.ThegenuineCozy
Companion Products are designed to be hypoallergenic, washable,
highquality pillowcases for children to transform an ordinary pillow
intoastuffedanimal.A194142.
TohelppromotethefamilyfriendlybrandofMilo&Gabby,the
Kellers used photographs of their children resting on the Cozy
Companion Products in the company's advertising. A151; A195153.
These images and advertisements of the patented Cozy Companion
ProductswerealsoprominentlydisplayedonMilo&Gabby'swebsite.
A166169;A195256.
13
Milo&GabbyandMrs.Kelleraretheownersofallright,title,
andinterestinthefollowingU.S.DesignPatents:
Patent
D520,798
D521,299
D521,792
D523,677
D551,889
Title
DogShapedPillowCase
RabbitShapedPillowCase
CatShapedPillowCase
DinosaurShapedPillowCase
PonyShapedPillowCase
Issued
May16,2006
May23,2006
May30,2006
June27,2006
October2,2007
A155;A203221.
Inaddition,theactualCozyCompanionProductsarethemselves
protectedbycopyrightregistrationsasfollows:
Copyright
1976817132
197905743
1978660959
1976528811
1985504482
1992407599
Title
DogShapedPillowCase
RabbitShapedPillowCase
CatShapedPillowCase
DinosaurShapedPillowCase
PonyShapedPillowCase
FishShapedPillowCase
A155;A222.
Milo&Gabbyswebsiteandtheimagesthereonarealsoprotected
by other valid U.S. copyrights,andaredisplayedin association with
propercopyrightmanagementinformation,includingapropercopyright
notice and other information identifying the copyright owner of the
severalworks.A155,A222.
14
Milo & Gabby designed, sold, and distributed its products to

retailers and online etailers throughout the United States and
internationally,withsomecommercialsuccess.A152.Forinstance,in
2012,Milo&Gabbyenteredintoanexclusivelicensearrangementin
Asia,andsincethenthecompanyhasmadepromisinggains. Id.;see
also,A19571959.Milo&Gabbyslicensee,PetiteElin,sellstheCozy
CompanionproductsinSouthKorea,Japan,andChina.A1959.Before
the actions of Amazon and others, Milo & Gabby aimed to further
expanditsoperationsby enteringintolicenseagreementsthroughout
North America. Id. However, those efforts were halted when
Amazon.com began selling direct knockoff copies of Milo & Gabbys
CozyCompanionProducts.Id.at13.
B.
BackgroundoftheDispute
In or about June 2013, Mrs. Keller saw her Cozy Companion
ProductsbeingofferedforsalebyAmazon.A196062;A1974.Asshown
inExhibitsBandCtothecomplaint(A170189),Amazonofferedand
sold knockoff versions of the Cozy Companion Products (Accused
Products) using Milo & Gabby's photographs of the Keller children.
A153; see also A196372, A1963 (That is an image of my youngest
15
daughteronthebunnypillowcase.),A1964(That'sanimageofmyson
onthedinosaurpillowcase.).
UponseeingtheproductsonAmazon'swebsite,Mrs.Kellercalled
Amazon'slegaldepartmentseveraltimesandleftavoicemailwiththe
company'sautomatedvoicemailsystem.A19731975.WhentheKellers
purchasedsomeoftheAccusedProductsfromAmazon,theyusedMr.
Steve Kellers Amazon account. A1967; A19761981. These products
ultimatelyarrivedinAmazonbrandedboxes.See,ExhibitD,A190199;
A19761981. TheKellerswereabletoimmediatelydiscernthatthese
productswere,infact,knockoffproducts.A1978.
Throughoutthisdispute,Amazonmaintainedthatitwasnotthe
infringing party. However, when Amazon answered the complaint, it
admitted that the Accused Products were shipped from Amazon
fulfillment centers. A365, 21. Amazon later admitted that the
infringingproductsaresubstantiallysimilartothedesignscoveredby
theMilo&Gabbypatents.A86.
C.
Amazon'sActionsasaSeller
At trial, Mr. Christopher Poad, Amazon's corporate
representative,testifiedthatAmazonactsasasellerineverystepofa
16
transaction.EveryproductsoldbyAmazonhasaproductdetailpage,
whereadescriptionofthegoodsisprovided.A2132.Thisdescriptionis
subject to rigorous oversight and control by Amazon. Amazon also
displays a price of the goods it hosts on its site. See, e.g., A2159.
Indeed, Amazon's counsel, during discussion of jury instructions,
furtheradmittedthatthecontentprovidedontheproductlistingpages
contain all necessary detail to constitute an offer for purposes of
contractlaw.A2194,1622(We'renotdebatingthattheproductlisting
pages communicate that thosearean offertosellbythethirdparty
sellers.). Amazon processes the payment for its consumers and its
retailers,anddisbursesthefundstotheseller.A2129.
Amazon,identicaltoaconsignmentseller,makesitpossiblefor
anyone to sell products with Amazon. A2136, lines 2224 (And so
anyonecancometoourwebsiteandfillinafewformsandsignupand
start selling products.). Mr. Poad proceeded to show precisely how
anyone couldsetup aselleraccountwith Amazon,muchlikehowa
consignmentsellerwouldallowanyonetouseitsstorefront.A213840.
Mr. Poad also confirmed that all of the thirdparty sellers in this
matteragreedtothe'businesssolutionsagreement.'(A2140)andthat
17
all of the third party sellers at issue in this casealso agreed to the
SellingonAmazontermsandconditions.A2150.
As a separate suite of services, Amazon offers socalled
FulfillmentbyAmazon(FBA).ThirdpartysellersthatuseAmazon's
FBAservices,mustabidebyanadditionalsetofrequirements.A2165.
Mr.PoadtestifiedondirectexaminationconcerningtheexpansiveFBA
service.A2161A2162:
The way it works is that if you're a seller, you send your
products in bulk, in a box or whatever, to an Amazon
fulfillment center. That's received by people who work in
Amazon fulfillment centers, our associates, put on a shelf.
It's still the seller's inventory. It's still their stock. It's just
sitting on an Amazon shelf. And then when the customer
comes and sees the seller's offer and buys the product from
the seller, Amazon gets the product from the shelf, puts it
in a box, and sends it to the customer on behalf of the
seller. We charge a fee for that service.
Q Is that what happened with the FAC box that's sitting up
there?
A Yes.
A2162 (emphasis added).
On cross examination, Mr. Poad again testified concerning
AmazonsrolesindistributionforFBAusers.A2248.Amazon'sactions
18
were never in serious factual dispute. What is in dispute, is how

Amazon'sactionsshouldbetreatedasamatteroflaw.
19
VI.
SUMMARYOFTHEARGUMENT
TheDistrictCourterredinconcludingthatAmazonneithersells
nor offers the accused products for sale. In particular, the District
Court erroneously believed that a transfer of legal title to the
infringing products to Amazon is needed before Amazon can sell
products. Applicable case law, as well as longestablished rules of
contract,donotrequirethatasellerholdlegaltitletoaproductinorder
tosellit. Indeed,consignmentsalesareonewellestablishedwayin
which a seller (consignee)cansellaproductwhoselegaltitlerests
withanother,i.e.,theconsignor.
Inadoptinganoverlyrestrictiveandlegallyfaultyinterpretation
ofsale,theDistrictCourtimproperlydismissedMilo&Gabby'sclaims
for patent infringement, copyright infringement, and violation of the
LanhamAct.
The District Court further erred in dismissing Milo & Gabbys
claim for passing off. Apparently without checking the record, the
DistrictCourtsimplyacceptedAmazon'sfactuallyincorrectclaimthat
Milo&Gabbyneverraisedapassingoffclaim.Inpointoffact,sucha
claimwasraisedveryearlyon,andthebillingrecordsofAmazon'sown
20
counselinthismattershow,beyonddispute,that,aslateasAugust14,
2014, Amazon's counsel even billed Amazon for Research[ing]
requirements for passing off and false advertising claims under the
LanhamActasallegedbyMilo&Gabby.
Finally,theDistrictCourtabuseditsdiscretionincontinuingto
awardAmazonitsattorneysfeesinconnectionwithmovingtodismiss
the passing off claim, even after Milo & Gabby pointed out and
demonstratedthatthepassingoffclaimhad,infact,beenraisedina
timelymanner.
21
VII. ARGUMENTS
A.
StandardofReview
This Court reviews the District Courts grant of summary
judgment and motions to dismiss de novo. Questions of contract

interpretation are revieweddenovo. See, DoeIv.WalMartStores,
Inc.,572F.3d677,681(9thCir.2009); Harryv.Marchant,237F.3d
1315,1317(11thCir.2001).
This Court reviews the District Courts grant of an award of
attorneysfeesforabuseofdiscretion.See,JeffD.v.Otter,643f.3d278
(9thCir.2011)(citingCaseyv.AlbertsonsInc.,362F.3d1254,1257(9th
Cir.2004)).
B.
AmazonIsASellerOfTheAccusedProducts
Amazonhasadmittednearlyeveryelementofeveryclaimagainst
it. Amazonhasconcededthattheaccusedproductsaresubstantially
similar toMilo &Gabbys proprietaryintellectualproperty. Amazon
hasconcededthatMilo&Gabbysintellectualpropertyisvalid. The
single common element of Milo & Gabbys claims that Amazon
continues to deny is whether Amazon sells the accused products.
Amazonerroneouslyarguedbelowthatwithoutacquiringlegaltitle,
22
Amazon cannot be a seller as a matter of law. A441A442.

Unfortunately,theDistrictCourtacceptedAmazonspositionwithout
analysis, and ruled that Amazon cannot be a seller of the accused
productsbecauseAmazondoesnotacquirelegaltitletotheproducts
soldthroughtheamazon.commarketplace.TheDistrictCourtruledas
follows:
[T]he Court rejects Plaintiffs contention that Amazon is
liable for [copyright] infringement based on its sales and
shipment of physical items. Here, the evidence demonstrates
that Amazon is not the seller of the alleged infringing
products. A496 at 12. Likewise, third-party sellers retain
full title to and ownership of the inventory sold by the third
party. A493 at 4. Plaintiffs have provided no evidence to
the contrary with respect to any specific third party involved
with the products in this case. Accordingly, the Court
concludes that Amazon was not the seller of the products at
issue here.
A33-34 (citations converted to the appendix).
TheonlyfactualassertionrelieduponbytheDistrictCourtisthat
Amazondoesnottakelegaltitletotheaccusedproducts.TheDistrict
Courterredbecausetakinglegaltitletoaproductisnot,andnever
hasbeen,arequirementforbeingaseller.
23
1.
TakingLegalTitleIsNotRequiredInOrderToBeA
SellerForThePurposeOfInfringement
This Court applies traditional contract principles to determine

whetherapartyisasellerforthepurposeofaninfringementanalysis.
See, e.g., Pfaffv. WellsElecs.Inc.,525U.S.55,67(1998)(traditional
contract principles apply to offers for sale in infringement analysis).
Therearenumerouscircumstanceswhereanentityisdeemedtobethe
sellerwithouttakinglegaltitletoproducts;legaltitleismerelyone
factorintheconsiderationofwhetheroneislegallyaseller.See,e.g.,
Pinter v. Dahl, 486 U.S. 622, 64243 (1988)(In common parlance, a
personmayofferorsellpropertywithoutnecessarilybeingtheperson
whotransferstitleto,orotherinterestin,thatproperty.).
Indeed,asthisveryCourthasrecognized,theconceptofpassing
legaltitlehasverylittletodowiththetortiousactofinfringement.
SeeNorthAm.PhilipsCorp.v.AmericanVendingSales,Inc.,35F.3d
1576,157980(Fed.Cir.1994) ([N]opolicy[is]furtheredbyaccording
controllingsignificancetothepassageoflegaltitlehere.Thiscasehas
nothingtodo,forexample,withtheproperallocationoftheriskofloss
betweenpartiestotheunderlyingsalescontracts.)
24
(a)
ConsignmentSales
The sales by Amazon of the accused products are essentially

consignment sales. Under a consignment sale, a consignee takes
physicalpossession,butnotlegaltitle,ofgoodsfromaconsignor.The
consigneethensellsthegoodsonbehalfoftheconsignor.Id.Insucha
transaction,theconsignor is thesellerofthegoods. Forinstance,in
Falkv.Brennan,414US190(1973) theU.S.SupremeCourtnotedas
follows:
[A] consignment sellers gross sales might properly be
measured by his gross receipts from sales of the product,
even though he did not actually hold title to the product that
he sold. Realistically, such a seller is in the business of
selling the product that is consigned to him, and he is
functionally in a position no different from that of a seller
who has purchased the product before resale.
Falk v. Brennan, 414 US at 199 (emphasis added).
Indeed, under the Uniform Commercial Code, the consignee is
deemedtohaverightsandtitletothegoods identical tothose[of]the
consignoreventhoughlegaltitleneverpassestotheconsignee. UCC
9319 (emphasisadded). Inotherwords,whilethegoodsareinthe
possession of the consignee (Amazon), the consignee (Amazon) is
deemedtohaverightsandtitletothegoods identical tothoseofthe
25
true owner. Accordingly, taking legal title is unnecessary for a

consigneetobeasellerofgoods.
(b)
AmazonIsAPersonInThePositionOfASeller
UndertheUniformCommercialCodeapersoninthepositionofa
sellerincludesanyonewhootherwiseholdsasecurityinterestorother
rightingoodssimilartothatofaseller. See UCC2707A. Inthe
instantaction,Amazonundeniablesatisfiesthedefinitionofapersonin
thepositionoftheseller.ItisundisputedthatAmazonholdsallrights
totheinfringingproductsofitsaffiliatesinthiscaseexcept solely for
legaltitle.Forexample,Amazonhaspossessionoftheproductsandthe
unfettered right to consummate the sale of those products with no
further input or control by its affiliates. A526. Once that sale is
consummated, Amazon packages up the product and ships it to the
purchaser. A536; A534A543. Indeed, Amazon even gift wraps the
productsifrequested. A539.Amazoncanreturnthegoodsordestroy
thematAmazonsownchoosing.A537.Amazoncanfreelycommingle
theaccusedproducts withitsown. A536. In short,Amazoncando
anything it wants with the products, just as if it held legal title.
26
Accordingly,Amazonisapersoninthepositionofasellerasdefined
bytheUCC.
(c)
SaleorreturnTransactions
Another example where a person to whom legal title is not

transferredbutnonethelessisdeemedtheselleristhesaleorreturn
transaction. Wheregoodsaredeliveredtoapersonforsaleandsuch
personmaintainsaplaceofbusinessatwhichhedealsingoodsofthe
kindinvolved,underanameotherthanthenameofthepersonmaking
delivery, then with respect to claims of creditors of the person
conductingthebusinessthegoodsaredeemedtobeonsaleorreturn.
See UCC2326. Insuchacase,thepersontowhomthegoodsare
deliveredmakesthesaleandisconsideredtobetheseller.Id.
The sale or return status for commercial transactions is yet
anotherexampleofasaleofaproductbeingmadebyanentitythat
doesnotholdlegaltitletothatproduct.
2.
ThisCourtShouldFindThatAmazonIsASellerOf
TheAccusedProductsAsAMatterOfLaw
Questions of contract interpretation are questions of law.

SeaboardLumberCo.v.U.S.,308F.3d1283,1292(Fed.Cir.2002)(this
27
court conducts de novo review of issues of law such as contract

interpretation.).SincetheissuebeforethisCourtiswhetherAmazon
isasellerorinthepositionofasellerbasedontheundisputedfacts,
itwouldbeappropriateforthisCourttorenderadecisionandconclude
thatAmazonisasellerasamatteroflaw.Id.
Amazonsagreementsbetweenitselfanditsaffiliates,aswellas
thetestimonyofitsonlywitnessattrial,provethatsalesmadeusing
theamazon.complatformareconsignmentsalesandthatAmazonisa
seller.Morespecifically,Amazonmaintainsitsownplaceofbusinessat
whichitmaydealinsimilargoods.A2132;A2255.Amazondealsinits
owngoodsunderitsownname,whichisobviouslydifferentthanthe
namesofitsaffiliates. Amazontakesphysicalpossessionofthegoods
that are delivered to it for sale. A2161A2162. Amazon maintains
possessionofthosegoodsuntiltheyaresold. Id.Thesaletransaction
occurswithoutanyfurtherinvolvementbythemanufacturer.A2129.
Amazonmaintainsoversightandcontrolovertheproductdetail
pages set up by its affiliates on the amazon.com platform. A2159.
Amazontransferspossessionoftheaccusedproductsdirectlyfromthe
Amazon fulfillment center to the purchaser. A2162. Amazons
28
compensationisapercentageoftheproceedsofthesalestransaction.
A2261.
Again,holdinglegaltitleisnotrequiredtobeaseller.Andaside
fromlegaltitle,Amazonholdseveryexclusiverightthatcanbeheldin
the accused products that are in its possession. Accordingly, it is
undeniablethatAmazonistheselleroftheaccusedproducts,orata
minimumisinapositionidenticaltothatoftheseller.
C.
AmazonsLiabilityAsTheSellerForPatentAndCopyright
Infringement
The District Court erroneously dismissed Milo & Gabbys
copyright infringement and patent infringement claims based on its

erroneous conclusion that Amazon is not a seller of the accused
products.A33;A44A46.However,assetoutatlengthabove,Amazon
is in fact a seller of the accused products,andaccordingly, Milo&
Gabbyspatentinfringementandcopyrightinfringementclaimsshould
bereinstated.
D.
AmazonHasCommittedCopyrightInfringement
OneoftheexclusiverightsunderTheCopyrightActistherightto
distributecopiesofapictorialorsculpturalwork. 17U.S.C. 106;
29
113(b). The Copyright Act defines copyright infringement as a

distributionofunauthorizedcopiesofaworkbysaleorothertransferof
ownership.17U.S.C.501.
Copyright infringement is a strict liability offense. Pinkham v.
SaraLeeCorp.,983 F.2d824,82829(8th Cir.1992); seealso, Blue
Nile,Inc.v.IdealDiamondSolutions,Inc.,C10380TSZ(W.D.Wash.
Aug. 3, 2011)(citing Foreverendeavor Music,Inc.,v. S.M.B., Inc., 701
F.Supp. 791, 7934 (W.D. Wash. 1988)). The defendant's intent is
accordingly irrelevant for purposes of establishing liability. See also,
HarborMotorCo.,Inc.v.ArnellChevroletGeo,Inc.,265F.3d638,643
(7thCir.2001)(newspaperthatassistedintheactualpreparationofan
infringing advertisement was a direct, not contributory, infringer);
Rogersv.Koons,777F.Supp.1,2(S.D.N.Y.1991)(artgallerythatsold
infringingsculptureswasadirectinfringer).
Using an indefensible and unsupported rationale, the District
CourtappliedthesafeharborsfromtheDigitalMillenniumCopyright
Act(17U.S.C. 512 et.seq.OrDMCA)tofindthatAmazondidnot
distributephysicalcopiesoftheAccusedProductsandphysicalcopiesof
30
the photographs on the associated packaging. See, A33, 39. Using

comparablyattenuatedrationale,theDistrictCourtstatedAmazonis
notthesellerofthegoodsatissue,soitcannotbefoundliablefordirect
copyrightinfringement.A33.
Asnotedabove,Milo&GabbyandMrs.Kelleraretherightful
ownersofnumerousvalidcopyrightsontheimagesthatappearonthe
physical packages of the pillowcases, as well as the pillowcases
themselves, and it is undisputed that Amazon distributed infringing
copies of the protected works for FAC System. As set out below,
regardlessofwhetherornotAmazonactsasaseller(itdoes),thereis
nodisputethatAmazonisliableforcopyrightinfringementbecauseit
actsasadistributoroftheinfringingproductsandphysicalimages.
1.
AmazonHasAlreadyAdmittedThatTheAccused
ProductsAreCopiesOfMilo&GabbysProtected
Products
Amazon conceded that the accused products are substantially

similartoMilo&Gabbysproprietaryintellectualproperty.SeeA2425
A2426. AmazonconcededthatMilo&Gabbysproprietaryintellectual
property is valid. A24252426. Accordingly, Amazon conceded that
31
infringement occurred; it merely denies that it is liable for that

infringement.
2.
ItIsUndisputedThatAmazonStoredandShippedthe
AccusedProducts
When Amazon answered the complaint, it admitted that the

AccusedProductswereshippedfromAmazonfulfillmentcenters.A365,
21(AmazonadmitsthatthirdpartysellerFACSystemsparticipated
in the Fulfilled by Amazon service, through which certain items are
offeredforsalebyathirdpartyseller,butshippedtothecustomerfrom
an Amazon fulfillment center.). This admission was continually
reiterated throughout discovery. See, e.g., Amazon Supplemental
Responses to Interrogatory No.7, A610A611 (...Amazon packs [the
inventory]andshipsittothecustomer.).
BeforetheDistrictCourterroneouslydismissedMilo&Gabbys
copyright infringement claims on Amazons Motion for Summary
Judgment,Amazonadmittedagainthatitdistributesproductsthrough
itsFBAsuiteofservices.See,DungPhanDeclaration(A309);ExhibitA
(A325SellingonAmazonterms,A341FBAterms).Asdescribedwithin
the FBAterms of service, AmazonrequiredFACSystemstoshipits
32
products to Amazon. A342 (You will ship Units to us in accordance

withapplicableProgramPolicies.).However,Amazoncouldstillrefuse
to accept an Unsuitable Unit that would otherwise infringe
intellectual property rights. See, A342, A350. In Opposition, Milo &
Gabby reminded the District Court that in addition to receiving,
inspecting, and shipping the Accused Products for FAC Systems,
AmazonexercisedimmensecontroloverthedistributionoftheAccused
Products.See,A57778.Forinstance,Amazoncanrepackage,relabel,
destroy,andcommingleinventoryitreceives. Id.PlaintiffsAppellants
furtherarguedthatAmazonsactionswith physical inventoryarenot
protectedbythesafeharborprovisionsoftheDMCA,17USC512(c).
See,A585A586.
The District Court even acknowledged that Amazon stores and
shipsproductsthroughitsFBAservices(A26)andthatitprovidedsuch
servicestooneofthethirdpartysellersmentioned,FACSystem.A27.
3.
Amazon'sOwnWitnessAdmittedThatAmazon
DistributesTheAccusedProducts
The above facts were confirmed at trial, when Amazon's only

witness,corporaterepresentativeMr.ChristopherPoad,testifiedthat
33
Amazonhelpssellerswiththedeliveryorshippingoftheirproducts.
A2130. On crossexamination, Mr. Poad reiterated Amazon's roles in
distribution: Q: You distribute products from the fulfillment center,
correct?A:Yes.PoadCrossexamination,A2248.Mr.Poadcontinuedto
describehowAmazonwarehouseworkershandlegoodscoveredbyFBA
services,namely,byphysicallyplacingthemintotes,removingthem
fromtotes,placingtheminboxes,placingtapeonthoseboxes,fixing
labelstothoseboxes,andsendingthemtoshippingprovider.A2249;
A226466.
4.
AmazonsDistributionIsASaleOrOtherTransferOf
Ownership
AsSetOutAbove,AmazonsTransferIsASaleoftheaccused
productsand,accordingly,AmazonisliableforviolatingMilo&Gabbys
exclusiverights.Alternatively,thetransactionsperformedbyAmazon
easily constitute an other transfer of ownership as contemplated
undertheCopyrightAct. Accordingly,Amazonisliableforcopyright
infringement.
34
5.
TheDMCASafeHarborProvisionsDoNotApplyTo
TheSaleOfPhysicalProducts
As a final matter, the District Court erred by applying Digital

Millennium Copyright Act (DMCA) immunity to Milo & Gabbys
copyrightinfringementclaims.InitsorderpartiallygrantingAmazons
MotionforSummaryJudgment,theDistrictCourt usedtheDMCAto
defend Amazons position that it does not distribute physical goods.
A3334.TheonlylegalauthorityrelieduponbytheDistrictCourtis
Hendricksonv.Amazon.com,Inc.,298F.Supp.2d914(C.D.Cal.2003),
which is inapplicable here. Indeed, in Hendrickson, the lower court
relied on DMCA immunity (the DMCA safe harbor provision).
However,putsimply,theDMCAsafeharboronlyappliesonline;itdoes
not apply to physical goods sold in cardboard boxes shipped from
standingwarehouses. 17U.S.C.512(c)(Aserviceprovidershallnot
beliable... forinfringementofcopyrightbyreasonofthestorageat
thedirectionofauserofmaterialthatresidesonasystemornetwork).
The DMCA safe harbor provisions simply do not apply unless the
infringingmaterialresidesonasystemornetwork.
35
Itcanhardlybearguedthatapieceoffabricinacardboardboxon
a concrete floor of a warehousein Kentuckyresideson asystemor
network. ButtheDistrictCourtbelowbelievedthatthe Hendrickson
courtheldthatundersimilarcircumstancesAmazonwasaninternet
serviceproviderforthethirdpartyandnotaseller.Evenifthatwere
true(andMilo&Gabbystronglydisagrees),thatstatementisirrelevant
concerningphysicalgoodsthatexistintherealworld.
Acursoryreadingof Hendrickson itselfconfirmsthattheDMCA
doesnotandcannotapplytodistributionofphysicalgoods.Inanalyzing
thecommitteenotesfromtheDMCA,theHendricksencourtfoundthat
[t]hetermactivityisintendedtomeanactivity usingthematerial on
thesystemornetwork.TheCommitteeintendssuchactivitytoreferto
wrongfulactivitythatisoccurringonthesite....H.R.at53(emphasis
added). Hendrickson,298F.Supp.2dat917. Accordingly,thecourtin
Hendricksonnotedthatthewrongfulactivitymustbeoccurringonthe
site to enjoy DMCA immunity. In contrast to the instant case, the
Hendrickson courtfoundthatAmazonneverpossessed theDVD,and
never had the opportunitytoinspecttheitem. Id. Accordingly,the
36
Hendrickson court extended DMCA immunity, although improperly.

Significantly,the Hendricksondecisionhasneverbeenreviewedbyan
appellatecourtuntilnow.
E.
TheDistrictCourtErredByDismissingMilo&Gabby's
PassingOffClaimAfterBeingMisledByAmazon
The District Court committed clear error by dismissing Milo &
Gabbys passing off claim for unfair infringement based on its

erroneousconclusionthatMilo&GabbyhadnotputAmazononfair
noticeofthatclaim. Indeed,notonlydidMilo&Gabbyprovidefair
notice of its claim, Amazons own submissions prove it had full
knowledge of precisely what Milo & Gabbys claim was under the
LanhamAct.
1.
TheDistrictCourtsDismissal
AmazonmovedforsummaryjudgmentonMilo&GabbysLanham
Act claim. A426. Milo & Gabby opposed summary judgment by
arguing,interalia,thatthefactsfullysupportedMilo&Gabbysclaim
ofpassingoffundertheLanhamAct.A590;A564A598.Initsreply,
Amazontacitlyconcededthatthepassingoffclaimissupportedbythe
facts,andarguedinsteadthatMilo&Gabbyhadnotpreviouslyraised
37
the passing off claim and therefore it should be dismissed. The

DistrictCourttookAmazonatitswordandsummarilydismissedMilo
&GabbysLanhamActclaimonthesolebasiserroneouslyarguedby
Amazon.
The District Court erroneously concluded that Plaintiffs have
neverraisedthesetheoriesofliabilityintheirComplaint,norhavethey
allegedanyfactsintheirComplaintprovidingnoticetoDefendantthat
theyintendedtoadvancesuchtheories.A44.Thatrulingwassimply
wronganditshouldbevacated. ThetruthisthatMilo&Gabbyhad
detailedthatexactclaimtobothAmazonandtheDistrictCourtalmost
twoyearsprior.
2.
TheComplaintDetailsTheFactsSupportingMilo&
GabbysPassingOffClaim
The Rules of Civil Procedure require only a short and plain

statementoftheclaimshowingthatthepleaderisentitledtorelief,in
ordertogivethedefendantfairnoticeofwhatthe...claimisandthe
groundsuponwhichitrests.BellAtlanticCorp.v.Twombly,127S.Ct.
1955,1964(2007).Accordingly,acomplaintthatrecitessufficientfacts
toprovidefairnoticeofMilo&Gabbysclaimissufficienttosurvivea
38
summary dismissal. Milo & Gabbys complaint easily satisfies that

standard,andthatwasexplainedindetailinMilo&Gabbysopposition
toAmazonsRule12(b)(6)motionatthepleadingstage.
(a)
TheElementsOfPassingOff
Passing off (sometimes also referred to as palming off) is

essentiallythesamecauseofactionunderbothWashingtonStatelaw
asunderSection43(a)(1)oftheLanhamAct.SeeSmithv.Montoro,648
F.2d602(9thCir.1981).
InSmithv.Montoro,theNinthCircuitstated:
Implied passing off occurs when an enterprise uses a
competitor's advertising material, or a sample or photograph
of the competitor's product, to impliedly represent that the
product it is selling was produced by the competitor. Such
practices have consistently been held to violate both the
common law of unfair competition and section 43(a) of the
Lanham Act.
Id at 604. (internal citations omitted).
Accordingly,theonlyfactsthatneedbeallegedtoputAmazonon
noticeofMilo&Gabbyspassingoffclaimarethat(1)Amazonused
Milo & Gabbys advertising material but (2) did not deliver Milo &
Gabbysproducts.Thosefactswerenotonlyadequatelypled,theyare
undisputed.
39
(b)
Milo&GabbysComplaintAllegedSufficient
FactsToMakeOutAClaimofPassingOff
In its Complaint, Milo & Gabby recited claims for unfair

competition arising under the Washington State law and under the
Lanham Act. See A156A157. Amazon moved to dismiss Milo &
GabbysWashingtonStateunfaircompetitionclaim,andMilo&Gabby
submitted its response detailing the basis of Milo & Gabbys unfair
competitionclaim. Morespecifically,Milo&Gabbyexplainedthatits
unfaircompetitionclaimwasbasedonthethetortofpassingoff(also
referred to as palming off). Milo & Gabby explained its claim as
follows:
As alleged in the Complaint, Amazon advertised Milo &
Gabbys own products on the amazon.com web site. In fact,
Amazon uses Milo & Gabbys own advertising materials
which obviously promote Milo & Gabbys products. However,
the products that Amazon actually sold were not the
products it advertised, i.e., Milo & Gabbys products; rather,
Amazon shipped the Amazon knock-offs.
The Complaint recites all the classic palming off facts:
Representing to the public that the goods offered and sold by
Amazon are in fact the Milo & Gabby products when they
are not. Palming off is the most classic form of unfair
competition. Accordingly, Amazons motion to dismiss Milo &
Gabbys unfair competition claim should be denied.
A261A262(internalcitationsomitted).
40
So not only did Milo & Gabby allege all the facts necessary to
supportitsclaimofpassingoffinitscomplaint,itexplicitlyidentified
itslegaltheorybasedonthosefactsinitsearlypleadingstagefilings.
Moreover,passingoffisa perse violationoftheLanhamAct.
SeeNorwichPharmacalCo.v.SterlingDrug,Inc.,271F.2d569(2dCir.
1959); J. Josephson, Inc. v. General Tire & Rubber Co., 357 F.Supp.
1047 (S.D.N.Y.1972). Asa perse violation,Milo&Gabbyneednot
proveanyadditionalfactsotherthanthosethatarealreadyundisputed:
ThatAmazondisplayedMilo&Gabbysactualproductandadvertising
materials, yet delivered a knockoff product. Nothing more need be
proven. Blissv.GothamIndustries,Inc.,316F.2d848,855(9thCir.
1963).
The District Courts erroneous reliance on Amazons
misrepresentation that Milo & Gabby had not adequately raised
passingoffasaclaimissimplywrongandshouldbevacated.
3.
NotOnlyWasAmazonPutOnFairNotice,Amazon
AdmittedlyHadActualNotice
OnAmazonsmotion,theDistrictCourtawardedattorneysfees
against Milo & Gabby after erroneously dismissing Milo & Gabbys
41
LanhamActclaim. FortuitouslyforMilo&Gabby,theDistrictCourt
ordered Amazon to substantiate itsfeesclaim with contemporaneous
billingrecords,whichAmazondid.WhenMilo&Gabbyreviewedthose
billingrecords,Milo&Gabbylocateddefinitiveproofthatnotonlywas
AmazononfairnoticeofMilo&Gabbyspassingoffclaim,Amazon
wasinfactfullyawareofthatclaim.
AlthoughAmazonredactedmostofeverytimeentrysubmitted,at
leastonetimeentryprovesthatAmazonwasinfact fullyaware that
Milo & Gabby had alleged passing off under the Lanham Act. In
support of Amazons fees motion, Amazon submitted the following
billingentryofAmazonscounsel:
8/14/2014
Research requirements for passing off and false

advertising claim under the Lanham Act as alleged by
Milo & Gabby
Passingofftimeentry(A1062).
ItcannotseriouslybearguedthatAmazonwasnotonfairnotice
that (1) Milo & Gabby had alleged (2) passing off (3) under the
LanhamActwhenallthreeofthosefactsareadmittedbyAmazons
owncounselinitsbillingentry.
42
TheDistrictCourtsconclusionthatMilo&Gabbyspassingoff
claimwasneverraisedpriortoMilo&GabbysresponsetoAmazons
summary judgment motion is manifestly erroneous and should be
vacated.
4.
TheAttorneysFeesAwardShouldBeVacated
OncethisCourtvacatestheDistrictCourtsdismissalofMilo&
GabbysLanhamActclaim,theDistrictCourtsawardofattorneysfees
undertheLanhamActshouldbevacatedaswell.Morespecifically,the
District Court concluded that its award of attorneys fees below was
basedonafindingthatthiscasewasanexceptionalcaseunderthe
LanhamAct.Accordingly,theDistrictCourtawardedattorneysfeesto
Amazon as the prevailing party. However, with Milo & Gabbys
Lanham Act claim reinstated, Amazon is no longer the prevailing
partyundertheLanhamActandanattorneysfeesawardisimproper.
Accordingly, Milo & Gabby requests that this Court also vacate the
DistrictCourtsawardofattorneysfees.
VIII. CONCLUSION
Foralltheforegoingreasons,AppellantsKarenKellerandMilo&
Gabby respectfully request that the Final Judgment issued by the
43
DistrictCourtbevacated,thatthisCourtholdasamatteroflawthat
Amazonistheselleroftheproductsaccusedofinfringementandthat
thiscaseberemandedforfurtherproceedingsconsistenttherewith.
Dated:March7,2016.
Respectfullysubmitted.
______________________
PhilipP.Mann
TimothyJ.Billick
MANNLAWGROUP
JohnWhitaker
WHITAKERLAWGROUP
1218ThirdAvenue,Suite1809
Seattle,Washington98101
(206)4360900
phil@mannlawgroup.com
john@wlawgrp.com
Attorney for Plaintiffs/Appellants
44
Addendum
Case 2:13-cv-01932-RSM Document 13 Filed 04/11/14 Page 1 of 19
1
2
3
4
5
6
7
UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF WASHINGTON
AT SEATTLE
8
9
10
MILO & GABBY, LLC and KAREN

KELLER, an individual,
CASE NO. C13-1932 RSM
11
ORDER GRANTING
DEFENDANTS MOTION TO
DISMISS FOR FAILURE TO STATE
A CLAIM IN PART
Plaintiffs,
12
v.
13
AMAZON.COM, INC.,
14
Defendant.
15
16
17
I. INTRODUCTION
This matter is before the Court upon Defendants Motion to Dismiss, In Part pursuant to
18 Fed. R. Civ. P. 12(b)(6). Dkt. # 8. Defendant Amzon.com, Inc. (Amazon) asks the Court to
19 dismiss Plaintiffs claims for unfair competition, right of publicity, trademark counterfeiting, and
20 indirect patent and copyright infringement. Having considered the parties memoranda and the
21 relevant law, the Court grants Amazons motion to dismiss Claims III, V, and VII of the
22 Complaint with leave to amend. Plaintiffs request for relief seeking redress for inducement,
23 willful, or contributory infringement is stricken, and Plaintiffs are ordered to show cause why
24 FAC System, LLC should not be joined as a necessary party.
ORDER GRANTING DEFENDANTS MOTION TO DISMISS FOR FAILURE TO STATE A CLAIM IN PART 1
ADD1
II. BACKGROUND
Plaintiffs make the following factual allegations. Plaintiff Milo & Gabby, LLC is a
3 Washington State limited liability company that designs and sells animal-shaped pillow cases,
4 among other accessories and bedding products. Plaintiff Karen Keller and her husband are the
5 founders and product designers of Milo & Gabby, LLC (Milo & Gabby). Dkt. #1, 7. The
6 couples four children and two family pets inspired the Kellers to create the Cozy Companion
7 Pillowcases product line for Milo & Gabby. The line consists of eight animal shaped pillowcases
8 that function as a combination of a pillow and a stuffed animal.
9
Plaintiffs are the authors and owners of various U.S. Copyrights and U.S. Design Patents.
10 On September 11, 2007, the Milo & Gabby design mark was registered with the U.S. Patent and
11 Trademark Office and was assigned U.S. Trademark Registration Number 3291697. Id. at 8. In
12 addition, Milo & Gabbys website and marketing images are protected by valid U.S. copyrights.
13 Id. at 10.
14
Over the past five years, Milo & Gabby has designed, sold, and distributed their products
15 to retailers and e-tailers throughout the United States and internationally. Id. at 11. During this
16 time, Milo & Gabbys animal-themed childrens accessories have seen commercial success. Id.
17 In 2012, Milo & Gabby entered into an exclusive license arrangement in Asia, and since then the
18 company has made promising gains. Id. Milo & Gabby aims to further expand its operations by
19 entering into license agreements throughout North America. Id. at 12. However, Milo & Gabby
20 claims these efforts were halted when Amazon.com allegedly began selling direct knock-off
21 copies of Milo & Gabbys Cozy Companion Products. Id. at 13.
22
23
24
ADD2
1 Defendant Amazon is a company that operates a widely used internet service retail website at
2 http://www.amazon.com. Amazon enables third-party vendors to sell and distribute a variety of
3 products to the public while Amazon fulfills the orders through amazon.com.1
4 On October 24, 2013, Plaintiffs Milo & Gabby, LLC and Karen Keller (collectively, Plaintiffs)
5 filed the instant lawsuit alleging that Amazon was using Plaintiffs intellectual property to
6 wrongfully market, sell, and distribute inferior-quality knockoffs of Plaintiffs animal-shaped
7 pillowcases on the amazon.com website.2
8
Amazon filed the instant Motion to Dismiss and moves to dismiss Counts III, V, and VII
9 of Plaintiffs Complaint for failure to state a claim pursuant to Fed. R. Civ. P. 12(b)(6). Amazon
10 also moves to dismiss Count I pursuant to Rule 12(b)(6) to the extent that Count I purports to
11 state a claim of patent infringement pursuant to either 35 U.S.C. 271(b) or (c), or, in the
12 alternative, to strike Plaintiffs requests for related injunctive and exceptional relief. Similarly,
13 Amazon requests dismissal of Count II to the extent it purports to state a claim of indirect
14 copyright infringement or, alternatively, to strike Plaintiffs request for related injunctive relief.
15
III. DISCUSSION
16 A. Standard of Review
17
In considering a Rule 12(b)(6) motion to dismiss, the Court must determine whether the
18 plaintiff has alleged sufficient facts to state a claim for relief which is plausible on its face.
19
1
FAC System, LLC (FAC System) is one such third-party seller. Until recently, FAC System used
20 Amazons retail website amazon.com to offer animal-shaped pillowcases for sale. See Dkt. #1 at Ex. C.
22
Amazon urges this court to order that FAC System be joined as a necessary party under Fed. R. Civ. P.
21 19(a). Amazon contests Plaintiffs pursuit of a complaint against Amazon despite exhibits to the complaint making
clear that the seller of the pillowcases at issue is FAC System. Dkt. #8, p.3 (citing Dkt. # 1, Ex. B at 1 (Screen
22 capture of allegedly infringing product on amazon.com noting that the product is [s]old by FAC System LLC and
23
24
Fulfilled by Amazon)). Amazon further argues that FAC should be joined as a necessary party because (1)
complete relief cannot be accorded among the existing parties and (2) FAC System may have a legally protected
interest in the subject of this action. Dkt. #8, n.1 (citing Shermoen v. United States, 982 F.2d 1312, 1317 (9th Cir.
1992) (discussing standard for joinder under Rule 19(a)); Fed. R. Civ. P. 19(a)(2) (If a person has not been joined
as required, the court must order that the person be made a party.)). Plaintiffs failed to address this issue.
ADD3
1 Ashcroft v. Iqbal, 129 S. Ct. 1937, 1951 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550
2 U.S. 544, 570 (2007)). A claim is facially plausible if the plaintiff has pled factual content that
3 allows the court to draw the reasonable inference that the defendant is liable for the misconduct
4 alleged. Id. (citing Twombly, 550 U.S. 556). In making this assessment, the Court accepts all
5 facts alleged in the complaint as true, and makes all inferences in the light most favorable to the
6 non-moving party. Baker v. Riverside County Office of Educ., 584 F.3d 821, 824 (9th Cir. 2009)
7 (internal citations omitted). The Court is not, however, bound to accept the plaintiffs legal
8 conclusions. Iqbal, 129 S. Ct. at 1949-50. While detailed factual allegations are not necessary,
9 the plaintiff must provide more than labels and conclusions or a formulaic recitation of the
10 elements of a cause of action. Twombly, 550 U.S. at 555.
11
Under Fed. R. Civ. P. 12(b)(6), dismissal is proper where there is either a lack of a
12 cognizable legal theory or the absence of sufficient facts alleged under a cognizable legal
13 theory. Butler v. Target Corp., 323 F. Supp. 2d 1052, 1055 (C.D. Cal. 2004) (quoting Balistreri
14 v. Pacifica Police Dept., 901 F.2d 696, 699 (9th Cir. 1990)). The court must (1) construe the
15 complaint in the light most favorable to the plaintiff; (2) accept all well-pleaded factual
16 allegations as true; and (3) determine whether the plaintiff can prove any set of facts to support a
17 claim that would merit relief. Id. (citing Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 33738 (9th
18 Cir. 1996)). Further, where a complaints state law claims are preempted by federal law, the
19 claims are subject to dismissal under Rule 12(b)(6). Id. (citing Falkowski v. Imation Corp., 309
20 F.3d 1123 (9th Cir. 2002).
21
B. Count III Unfair Competition
22
Plaintiffs complaint alleges Amazon violated Washingtons Consumer Protection Act
23
(CPA). Specifically, Plaintiffs claim for unfair competition states:
24
ADD4
1
2
3
4
Defendant Amazon violated RCW Chapter 19.86 due to its unfair methods
of competition and unfair or deceptive acts or practices in the conduct of
its trade or commerce. By offering for sale, selling, importing, and
distributing actual products that include infringing materials, Amazon is
directly liable for its own actions, as set forth above. Amazon has sold,
imported, and delivered the Amazon knock-offs to consumers in this
district.
5 Dkt. # 1, 3334.
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
Amazon challenges Plaintiffs unfair competition claim as insufficient under federal

pleading requirements. Amazon first argues that paragraph 33 of the unfair competition claim
amounts to nothing more than a formulaic and impermissible recitation of the elements of a CPA
claim. Dkt. #8 at p. 6. Second, Amazon contends that Plaintiffs use of the term infringing
refers toand incorporates by referencePlaintiffs two preceding causes of action for patent
and copyright infringement. Id. Amazon also argues that the phrase as set forth above
incorporates the first two claims by reference. Because the claim fails to articulate a basis for
relief that is distinct from Plaintiffs causes of action for patent and copyright infringement,
Amazon contends that Plaintiffs unfair competition claim is preempted by federal patent and
copyright law. Id.
Washingtons CPA makes unlawful [u]nfair methods of competition and unfair or
deceptive acts or practices in the conduct of any trade or commerce . . .. RCW 19.86.020
(2009). To sustain an unfair competition action under the CPA, a plaintiff must demonstrate (1)
an unfair or deceptive act or practice (2) occurring in trade or commerce (3) that impacts the
public interest (4) causing an injury to the plaintiff's business or property with (5) a causal link
between the unfair or deceptive act and the injury suffered. Natl Products, Inc. v. GamberJohnson LLC, 699 F. Supp. 2d 1232, 1242 (W.D. Wash. 2010) (citing Dewitt Const. Inc. v.
Charter Oak Fire Ins. Co., 307 F.3d 1127, 1132 (9th Cir. 2002)).
24
ADD5
A CPA claim may be preempted by federal copyright law when the state claim
2 incorporates by reference and merely restates federal patent and copyright claims. See Litchfield
3 v. Spielberg, 736 F.2d 1352, 1358 (9th Cir. 1984) (holding that because the unfair competition
4 and misrepresentation claims are restatements of the copyright infringement claims, they are
5 preempted by federal copyright law); see also Blue Nile, Inc. v. Ice.com, Inc., 478 F. Supp. 2d
6 1240, 1247 (W.D. Wash. 2007) (Plaintiff cannot both expressly rely on the copyright
7 allegations in all of its state law claims and assert that the state law claims are outside copyright's
8 subject matter for purposes of avoiding preemption.) (emphasis in original). The same
9 reasoning also applies to preemption under patent law. G.S. Rasmussen & Associates, Inc. v.
10 Kalitta Flying Service, Inc., 958 F.2d 896, 904 (9th Cir. 1992) (patent law establishes a zone of
11 preemption broader than that of copyright law: Even if Congress has left an area unprotected, the
12 fact that patent law could reach it preempts state-law protection.) (citing Sears, Roebuck & Co.
13 v. Stiffel Co., 376 U.S. 225, 23032 (1964)); Compco Corp. v. DayBrite Lighting, Inc., 376 U.S.
14 234, 23738 (1964).
15
The Ninth Circuit has adopted a two-part test to determine whether a state law claim is
16 preempted by the Copyright Act. The test requires the court to first determine whether the
17 subject matter of the state law claim falls within the subject matter of copyright as described in
18 17 U.S.C. 1023 and 103.4 Second, if the subject matter prong has been met, the court must
19
20
21
22
23
24
102. Subject matter of copyright: In general

(a) Copyright protection subsists, in accordance with this title, in original works of authorship fixed in any tangible
medium of expression, now known or later developed, from which they can be perceived, reproduced, or otherwise
communicated, either directly or with the aid of a machine or device. Works of authorship include the following
categories:
(1) literary works;
(2) musical works, including any accompanying words;
(3) dramatic works, including any accompanying music;
(4) pantomimes and choreographic works;
(5) pictorial, graphic, and sculptural works;
ADD6
1 determine whether the rights asserted under state law are equivalent to the rights contained in 17
2 U.S.C. 106.5 Laws v. Sony Music Entertainment, Inc., 448 F.3d 1134, 113738 (9th Cir. 2006);
3 Downing v. Abercrombie & Fitch, 265 F.3d 994, 1003 (9th Cir. 2001).
4
Here, Plaintiffs seek to protect their photographs for use in marketing. It is undisputed
5 that these photographs are pictorial works that can be copyrighted. 17 U.S.C. 102(a)(5).
6 Thus, the work that Plaintiffs seek to protect falls within the subject matter of the Copyright
7 Act, and satisfies the first prong of the preemption test. Whether the CPA claim states equivalent
8 rights as the copyright claim, however, is less clear. As drafted, the CPA claim lacks sufficient
9 factual allegations to state a CPA claim. Because the claim language as set forth above is
10 vague, it is unclear whether that language fully incorporates the copyright and patent
11 infringement claims by reference or whether the CPA claim attempts to incorporate factual
12 matter from the factual summary of the Complaint that might otherwise support a viable CPA
13
14
15
16
17
18
19
20
21
22
23
24
(6) motion pictures and other audiovisual works;

(7) sound recordings; and
(8) architectural works.
4
103. Subject matter of copyright: Compilations and derivative works
(a) The subject matter of copyright as specified by section 102 includes compilations and derivative works,
but protection for a work employing preexisting material in which copyright subsists does not extend to any
part of the work in which such material has been used unlawfully.
(b) The copyright in a compilation or derivative work extends only to the material contributed by the author
of such work, as distinguished from the preexisting material employed in the work, and does not imply any
exclusive right in the preexisting material. The copyright in such work is independent of, and does not
affect or enlarge the scope, duration, ownership, or subsistence of, any copyright protection in the
preexisting material.
5
106. Exclusive rights in copyrighted works
Subject to sections 107 through 122, the owner of copyright under this title has the exclusive rights to do and to
authorize any of the following:
(1) to reproduce the copyrighted work in copies or phonorecords;
(2) to prepare derivative works based upon the copyrighted work;
(3) to distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of
ownership, or by rental, lease, or lending;
(4) in the case of literary, musical, dramatic, and choreographic works, pantomimes, and motion pictures
and other audiovisual works, to perform the copyrighted work publicly;
(5) in the case of literary, musical, dramatic, and choreographic works, pantomimes, and pictorial, graphic,
or sculptural works, including the individual images of a motion picture or other audiovisual work, to
display the copyrighted work publicly; and
(6) in the case of sound recordings, to perform the copyrighted work publicly by means of a digital audio
transmission.
ADD7
1 claim.6 At best, the Complaint as a whole is ambiguous and as drafted, Plaintiffs CPA claim
2 asserts no new or different allegations to distinguish it from Plaintiffs patent or copyright
3 infringement claims. Therefore, the CPA claim asserts rights indistinguishable from those rights
4 expressly granted, and thus preempted, by the Copyright Act. Accordingly, Count III is
5 dismissed without prejudice.
6
C. Count V - Right of Publicity
7
Under RCW 63.60.050, a right of publicity claim accrues when:
8
9
10
11
12
13
Any person who uses or authorizes the use of a living or deceased

individual's or personality's name, voice, signature, photograph, or
likeness, on or in goods, merchandise, or products entered into commerce
in this state, or for purposes of advertising products, merchandise, goods,
or services, or for purposes of fund-raising or solicitation of donations, or
if any person disseminates or publishes such advertisements in this state,
without written or oral, express or implied consent of the owner of the
right, has infringed such right. An infringement may occur under this
section without regard to whether the use or activity is for profit or not for
profit.
14 RCW 63.60.050 (2013).

15
Amazon asks the Court to dismiss Plaintiffs right of publicity claim for two reasons.
16 First, Amazon argues that Plaintiffs have not pled facts establishing standing to assert the claim.
17 Second, Amazon contends that under the Supremacy Clause of the U.S. Constitution, the
18 Copyright Act expressly preempts Plaintiffs state law claim because it is based solely on the
19 alleged infringement of copyrighted worksnamely, Amazons reproduction and display of
20 photographs depicting Karen Kellers young children. Dkt. # 8, p. 10.
21
22
23
24
The Court makes no determination at this time as to whether Plaintiffs factual allegations would be
sufficient to survive the preemption analysis. As Amazon notes, to survive preemption, Plaintiffs CPA claim must
contain an extra element[] that makes the rights asserted qualitatively different from the rights protected under
the Copyright Act. Blue Nile, 478 F. Supp. 2d at 1249 (quotations and citations omitted). Plaintiffs have failed to
squarely address this argument in the briefing.
ADD8
1
2
1. Standing
The Complaint lacks a basis for inferring that Ms. Keller has standing to bring a right to
3 publicity claim on behalf of her children. Plaintiffs contend that the Complaints allegations of
4 misappropriated images depicting Ms. Kellers obviously minor children should be sufficient
5 for purposes of inferring standing. Dkt. # 11, p. 5. The Court disagrees.
6
The rights granted under RCW 63.60.040(3) may be exercised by a personal
7 representative, attorney-in-fact, parent of a minor child, or guardian, or as authorized by a court

8 of competent jurisdiction. Here, the Complaint offers no factual basis demonstrating Ms.
9 Kellers legal authority to serve as a personal representative for the children at issue.
10 Furthermore, Plaintiffs fail to assert basic essential facts, such as the number of children at issue,
11 their current ages, and when the photos at issue were taken. Accordingly, Plaintiffs right of
12 publicity claim, as drafted, is insufficient on its face.
13
14
2. Preemption
Amazon contends that even if Plaintiffs standing defect were cured, Plaintiffs right of
15 publicity claim is preempted by the Copyright Act. The Complaint alleges that Amazon used
16 the photograph and/or likeness of Plaintiff Kellers children on goods, merchandise, or
17 products without authorization. Dkt. # 1, 20. Here, the essence of Plaintiffs right of publicity
18 claim is that Amazon reproduced and distributed photographs of the Keller children without
19 authorization to do so.
20
Plaintiffs right of publicity claim replicates Plaintiffs copyright infringement claim. Six
21 different photographic images of children with Milo & Gabby pillows are the basis of the right of
22 publicity claim here. The same photos make up the marketing materials that form the basis of
23 Plaintiffs copyright infringement claim. These photographs of Ms. Kellers children are
24 contained within the subject matter of copyright as pictoral works. 17 U.S.C. 102(5).
ADD9
Amazon characterizes Plaintiffs copyright infringement and right of publicity claims as
2 duplicative and coextensive. Dkt. # 8, p. 13. Plaintiffs insist that the publicity rights being
3 asserted by Ms. Kellers children are not equivalent to any rights asserted under copyright. Dkt.
4 #11, p. 5. They argue that because the Keller children have no ownership interest in any of the
5 copyrights at issue, their right of publicity claim is altogether exempt from preemption. Id.
6 ([A]ll the intellectual property rights (except the right-of-publicity claims) are owned by Milo &
7 Gabby and/or Ms. Keller. The right of-publicity claims are held by Ms. Kellers children, who do
8 not have any ownership interest in the other intellectual property rights.) In essence, Plaintiffs
9 assert a de-facto non-equivalency argument because the childrens right to publicity claim
10 cannot be equivalent to a claim which they do not have. Id. Plaintiffs argument misses the
11 mark.
12
Plaintiffs rely on Jules Jordan Video, Inc. v. 144942 Canada Inc., 617 F.3d 1146 (9th
13 Cir. 2010), the sole authority cited in Plaintiffs response brief, for the proposition that a state
14 right of publicity claim can be preempted only where the rights asserted by the plaintiff are
15 equivalent to the exclusive rights held by the copyright owner. Dkt. #11, p. 5. However,
16 Plaintiffs reliance is misplaced. The Ninth Circuits decision in Jules Jordan Video actually
17 supports Amazons argument. In Jules Jordan Video, an adult movie actor asserted a right-of18 publicity claim based on allegations that his name, likeness, photograph and voice appeared in
19 counterfeit films without his authorization. 617 F.3d at 1154. The Ninth Circuit found that [t]he
20 essence of [the actor]s claim is that the . . . defendants reproduced and distributed the [films]
21 without authorization and held his claim preempted by the Copyright Act. Id. at 1155. Here, the
22 essence of Plaintiff Kellers right of publicity claim is that Amazon reproduced and distributed
23
24
ADD10
1 photographs of the children without authorizationa claim under the Copyright Act and thus
2 preempted by that Act. Id.
3
Plaintiffs attempt to distinguish the asserted publicity rights from the copyright claim by
4 arguing that the publicity rights are owned by Ms. Kellers children, while the copyrights are
5 owned by Milo & Gabby and Ms. Keller. Dkt. #11, p. 5. But Amazon points to Baltimore
6 Orioles, Inc. v. Major League Baseball Players Assn, 805 F.2d 663 (7th Cir. 1986)which
7 Plaintiffs have made no attempt to distinguishwhere it made no difference for the preemption
8 analysis that a baseball club owned the copyrighted telecast encompassing individual players
9 alleged rights of publicity in their performances shown in the telecast. There, the Seventh Circuit
10 held that the players right-of-publicity claims were preempted because the claims fell within the
11 subject matter of copyright and were equivalent to the exclusive 17 U.S.C. 106 right to
12 distribute the telecast held by the baseball club. See 805 F. 2d at 67678.
13
Here, as in Baltimore Orioles, the factual allegations under Plaintiffs right of publicity
14 claim fall directly within the scope of federal copyright protection. The Complaint alleges that
15 Amazon misappropriated the Milo & Gabby photographs by reproducing and distributing their
16 copyrighted images without permission. Dkt. #1, 3738. Such rights are exclusively reserved to
17 the copyright holder under federal law. 17 U.S.C.A. 106; see also Baltimore Orioles, 805 F.2d
18 at 67779 (7th Cir. 1986) (rejecting right of publicity claim as preempted by Copyright Act
19 where claim implicated only violation of a copyright holders rights to copyrighted subject
20 matter). Thus, Plaintiffs right of publicity claim is preempted. Because Plaintiffs right of
21 publicity claim is both insufficient on its face and preempted by the Copyright Act, Count V is
22 dismissed without prejudice.
23
D. Count VII - Trademark Counterfeiting
24
ADD11
1
Amazon contends that the trademark counterfeiting claim under 15 U.S.C. 11147 fails
2
because Plaintiffs have not plausibly alleged either (1) that Amazon reproduced Plaintiffs
3
registered trademark, and (2) that Amazon intentionally used the mark knowing that it was
4
counterfeit. Dkt. # 12, p. 1416.
5
As an initial matter, Plaintiffs contend that Amazons graphic reproduction of Milo &
6
Gabbys registered word and design mark takes matters outside the pleadings and transforms this
7
motion into one for summary judgment. Dkt. # 11, p. 6 (addressing Amazons reliance on new
8
evidence not found in the pleadings to show that an exact copy of Milo & Gabbys registered
9
trademark does not appear on the exhibits . . . attached to the complaint). By displaying the
10
mixed word and design mark in Amazons motion to dismiss, Plaintiffs claim that Amazon is
11
asking the Court to consider new evidence outside the pleadings. Id. Plaintiffs argue that, as a
12
consequence, Amazons motion is not properly presented under Fed. R. Civ. P. 12(b)(6) and
13
must be treated as a motion for summary judgment. Id. (citing Fed. R. Civ. P. 12(d)). Plaintiffs
14
request a full and fair opportunity to discover and present all material pertinent to Amazons
15
16
17
18
19
20
21
22
23
Title 15 U.S.C. 1114(1) states as follows:
(1) Any person who shall, without the consent of the registrant-(a) use in commerce any reproduction, counterfeit, copy, or colorable imitation of a registered
mark in connection with the sale, offering for sale, distribution, or advertising of any goods or
services on or in connection with which such use is likely to cause confusion, or to cause mistake,
or to deceive; or
(b) reproduce, counterfeit, copy, or colorably imitate a registered mark and apply such
reproduction, counterfeit, copy, or colorable imitation to labels, signs, prints, packages, wrappers,
receptacles or advertisements intended to be used in commerce upon or in connection with the
sale, offering for sale, distribution, or advertising of goods or services on or in connection with
which such use is likely to cause confusion, or to cause mistake, or to deceive,
shall be liable in a civil action by the registrant for the remedies hereinafter provided. Under subsection (b)
hereof, the registrant shall not be entitled to recover profits or damages unless the acts have been
committed with knowledge that such imitation is intended to be used to cause confusion, or to cause
mistake, or to deceive.
24
ADD12
1 motion, and urge the Court to defer ruling on Amazons motion until adequate discovery has
2 been afforded. Id. (citing Fed. R. Civ. P. 56(d)).
3
Federal courts have long recognized procedures for considering documents outside the
4 pleadings when ruling on motions to dismiss. District courts may take judicial notice of key
5 documents mentioned in the pleadings where there is no factual dispute about the documents
6 authenticity or enforceability. Fed. R. Evid. 201(b) (a court may judicially notice a fact that is
7 not subject to reasonable dispute because it (1) is generally known within the trial courts
8 territorial jurisdiction; or (2) can be accurately and readily determined from sources whose
9 accuracy cannot reasonably be questioned). In the Ninth Circuit, district courts may take
10 judicial notice of documents that the pleadings do not mention, provided the documents are
11 integral to the plaintiffs claims. See, e.g., Parrino v. FHP, Inc., 146 F.3d 699, 706 (9th Cir.
12 1998) (holding that a district court ruling on a motion to dismiss may consider a document the
13 authenticity of which is not contested, and upon which the plaintiffs complaint necessarily
14 relies).
15
It is well settled that documents attached to or incorporated by reference, such as
16 Plaintiffs own exhibits to the Complaint, are properly before the Court for consideration on a
17 Rule 12(b)(6) motion. U.S. v. Ritchie, 342 F.3d 903, 908 (9th Cir. 2003) (citing Van Buskirk v.
18 CNN, 284 F.3d 977, 980 (9th Cir. 2002); Barron v. Reich, 13 F.3d 1370, 1377 (9th Cir. 1994)).
19 Here, Plaintiffs expressly base their claims on exhibits to the Complaint and have incorporated
20 those exhibits by reference throughout the Complaint. See Dkt. #1 at 10, 14, 16, 17-21, 23, 25,
21 26.
22
Further, the Complaint expressly identifies Milo & Gabbys design mark as protected by
23 U.S. Trademark Registration Number 3291697. Dkt. # 1, 8. Federal Rule of Evidence 201
24
ADD13
1 authorizes this Court to take judicial notice of such admission because it is not subject to
2 reasonable dispute in that it is capable of accurate and ready determination by resort to sources
3 whose accuracy cannot reasonably be questioned. Fed. R. Evid. 201(b); Singh v. Ashcroft, 393
4 F.3d 903, 905 (9th Cir. 2004). Thus, the Court may properly examine the nature and
5 characteristics of the protected mark without converting Defendants motion to dismiss into one
6 for summary judgment.
7
The Lanham Act defines a counterfeit mark as a spurious mark that is identical to, or
8 substantially indistinguishable from, a mark that is registered and in use. 15 U.S.C. 1116
9 (d)(1)(B). Plaintiffs point to Exhibit C and Exhibit D to the Complaint in support of their
10 allegations that Amazon infringed the Milo & Gabby trademark. Dkt. # 1, 20. Neither exhibit,
11 however, depicts any such use of the Milo & Gabby mark. The photographs attached as Exhibit
12 D display the alleged knock-off products bearing the mark DOOMAGIC, but contain no mark
13 bearing even the slightest similarity to Plaintiffs registered mark. Similarly, a review of Exhibit
14 B revealed nothing resembling Plaintiffs registered mark. The protected mark is equally absent
15 from all other exhibits offered by Plaintiffs to support their allegations of Amazons misuse of
16 Milo & Gabby materials.
17
Here, Plaintiffs fail to present plausible factual support for trademark counterfeiting
18 beyond bare recitation of the reproduction element of the claim. As Amazon points out, Plaintiffs
19 cannot sustain a claim for trademark counterfeiting based upon exhibits that do not show any
20 reproduction of Plaintiffs registered mark. To survive a motion to dismiss, a complaints
21 [f]actual allegations must be enough to raise a right to relief above the speculative level.
22 Twombly, 550 U.S. at 555. The Complaints allegations concerning unauthorized use of
23 Plaintiffs trademark do not meet this standard.
24
ADD14
But even if Plaintiffs had presented sufficient factual support for trademark reproduction,
2 Amazon maintains that Plaintiffs trademark counterfeiting claim would nonetheless fail because
3 it lacks any supporting allegations that Amazon either intentionally used the registered mark
4 knowing it was counterfeit, or was willfully blind to such use. Dkt. # 8, p. 15. Further, Amazon
5 argues that intent must be pled with specificity.
6
As to the issue of whether intent must be plead with specificity, Plaintiffs argue that
7 Amazon has confused fraud or mistake, which must be pled with specificity, with intent,
8 knowledge, and other conditions of a persons mind, which may be alleged generally. Dkt. # 11
9 (citing Fed. R. Civ. P. 9(b)). Plaintiffs also insist that their trademark counterfeiting claim has
10 been adequately alleged because the Complaint asserts that Amazon violated Plaintiffs
11 intellectual property rights with full knowledge of those rights. Dkt. # 1, 16, 17.
12
Here, the bare factual allegations supporting Plaintiffs trademark counterfeiting claim
13 establish neither counterfeiting nor intent. Rather, Plaintiffs simply provide a formulaic recitation
14 of the elements establishing liability under 15 U.S.C. 1114.8 Plaintiffs have offered no
15 plausible, factual basis for their allegations, and thus supply no more than mere labels and
16 conclusions. Twombly, 550 U.S. at 555. Further, Plaintiffs offer no factual basis to support the
17
18
8
19
20
21
22
23
24
The relevant statutory language provides:

(1) Any person who shall, without the consent of the registrant
(a) use in commerce any reproduction, counterfeit, copy, or colorable imitation of a registered mark in
connection with the sale, offering for sale, distribution, or advertising of any goods or services on or in
connection with which such use is likely to cause confusion, or to cause mistake, or to deceive; or
(b) reproduce, counterfeit, copy, or colorably imitate a registered mark and apply such reproduction,
counterfeit, copy, or colorable imitation to labels, signs, prints, packages, wrappers, receptacles or
advertisements intended to be used in commerce upon or in connection with the sale, offering for sale,
distribution, or advertising of goods or services on or in connection with which such use is likely to
cause confusion, or to cause mistake, or to deceive, shall be liable in a civil action by the registrant for
the remedies hereinafter provided. Under subsection (b) hereof, the registrant shall not be entitled to
recover profits or damages unless the acts have been committed with knowledge that such imitation is
intended to be used to cause confusion, or to cause mistake, or to deceive.
15 U.S.C. 1114 (1)(a)-(b).
ADD15
1 intent and knowledge element of trademark counterfeiting. Accordingly, Plaintiffs trademark

2 counterfeiting claim and corresponding remedies are dismissed without prejudice.
3
E. Prayer for Relief
4
Plaintiffs Prayer for Relief seeks to enjoin Amazons infringement, inducement, and
5
contributory infringement. Dkt. #1, L. Construing the requested relief as a claim for indirect
6
and willful infringement, Amazon urges the Court to dismiss Count I to the extent Plaintiffs are
7
trying to allege induced or contributory patent infringement under 35 U.S.C. 271(b) and (c).
8
Amazon alternatively asks that the Court strike portions of Plaintiffs Prayer for Relief based on
9
any claim for induced, contributory, or willful patent infringement. Namely, Amazon requests
10
that the Court strike Prayer paragraphs (C) (seeking enhanced damages), (D) (seeking a finding
11
that case is exceptional under 35 U.S.C. 285), and (L) (seeking injunctive relief related to
12
induced and contributory infringement).
13
Similarly, Amazon seeks dismissal of Count II to the extent Plaintiffs assert indirect
14
copyright infringement. In the alternative, Amazon asks the Court to strike Plaintiffs request for
15
injunctive relief against indirect copyright infringement.
16
1.
Indirect and Willful Patent Infringement
17
A claim for indirect patent infringement requires a plaintiff to plead facts showing the
18
defendant had knowledge of the patents at issue, as well as knowledge that the induced acts
19
constitute patent infringement. Global-Tech Appliances, Inc. v. SEB S.A., 131 S.Ct. 2060, 2068
20
(2011).
21
To state a claim for willful patent infringement, Plaintiffs must provide factual matter to
22
support the conclusion that Amazon had knowledge of the patents-in-suit. Gustafson, Inc. v.
23
Intersystems Indus. Prods., Inc., 897 F.3d 508, 511 (Fed. Cir. 1990) ([A] party cannot be found
24
ADD16
1 to have willfully infringed a patent of which the party had no knowledge.); Pacing Techs.,
2 LLC v. Garmin Intl, Inc., No. 12-cv-1067, 2013 U.S. Dist. LEXIS 15728, at *10 (S.D. Cal. Feb.
3 5, 2013) (to survive a motion to dismiss willful patent infringement claim, a complaint must
4 plead more than bare allegation of actual knowledge).
5
Amazon contends that Plaintiffs have not pled a single fact supporting indirect or willful
6 patent infringement by Amazon and thus are not entitled to the relief requested as to those causes
7 of action. Dkt. # 8. Plaintiffs, on the other hand, insist they have properly pled their allegations of
8 Amazons indirect and willful infringement of their patent rights as alternative theories of
9 recovery under the pleading rules.
10
Rule 8(d)(2) allows a party to set out 2 or more statements of a claim or defense
11 alternatively or hypothetically, either in a single count or defense or in separate ones. Fed. R.

12 Civ. P. 8(d)(2). If a party makes alternative statements, the pleading is sufficient if any one of
13 them is sufficient. Id. However, pursuit of alternate relief does not relieve plaintiffs of their
14 obligation to plead sufficient factual allegations in support of that request. Garcia v. M-F Athletic
15 Co., No. 11-2430, 2012 WL 531008, at *2 (E.D. Cal. Feb. 17, 2012) (although plaintiffs are
16 allowed to plead in the alternative, on a motion to dismiss the plaintiff must allege facts that
17 plausibly suggest an entitlement to relief (quoting Iqbal, 556 U.S. at 680)).
18
Plaintiffs point to paragraphs 13, 16, 17, 18, and 21 of the Complaint to defend against
19 the motion to dismiss. However, those paragraphs contain no factual allegations addressing the
20 requisite elements to support claims for indirect and willful patent infringement, such as
21 Amazons knowledge of the patents at issue or Amazons inducement of infringement by a third
22 party.
23
24
ADD17
1 2.
2
Indirect Copyright Infringement

To state a claim for indirect copyright infringement, a plaintiff must plead facts showing
3 that the defendant caused a third partys infringement or distributed a work with the intent to
4 foster infringement by third parties. See Flava Works, Inc. v. Clavio, No. 11 C 05100, 2012 WL
5 2459146, at *2 (N.D. Ill. June 27, 2012). Here, Plaintiffs make no mention of a third party in
6 their Complaint from which the Court can infer inducement. Furthermore, the Complaint
7 contains no allegations that Amazon directed or influenced any third party to infringe upon the
8 federal copyright or patent rights held by the Plaintiffs.
9
In sum, Plaintiffs have offered insufficient factual support for their alternate theories of
10 recovery based on indirect or willful patent infringement and indirect copyright infringement.
11 Accordingly, those portions of Plaintiffs Prayer for Relief are stricken as follows: Paragraph C
12 of the Complaint is STRICKEN IN PART as to the words and increased or enhanced damages;
13 Paragraph D of the Complaint is STRICKEN; and Paragraph L of the Complaint is STRICKEN
14 IN PART as to the words inducement and contributory infringement.
15
IV. CONCLUSION
16
Having considered the motion, the response and reply thereto, and the remainder of the
17
record the Court hereby finds and ORDERS:
18
(1) Defendants Motion to Dismiss, In Part (Dkt. # 8) is GRANTED;
19
(2) Counts III, V, and VII of the Complaint are dismissed without prejudice and with
20
leave to amend;
21
(3) Paragraph C of the Complaint is STRICKEN IN PART as to the words and
22
increased or enhanced damages;
23
(4) Paragraph D of the Complaint is STRICKEN;
24
ADD18
1
2
3
(5) Paragraph L of the Complaint is STRICKEN IN PART as to the words inducement

and contributory infringement;
(6) Plaintiffs are ORDERED to SHOW CAUSE within twenty one (21) days why FAC
System, LLC should not be joined as a necessary party. Defendant is permitted to file
a response brief within fourteen (14) days of Plaintiffs Response to Order to Show
Cause.
7
8
9
10
11
Dated this 11th day of April 2014.
RICARDO S. MARTINEZ
UNITED STATES DISTRICT JUDGE
12
13
14
15
16
17
18
19
20
21
22
23
24
ADD19
1
2
3
4
5

AT SEATTLE
6
7
8
9
MILO & GABBY, LLC, and KAREN

10
Plaintiffs,
11
12
13
v.
AMAZON.COM, INC.,
14
Defendant.
15
I.
)
)
)
)
)
)
)
)
)
)
)
CASE NO. C13-1932RSM
ORDER GRANTING IN PART AND

DENYING IN PART DEFENDANTS
MOTION FOR SUMMARY JUDGMENT
INTRODUCTION
16
This matter comes before the Court on Defendants Motion for Summary Judgment on
17
18
the remaining claims in this action. Dkt. #30. Defendant, Amazon.com, Inc. (Amazon),
19
argues that it is entitled to summary judgment on Plaintiffs remaining claims for direct patent
20
infringement, direct copyright infringement, false designation of origin under the Lanham Act,
21
and violation of the Digital Millennium Copyright Act, primarily because the alleged infringing
22
23
actions were committed by third-party vendors and not Defendant. Id. Plaintiffs argue in
24
opposition that Defendant is liable under several theories of law, including vicarious liability,
25
such that summary judgment is precluded. Dkt. #36. Having reviewed the parties briefing,
26
and having determined that no oral argument is necessary on this motion, the Court disagrees
27
with Plaintiffs in part and GRANTS IN PART and DENIES IN PART Defendants motion.
28
ORDER
PAGE - 1
ADD20
II.
BACKGROUND1
Plaintiff MILO & GABBY, LLC is a Washington State limited liability company that
designs and sells animal-shaped pillow cases, among other accessories and bedding products.
Plaintiff Karen Keller and her husband are the founders and product designers of Milo &
Gabby, LLC (Milo & Gabby). Dkt. #1 at 7. According to Ms. Keller, the couples four
6
7
children and two family pets inspired the Kellers to create the Cozy Companion Pillowcases
product line for Milo & Gabby. Dkt. #1 at 7. The line consists of eight animal shaped
pillowcases that function as a combination between a pillow and a stuffed animal.
10
Plaintiffs are the authors and owners of various U.S. Copyrights and U.S. Design
11
Patents. See id. at 10. On September 11, 2007, the Milo & Gabby design mark was
12
13
registered with the U.S. Patent and Trademark office and was assigned U.S. Trademark
14
Registration Number 3291697. Id. at 8. In addition, Milo & Gabbys website and marketing
15
images are protected by valid U.S. copyrights. Id. at 10.
16
For several years, Milo & Gabby has designed, sold, and distributed its products to
17
18
retailers and e-tailers throughout the United States and internationally. Id. at 11. During this
19
time, Milo & Gabbys animal-themed childrens accessories have seen commercial success. Id.
20
In 2012, Milo & Gabby entered into an exclusive license arrangement in Asia, and since then
21
the company has made promising gains. Id. Milo & Gabby aims to further expand its
22
operations by entering into license agreements throughout North America.
Id. at 12.
23
24
25
However, Milo & Gabby claims these efforts were halted when Amazon.com allegedly began
selling direct knock-off copies of Milo & Gabbys Cozy Companion Products. Id. at 13.
26
27
28
The Court draws this factual background from Plaintiffs Complaint and Defendants motion
for summary judgment, as Plaintiffs failed to set forth their own separate statement of facts in
opposition to the instant motion. See Dkt. #36.
ORDER
PAGE - 2
ADD21
Amazon is a company that operates a widely used internet service retail website at
http://www.amazon.com. Dkt. #35 at 2. Amazon.com enables third-party vendors to sell and
distribute a variety of products to the public, while Amazon fulfills the orders through
Amazon.com. Dkt. #35 at 2-3 and 11.
When a third-party seller wants to offer a new product for sale on the Amazon.com
6
7
platform, the third-party seller is responsible for sending Amazon, via an automated file upload
system, content related to the new product, such as a product description, an image of the
product, and the products price. Id. at 5. This content is used to automatically generate a
10
product detail page and, in some instances, to create advertisements related to the new
11
product. Id. at 6; Dkt. #33 at 4; and Dkt. #32 at 2. The third-party seller is responsible for
12
13
the uploaded content, and specifically represents and warrants that it has the right to grant
14
Amazon a license to use all content, trademarks, and other materials provided by it. Dkt. #35,
15
Ex. A at 4-5 & Definitions and Ex. B. Under Amazons Intellectual Property Violations
16
Policy, third-party sellers are responsible for ensuring that the products they offer for sale are
17
18
legal. Id. at 9 and Ex. D. With respect to images, third-party sellers agree that it is their
19
responsibility to ensure that [they] have all the necessary rights for the images [they] submit.
20
Id. at 10 and Ex. E.
21
Third-party sellers may ship their products to customers directly or, for a fee, use the
22
Fulfillment by Amazon (FBA) service. Dkt. #34 at 2. Third-party sellers who use
23
24
25
26
27
Amazons FBA service retain legal title to their products, while Amazon provides fulfillment
services for the products, such as storage and shipping. Id. at 3-4.
Plaintiffs allege that Amazon offered and sold infringing pillowcases via Amazon.com,
using their marks and copyrighted images in the pillowcase offerings. Plaintiffs contends that
28
ORDER
PAGE - 3
ADD22
Amazon is the real seller of the knock-off products because: (1) the products are
advertised on the amazon.com domain; (2) [p]ayment is made directly to Amazon; (3)
Amazon issues the invoice and tracking information; (4) Amazon ships the products in a
box that bears the Amazon logo; and (5) Amazon broadcasts email advertisements from its
own account (not the manufacturers) offering the knock-off products. Dkt. #11 at 3.
6
7
However, according to Amazon, all allegedly infringing pillowcases at issue in this case
were offered and sold by third-party sellers. Dkt. #35 at 15. Amazon is not the seller of
record for any of the allegedly infringing pillowcases. Id. and Dkt. #1, Ex. C. The content for
10
the allegedly infringing pillowcases (including product name, description, and images)
11
displayed by Amazon was provided by third-party sellers. Dkts. #35 at 16; #33 at 3; and
12
13
#32 at 3. Amazon did not actively copy any of Plaintiffs images. Dkt. #35 at 16. Nor did
14
Amazon alter, modify, or remove any copyright registration information, or other information,
15
related to any images or content supplied by third-party sellers in conjunction with third-party
16
seller offerings of the allegedly infringing pillowcases. Id. In fact, all images and other content
17
18
provided to Amazon by third-party sellers did not contain any visible patent, copyright, or
19
trademark registration information. Id. Amazon did provide FBA services to one of the third-
20
party sellers (FAC System LLC) that offered allegedly infringing pillowcases. Id. at 17.
21
Upon receipt of the instant lawsuit in October 2013, Amazon investigated Plaintiffs
22
allegations and removed within days the allegedly infringing pillowcase offerings. Dkt. #35 at
23
24
20. During the course of this case, additional third-party sellers have offered allegedly
25
infringing pillowcases. Id. at 21. As soon as Amazon learned of, or was made aware of, the
26
additional allegedly infringing offerings, Amazon also promptly removed the offerings. Id.
27
28
ORDER
PAGE - 4
ADD23
On October 24, 2013, Plaintiffs filed the instant lawsuit alleging that Amazon was using
Plaintiffs intellectual property to wrongfully market, sell, and distribute inferior-quality
knockoffs of Plaintiffs animal-shaped pillowcases on the amazon.com website. On April 11,
2014, the Court granted Defendants Rule 12(b)(6) motion and dismissed Plaintiffs claims for
unfair competition under Washingtons Consumer Protection Act; right of publicity; and
6
7
trademark counterfeiting.
Dkt. #13.
The Court also struck Plaintiffs claim for patent
infringement based on any allegation of induced, contributory, or willful patent infringement,
as well as Plaintiffs claim for indirect copyright infringement. Id. The parties have since
10
attempted to resolve this matter and have agreed that a Markman hearing is not necessary as the
11
patents at issue are design patents. Accordingly, the instant motion is now ripe for review.
12
III.
13
14
15
DISCUSSION
A. Plaintiffs Overlength Brief

As an initial matter, the Court addresses Plaintiffs overlength brief which was filed
16
without permission of the Court. This Courts Local Rules specifically provide that motions
17
18
for summary judgment and briefs in opposition thereto shall not exceed 24 pages in length.
19
LCR 7(e)(3). Further, the Rules provide that, while disfavored, parties may seek permission to
20
file overlength briefs, and such requests must be filed three days prior to the date the
21
underlying brief is due. LCR 7(f). No such permission was sought by Plaintiffs in this case.
22
Rather, Plaintiffs simply filed a 32-page opposition brief. Dkt. #36. Because Plaintiffs did not
23
24
seek permission to file eight extra pages of briefing, the Court refuses to consider certain text
25
not contained within the applicable page limits. LCR 7(e)(6). In this case, in an effort to
26
review the substantive arguments made by Plaintiffs, the Court will exclude from consideration
27
the first five pages of the brief, which encompass the introduction, summary judgment standard
28
ORDER
PAGE - 5
ADD24
and a motion to strike certain of Defendants declarations supporting its motion for summary
judgment. Dkt. #36 at 1-5. The Court also will not consider the final page of the brief, which
consists of a one-sentence conclusion. DKt. #36 at 2. The Court will consider Plaintiffs
substantive arguments contained at pages 5-31 of their brief.2
B. Plaintiffs Motion to Strike

6
Because Plaintiffs motion to strike will not be considered, the Court will review all
7
8
evidentiary material presented by Defendant, and will afford it due consideration as discussed
herein.
10
C. Legal Standard on Summary Judgment
11
Summary judgment is appropriate where the movant shows that there is no genuine
12
13
dispute as to any material fact and the movant is entitled to judgment as a matter of law. Fed.
14
R. Civ. P. 56(a); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247 (1986).
15
summary judgment, a court does not weigh evidence to determine the truth of the matter, but
In ruling on
16
only determine[s] whether there is a genuine issue for trial. Crane v. Conoco, Inc., 41 F.3d
17
18
547, 549 (9th Cir. 1994) (citing Federal Deposit Ins. Corp. v. OMelveny & Meyers, 969 F.2d
19
744, 747 (9th Cir. 1992)). Material facts are those which might affect the outcome of the suit
20
under governing law. Anderson, 477 U.S. at 248. A factual dispute is genuine if the
21
evidence is such that reasonable persons could disagree about whether the facts claimed by the
22
moving party are true. Aydin Corp. v. Loral Corp., 718 F.2d 897, 902 (9th Cir. 1983). [T]he
23
24
issue of material fact required . . . to be present to entitle a party to proceed to trial is not
25
required to be resolved conclusively in favor of the party asserting its existence; rather, all that
26
is required is that sufficient evidence supporting the claimed factual dispute be shown to
27
2
28
The Court has also considered Plaintiffs supplemental authority submitted on July 7, 2015.
Dkts. #41 and #42.
ORDER
PAGE - 6
ADD25
require a jury or judge to resolve the parties differing versions of the truth at trial. First Nat.
Bank of Ariz. v. Cities Serv. Co., 391 U.S. 253, 288-89, 88 S. Ct. 1575, 20 L. Ed. 2d 569
(1968).
The Court must draw all reasonable inferences in favor of the non-moving party. See
OMelveny & Meyers, 969 F.2d at 747, revd on other grounds, 512 U.S. 79 (1994). However,
6
7
the nonmoving party must make a sufficient showing on an essential element of her case with
respect to which she has the burden of proof to survive summary judgment. Celotex Corp. v.
Catrett, 477 U.S. 317, 323 (1986). Further, [t]he mere existence of a scintilla of evidence in
10
support of the plaintiff's position will be insufficient; there must be evidence on which the jury
11
could reasonably find for the plaintiff. Anderson, 477 U.S. at 251.
12
13
D. Direct Copyright Infringement
14
Plaintiffs allege that Amazon publicly displayed Plaintiffs copyrighted images on the
15
Amazon.com website and distributed allegedly infringing goods with Plaintiffs copyrighted
16
images on the product labels in violation of established copyright laws. Dkt. #1 at 28-31.
17
18
Defendant argues that this claim must be dismissed because there is no evidence that Amazon
19
actively participated in, or directly caused, the alleged copying of Plaintiffs images, and even
20
if there was such evidence, Amazon is immune from liability under the Section 512(c) safe
21
harbor provision of the Digital Millenium Copyright Act (DMCA). The Court agrees with
22
Defendant.
23
24
1. Direct Copyright Infringement
25
To establish a claim of copyright infringement by reproduction, the plaintiff must
26
show ownership of the copyright and copying by the defendant. Fox Broad. Co. v. Dish
27
Network L.L.C., 747 F.3d 1060, 1066-67 (9th Cir. 2014) (quoting Kelly v. Arriba Soft Corp.,
28
ORDER
PAGE - 7
ADD26
336 F.3d 811, 817 (9th Cir. 2003)); see also 17 U.S.C. 106(1), 501(a). Accordingly,
infringement of the reproduction right requires copying by the defendant, which comprises a
requirement that the defendant cause the copying. Fox Broad. Co., 747 F.3d at 1067 (emphasis
added; citations omitted). In this case, there is no evidence in the record that Amazon actively
reviewed, edited, altered or copied Plaintiffs images. See Dkt. #35 at 17-18. Rather, the
6
7
content of the website was provided by a third-party vendor, and was handled in an entirely
automated manner to generate product detail pages or ads. Dkts. #35 at 6; #33 at 3; and #32
at 2. Plaintiffs respond with two arguments first, that Defendant is vicariously liable for the
10
third-partys infringement, and second, that Defendant is liable for direct infringement because
11
it accepts and stores the infringing images. Dkt. #36 at 7-21.

12
13
The Court first addresses Plaintiffs vicarious liability arguments. Dkt. #36 at 7-12
14
and14-21. A defendant is vicariously liable for copyright infringement if he enjoys a direct
15
financial benefit from anothers infringing activity and has the right and ability to supervise
16
the infringing activity. Ellison v. Robertson, 357 F.3d 1072, 1076 (9th Cir. 2004) (citations
17
18
19
omitted). Financial benefit exists where the availability of infringing material acts as a
draw for customers. Id. at 1078 (citations omitted).
20
Plaintiffs have never raised this theory of vicarious liability in their Complaint, nor have
21
they alleged any facts in their Complaint providing notice to Defendant that they intended to
22
advance such a theory. See Dkt. #1. Rather, Plaintiffs have alleged that Amazon, without
23
24
authorization, is distributing copies of Milo & Gabbys copyrighted works as the Amazon
25
knock-offs and as labels on the Amazon knock-offs. . . ., is publicly displaying numerous Milo
26
& Gabby copyrighted images on the amazon.com website. . . ., [and] is distributing numerous
27
Milo & Gabby copyrighted images on the labels of its Amazon knock-off products. . . ., [in]
28
ORDER
PAGE - 8
ADD27
violation of the U.S. Copyright Act, 15 U.S.C. 501, et. seq. Dkt. #1 at 29-32; see also
Dkt. #1 at 7-24. After the Court previously examined this copyright infringement claim and
dismissed it to the extent the claim was based on a theory of indirect trademark infringement,
Dkt. #13, the only remaining basis for the claim has been direct infringement. Plaintiffs never
moved to amend the Complaint to add a claim for vicarious infringement or seek clarification
6
7
that any theory of vicarious infringement had not been subsumed in the Courts ruling on
indirect infringement. Accordingly, the Court will not consider Plaintiffs vicarious liability
arguments. Pickern v. Pier 1 Imports (U.S.), Inc., 457 F.3d 963, 965 (9th Cir. 2006) (finding
10
that a district court need not address allegations raised for the first time in response to a motion
11
for summary judgment if the plaintiff's pleadings did not provide sufficient notice of those
12
13
allegations.); Williams v. Fed. Express Corp., 2013 U.S. Dist. LEXIS 72722 at *25 (W.D.
14
Wash. May 22, 2013) (dismissing a claim on the basis that a plaintiff may not assert new
15
causes of action or theories of recovery for the first time in an opposition to a motion for
16
summary judgment).
17
18
Thus, the Court turns to Plaintiffs argument that Defendants acceptance and storage of
19
the alleged infringing images alone is enough to violate the Copyright Act. Dkt. #36 at 12-14.
20
Central to a finding of direct copyright infringement is the principle that a defendant must
21
actively engage in one of the protected activities under the Copyright Act. In Perfect 10, Inc.
22
v. Cybernet Ventures, Inc., 213 F. Supp.2d 1146 (C.D. Cal. 2002), the Central District of
23
24
California collectively examined cases involving liability and computer technology.
The
25
Perfect 10 Court noted that the Ninth Circuit and other District Courts have repeatedly rejected
26
arguments of direct infringement where software or hardware schemes automatically produce
27
copies of the allegedly infringing images and the defendants do not actively participate in such
28
ORDER
PAGE - 9
ADD28
1
2
activity. Perfect 10, 213 F. Supp.2d at 1167-69. The Court also noted that other courts had
found direct infringement where the defendants were:
encouraging subscribers to upload files onto its system, viewing the files in
the upload file, and then moving the uploaded files into files generally
available to subscribers. This transformed the defendants from passive
providers of a space to active participants in the process of copyright
infringement. The moving of the files, accomplished by employees
constituted the distribution, and the display of those copies after the BBS's
employees placed the files there violated the right of display.
3
4
5
6
7
8
9
10
Perfect 10, 213 F. Supp.2d 1168 (citations omitted; emphasis in original).

In the instant case, the Court finds the circumstances more akin to those where software
or hardware schemes automatically produce copies of the allegedly infringing images and the
11
defendants do not actively participate in such activity. Indeed, the evidence in the record
12
13
demonstrates that the content of the detail pages and advertisements was supplied by third-
14
parties via an automated file upload system, and did not originate from Amazon. Dkts. #33 at
15
4; #32 at ; and #35 at 6 and 17. This evidence has gone un-refuted by Plaintiffs. Thus, it
16
does not appear that Amazon actively participated in the alleged copying of the digital images
17
18
19
at issue.
Finally, the Court rejects Plaintiffs contention that Amazon is liable for trademark
20
infringement based on its sales and shipment of physical items.
Here, the evidence
21
demonstrates that Amazon is not the seller of the alleged infringing products. See Dkt. #35 at
22
12. Likewise, third-party sellers retain full title to and ownership of the inventory sold by the
23
24
third party. Dkt. #34 at 4. Plaintiffs have provided no evidence to the contrary with respect
25
to any specific third party involved with the products in this case. Accordingly, the Court
26
concludes that Amazon was not the seller of the products at issue here. Hendrickson v.
27
28
ORDER
PAGE - 10
ADD29
1
2
3
4
Amazon.com, Inc., 298 F. Supp.2d 914, 915 (C.D. Cal. 2003) (holding that under similar
circumstances Amazon was an internet service provider for the third party and not a seller).
2. Safe Harbor Provision Under DMCA
Amazon also asserts that even if there was an issue of fact with respect to its alleged
copying of Plaintiffs images, it would be immune from liability under the DMCAs safe
6
7
8
9
10
harbor provision under Section 512(c). Dkt. #30 at 10-17. Plaintiffs respond that Amazon does
not meet the statutory requirements for the safe harbor provision. Dkt. #36 at 15.
In Corbis Corp. v. Amazon.com, Inc., 351 F. Supp.2d 1090 (W.D. Wash. 2004), this
Court examined the safe harbor provision at issue here. The Court explained:
11
12
13
14
The DMCA safe harbors do not render a service provider immune from
copyright infringement. They do, however, protect eligible service
providers from all monetary and most equitable relief that may arise from
copyright liability. Thus, even if a plaintiff can show that a safe harboreligible service provider has violated her copyright, the plaintiff will only
be entitled to the limited injunctive relief set forth in 17 U.S.C. 512(j).
15
16
17
18
19
20
21
The DMCA safe harbors provide protection from liability for: (1)
transitory digital network communications; (2) system caching; (3)
information residing on systems or networks at the direction of users; and
(4) information location tools.
To be eligible for any of the safe harbors, a service provider must meet a
series of threshold conditions. At the outset, a party seeking safe harbor
must, in fact, be a service provider as that term is defined under the
DMCA. If it fits within that definition, the service provider must then show
that it
22
(A) has adopted and reasonably implemented, and informs

subscribers and account holders of the service providers system or
network of, a policy that provides for the termination in
appropriate circumstances of subscribers and account holders of
the service providers system or network who are repeat infringers;
and
23
24
25
26
(B) accommodates and does not interfere with standard technical

measures.
27
28
ORDER
PAGE - 11
ADD30
A service provider that does not meet these threshold conditions may not
invoke the DMCAs safe harbor limitations on liability.
2
3
4
5
6
7
Once the threshold conditions have been met, a service provider must then
satisfy the specific requirements for the particular safe harbor. Amazon
asserts that it is entitled to protection for information residing on systems or
networks at the direction of users. The 512(c) safe harbor protects a
service provider from liability for infringement of copyright by reason of
the storage at the direction of a user of material that resides on a system or
network controlled or operated by or for the service provider. To qualify
for the 512(c) safe harbor, a service provider must show that:
(1) it has neither actual knowledge that its system contains
infringing materials nor an awareness of facts or circumstances
from which infringement is apparent, or it has expeditiously
removed or disabled access to infringing material upon obtaining
actual knowledge of infringement;
8
9
10
11
(2) it receives no financial benefit directly attributable to infringing

activity; and
12
13
(3) it responded expeditiously to remove or disable access to

material claimed to be infringing after receiving from the copyright
holder a notification conforming with requirements of 512(c)(3).
14
15
16
Corbis, 351 F. Supp.2d at 1098-99 (citations omitted). Thus, the Court must examine whether
17
Amazon meets the safe harbor requirements in this case.
18
a. Service Provider
19
For purposes of the 512(c) safe harbor, a service provider is defined as a provider of
20
21
online services or network access, or the operator of facilities therefore.
17 U.S.C.
22
512(k)(1)(B). As this Court has previously determined, [t]his definition encompasses a broad
23
variety of Internet activities, and there is no doubt that Amazon fits within the definition.
24
Corbis, 351 F. Supp.2d at 1100.
25
b. Infringement Policies
26
27
Next, the Court determines whether Defendant meets the infringement policy
28
requirement. The Ninth Circuit has held that the DMCAs infringement policy requirement has
ORDER
PAGE - 12
ADD31
three prongs. Ellison v. Robertson, 357 F.3d 1072, 1080 (9th Cir. 2004). In Ellison, the Court
explained that to meet the requirement a service provider must: 1) adopt a policy that provides
for the termination of service access for repeat copyright infringers in appropriate
circumstances; 2) inform users of the service policy; and 3) implement the policy in a
reasonable manner. Id. Amazon has satisfied each of these prongs.

6
7
First, Amazon has adopted a policy that provides for the termination of users who are
repeat infringers. Dkt. #35 at 3, 4, 6-9 and 22 and Exs. A, C, D and E. Plaintiffs do not
dispute this fact. Second, Amazon informs all third-party sellers of its policies. Id. Plaintiffs
10
also do not dispute this fact. Third, Amazon has implemented its policy in a reasonable
11
manner. It provides mechanisms for the filing of claims of infringement, a process for removal
12
13
of infringing products, and processes for the permanent suspension of repeat offenders. Dkt.
14
#35 at 22-24. Plaintiffs also do not dispute these facts. Thus, the Court finds Amazon has
15
established that it has adopted and reasonably implemented, and informs subscribers and
16
account holders of the service providers system or network of, a policy that provides for the
17
18
19
termination in appropriate circumstances of subscribers and account holders of the service

providers system or network who are repeat infringers.
c. Standard Technical Measures
20
21
The Court also finds that Amazon does not interfere with standard technical measures
22
used to identify and protect copyrighted works.
The DMCA defines the term standard
23
24
technical measures as technical measures that are used by copyright owners to identify or
25
protect copyrighted works and (a) have been developed pursuant to a broad consensus of
26
copyright owners and service providers in an open, fair, voluntary, multi-industry standards
27
process, (b) are available to any person on reasonable and nondiscriminatory terms, and (c)
28
ORDER
PAGE - 13
ADD32
do not impose substantial costs on service providers or substantial burdens on their systems or
networks. 17 U.S.C. 512(i)(2). Plaintiffs have not challenged Amazons assertion that it
meets this element. Accordingly, this element is satisfied. See Corbis, 351 F. Supp.2d at 1106
(finding that this element is established where the plaintiff did not challenge Amazons
assertion of compliance).
6
d. Knowledge of Infringement
7
8
In order to qualify for protection under the safe harbor provision, Amazon must also
show that it (1) does not have actual knowledge that the material or an activity using the
10
material on the system or network is infringing, and (2) is not aware of facts or circumstances
11
from which infringing activity is apparent. If a service provider does obtain either actual or
12
13
apparent knowledge, it may still invoke the safe harbor if it acts expeditiously to remove or
14
disable access to the infringing material. A notice of infringement constitutes evidence of the
15
service providers knowledge. Under the DMCA, the service provider may attempt to refute
16
this knowledge by showing that the notice failed to substantially comply with the DMCA's
17
18
notice requirements.
19
In the instant matter, Amazon presents evidence that it did not have actual notice of
20
infringement prior to this case being filed. Dkt. #35 at 19. However, Plaintiffs also assert
21
that Amazon did have notice. See Dkt. #31, Ex. A at Response to Interrogatory No. 15.
22
Regardless of whether Plaintiffs can establish actual notice, the Court finds that Amazon acted
23
24
expeditiously to remove the allegedly infringing material in response to the instant lawsuit.
25
Dkt. #35 at 20-21. There is no evidence in the record to the contrary. Accordingly, the Court
26
finds this element to be satisfied.
27
28
ORDER
PAGE - 14
ADD33
e. Right and Ability to Control Infringing Activity and Financial Benefit
1
2
Finally, a service provider will be excluded from the 512(c) safe harbor if it (1) has the
right and ability to control the infringing activity, and (2) receives a financial benefit directly
attributable to the infringing activity. 17 U.S.C. 512(c)(1)(B). Both elements must be met
for the safe harbor to be denied. See 3 NIMMER ON COPYRIGHT, 12 12B.04[A][1], at

6
7
12B-50.
Amazon argues that it does not have the practical ability to control the allegedly
infringing conduct. Dkt. #30 at 15-17. In order to have the right and ability to control, the
10
service provider must exert[] substantial influence on the activities of users.
UMG
11
Recordings, Inc. v. Shelter Capital Partners LLC, 718 F.3d 1006, 1030 (9th Cir. 2013).
12
13
However, a service provider does not have the practical ability to stop or limit infringing
14
conduct simply because (1) the infringing content resides on the service providers system; (2)
15
the service provider had the ability to remove such material; (3) the service provider could have
16
implemented, and did implement, filtering systems; and (4) the service provider could have
17
18
searched for potentially infringing content. See UMG Recordings, 718 F.3d at 1030 (Such
19
circumstances are not equivalent to the activities found to constitute substantial influence in
20
Cybernet and Grokster.). Rather, the law requires something more. Id. In this case, the
21
Court agrees with Amazon that Plaintiffs have failed to identify the something more such that
22
Amazon had the practical ability to control infringement.

23
24
It is undisputed that Amazon lacks the ability to analyze every image it receives from
25
third party sellers, compare the submitted image to all other copyrighted images that exist in the
26
world, and determine whether each submitted image infringes someones copyright interest.
27
Dkt. #35 at 26. As a result, Amazon lacks the ability to control the infringing activity. See
28
ORDER
PAGE - 15
ADD34
Hendrickson, 298 F. Supp.2d at 918 (finding that Amazon did not have the ability to control its
users); Corbis, 351 F. Supp.2d at 1110 (concluding that Amazon did not have the right or
ability to control vendor sales). Because Amazon does not have the right and ability to control
the infringing material, it is not necessary for this Court to inquire as to whether Amazon
receives a direct financial benefit from the allegedly infringing conduct.
Corbis, 351 F.
6
7
8
9
10
Supp.2d at 1110. Accordingly, the Court finds that Defendant meets all of the requirements for
protection under the Section 512(c) safe harbor provision.
3. Intentional Removal or Alteration of Copyrighted Material
Plaintiffs have also alleged that Amazon violated the DMCA by intentionally removing
11
or altering copyright management information from their copyrighted images. Dkt. #1 at 39.
12
13
Amazon asserts that there is no evidence that it has done so, and provides evidence to refute the
14
accusation. See Dkts. #31, Ex. A, Response to Interrogatory No. 8 and #35 at 6 and 18.
15
While Plaintiffs argue that Amazons assertions are unsupported, an argument with which the
16
Court disagrees, Plaintiffs fail to point to any evidence in the record rebutting Amazons
17
18
assertions. Indeed, Plaintiffs ignore the basic tenet that on a motion for summary judgment,
19
there must be evidence on which the jury could reasonably find for the plaintiff. Anderson,
20
477 U.S. at 251. Accordingly, the Court rejects Plaintiffs argument.
21
For all of these reasons, the Court dismisses Plaintiffs copyright infringement claim in
22
its entirety.
23
24
25
26
E. False Designation of Origin

The Court next turns to Plaintiffs claim for trademark infringement under the Lanham
Act, 15 U.S.C. 1125(a)(1)(A). Dkt. #1 at 35-36.
27
28
ORDER
PAGE - 16
ADD35
1. Claim Preemption
1
2
Amazon first argues that Plaintiffs Lanham Act claim should be dismissed because it is
duplicative of the copyright claim. Dkt. #30 at 18-19. Lanham Act trademark claims that
overlap with copyright claims are preempted when the Copyright Act provides an adequate
remedy. Dastar Corp. v. Twentieth Cent. Fox Corp., 539 U.S. 23, 34, 123 S. Ct. 2041, 156 L.
6
7
Ed. 2d 18 (2003); Shaw v. Lindheim, 919 F.2d 1353, 1364-65 (9th Cir. 1990). Plaintiffs
respond that their trademark claim has been mischaracterized by Defendant and that it is not
duplicative of the copyright claim. Dkt. #36 at 22-24.
10
In their Complaint, Plaintiffs allege their Lanham Act claim as follows:
11
35. Defendant Amazons unauthorized use of Plaintiffs marketing

materials and its reproduction and emulation of Plaintiffs photographs,
images, and products are intended to cause confusion, mistake or to deceive
consumers as to the source of origin of their products. Defendants actions
are likely to cause members of the public who search for Milo & Gabbys
genuine products to believe that the goods being offered for sale, sold, and
imported by Amazon to believe that the Amazon knock-offs have an
affiliation, connection, association, origin, or sponsorship relationship with
Milo & Gabby.
12
13
14
15
16
17
36. Defendants actions constitute a false designation of origin in violation

of the Lanham Act, 15 U.S.C. 1125(a)(1).
18
19
Dkt. #1 at 35-36. In response to discovery, Plaintiffs described the factual basis of their
20
21
22
23
24
25
claim:
Amazon has violated M&Gs rights in the following marks: MILO &
GABBY; COZY COMPANIONS; Original M&G TM Number 3291697;
Additional M&G TM Number 4644732.
INTERROGATORY NO. 17: Describe in detail the facts supporting all
allegations of Amazons allegedly unauthorized use of Plaintiffs asserted
trademark.
26
27
28
RESPONSE:
The response to this Interrogatory can be derived from documents being
produced by M&G, specifically a screen shot of Amazons website where
ORDER
PAGE - 17
ADD36
1
2
3
4
Milo & Gabbys Trademark was clearly readable. In addition, Amazons

wholesale copying of all of M&Gs marketing materials, which were replete
with
references
to
M&G
trademarks,
including
numerous
misrepresentations that the products being purchased from Amazon were
being sold in connection with the M&G marks.
Dkt. #31, Ex. A at Response to Interrogatory Nos. 16 and 17.
Trademark and copyright law have fundamentally different purposes. Trademark law
6
7
is concerned with the protection of symbols, elements or devices used to identify a product in
the marketplace and to prevent confusion as to its source. RDF Media Ltd. v. Fox Broad. Co.,
372 F. Supp.2d 556, 563 (C.D. Cal. 2005) (quoting EMI Catalogue Partnership v. Hill,
10
Holliday, Connors, Cosmopulos, Inc., 228 F.3d 56, 63 (2d Cir. 2000)). In contrast, copyright
11
law protects the artists right in an abstract design or other creative work. Id. Therefore,
12
13
trademark law protects the distinctive source-distinguishing mark, while copyright law protects
14
the work as a whole. See Whitehead v. CBS/Viacom, Inc., 315 F. Supp.2d 1, 13 (D.D.C. 2004).
15
The fact that the two areas of law protect against different wrongs is reflected in the
16
many cases in which courts have analyzed the same set of facts under both trademark and
17
18
copyright law without concluding that the trademark claims were piggybacking on the
19
copyright claims. See Mattel Inc. v. Walking Mountain Prods., 353 F.3d 792 (9th Cir. 2003)
20
(holding that an artist who developed a series of photographs which depicted Barbie in various
21
absurd positions did not violate Mattels copyright or trademark rights in Barbie doll); Dr.
22
Seuss Enters., L.P. v. Penguin Books USA, Inc., 109 F.3d 1394 (9th Cir. 1997) (affirming a
23
24
preliminary injunction prohibiting the publication of The Cat NOT in the Hat! A Parody by Dr.
25
Juice, a rhyming summary of highlights from the O.J. Simpson trial, as violating Dr. Seusss
26
copyright and trademark rights); Nintendo of Am., Inc. v. Dragon Pacific Intl, 40 F.3d 1007
27
(9th Cir. 1994) (affirming district courts award of damages under both copyright and
28
ORDER
PAGE - 18
ADD37
trademark law where defendant copied Nintendo games (copyright infringement) and then sold
the games as a package, but advertised that they were Nintendo products (trademark
violation)); Toho Co., Ltd. v. William Morrow & Co., 33 F. Supp. 2d 1206 (C.D. Cal. 1998)
(issuing a preliminary injunction based on plaintiffs likelihood of success on both trademark
and copyright claims where publisher was about to release book entitled Godzilla (trademark
6
7
8
9
10
violation) that included images and photographs from original Godzilla film as well as
descriptions of the character of Godzilla (copyright violations)).
In this case, Amazon argues that Plaintiffs copyright and trademark claims overlap
because the Complaint relies on similar factual allegations of copying for both its trademark
11
and copyright claims. See Dkt. #1 at 28-31. But as Plaintiffs point out, Plaintiffs are
12
13
seeking remedies for distinct wrongs under each legal framework. Plaintiffs rights in the
14
image and physical construct of the pillow case (a puffy animal-shaped pillow case/stuffed
15
animal) are being asserted under copyright law because the images and physical construct are
16
the creative work, while the name and title of the pillow cases ( Milo & Gabby and Cozy
17
18
19
20
21
Companion) are protected under trademark law because it is the name and title that are the
source-identifying marks associated with Plaintiffs. Dkt. #36 at 23.
The Court agrees that Plaintiffs claims sound in both trademark and copyright law.
The Court will therefore consider the merits of Plaintiffs trademark claims.
22
2. Trademark Infringement
23
24
25
26
27
28
As noted above, Plaintiffs trademark infringement claim is based on section 43(a) of

the Lanham Act, 15 U.S.C. 1125(a), which provides, in relevant part:
(1) Any person who, on or in connection with any goods or services, or any
container for goods, uses in commerce any word, term, name, symbol, or
device, or any combination thereof, or any false designation of origin, false
or misleading description of fact, or false or misleading representation of
ORDER
PAGE - 19
ADD38
1
2
3
4
fact, which -- (A) 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, or as to the origin, sponsorship, or approval of his or her
goods, services, or commercial activities by another person . . . shall be
liable in a civil action by any person who believes that he or she is or is
likely to be damaged by such act.
To prevail on such a claim, Plaintiffs must show that they have a valid, enforceable mark
entitled to protection under the Act, and that Defendants use of the mark creates a likelihood
of confusion. See Brookfield Communs., Inc. v. West Coast Entertainment Corp., 174 F.3d
1036, 1046 (9th Cir. 1999).

9
10
In this case, Plaintiffs claim fails because there is no evidence of a valid, enforceable
11
mark entitled to protection under the Act. Plaintiffs have asserted that their trademark claim
12
rests on alleged violations of MILO & GABBY; COZY COMPANIONS; Original M&G TM
13
Number 3291697; Additional M&G TM Number 4644732. Dkt. #31, Ex. A at Response
14
to Interrogatory No. 16. MILO & GABBY; COZY COMPANIONS is a mixed word and
15
16
design mark registered as U.S. Trademark No. 3291697 (the Design Mark). MILO &
17
GABBY is a character mark registered as U.S. Trademark No. 4644732 (the Word Mark).
18
Dkt. #31 at 10 and Ex. A at Response to Interrogatory No. 16. Defendants assert, and
19
Plaintiffs have offered no evidence in rebuttal, that there is no evidence of any alleged use by
20
21
Amazon of the Design Mark. Rather, it appears Plaintiffs assert an alleged use of the Word
22
Mark via an image that allegedly depicts Plaintiffs marketing materials and reflects the text
23
Milo & Gabby. Id. However, that Word Mark was not registered until November 25, 2014,
24
over a year after the lawsuit was filed and the mark allegedly used. Dkt. #31 at 11 and Ex. B.
25
Therefore, there was no presumption of validity at the time of alleged use. See Toho Co. v.
26
27
Sears, Roebuck & Co., 645 F.2d 788, 789 (9th Cir. 1981) (explain that without federal
28
registration, there is no presumption of validity).

ORDER
PAGE - 20
ADD39
Moreover, to the extent Plaintiffs now claim that Amazon is infringing COZY
COMPANION, a purported common-law mark, see Dkt. #36 at 22-23, this Court takes
judicial notice of the fact that COZY COMPANION is not a registered trademark. Dkt. #39 at
11, fn. 15. Further, Plaintiffs have failed to provide any evidence from which a jury could
conclude that they own any rights in a COZY COMPANION mark, that this alleged mark
6
7
serves as an identifier of source in the minds of consumers such that it is entitled to legal
protection, or that there is any evidence of confusion. S. Cal. Darts Assn v. Zaffina, 762 F.3d
921, 929 (9th Cir. 2014) (a plaintiff asserting an unregistered, common-law trademark must
10
establish both ownership and protectability of the mark, including proof of distinctiveness).
11
Finally, the Court addresses Plaintiffs arguments with respect to vicarious liability
12
13
under the Lanham Act or palming off in violation of the Lanham Act, which have been raised
14
for the first time in response to Defendants summary judgment motion. Plaintiffs have never
15
raised these theories of liability in their Complaint, nor have they alleged any facts in their
16
Complaint providing notice to Defendant that they intended to advance such theories. See Dkt.
17
18
19
20
21
#1. Accordingly, the Court will not consider Plaintiffs arguments. Pickern, 457 F.3d at 965;
Williams, 2013 U.S. Dist. LEXIS 72722 at *25.
For all of these reasons, the Court dismisses Plaintiffs Lanham Act claim in its entirety.
F. Direct Patent Infringement
22
Lastly, the Court turns to Plaintiffs patent infringement claim. Plaintiffs allege as the
23
24
25
26
27
basis for their patent infringement claim:

26. As set forth above, Plaintiff Milo & Gabby is the owner of several
design patents that protect the Milo & Gabby Cozy Companion Products.
Defendant Amazon is making, using, selling, offering for sale, and/or
importing the Amazon knock-offs which are virtually indistinguishable (but
for quality) from Plaintiff Milo & Gabbys patented designs.
28
ORDER
PAGE - 21
ADD40
27. Defendant Amazons actions constitute patent infringement under 35

U.S.C. 271, et seq.
Dkt. #1 at 26-27. To succeed on a claim of direct patent infringement, a plaintiff must

3
4
5
6
7
establish ownership of the patents and show that the accused infringer, without authorization,
made, used, offered to sell, sold, or imported the patented invention. 35 U.S.C. 271(a).
On summary judgment, Defendant argues that there is no evidence Amazon has ever
sold or offered to sell such products within the meaning of 35 U.S.C. 271(a). Dkt. #30 at
23-24. Plaintiffs oppose the motion, arguing that Amazon has indeed offered to sell the
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
products within the meaning of the statute. Dkt. #36 at 28-31.

The Federal Circuit Court of Appeals has examined the term offered to sell in the
context of patent litigation:
We have defined liability for an offer to sell under section 271(a)
according to the norms of traditional contractual analysis. Thus, the
defendant must communicate[] a manifestation of willingness to enter into
a bargain, so made as to justify another person in understanding that his
assent to that bargain is invited and will conclude it. We considered the
meaning of offer to sell in 3D Systems, Inc. v. Aarotech Laboratories,
Inc., 160 F.3d 1373 (Fed. Cir. 1998). The defendants in 3D Systems
provided potential California customers with price quotations, brochures,
specification sheets, videos, and sample parts related to their product. Id. at
1379. Based on this activity, the patentee sued the defendants in the United
States District Court for the Central District of California for infringement
of a variety of patents, arguing that the defendants were liable for offering
to sell the patented inventions. Id. at 1377. The defendants moved to
dismiss the suit for lack of personal jurisdiction. Id. The district court
granted the motion to dismiss; on appeal, this court reversed. We
concluded that although the price quotation letters state on their face that
they are purportedly not offers, the letters could be regarded as offers to
sell under section 271 based on the substance conveyed in the letters, i.e., a
description of the allegedly infringing merchandise and the price at which it
can be purchased. We also noted that one of the purposes of adding
offer[] to sell to section 271(a) was to prevent exactly the type of activity
Aaroflex has engaged in, i.e., generating interest in a potential infringing
product to the commercial detriment of the rightful patentee.
28
ORDER
PAGE - 22
ADD41
1
2
MEMC Elec. Materials, Inc. v. Mitsubishi Materials Silicon Corp., 420 F.3d 1369, 1376 (Fed.
Cir. 2005).
The Court agrees with Plaintiffs that under the applicable definition of offer to sell,
3
4
questions of fact preclude summary judgment on this claim. As illustrated in Exhibit B to the
Complaint, Amazon displays photos of the item for sale and invites the purchaser to place an
6
7
order and buy the item through Amazon. Dkt. #1, Ex. B. While Amazon notes that the item is
sold by a third-party vendor and fulfilled by Amazon, the fact that the item is displayed on
the amazon.com website and can be purchased through the same website, could be regarded as
10
an offer for sale for the reasons discussed in MEMC, supra. Likewise, looking at the website, a
11
potential purchaser may understand that his or her assent is all that is required to conclude the
12
13
deal. Indeed, the website notes the price, allows the buyer to choose a quantity, and allows the
14
buyer to then conclude the purchase. For these reasons, summary judgment is inappropriate on
15
this claim, and the Court will not dismiss it.
16
However, the Court clarifies the scope of the patent infringement claim to include only
17
18
the five patents actually alleged to have been infringed in the Complaint. Dkt. #1 at 25.
19
Defendant notes that Exhibit G to the Complaint reflects a sixth patent, U.S. Design Patent No.
20
D545, 605 (the 605 patent) that Plaintiffs are apparently attempting to put into contention
21
now.
See Dkt. #31 at 12 and Ex. A at Response to Interrogatory No. 2.
However,
22
infringement of that patent was never alleged in the Complaint, nor was it included in
23
24
Plaintiffs Preliminary Infringement Contentions, Dkts. #1 and #31 at 12 and Exs. C and D,
25
and Plaintiffs have never moved to amend their Complaint to assert such a claim. Accordingly,
26
the 605 patent will not be at issue in this matter.
27
28
ORDER
PAGE - 23
ADD42
G. Unavailability of the Court for Trial Date
This matter is currently scheduled for trial on September 28, 2015. However, the Court
will be unavailable on that date due to other scheduled matters. Accordingly, the Court will be
contacting the parties to discuss a new trial date. The Court advises that the parties meet and
confer in the meantime to discuss mutually-agreeable potential trial dates and the length of the
6
7
8
9
10
trial.
H. Joinder of Necessary Party
This Court previously asked Plaintiffs to show cause why FAC System, LLC, should
not be joined as a necessary party to this action. Dkt. #13 at 3, fn. 2. Plaintiffs filed a response,
11
to which Defendant replied; however, the Court has not since addressed the issue, and no party
12
13
has ever actually moved for such joinder. Because the Court has determined that Plaintiffs
14
copyright infringement and Lanham Act claims should be dismissed, but their patent
15
infringement claim shall proceed, the Court invites Defendant to make a formal motion for
16
joinder should Defendant believe such joinder is necessary, no later than 10 days from the date
17
18
of this Order. Any such motion shall be noted on the Courts motion calendar in accordance
19
with the Local Rules. Plaintiffs shall file any response in accordance with the Courts Local
20
Rules. The parties should also address the affect of any joinder of a new party on the trial date
21
in their briefing.
22
IV.
CONCLUSION
23
24
Having reviewed the parties cross-motions, the responses in opposition thereto and
25
replies in support thereof, along with the supporting declarations and exhibits and the
26
remainder of the record, the Court hereby FINDS and ORDERS:
27
28
ORDER
PAGE - 24
ADD43
1) Defendants Motion for Summary Judgment (Dkt. #30) is GRANTED IN PART

AND DENIED IN PART as discussed above.
2
3
2) Plaintiffs copyright and Lanham Act claims are dismissed in their entirety.
Plaintiffs patent infringement claim remains.
3) The scope of Plaintiffs patent infringement claim includes only the five patents
6
actually alleged to have been infringed in the Complaint at Dkt. #1, 25.
7
8
DATED this 16th day of July 2015.
10
RICARDO S. MARTINEZ
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
ORDER
PAGE - 25
ADD44
1
2
3
4
5

AT SEATTLE
6
7
8
9
MILO & GABBY, LLC, and KAREN

Plaintiffs,
10
11
12
v.
AMAZON.COM, INC.,
13
Defendant.
)
) CASE NO. C13-1932RSM
)
)
) ORDER GRANTING DEFENDANTS
) MOTION FOR ATTORNEYS FEES
)
)
)
)
)
14
I.
15
INTRODUCTION
16
This matter comes before the Court on Defendant Amazons Motion for Attorneys
17
Fees and Costs. Dkt. #53. Defendant argues that it is entitled to fees and costs as the
18
prevailing party under both the Copyright Act and the Lanham Act. Id. In response, rather
19
20
than address the fee issue directly, Plaintiffs appear to re-argue many of the issues raised in
21
their prior opposition to summary judgment. Dkt. #61. Having reviewed the parties briefing,
22
and having determined that no oral argument is necessary on this motion, the Court now
23
GRANTS Defendants motion.
24
II.
BACKGROUND
25
26
A more complete background has been set forth in this Courts Order on summary
27
judgment, which is incorporated by reference herein.
28
Plaintiffs filed the instant lawsuit alleging that Amazon was using Plaintiffs intellectual
ORDER
PAGE - 1
ADD45
Dkt. #44.
On October 24, 2013,
property to wrongfully market, sell, and distribute inferior-quality knockoffs of Plaintiffs
animal-shaped pillowcases on the amazon.com website. On April 11, 2014, the Court granted
Defendants Rule 12(b)(6) motion and dismissed Plaintiffs claims for unfair competition under
Washingtons Consumer Protection Act; right of publicity; and trademark counterfeiting under
the Lanham Act. Dkt. #13. The Court also struck Plaintiffs claim for patent infringement
6
7
based on any allegation of induced, contributory, or willful patent infringement, as well as
Plaintiffs claim for indirect copyright infringement. Id. On July 16, 2015, this Court granted
in part and denied in part Defendants motion for summary judgment, dismissing Plaintiffs
10
copyright and remaining Lanham Act claims in their entirety, but allowing a direct patent
11
infringement claim to proceed. Dkt. #44 at 25. Defendant now seeks fees and costs based on
12
13
the dismissed claims.

III.
14
15
DISCUSSION
A. Fees for Prevailing Party on Copyright Claim
16
This Court has discretion to grant attorneys fees and costs to a prevailing party on a
17
18
copyright claim. The United States Supreme Court has mandated that [p]revailing plaintiffs
19
and prevailing defendants are to be treated alike by the courts. Fogerty v. Fantasy, Inc., 510
20
U.S. 517, 534 (1994). Relevant to the consideration of such an award is:
21
the Copyright Acts primary objective, to encourage the production of

original literary, artistic, and musical expression for the good of the public;
the fact that defendants as well as plaintiffs may hold copyrights and run
the gamut from corporate behemoths to starving artists; the need to
encourage defendants who seek to advance a variety of meritorious
copyright defenses ... to litigate them to the same extent that plaintiffs are
encouraged to litigate meritorious claims of infringement; and the fact that
a successful defense of a copyright infringement action may further the
policies of the Copyright Act every bit as much as a successful prosecution
of an infringement claim by the holder of a copyright.
22
23
24
25
26
27
28
ORDER
PAGE - 2
ADD46
Fantasy, Inc. v. Fogerty, 94 F.3d 553, 557-58 (9th Cir. 1996) (ellipsis in original; citations
omitted) (Fogerty, 510 U.S. at 524-27).
Plaintiffs copyright claims furthered the policies of the Copyright Act under the circumstances
Defendant argues that its successful defense of
of this case, and therefore an award of fees and costs is appropriate. Dkt. #53 at 3-5.
Plaintiffs do not directly respond to Defendants motion. First, they attack the validity
6
7
of the Declarations previously relied on by Defendants to support its motion for summary
judgment, but which have not been cited in support of the instant motion for fees and costs and
are therefore irrelevant. Dkt. #61 at 1-2. Plaintiffs then rehash at length their arguments
10
previously raised in opposition to summary judgment pertaining to whether Defendant is a
11
seller for purposes of the Copyright Act, asserting that the issue has not been fully resolved
12
13
by the Court. Dkt. #61 at 2-4. Plaintiffs also appear to believe that this Court never addressed
14
the sale of physical products. Such arguments completely ignore the rulings of this Court.
15
Indeed, in its prior ruling on summary judgment, this Court expressly rejected:
16
Plaintiffs contention that Amazon is liable for [copyright]1 infringement

based on its sales and shipment of physical items. Here, the evidence
demonstrates that Amazon is not the seller of the alleged infringing
products. See Dkt. #35 at 12. Likewise, third-party sellers retain full title
to and ownership of the inventory sold by the third party. Dkt. #34 at 4.
Plaintiffs have provided no evidence to the contrary with respect to any
specific third party involved with the products in this case. Accordingly,
the Court concludes that Amazon was not the seller of the products at issue
here. Hendrickson v. Amazon.com, Inc., 298 F. Supp.2d 914, 915 (C.D.
Cal. 2003) (holding that under similar circumstances Amazon was an
internet service provider for the third party and not a seller).
17
18
19
20
21
22
23
24
Dkt. #44 at 10-11 (emphasis added).
25
26
27
28
While the Court inadvertently used the term trademark infringement in its order, it should
have been obvious to all parties that the Court was actually discussing copyright infringement,
as the legal discussion referenced the Copyright Act, the title of the section of the Order
referenced Direct Copyright Infringement, and the parties argued copyright infringement in
their briefs. See Dkts. #30, #36, #39 and #44 at 7-11.
ORDER
PAGE - 3
ADD47
The Court assumes that Plaintiffs have raised these arguments to demonstrate the
reasonableness of their underlying opposition on summary judgment, which is one of the
factors that may be considered on a motion for attorneys fees and costs. Halicki Films, LLC v.
Sanderson Sales and Marketing, 547 F. 3d 1213, 1230 (9th Cir. 2008).
The Court has
considered Plaintiffs arguments, and, although the Court does not find them directly on point,
6
7
ultimately, even though Plaintiffs claims were summarily dismissed, it cannot be said that
Plaintiffs claims were frivolous, that legal or factual arguments underlying those claims were
objectively unreasonable, or that an award of costs is necessary to advance considerations of
10
deterrence. As a result, the Court denies Defendants motion for fees and costs under the
11
Copyright Act.
12
13
B. Fees for Prevailing Party on Lanham Act Claim
14
Thus, the Court turns to Defendants request for fees and costs under the Lanham Act.
15
Section 35(a) of the Lanham Act provides that [t]he court in exceptional cases may award
16
reasonable attorney fees to the prevailing party. 15 U.S.C. 1117(a). The Ninth Circuit has
17
18
held that this requirement is met when the case is either groundless, unreasonable, vexatious,
19
or pursued in bad faith. Cairns v. Franklin Mint Co., 292 F.3d 1139, 1156 (9th Cir. 2002)
20
(emphasis in original); accord Secalt S.A. v. Wuxi Shenxi Constr. Mach. Co., 668 F.3d 677, 687
21
(9th Cir. 2012).
The Ninth Circuit has explained that the exceptional circumstances
22
requirement is to be construed narrowly. Classic Media, Inc. v. Mewborn, 532 F.3d 978, 990
23
24
(9th Cir. 2008). Where a plaintiff is able to provide some legitimate evidence in support of
25
his claims, the case will likely fall on the unexceptional side of the dividing line. Secalt, 668
26
F.3d at 688.
27
28
ORDER
PAGE - 4
ADD48
As the Supreme Court recently held construing identical language under the Patent Act,
1
2
an exceptional case is simply one that stands out from others with respect to the substantive
strength of a partys litigating position (considering both the governing law and the facts of the
case) or the unreasonable manner in which the case was litigated. Octane Fitness, LLC v.
ICON Health & Fitness, Inc., __ U.S. __, 134 S. Ct. 1749, 1756, 188 L. Ed. 2d 816 (2014).
6
7
However, the mere absence of bad faith on [the losing partys part] does not render [the
prevailing party] ineligible for attorneys fees. Secalt S.A. v. Wuxi Shenxi Const. Mach. Co.,
668 F.3d at 687 (quoting opinion below and affirming). Although the Lanham Act may not
10
require subjective bad faith, a defendant seeking attorneys fees under the Lanham Act must
11
demonstrate, at minimum, that the plaintiff has no reasonable or legal basis to believe in
12
13
success on the merits. Id.
14
In this case, the Court finds Plaintiffs Lanham Act claims to have been groundless and
15
unreasonable. As an initial matter, the Court dismissed Plaintiffs trademark counterfeiting
16
claim for Plaintiffs failure to state a plausible claim for relief. Dkt. #13 at 11-16. The Court
17
18
noted:
Plaintiffs fail to present plausible factual support for trademark
counterfeiting beyond bare recitation of the reproduction element of the
claim. As Amazon points out, Plaintiffs cannot sustain a claim for
trademark counterfeiting based upon exhibits that do not show any
reproduction of Plaintiffs registered mark. To survive a motion to dismiss,
a complaints [f]actual allegations must be enough to raise a right to relief
above the speculative level. Twombly, 550 U.S. at 555. The Complaints
allegations concerning unauthorized use of Plaintiffs trademark do not
meet this standard.
...
19
20
21
22
23
24
25
Here, the bare factual allegations supporting Plaintiffs trademark

counterfeiting claim establish neither counterfeiting nor intent. Rather,
Plaintiffs simply provide a formulaic recitation of the elements establishing
liability under 15 U.S.C. 1114. Plaintiffs have offered no plausible,
factual basis for their allegations, and thus supply no more than mere
26
27
28
ORDER
PAGE - 5
ADD49
labels and conclusions. Twombly, 550 U.S. at 555. Further, Plaintiffs

offer no factual basis to support the intent and knowledge element of
trademark counterfeiting. Accordingly, Plaintiffs trademark counterfeiting
claim and corresponding remedies are dismissed without prejudice.
1
2
3
4
5
6
7
Dkt. #13 at 14-16 (footnote omitted). Plaintiffs did not amend the Complaint at any point to replead this claim.
Next, the Court dismissed Plaintiffs remaining Lanham Act claims in their entirety on
summary judgment, in part because they failed to show any evidence of a valid enforceable
mark entitled to protection. Dkt. #44 at 20. For reasons this Court does not understand,
9
10
Plaintiffs now argue that the Lanham Act issues have yet to be decided and therefore fees under
11
the Act should be denied. See Dkt. #61 at 5-6. Yet, the Courts prior Order on summary
12
judgment could not be more clear:
13
In this case, Plaintiffs claim fails because there is no evidence of a valid,

enforceable mark entitled to protection under the Act. Plaintiffs have
asserted that their trademark claim rests on alleged violations of MILO &
GABBY; COZY COMPANIONS; Original M&G TM Number 3291697;
Additional M&G TM Number 4644732. Dkt. #31, Ex. A at Response to
Interrogatory No. 16. MILO & GABBY; COZY COMPANIONS is a
mixed word and design mark registered as U.S. Trademark No. 3291697
(the Design Mark). MILO & GABBY is a character mark registered as
U.S. Trademark No. 4644732 (the Word Mark). Dkt. #31 at 10 and Ex.
A at Response to Interrogatory No. 16. Defendants assert, and Plaintiffs
have offered no evidence in rebuttal, that there is no evidence of any alleged
use by Amazon of the Design Mark. Rather, it appears Plaintiffs assert an
alleged use of the Word Mark via an image that allegedly depicts Plaintiffs
marketing materials and reflects the text Milo & Gabby. Id. However,
that Word Mark was not registered until November 25, 2014, over a year
after the lawsuit was filed and the mark allegedly used. Dkt. #31 at 11 and
Ex. B. Therefore, there was no presumption of validity at the time of
alleged use. See Toho Co. v. Sears, Roebuck & Co., 645 F.2d 788, 789 (9th
Cir. 1981) (explain that without federal registration, there is no presumption
of validity).
14
15
16
17
18
19
20
21
22
23
24
25
26
Moreover, to the extent Plaintiffs now claim that Amazon is infringing

COZY COMPANION, a purported common-law mark, see Dkt. #36 at
22-23, this Court takes judicial notice of the fact that COZY COMPANION
is not a registered trademark. Dkt. #39 at 11, fn. 15. Further, Plaintiffs
27
28
ORDER
PAGE - 6
ADD50
have failed to provide any evidence from which a jury could conclude that
they own any rights in a COZY COMPANION mark, that this alleged mark
serves as an identifier of source in the minds of consumers such that it is
entitled to legal protection, or that there is any evidence of confusion. S.
Cal. Darts Assn v. Zaffina, 762 F.3d 921, 929 (9th Cir. 2014) (a plaintiff
asserting an unregistered, common-law trademark must establish both
ownership and protectability of the mark, including proof of
distinctiveness).
1
2
3
4
5
6
Finally, the Court addresses Plaintiffs arguments with respect to vicarious

liability under the Lanham Act or palming off in violation of the Lanham
Act, which have been raised for the first time in response to Defendants
summary judgment motion. Plaintiffs have never raised these theories of
liability in their Complaint, nor have they alleged any facts in their
Complaint providing notice to Defendant that they intended to advance such
theories. See Dkt. #1. Accordingly, the Court will not consider Plaintiffs
arguments. Pickern, 457 F.3d at 965; Williams, 2013 U.S. Dist. LEXIS
72722 at *25.
7
8
9
10
11
12
For all of these reasons, the Court dismisses Plaintiffs Lanham Act claim in
its entirety.
13
14
Dkt. #44 at 20-21. In this case, Plaintiffs essentially pursued a claim for which they had no
15
evidentiary basis, and then attempted to circumvent that problem by improperly raising legal
16
arguments never pled in their Complaint.2
17
Finally, Plaintiffs continue to assert that they will pursue their Lanham Act claims,
18
19
stating in their opposition to the instant motion that: M&G had, and has, ample basis to
20
continue the Lanham Act causes of action given Amazons intimate involvement in the
21
selection, retention, and redistribution of images that bear M&Gs trademarks. Dkt. #61 at 6.
22
That assertion again ignores the prior rulings of this Court. The Court reminds Plaintiffs that,
23
24
in no uncertain terms, their Lanham Act claims have been dismissed in their entirety, and warns
25
Plaintiffs that if they continue to ignore this Courts rulings on those claims, they will be
26
27
28
Plaintiffs also seem to believe that this Courts prior Minute Order directing a response to
Defendants motion for reconsideration on Plaintiffs patent infringement claim has some
bearing on the Lanham Act claim. See Dkt. #61 at 5 (referencing Dkt. #58). Nothing in the
Courts Minute Order pertains to the Lanham Act claims at issue here, nor does the Minute
Order lend any weight to Plaintiffs arguments on the Lanham Act claims.
ORDER
PAGE - 7
ADD51
subject to sanction. The Court also agrees with Defendant that Plaintiffs apparent willful
ignorance of the Courts dismissal of their Lanham Act claims serves as another basis to find
frivolousness in this matter.
As a result, for all of the reasons discussed herein, the Court finds this case to be
exceptional under the Lanham Act and therefore awards attorneys fees and costs to
6
7
Defendant.
IV.
8
9
10
CONCLUSION
Having reviewed Defendants motion, the response in opposition thereto and reply in
support thereof, along with the remainder of the record, the Court hereby FINDS and
11
ORDERS:
12
13
1) Defendants Motion for Fees and Costs (Dkt. #53) is GRANTED.
14
2) Within fourteen (14) days from the date of this Order, Defendant shall file a
15
Supplemental Motion for Award of Fees and Costs, supplying this Court with
16
detailed documentation supporting the requested fees and costs. Defendant shall
17
note the Motion for consideration no later than two Fridays after the motion is filed.
18
19
Plaintiffs shall file a response not to exceed ten (10) pages, no later than the Monday
20
prior to the noting date. No reply shall be filed. Upon the completion of briefing,
21
the Court will take this matter under consideration without oral argument.
22
DATED this 1 day of September 2015.

23
24
25
26
RICARDO S. MARTINEZ
27
28
ORDER
PAGE - 8
ADD52
1
2
3
4
AT SEATTLE
5
6
7
MILO & GABBY, LLC, et al.
Plaintiffs,
9
10
Case No. C13-1932RSM

OPINION OF THE COURT
vs.
AMAZON.COM, et al.
11
Defendants.
12
I. INTRODUCTION
13
14
In this action, Plaintiffs, Milo & Gabby, LLC and Karen Keller, sought money damages
15
from Defendant, Amazon.com, Inc. (Amazon), for its offering to sell products that allegedly
16
17
infringe certain design patents. Plaintiffs also sought an Order from this Court which would
prevent Amazon from importing, offering to sell, or selling these products in the future. Amazon
18
has stipulated that the allegedly infringing products are substantially similar to the designs
19
20
covered by the Milo & Gabby patents. Further, the Court has previously determined that certain
21
Third Parties Da Fang Sun, Chongqin World First Electronic Commerce Co., Ltd., T Liu, FAC
22
System, Dinding Zou, Qiumei Zhang, Charlotte Xia, Nimble Joy, Amanialarashi2165, and
23
Monaqo were responsible for providing the products that were accused of infringement. The
24
Court has also previously determined that Amazon did not sell any of the allegedly infringing
25
26
OPINION - 1
ADD53
1
2
products. Throughout the pendency of this case, Amazon has denied that it offered to sell the
allegedly infringing products.
On October 26, 27 and 28, 2015, the Court conducted a Jury trial in this matter, with the
agreement and understanding by the parties that any verdict would be only advisory in nature
given that whether something constitutes an offer to sell is a question of law for the Court.
6
7
However, the Court and the parties recognized that the answer to that question is dependent on
underlying factual findings, which the Court found appropriate for the Jury to determine.
8
Following the trial, the Jury found in favor of Amazon, answering all of the following
9
10
11
12
13
14
15
questions in the negative:

1. Do you find that Amazon, through its website, communicated a description of the
allegedly infringing products? No.
2. Do you find that Amazon, through its website, communicated the price at which the
allegedly infringing product could be purchased? No.
3. Do you find that Amazon provided the descriptions of the allegedly infringing products?
16
No.
17
18
19
20
21
22
23
24
4. Do you find that Amazon set the price at which the allegedly infringing products could be
purchased? No.
5. Do you find that Amazon set the quantity(ies) of the allegedly infringing product(s) for
sale on its website? No.
6. Do you find that Amazon, through its website, communicated that it was willing to enter
into a bargain to sell the allegedly infringing products? No.
7. . . .
25
26
OPINION - 2
ADD54
1
2
3
8. Have Plaintiffs proven that it is more likely than not that Amazon offered to sell the
alleged infringing products? No.
Dkt. #149.
The Court has since considered the evidence and testimony presented at trial, reviewed
the parties exhibits, and considered the Verdict of, and facts determined by, the Jury, and now
6
7
enters the following Order also concluding that Amazon did not offer to sell the alleged
infringing products and therefore is not liable to Plaintiffs for patent infringement.
8
II. BACKGROUND
9
10
11
The Court has previously set forth the background of this matter and incorporates that
background by reference herein. See Dkt. #44.
III. DISCUSSION
12
13
The Federal Circuit defines 271(a)s offer to sell liability according to the norms of
14
traditional contractual analysis. Rotec Indus., Inc. v. Mitsubishi Corp., 215 F.3d 1246, 1254-55
15
(Fed. Cir. 2000). An offer is the manifestation of willingness to enter into a bargain, so made as
16
to justify another person in understanding that his assent to that bargain is invited and will
17
18
19
conclude it. Restatement (Second) of Contracts 24 (1981). One of the purposes of adding
offer [ ] to sell to section 271(a) was to prevent . . . generating interest in a potential infringing
20
product to the commercial detriment of the rightful patentee. MEMC Elec. Materials, Inc. v.
21
Mitsubishi Materials Silicon Corp., 420 F.3d 1369, 1376 (Fed. Cir. 2005) (quoting 3D Sys., Inc.,
22
160 F.3d at 1379). An offer to sell is a distinct act of infringement separate from an actual sale.
23
An offer to sell differs from a sale in that an offer to sell need not be accepted to constitute an act
24
of infringement. Transocean Offshore Deepwater Drilling, Inc. v. Maersk Contractors USA,
25
Inc., 617 F.3d 1296, 1308 (Fed. Cir. 2010).
26
OPINION - 3
ADD55
While the Federal Circuit has most often addressed offer to sell liability in the
jurisdictional context, analyzing where the offer took place, this Court is not aware of any
Federal Circuit case directly addressing the central issue before this Court that is, who made
the alleged offer to sell. Thus, this Court acknowledges its difficulty in reaching its conclusion
in this matter.
6
7
Nonetheless, based on the factual determinations made by the Jury, the Court concludes
that Amazon did not offer to sell the alleged infringing products in this case. Indeed, as noted
8
above, the Jury specifically found the following:
9
10
11
12
13
14
15
Amazon, through its website, did not communicate a description of the allegedly
infringing products;
Amazon, through its website, did not communicate the price at which the allegedly
infringing product could be purchased;
Amazon did not provide the descriptions of the allegedly infringing products;
Amazon did not set the price at which the allegedly infringing products could be
16
17
18
19
20
21
22
23
purchased;
Amazon did not set the quantity(ies) of the allegedly infringing product(s) for sale on its
website;
Amazon, through its website, did not communicate that it was willing to enter into a
bargain to sell the allegedly infringing products
Dkt. #149.
Based on these findings, and having reviewed the evidence and testimony presented in
24
25
26
this matter, the Court can only conclude that Amazon did not offer to sell the alleged infringing
products because there was no manifestation of the willingness of Amazon to enter into a
OPINION - 4
ADD56
1
2
bargain, so made as to justify another person in understanding that his assent to that bargain is
invited and will conclude it.
However, the Court is troubled by its conclusion and the impact it may have on the many
small retail sellers in circumstances similar to the Plaintiffs. There is no doubt that we now live
in a time where the law lags behind technology. This case illustrates that point. Amazons
6
7
representative, Christopher Poad, testified that Amazon completely changed the online market
place by creating a platform where any seller can offer products to Amazons customers. He
8
further testified that Amazon allows sellers to offer their products with minimal effort, by simply
9
10
filling out an online information form, clicking on an agreement to Amazons terms and
11
conditions, and providing certain banking information. Amazon then offers those sellers both
12
payment processing and fulfillment services, all with an asserted interest in providing the best
13
service to their customers. Mr. Poad also testified that when customers cannot resolve problems
14
with a particular seller, Amazon will often step in to make things right. As a result, Amazon
15
enables and fosters a market place reaching millions of customers, where anyone can sell
16
anything, while at the same time taking little responsibility for offering to sell or selling the
17
18
19
20
products.1 Indeed, under the current case law, Amazon has been able to disavow itself from any
responsibility for offering to sell the products at all. As noted above, the purpose of adding
offer [ ] to sell to section 271(a) was to prevent . . . generating interest in a potential infringing
21
22
23
24
25
26
The Court recognizes that Amazon asserts and embraces an interest in preventing counterfeit
and dangerous products from being sold through its Amazon.com website, that it reserves the
right to unilaterally remove such products from the website, and has created a mechanism by
which intellectual property owners can complain about violations of property rights. The Court
also acknowledges that Amazon removed the alleged infringing products in this case from the
Amazon.com website, continued to monitor and remove those product pages throughout the
litigation, and barred the other Defendant sellers from selling at all on Amazon.com.
OPINION - 5
ADD57
product to the commercial detriment of the rightful patentee. MEMC Elec. Materials, Inc., 420
F.3d at 1376. In this instance, the Court is not convinced that such purpose has been fulfilled.
However, that is a subject which must be addressed to Congress and not the courts.
For the reasons above, the Court adopts the verdict of the Jury and finds that Amazon is
not liable for offering to sell the alleged infringing products at issue in this matter. Judgment
6
7
shall be entered in favor of Amazon. All Plaintiffs claims against Amazon are dismissed.
DATED this 3 day of November 2015.
8
9
10
11
RICARDO S. MARTINEZ
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
OPINION - 6
ADD58

161290
Milo&GabbyLLCandKarenKeller,
PlaintiffsAppellants,
v.
Amazon.com,
DefendantAppellee.
CERTIFICATEOFSERVICE
Beingdulyswornaccordingtolaw,andbeingovertheageof18,
uponmyoathIdeposeandsaythat:
On the date indicated below, I electronically filed the foregoing
withtheClerkoftheCourtfortheUnitedStatesCourtofAppealsfor
the Federal Circuit by using the appellateCM/ECFsystem. Icertify
thatallparticipantsinthecaseareregisteredCM/ECFusersandthat
servicewillbeaccomplishedbytheappellateCM/ECFsystem.
Dated:March21,2016.
/s/JohnWhitaker
JohnWhitaker
CERTIFICATEOFCOMPLIANCE
I hereby certify that this brief complies with the typevolume
limitationofFederalRuleofAppellateProcedure32(a)(7)(B).
Thisbriefcontains 7,479 words,excludingthepartsofthebrief
exempted by Federal Rule of Appellate Procedure 32(a)(&)B)(iii) and
FederalCircuitRuleofAppellateProcedure32(b).Thewordcountwas
performedbytheautomatedwordcountingfunctionofcounselsword
processingsoftware.
This brief complies with the typeface requirements of Federal
RulesofAppellateProcedure32(a)(5,6).Thisbriefhasbeenpreparedin
a proportionally spaced typeface using LibreOffice in a 14 point
CenturySchoolbookfont.
Dated:March7,2016.
/s/JohnWhitaker
JohnWhitaker
16-1290

MILO & GABBY LLC AND KAREN KELLER,
Plaintiffs-Appellants,
v.
AMAZON.COM, INC.,
Defendant-Appellee,
DA FANG SUN, AKA SETH L, CHONGQIN WORLD FIRST ELECTRONIC
COMMERCE CO., LTD., AKA WOTEFUSI, T. LIU, AKA BIN DEAL,
FAC SYSTEM, AKA FAC SYSTEM LLC, DINGDING ZOU,
AKA HAPPY SUNDAY, QIUMEI ZHANG, AKA HITECE, CHARLOTTE XIA,
Defendants.
Appeal from the United States District Court for the Western District of Washington in
Case No. 2:13-cv-01932-RSM, Judge Ricardo S. Martinez
RESPONSE BRIEF OF DEFENDANT-APPELLEE AMAZON

John M. Hughes
Katherine L.I. Hacker
Joseph W. Doman
BARTLIT BECK HERMAN
PALENCHAR & SCOTT LLP
1899 Wynkoop Street, 8th Floor
Denver, CO 80202
(303) 592-3100
Gregory G. Garre
Jonathan Y. Ellis
LATHAM & WATKINS LLP
555 Eleventh Street, NW, Suite 1000
Washington, DC 20004
(202) 637-2200
Counsel for Defendant-Appellee
AMAZON.COM, INC.
April 21, 2016
CERTIFICATE OF INTEREST
Counsel for the Defendant-Appellee certifies the following:
1.

Amazon.com, Inc.
2.
The name of the real party in interest (if the party named in the caption is not
the real party in interest) represented by me is:
None.
3.
All parent corporations and any publicly held companies that own 10 percent
or more of the stock of the party or amicus curiae represented by me are:
None.
4.
The names of all law firms and the partners or associates that appeared for the
party or amicus now represented by me in the trial court or agency or are expected to appear in this Court are:
DURIE TANGRI LLP: Alexandra H. Moss, Daralyn J. Durie, Mark A. Lemley
STOEL RIVES: Nathan C. Brunette, Brian C. Park, Vanessa S. Power
BARTLIT BECK HERMAN PALENCHAR & SCOTT LLP:
John M. Hughes, Katherine L.I. Hacker, Joseph W. Doman
LATHAM & WATKINS LLP: Gregory G. Garre, Jonathan Y. Ellis
April 21, 2016
/s/John M. Hughes
John M. Hughes
AMAZON.COM, INC.
TABLE OF CONTENTS
CERTIFICATE OF INTEREST............................................................................................ i
TABLE OF AUTHORITIES ................................................................................................ iv
STATEMENT OF RELATED CASES ............................................................................... 1
STATEMENT OF THE ISSUES.......................................................................................... 2
INTRODUCTION .................................................................................................................. 3
STATEMENT OF THE CASE ............................................................................................. 5
A.
Amazon Creates an Online Marketplace Then Opens It to

Third-Party Sellers Around the World ........................................................... 5
B.
Third-Party Sellers, Not Amazon, Sell the Pillowcases ............................. 10
C.
The District Court Dismisses Most of Milo & Gabbys

Claims but Allows the Direct Patent Infringement Claim to
Proceed to Trial ................................................................................................ 13
D.
An Advisory Jury Finds that Amazon Did Not Offer to Sell

the Pillowcases, So the Court Rules that Amazon Did Not
Commit Direct Patent Infringement ............................................................ 17
SUMMARY OF THE ARGUMENT ................................................................................. 20

ARGUMENT .......................................................................................................................... 23
I.
Amazon Is Not Liable for Direct Patent Infringement ........................................ 23

A.
Milo & Gabby Waived the Argument that Amazon Should

be Liable for Direct Patent Infringement for Selling the
Pillowcases ........................................................................................................ 24
B.
Third-Party Sellers, Not Amazon, Sold the Pillowcases ............................ 25
C.
Amazon Did Not Sell the Pillowcases Even Under the Three
U.C.C. Sections Cited by Milo & Gabby...................................................... 29
1.
Amazon Did Not Act as a Consignee for the ThirdParty Sellers Under U.C.C. 9-319 ................................................... 29
II.
III.
IV.
2.
Amazon Did Not Act as a Person in the Position of the

Third-Party Sellers Under U.C.C. 2-707 ........................................ 36
3.
Amazon Did Not Act as a Seller in a Sale-or-Return

Transaction Under U.C.C. 2-326 .................................................... 37
Amazon is Not Liable for Direct Copyright Infringement................................... 39

A.
Amazon Did Not Distribute the Pillowcases by Sale ................................ 39
B.
Amazon Did Not Actively Participate in or Directly Cause

Any Copying of Images of the Pillowcases ................................................. 41
C.
The Digital Millennium Copyright Act Safe Harbor

Protects Amazon from Copyright Liability for Any
Copying of Images of the Pillowcases .......................................................... 43
Amazon Is Not Liable for a Lanham Act Palming-Off Claim ............................. 46

A.
Milo & Gabby Did Not Plead a Palming-Off Theory in Its

Complaint .......................................................................................................... 46
B.
Even If Milo & Gabby Had Pled a Palming-Off Theory,

the Claim Would Still Fail ............................................................................... 48
The Attorney-Fee Award Is Not Ripe for Review ................................................. 49
CONCLUSION AND STATEMENT OF RELIEF SOUGHT ................................... 51

PROOF OF SERVICE .......................................................................................................... 53
CERTIFICATE OF COMPLIANCE ................................................................................. 54
TABLE OF AUTHORITIES
Cases
3D Sys., Inc. v. Aarotech Labs., Inc.,
160 F.3d 1373 (Fed. Cir. 1998) ........................................................................................17
Atrium of Princeton, LLC v. N.L.R.B.,
684 F.3d 1310 (D.C. Cir. 2012) .......................................................................................31
Cartoon Network LP, LLLP v. CSC Holdings, Inc.,
536 F.3d 121 (2d Cir. 2008) .............................................................................................42
Cisneros v. UNUM Life Ins. Co. of Am.,
134 F.3d 939 (9th Cir. 1998) ............................................................................................30
CoStar Grp., Inc. v. LoopNet, Inc.,
373 F.3d 544 (4th Cir. 2004) ............................................................................................42
Ellison v. Robertson,
357 F.3d 1072 (9th Cir. 2004) ..........................................................................................43
Enercon GmbH v. Intl Trade Commn,
151 F.3d 1376 (Fed. Cir. 1998) ........................................................................................26
Falana v. Kent State Univ.,
669 F.3d 1349 (Fed. Cir. 2012) ................................................................................. 50, 51
Falk v. Brennan,
414 U.S. 190........................................................................................................................35
Fox Broad. Co., Inc. v. Dish Network, L.L.C.,
747 F.3d 1060 (9th Cir. 2013) ................................................................................... 41, 42
Grp. One, Ltd. v. Hallmark Cards, Inc.,
254 F.3d 1041 (Fed. Cir. 2001) ........................................................................................28
Halo Elecs., Inc. v. Pulse Elecs., Inc.,
769 F.3d 1371 (Fed. Cir. 2014) ................................................................................. 26, 27
Hillis v. Heineman,
626 F.3d 1014 (9th Cir. 2010) ............................................................................. 24, 25, 37
iv
In re Music City RV, LLC,

304 S.W.3d 806 (Tenn. 2010) ..........................................................................................33
K-S-H Plastics, Inc. v. Carolite, Inc.,
408 F.2d 54 (9th Cir. 1969) ....................................................................................... 22, 48
Linear Tech. Corp. v. Micrel, Inc.,
275 F.3d 1040 (Fed. Cir. 2001) ........................................................................................28
MEMC Elec. Materials, Inc. v. Mitsubishi Materials Silicon Corp.,
420 F.3d 1369 (Fed. Cir. 2005) ........................................................................................17
Multicare Health Sys. v. Maplehurst Bakeries, Inc.,
265 F. Appx 685 (9th Cir. 2008) ............................................................................. 30, 31
N. Am. Philips Corp. v. Am. Vending Sales, Inc.,
35 F.3d 1576 (Fed. Cir. 1994) ................................................................................... 28, 29
NTP, Inc. v. Research In Motion, Ltd.,
418 F.3d 1282 (Fed. Cir. 2005) ........................................................................... 25, 26, 27
Online Policy Grp. v. Diebold, Inc.,
337 F. Supp. 2d 1195 (N.D. Cal. 2004) ..........................................................................41
Orenshteyn v. Citrix Sys., Inc.,
691 F.3d 1356 (Fed. Cir. 2012) ................................................................................. 50, 51
Overton v. Art Finance Partners LLC,
No. 15-cv-3927, 2016 WL 413128 (S.D.N.Y. Feb. 2, 2016) ................................ 33, 34
Parker v. Google, Inc.,
242 F. Appx 833 (3d Cir. 2007) ......................................................................................42
Pickern v. Pier 1 Imports (U.S.), Inc.,
457 F.3d 963 (9th Cir. 2006) ............................................................................................46
Pinter v. Dahl,
486 U.S. 622 (1988) .................................................................................................... 27, 28
Religious Tech. Ctr. v. Netcom On-Line Commcns Servs., Inc.,
907 F. Supp. 1361 (N.D. Cal. 1995) .................................................................. 41, 42, 43
Rotec Indus., Inc. v. Mitsubishi Corp.
215 F.3d 1246 (Fed. Cir. 2000) ........................................................................................17
v
Stephen W. Boney, Inc. v. Boney Servs., Inc.,

127 F.3d 821 (9th Cir. 1997) ..................................................................................... 23, 50
Sweepstakes Patent Co., LLC v. Burns,
610 F. Appx 1006 (Fed. Cir. 2015) ................................................................................24
Teva Pharm. Indus. Ltd. v. AstraZeneca Pharm. LP,
661 F.3d 1378 (Fed. Cir. 2011) ........................................................................................23
Transocean Offshore Deepwater Drilling, Inc. v. Maersk Contractors USA, Inc.,
617 F.3d 1296 (Fed. Cir. 2010) ........................................................................................17
United States v. Idaho,
210 F.3d 1067, (9th Cir. 2000), affd 533 U.S. 262 (2001) ............................................32
Universal Health Servs. Inc. v. Thompson,
363 F.3d 1013 (9th Cir. 2004) ..........................................................................................23
Walter E. Heller & Co. Se. v. Riviana Foods, Inc.,
648 F.2d 1059 (5th Cir. 1981) ..........................................................................................38
Zoltek Corp. v. United States,
672 F.3d 1309 (Fed. Cir. 2012) (en banc) ......................................................................25
Statutes and Rules

15 U.S.C. 1117 ......................................................................................................................51
17 U.S.C. 106...................................................................................................................passim
17 U.S.C. 512............................................................................................................ 43, 44, 45
35 U.S.C. 271...................................................................................................................passim
35 U.S.C. 285.........................................................................................................................50
Federal Circuit Rule 28 ...........................................................................................................23
Federal Rule of Civil Procedure 8 .................................................................................. 22, 46
Federal Rule of Civil Procedure 39.......................................................................................17
vi
Miscellaneous
3 C.J.S. Agency 541 ..............................................................................................................31
32 Am. Jur. 2d Factors & Commission Merchants 5 (2016) .........................................30
3A Anderson U.C.C. 2-326:41 (3d ed. 2015) ............................................................ 30, 38
4A Part I Anderson U.C.C. 2-707:3 (3d ed. 2015) ..........................................................36
Blacks Law Dictionary (10th ed. 2014) ...............................................................................26
H.R. REP. NO. 105551(I) (1998) .........................................................................................42
H.R. REP. NO. 105551(II) (1998) .......................................................................................44
Restatement (Third) of Agency 1.02 (2006) .....................................................................31
S. REP. NO. 105190 (1998) ..................................................................................................43
U.C.C. 2-106 ..........................................................................................................................26
U.C.C. 2-326 ................................................................................................................... 37, 38
U.C.C. 2-707 ............................................................................................................. 16, 36, 37
U.C.C. 9-101 ................................................................................................................... 32, 33
U.C.C. 9-319 ............................................................................................................. 29, 30, 33
Wash. Rev. Code 62A.9A-319 ............................................................................................30
William W. Story, A Treatise on the Law of Sales of Personal Property 1 (1853) .................26
vii
STATEMENT OF RELATED CASES

1.
No other appeal in or from the same civil action was previously before this or
any other appellate court.
2.
Counsel is not aware of other pending cases that will directly affect or be directly affected by this Courts decision in the pending appeal.
STATEMENT OF THE ISSUES

1.
Whether Amazon should be liable for direct patent infringement based on

third-party sales of pillowcases on Amazon.com.
2.
Whether Amazon should be liable for direct copyright infringement for merely
shipping pillowcases sold by a third party.
3.
Whether Milo & Gabby can pursue a meritless Lanham Act palming-off claim
that it failed to plead in its complaint and raised for the first time in response to
a motion for summary judgment.
4.
Whether this Court should review a non-final attorney-fee award before the
district court determines the amount of that award.
INTRODUCTION
Amazon started small by creating an online marketplace that sold only books
out of a garage. Later Amazon built upon that foundation by adding other products
like CDs, DVDs, video games, and software. In 1999after spending years investing
in technological and physical-distribution infrastructureAmazon expanded its
online marketplace by opening it to third-party sellers. Since then, third-party sellers
have been able to offer and sell products on Amazon.com, competing directly with
Amazon in what is now the largest online marketplace in the United States.
Today, as Milo & Gabby repeatedly observes, Amazon continues to offer and
sell thousands of products on Amazon.com. But this case is not about products offered or sold by Amazon. This case concerns pillowcases offered and sold only by
third-party sellers. Milo & Gabby chose not to sue those third-party sellers. The thirdparty sellers were only added to this case when the district court granted Amazons
motion to join them as necessary parties. Instead of pursuing the third-party sellers,
Milo & Gabby seeks to hold Amazon liable for direct patent infringement, direct copyright infringement, and Lanham Act violations based on the third-party sellers offers
and sales of the pillowcases on Amazon.com.
At every turn, Milo & Gabby has tried to reshape its case to fit the direct infringement theories it pursued. In the district court, Amazon moved for summary
judgment on Milo & Gabbys direct patent infringement claim and argued that Amazon did not make, use, offer to sell, or sell the pillowcases at issue. In response to that
motion, Milo & Gabby did not argue that Amazon made, used, or sold any of the pillowcases. Instead, Milo & Gabby argued only that Amazon offered to sell the pillowcas-
es. Concluding that there were fact questions about whether Amazon offered to sell
the pillowcases, the district court denied that part of Amazons motion for summary
judgment. So the case proceeded to trial on one question: whether Amazon offered to
sell the pillowcases. After a three-day trial, a jury concluded that Amazon did not offer
to sell the pillowcases and the district court entered judgment finding the same.
On appeal, Milo & Gabby does not challenge the jurys findings or the district
courts judgment but pivots to a new theory that Amazon should be liable for actually
selling the pillowcases. Milo & Gabby had an opportunity to prove its patent infringement claim in the district court. Although Milo & Gabby might be unhappy
with the result, that does not entitle it to rewind this case to try again with a new argument never raised before this appeal.
Even if Milo & Gabby were given a do-over to pursue this new theory, its direct patent infringement claim would still fail. This Court gives sell in the context of
patent infringement under 35 U.S.C. 271 its ordinary meaning: to transfer title to a
buyer for a price. It is undisputed that Amazon simply provided third-party sellers
with a means to offer and sell their own pillowcases. Amazon never had title to any of
the pillowcases in this case. Only the third-party sellers had title and the ability to
transfer title of the pillowcases. For that reason, Amazon could not and did not sell
the pillowcases. Therefore, Amazon should not be held liable for direct patent infringement.
Milo & Gabbys direct copyright infringement claim fails for a similar reason.
Milo & Gabby claims that Amazon committed copyright infringement by providing
one third-party seller with optional fulfillment services. Fulfillment services were lim4
ited to storing the third-party sellers pillowcases and shipping those pillowcases after
they were sold by the third party. To be liable under 17 U.S.C. 106, however, a party
must distribute copies to the public by sale or other transfer of ownership. Again, Amazon never had title or any other ownership rights in the pillowcases. Amazon could
not have distributed the pillowcases by sale or other transfer of ownership. So Amazon also should not be held liable for direct copyright infringement.
Milo & Gabby also pursues a meritless Lanham Act palming-off theory that it
never pled in its complaint. Having not provided Amazon fair notice of that claim,
Milo & Gabby should not be able to rely on it in this appeal.
Finally, Milo & Gabby asks this Court to review a non-final attorney-fee award.
Although the district court ordered Milo & Gabby to pay attorney fees, the district
court has not yet ruled on the amount of fees to be paid. Therefore, the attorney-fee
award is not yet ripe for this Courts review.
STATEMENT OF THE CASE
AMAZON CREATES AN ONLINE MARKETPLACE THEN OPENS
IT TO THIRD-PARTY SELLERS AROUND THE WORLD
Jeff Bezos founded Amazon in 1994 as a retailer selling books online.
(A212223.) To deliver books (and later other products) to customers as quickly and
efficiently as possible, Amazon invested in a number of areas. First, Amazon created
software for its website so that customers could easily search for and order products.
(A2127.) Then Amazon built relationships with carriers, like the U.S. postal service,
UPS, and FedEx, so that customers could pay low shipping costs but still receive orders as fast as possible. (A2127.) Amazon then hired and trained people to provide
top-notch
customer
service.
(A2127.)
Finally,
Amazon
purchased
ware-
housesknown within Amazon as fulfillment centersall around the country to

enable Amazon to deliver things promptly to customers. (A2127.)
Amazon realized the infrastructure it built to deliver books could also be used
to deliver other products customers wanted. So Amazon began selling more items in
its marketplace, from clothing to computers. But Amazon did not stop there.
With a firm belief that its customers would benefit from a competitive marketplace, in 1999 Amazon opened its virtual doors to let other third-party companies sell
products on Amazon.com. (A212729.) Where industry analysts faulted Amazon for
providing competitors an advantage to its own detriment, Amazon saw an opportunity to offer customers what they wanted: low prices and broad selection. (A2128.) Now
over fifteen years later, most of the hundreds of millions of products [on Amazon.com] are offered by third-party sellers, rather than Amazon itself. (A212829.)
Despite Milo & Gabbys attempt to conflate when Amazon itself offers or sells
a product with when a third-party seller offers or sells a product, Amazons website
clearly identifies the offeror and the seller of each product. Every product has a
product-detail page associated with it. (A2132.) For example, this product-detail
page shows a soccer net shipped from and sold by Amazon itself:
(A3696; see also A2132.) In this example, Amazon is the seller of record offering to sell
the soccer net. The box in the bottom right corner of this page, titled Other Sellers
on Amazon, indicates that multiple companies are offering to sell this soccer net in
addition to Amazon. (A3696.) When customers click through that box, they go to the
offer listing page. (A2133.) On the offer listing page, customers can see all the
sellers who are selling this product. (A2133.) In the soccer net example, the offer listing page shows at least four sellers:
(A3697.) The first seller offering to sell this product is a company called ABCD
Sales, and theyre offering this product for $94.49. (A2134.) Amazon is listed as the
second seller. (A3697; A2134.) A third company called Anthem Sports is offering to
sell the soccer net for $95.95, and a fourth called Sarahs pro sports shop is offering to
sell the soccer net for $103.81. (A3697; A2135.) For every product available on Amazons website, a product-detail page like this one shows which entity or entities are offering to sell the product at what price.
In addition to providing third-party sellers access to its marketplace to sell
products like the soccer net, Amazon provides sellers tools and services. Two are relevant here. First, Amazon offers payment processing services. (A2130.) When a customer purchases a product from a third-party seller on Amazons website, Amazon
processes the payment and then disburses the funds to the third-party seller. (A2130.)
8
Sellers can use this service, called Pay with Amazon, on other websites too.
(A2130.) Just like PayPal, a seller can use Pay with Amazon to process orders placed
on the sellers own website. (A2130.)
Second, Amazon offers a service called Fulfillment by Amazon, which allows
third-party sellers to take advantage of Amazons logistics network. To use Fulfillment
by Amazon, a seller sends its products to an Amazon fulfillment center. (A2162.) Amazon then places those products on a shelf. (A2162.) When a customer orders that
sellers product, Amazon pulls the product off the shelf, packages it, and ships it to
the customer on behalf of the seller. (A2162.) With fulfillment centers strategically
placed around the country, Amazon can ship products from the closest fulfillment
center to the customer quicker than if the seller is shipping the product directly to
the customer themselves. (A2163.)
Just like the Pay with Amazon service, third-party sellers can use Fulfillment by
Amazon to store and ship products for sale in marketplaces other than Amazon.com.
(A2164.) Instead of using FedExs logistics and shipping services, a seller using eBay,
Craigslist, or even its own website can send products to an Amazon fulfillment center
for Amazon to fulfill and ship orders placed on those websites. (A216465.)
When third-party sellers use Fulfillment by Amazon to ship orders placed on
Amazon or any other website, the product remains the third-party sellers property at
all times. (A216364.) Amazon cant just take a third-partys product to sell it.
(A2164.) Similarly, if a third-party seller decided for any reason that it no longer wanted to use Fulfillment by Amazon, then the third-party seller could remove its stock at
any time. (A2163.)
9
These tools and services have helped create the thriving Amazon marketplace
that exists today. Like any marketplace, however, there is a risk that bad actors will attempt to abuse the system. This case involves that risk. In this case, third-party sellers
offered and sold pillowcases that violated Milo & Gabbys intellectual property rights
and Amazons policies. When Amazon discovered the problem, it reacted by removing the listings and blocking the third-party sellers. Amazon did not, as Milo & Gabby
claims, sell (or offer to sell) any of the pillowcases itself.
Third-Party Sellers, Not Amazon, Sell the Pillowcases.
Milo & Gabby began selling its animal-shaped pillowcases in 2005. (A1942.)
After six years of mixed results selling the pillowcases at trade shows and trade marts,
Milo & Gabby executed an exclusive license agreement with a Korean company
named Petit Elin. (A2015; A206364; A2702.) Under that license agreement, Petit
Elin received the exclusive right to manufacture and sell the pillowcases, initially in
Korea, and then later also in Japan, China, Taiwan, Hong Kong, Singapore, Australia,
and New Zealand. (A2021; A2702.) Since Milo & Gabby signed that license, Petit Elin
has been the primary distributor of the pillowcases. (A2018.)
The license agreement gave Petit Elin not only the exclusive right to manufacture and sell the pillowcases but also the right to use Milo & Gabbys marketing material. To promote the pillowcases, Milo & Gabbys owners Karen and Steven Keller
took photographs of their children with the pillowcases. (A195152.) Milo & Gabby
then provided those photographs to Petit Elin. (A2015.) Petit Elin, in turn, used the
photographs on its website. (A3718.)
10
Roughly a year after Milo & Gabby entered into the license agreement with
Petit Elin, Milo & Gabby discovered that copies of the pillowcases were being sold on
Alibaba.com using the same photographs provided to Petit Elin. (A1959.) Soon thereafter, Mrs. Keller discovered that some third-party sellers were offering pillowcases on
Amazons website too. (A1961.) Unlike the soccer net example, Amazon itself was
not offering or selling the pillowcases. (A216061.) Instead, only third-party sellers1
were offering to sell the pillowcases. (A216061.) The product-detail pages for each
of those pillowcases showed that only third-party sellers were offering to sell the pillowcases. For example, this product-detail page from 2013 says, Ships from and sold
by Nimble Joy:
(A2533.)
The following ten third-party sellers listed as Defendants in the caption actually
sold pillowcases: (1) Da Fang Sun; (2) Chongqin World First Electronic Commerce
Co., Ltd.; (3) T Liu; (4) FAC System; (5) Dingding Zhou; (6) Qiumei Zhang; (7) Charlotte Xia; (8) Nimble Joy; (9) Amanialarashi2165; and (10) Monaqo. (A5556.)
1
11
Milo & Gabby misleadingly claims that the pillowcases were stored in Amazon
fulfillment centers and shipped by Amazon, implying that all of the third-party sellers
used Fulfillment by Amazon. (Br. at 8.) But only one of the ten third-party sellers used
Fulfillment by Amazon: seller FAC System LLC. (A2164.) In other words, nine of the
ten third-party sellers stored and shipped their own products independently of Amazon. Just like all of the other product-detail pages, the product-detail page for the one
seller that used Fulfillment by Amazon made clear that the pillowcases were being
sold by that seller, FAC System LLC, not by Amazon:
(A2479.)
12
Amazon received notice of Milo & Gabbys complaints for the first time when
Milo & Gabby filed this lawsuit in October 2013. (A218384; A150.) Milo & Gabbys
owner Karen Keller claims that she placed two telephone calls to Amazon and left a
message to report the problem. (Br. at 9.) Not only does Mrs. Keller not have any
records of those phone calls, but Amazon also checked the records it keeps and could
not find any evidence of the message. (A2054; A217677.) In addition, Milo & Gabby
did not fill out the form available on Amazons website for reporting intellectual
property violations. (A1974; A2177; A2183; A2328; A2340; A2479; A2803.) Upon receiving notice of this lawsuit, Amazon took the product listings down, suspended the
third-party sellers, and kicked the third-party sellers out of the marketplace.
(A218485.) When third-party sellers attempted to relist the pillowcases by changing
the product names, Amazon again took the listings down and removed the sellers.
(A218485.) Milo & Gabby admits that Amazon immediately took action to remove
the pillowcases and to block the third-party sellers. (Br. at 9 n.1.)
The District Court Dismisses Most of Milo & Gabbys
Claims but Allows the Direct Patent Infringement Claim to
Proceed to Trial.
When Milo & Gabby first filed this case, the complaint included seven claims:
(1) patent infringement; (2) copyright infringement; (3) unfair competition under
Washingtons Consumer Protection Act; (4) false designation of origin under the
Lanham Act; (5) right of publicity under Washington state law; (6) removal of copyright management information under the Digital Millennium Copyright Act; and
(7) trademark counterfeiting under the Lanham Act. (A15658.) The district court
granted Amazons motion to dismiss the unfair competition, right of publicity, and
13
trademark counterfeiting claims. (A5.) The district court also dismissed Milo & Gabbys claims for contributory and induced patent and copyright infringement.
(A2022.) Although the district court granted Milo & Gabby leave to amend in that
same order, Milo & Gabby never filed an amended complaint reasserting any of these
claims.
The district courts motion to dismiss ruling, therefore, whittled the case down
to four claims: (1) direct copyright infringement; (2) direct patent infringement;
(3) false designation of origin under the Lanham Act; and (4) removal of copyright
management information under the Digital Millennium Copyright Act. Amazon then
filed a motion for summary judgment challenging all four remaining claims. (A426.)
First, Amazon challenged Milo & Gabbys copyright infringement claim.
(A43949.) Amazon explained that it could not be liable for displaying images of the
pillowcases provided by third-party sellers on its website because it did not actively
participate in or directly cause the alleged copying. (A43941.) In addition, Amazon
showed that the Digital Millennium Copyright Act (DMCA) safe harbor in
17 U.S.C. 512(c) protected it from liability for storing images for its website at the
direction of third parties. (A44249.) Finally, Amazon argued that it also could not be
liable for shipping a customers order for a third-party sellers pillowcases because
Amazon never had an ownership interest in the pillowcases (A441442.)
In response, Milo & Gabby first proffered some vicarious liability arguments
that it no longer pursues. (A57278.) Then Milo & Gabby focused almost entirely on
its argument that Amazon should be liable for storing the images and displaying them
on its website at the direction of the third-party sellers. (A587 (Regardless of who
14
actually supplies the images, it is undisputed that Amazon stores the infringing images on its servers.); see also A578587.) In the midst of that argument, Milo & Gabby sprinkled in a few statements referencing Amazon shipping the physical pillowcases. (A578 (Amazon cannot hide behind the DMCA 512(c) protections for its control
over the sales of physical goods in commerce.).) But Milo & Gabby never argued
that Amazon actually sold the pillowcases.
In granting the part of Amazons motion related to the copyright infringement
claim, the district court addressed both of Milo & Gabbys arguments. Given that Milo & Gabby emphasized its argument concerning the images of the pillowcases, the
district court spent the majority of its analysis on that issue. (A3033.) The court concluded that Amazon did not actively participate or directly cause any copying and that,
in any event, the DMCA safe harbor protected Amazon from that allegation.
(A3033.) The district court did not, however, leave Milo & Gabbys argument about
Amazon shipping the pillowcases unaddressed. On that front, the district court concluded that the third-party sellers retain[ed] full title to and ownership of the inventory. (A33.) Given that distribution must be by sale, Amazon could not be liable for
direct copyright infringement. (A33.)
Amazon next challenged Milo & Gabbys remaining Lanham Act claim based
on preemption and lack of a valid trademark, among other grounds. (A44951, A450
n.9.) In response, Milo & Gabby attempted to save its trademark infringement claim
by relying on two new theoriespalming off and vicarious liability. (A58894.) The
district court rejected that attempt and concluded that Amazon was not liable for
Lanham Act violations. (A3944.)
15
Finally, on the direct patent infringement claim, Amazon argued that it was undisputed that Amazon did not make, use, sell, or offer to sell any of the pillowcases.
(A45556.) In response, Milo & Gabby argued only that Amazon offered to sell the
pillowcases. (A59497.) Milo & Gabby made no attempt to challenge Amazons contention that undisputed facts demonstrated that Amazon did not sell the pillowcases.
Milo & Gabby made its choice to pursue only an offer-to-sell theory clear in its summary judgment briefing: Amazon is liable for direct patent infringement of [Milo &
Gabbys] design patents by, at a minimum, offering to sell infringing products.
(A594.)
Milo & Gabby then offered two arguments to support this offer-to-sell theory.
First, Milo & Gabby argued that [i]n the patent context, the term offer for sale has
a unique meaning different from the typical contractual law analysis of offer and sale.
(A595.) Second, Milo & Gabby relied on a U.C.C. argument, stating that the UCC
[can] enlighten the analysis of whether Amazon can offer to sell a product to which
it does not have legal title. (A596.) Citing the Washington state law equivalent of
U.C.C. 2-707, Milo & Gabby argued that Amazon is a person in the position of a
seller. (A596.) In making its U.C.C. argument, Milo & Gabby also claimed without
explanation that Amazon is analogous to a consignee. (A597.) Milo & Gabby relied
on these arguments, however, to try to support its offer-to-sell theory, not to support
the sale theory it now advances on appeal. (A59497.)
When the district court ruled on the patent infringement claim, it recognized
that Milo & Gabby was pursuing an offer-to-sell theory. The court explained that Milo & Gabby argu[ed] that Amazon has indeed offered to sell the products within the
16
meaning of the statute. (A45 (emphasis added).) The district court then agreed with
Milo & Gabby that fact questions precluded summary judgment on that issue. (A46.)
So the case proceeded to a jury on a single issue: Did Amazon offer to sell the pillowcases?
An Advisory Jury Finds that Amazon Did Not Offer to Sell
the Pillowcases, So the Court Rules that Amazon Did Not
Commit Direct Patent Infringement.
Although all parties agreed that the remaining issuedid Amazon offer to sell
the pillowcaseswas a question of law for the district court to decide, the court empaneled an advisory jury to answer underlying fact questions. See Fed. R. Civ. P. 39(c).
Even though Milo & Gabby claimed that offer to sell has a unique definition in the
context of patent liability on summary judgment,2 in this appeal Milo & Gabby does
not challenge the following instruction given to the jury by the district court:
An offer to sell occurs when one communicates that it was willing
to enter into a bargain so made as to justify another person in understanding that his assent to that bargain is invited and will conclude it.
An offer to sell is a distinct act of infringement separate from an
actual sale. An offer to sell differs from a sale in that an offer to sell need
not be accepted to constitute an act of infringement.
Mere advertisements directed to a national audience, however, are
not offers to sell.
Contrary to Milo & Gabbys argument, the term offer to sell is defined according to traditional contract law principles. See Transocean Offshore Deepwater Drilling, Inc. v.
Maersk Contractors USA, Inc., 617 F.3d 1296, 1308 (Fed. Cir. 2010); MEMC Elec. Materials, Inc. v. Mitsubishi Materials Silicon Corp., 420 F.3d 1369, 1376 (Fed. Cir. 2005); Rotec
Indus., Inc. v. Mitsubishi Corp., 215 F.3d 1246, 125455 (Fed. Cir. 2000); 3D Sys., Inc. v.
Aarotech Labs., Inc., 160 F.3d 1373 (Fed. Cir. 1998).
2
17
(A2357.) In addition, Milo & Gabby never asked the district court for an instruction
concerning the U.C.C. or consignment arguments it made on summary judgment.
(A18031823.) And Milo & Gabby did not ask for the jury to decide whether it satisfied the factual predicate for those arguments. (A176465, 1824.)
Now, on appeal, Milo & Gabby mischaracterizes what happened at trial. Milo
& Gabby claims that Mr. Christopher Poad, Amazons corporate representative, testified that Amazon acts as a seller in every step of a transaction. (Br. at 1617.) Mr.
Poad explained quite the opposite:
Q
And Mr. Poad, youve familiarized yourself with the pillowcases at

issue in this case?
Yes, I have.
And was Amazon ever identified as the seller offering to sell the
pillowcase, for any of the pillowcases?
No.
(A2136.)
After a three-day trial, the jury returned the following answers to seven questions related to whether Amazon offered to sell the pillowcases:
1.
Do you find that Amazon, through its website, communicated a

description of the allegedly infringing products?
No.
2.
Do you find that Amazon, through its website, communicated the

price at which the allegedly infringing product could be purchased?
No.
3.
Do you find that Amazon provided the description of the allegedly

infringing products?
18
No.
4.
Do you find that Amazon set the price at which the allegedly infringing products could be purchased?
No.
5.
Do you find that Amazon set the quantity(ies) of the allegedly infringing product(s) for sale on its website?
No.
6.
Do you find that Amazon, through its website, communicated that

it was willing to enter into a bargain to sell the allegedly infringing
products?
No.
...
8.
Have Plaintiffs proven that it is more likely than not that Amazon
offered to sell the alleged infringing products?
No.
(A241517.) Adopting those factual findings, the district court issued an order concluding that Amazon did not offer to sell the pillowcases as a matter of law and, therefore, was not liable for direct patent infringement. (A96101.) In this appeal, Milo &
Gabby makes nothing more than a few generic statements that the district court erred
in concluding that Amazon does not offer to sell the pillowcases. (Br. at 3, 4, 20.) But
Milo & Gabby does not challenge the district courts factual findings or legal conclusion and makes no substantive argument that Amazon offered to sell the pillowcases.
(Br. at 2021.) Instead, Milo & Gabby challenges only the district courts pre-trial rulings on Amazons motion for summary judgment and Amazons motion for attorney
fees.
19
SUMMARY OF THE ARGUMENT

Milo & Gabby waived the main argument it offers to this Courtthat Amazon
should be liable for direct patent infringement for selling the pillowcases. Before the
district court, Milo & Gabby argued that Amazon committed direct patent infringement by offering to sell the pillowcases at issue in this case under 35 U.S.C. 271(a).
Before this Court, Milo & Gabby effectively abandons that claim making no substantive argument that Amazon offered to sell the pillowcases. Instead, Milo & Gabby
claims that Amazon committed direct patent infringement by actually selling the pillowcases. Having not raised that argument below, Milo & Gabby cannot pursue it
now.
Even ignoring the waiver problem, Milo & Gabbys new argument that Amazon committed direct patent infringement by selling the pillowcases fails. Milo &
Gabby does not even attempt to reconcile the unchallenged result of the triala legal
finding that Amazon does not offer to sell the pillowcaseswith its appellate theory
that Amazon nevertheless sells the pillowcases. It does not do so because it cannot. In
the context of 271(a), this Court gives sell its ordinary meaning: to transfer title to
a buyer for a price. Amazon undisputedly never held title to any of the pillowcases.
For that reason, Amazon could not and did not transfer the title of the pillowcases to
anyone. Unable to overcome the evidence that Amazon lacked title to the pillowcases,
Milo & Gabby resorts to relying on a consignment theory and various sections of the
U.C.C. to argue that sell in 271(a) does not carry its ordinary meaning and does
not require the transfer of title. But the undisputed facts show there was no consignment relationship here. And the other U.C.C. sections do not define what it means to
20
sell a productunder the Patent Act or in any other contextbut instead help explain a sellers or creditors rights in specific situations. Even so, Amazon did not sell
or act as a seller of the pillowcases under the U.C.C. sections cited by Milo & Gabby.
Therefore, this Court should affirm the district courts ruling on Milo & Gabbys direct patent infringement claim.
Milo & Gabbys attempt to hold Amazon liable for direct copyright infringement fails as well. Before the district court, Milo & Gabby argued that Amazon
should be liable for direct copyright infringement for displaying images provided by
third-party sellers of the Milo & Gabby pillowcases and for shipping some pillowcases. On appeal, Milo & Gabby no longer argues that Amazon should be liable for direct copyright infringement for displaying images of the Milo & Gabby pillowcases on
its website. Instead, Milo & Gabby relies only on Amazons role in shipping some pillowcases for one third-party seller. Distribution under 17 U.S.C. 106(3) requires
transferring ownership by sale. The same weakness from Milo & Gabbys patent
claim also dooms Milo & Gabbys copyright claim: Milo & Gabby has no evidence
that Amazon had title to the pillowcases and the ability to transfer that title by sale.
Therefore, the Court should also affirm the district courts ruling on Milo & Gabbys
direct copyright infringement claim.
Milo & Gabbys third argumentthat Amazon should be liable for a Lanham
Act palming-off claimsuffers from a similar problem as its patent infringement
claim. Milo & Gabby never pled any allegations related to a Lanham Act palming-off
claim in its complaint. Milo & Gabby cobbles together a few sentences from its motion to dismiss opposition about its state law unfair competition claim. That does not,
21
however, change the fact that Milo & Gabby never provided even a short and plain
statement of these allegations in its complaint as required by Federal Rule of Civil
Procedure 8(a).
Moreover, a Lanham Act palming-off claim requires the unauthorized substitution of the goods of one manufacturer when the goods of another are requested by
the customer. K-S-H Plastics, Inc. v. Carolite, Inc., 408 F.2d 54, 59 (9th Cir. 1969). That
did not happen here. To the contrary, all of the product-detail pages for the pillowcases identified the correct seller and manufacturer of the pillowcases. Milo & Gabby
was not identified as either the seller or the manufacturer of any of the pillowcases at
issue. In fact, the words Milo & Gabby never appeared on any of those pages.
(A247991, A251336.) Milo & Gabby has identified no evidence that Amazon substituted pillowcases sold by the third-party sellers in response to a request for Milo &
Gabby pillowcases. Therefore, this Court should also affirm that district courts ruling
on Milo & Gabbys Lanham Act claim.
Finally, Milo & Gabby requests review of a non-final attorney-fee award. The
district court properly granted Amazons motion for attorney fees, but the district
court has not yet established the amount of those fees. Under this Courts precedent,
such an award is not final and appealable until the district court determines the
amount of the attorney fees. This rule prevents piecemeal appeals of fee awards. The
Court should follow that rule and refuse to address Milo & Gabbys argument concerning the district courts order awarding attorney fees.
22
ARGUMENT
This Court applies the law of the regional circuit when reviewing a district
courts grant of a motion for summary judgment.3 Teva Pharm. Indus. Ltd. v. AstraZeneca
Pharm. LP, 661 F.3d 1378, 1381 (Fed. Cir. 2011). The Ninth Circuit reviews the grant
of a motion for summary judgment de novo. Universal Health Servs. Inc. v. Thompson,
363 F.3d 1013, 1019 (9th Cir. 2004).
AMAZON IS NOT LIABLE FOR DIRECT PATENT
INFRINGEMENT.
To establish a claim for direct patent infringement, a plaintiff must prove that
the accused infringer made, used, offered to sell, or sold a patented invention. 35
U.S.C. 271(a). Before the district court, Milo & Gabby argued exclusively that Amazon directly infringed by offering to sell the pillowcases, but Milo & Gabby now shifts
its focus from the offer to sell prong of 271(a) to the sell prong. Milo & Gabby
waived the argument that Amazon directly infringed by selling the pillowcases. Even
if it did not waive, the argument is meritless. The undisputed facts establish that Amazon never sold any of the pillowcases.
Although Milo & Gabby included the district courts motion to dismiss order,
summary judgment order, and final opinion in its addendum of orders challenged under Federal Circuit Rule 28(a)(12), the arguments in Milo & Gabbys brief do not concern the motion to dismiss or the final opinion. Therefore, the standard of review for
motions for summary judgment applies to the entirety of this appeal with one exception. Milo & Gabby also argues that the district court erred in granting a motion for
attorney fees. That order would be reviewed for abuse of discretion, see Stephen W.
Boney, Inc. v. Boney Servs., Inc., 127 F.3d 821, 825 (9th Cir. 1997), though it is not yet
ripe for review. See infra Section IV.
3
23
Milo & Gabby Waived the Argument that Amazon Should

Be Liable for Direct Patent Infringement for Selling the
Pillowcases.
Waiver is governed by local circuit lawin this case, the Ninth Circuits.
Sweepstakes Patent Co., LLC v. Burns, 610 F. Appx 1006, 1008 (Fed. Cir. 2015). In the
Ninth Circuit, waiver prohibits parties from raising new arguments on appeal that
were not raised before the district court. See Hillis v. Heineman, 626 F.3d 1014, 1019
(9th Cir. 2010).
Milo & Gabby abandoned any claim for patent infringement liability under the
sell prong of 271(a) by failing to raise that argument before the district court. Amazon moved for summary judgment on Milo & Gabbys direct patent infringement
claim, arguing it was undisputed that Amazon did not make, use, offer to sell, or sell
any patented products. In response, Milo & Gabby argued only that Amazon offered
to sell the pillowcases: Amazon is liable for direct patent infringement of [Milo &
Gabbys] design patents by, at a minimum offering to sell infringing products.
(A594.) The district court recognized that choice. (See A45 (Plaintiffs oppose the motion [for summary judgment], arguing that Amazon has indeed offered to sell the products within the meaning of the statute. (emphasis added)).) Then the district court
agreed with Milo & Gabby that fact questions remained about whether Amazon offered to sell the pillowcases. (A46.) So that question proceeded to trial.
Instead of challenging the district courts finding that Amazon did not offer to
sell the pillowcases, Milo & Gabby now pivots to a new theory. Essentially Milo &
Gabby argues that even though Amazon did not offer to sell the pillowcases, Amazon
somehow sold the pillowcases. (Br. at 2229.) Milo & Gabby argues generally that
24
Amazon sold the pillowcases without explaining whether that argument applies to its
patent or copyright claim. (Br. at 2229.) By collapsing its argument about whether
Amazon sold the pillowcases into one section, Milo & Gabby conflates the district
courts rulings on its patent and copyright claims. (Br. at 2229.) Milo & Gabby states
that the district court dismissed Milo and Gabbys copyright infringement and patent
infringement claims based on its erroneous conclusion that Amazon is not a seller of
the accused products. (Br. at 29.) Only half of that statement is accurate. Although
the district court dismissed Milo & Gabbys copyright infringement claim, the district
court did not dismiss Milo & Gabbys patent infringement claim. (A46; see also A48
(Plaintiffs patent infringement claim remains.).) Instead, the district court allowed
that claim to go to trial based on the sole theory argued by Milo & Gabby. The jury
then rejected that theory, and the district court adopted the jurys findings. (A2415.)
This Court should not allow Milo & Gabby to attack the district courts finding
that Amazon did not offer to sell the pillowcases without appealing it directly. Milo &
Gabby cannot resurrect its direct patent infringement claim by arguing for the first
time on this appeal that Amazon is liable for actually selling the pillowcases. See Hillis,
626 F.3d at 1019.
Third-Party Sellers, Not Amazon, Sold the Pillowcases.
Even if Milo & Gabby had raised the sell prong before the district court, Milo
& Gabbys argument would still fail. Although the patent statute does not define
sale for purposes of 271(a), this Court has consistently ruled that sale takes on
its ordinary meaning. NTP, Inc. v. Research In Motion, Ltd., 418 F.3d 1282, 1319 (Fed.
Cir. 2005), abrogated on other grounds by Zoltek Corp. v. United States, 672 F.3d 1309, 1323
25
(Fed. Cir. 2012) (en banc); see also Halo Elecs., Inc. v. Pulse Elecs., Inc., 769 F.3d 1371,
1379 (Fed. Cir. 2014) (relying on the ordinary meaning of sale for patent infringement analysis); Enercon GmbH v. Intl Trade Commn, 151 F.3d 1376, 138182
(Fed. Cir. 1998) (relying on the ordinary meaning from dictionaries and traditional
contract principles to define sale under the Tariff Act). To discern that ordinary
meaning, this Court has turned to dictionaries and to the Uniform Commercial
Code. NTP, 418 F.3d at 1319. Blacks Law Dictionary defines sale as a transfer of
the absolute title to property for a certain agreed price. Blacks Law Dictionary (10th
ed. 2014) (citing William W. Story, A Treatise on the Law of Sales of Personal Property 1,
at 1 (1853)). Similarly, the U.C.C. defines sale as the passing of title from the seller
to the buyer for a price. U.C.C. 2-106(1). Based on those definitions, this Court has
held that [p]lainly, the common, or usual meaning of the term sale includes those situations in which a contract has been made between two parties who agree to transfer
title and possession of specific property for a price. Enercon, 151 F.3d at 1382; see also
Halo, 769 F.3d at 1379 (A sale consists in the passing of title from the seller to the
buyer for a price. (citing U.C.C. 2-106)).
To determine who sold the pillowcases, the Court should look to who held title
and had the ability to transfer it. It is undisputed in this case that the third-party
sellers, not Amazon, always held and transferred title. (A49293; A216364.) Amazon
never had title to any of the pillowcases. Even when a third-party seller used Fulfillment by Amazon, the third-party seller retained title and all other property rights in
the pillowcases. The Fulfillment by Amazon agreement made clear that the third-party
seller represents and warrants that they have valid legal title to all Units. (A2760.)
26
Amazon did not and could not sell the pillowcases because it never had title to the pillowcases that would allow it to transfer them to a buyer for a price.
In the face of these undisputed facts, Milo & Gabby does not attempt to argue
that Amazon had title to the pillowcases or the ability to transfer title for a price as is
required by this Courts definition of sell under 271(a) in NTP and Halo. Instead,
Milo & Gabby maintains that Amazon can be liable as a seller under 271(a) even if it
did not transfer title to the pillowcases. Milo & Gabby cites two cases for this theory.
Neither support extending the definition of sell under 271(a) to the facts of this
case.
First, Milo & Gabby points to Pinter v. Dahl, a case in which the Supreme Court
determined whether a purchaser of oil and gas securities was a seller under the Securities Act even though he never owned or passed title. 486 U.S. 622, 64243 (1988).
The Court began its analysis by recognizing that the Securities Act covers buyerseller relationship[s] under traditional contract[] law where the owner passed title,
or other interest in the security, to the buyer for value. Id. at 642. The Court then explained that the Securities Act would apply to someone who was not a seller in this
conventional sense . . . only if [Securities Act] liability extends to persons other than the
person who passes title. Id. (emphasis added). In other words, the Supreme Court
assumed that seller should not be defined more broadly than a person who transfers
title for a price unless Congress expressly expands that definition. In the Securities
Act, Congress did just that. For the Securities Act, Congress expressly intended to
define [sale and offer to sell] broadly so broadly that a seller under the Securities Act includes brokers and others who solicit offers to purchase securities[.] Id. at
27
646 (emphasis added). The Court explained that this broad definition promote[d] full
and fair disclosure of information to the public in the sales of securities. Id.
Congress did not adopt a similarly broad, unconventional definition of sell
under the Patent Act. Indeed, this Court has explained that mere solicitation does not
fall within the scope of the Patent Act. See Linear Tech. Corp. v. Micrel, Inc., 275 F.3d
1040, 1051 (Fed. Cir. 2001) (finding that an advertisement may have prompted requests to buy an infringing product but did not amount to an offer to sell); Grp. One,
Ltd. v. Hallmark Cards, Inc., 254 F.3d 1041 (Fed. Cir. 2001) (concluding that letters sent
to generate interest in a device did not add up to a commercial offer to sell). So Pinters definition of seller cannot be used in this case. Nevertheless, the Supreme Courts
reasoning in Pinter actually supports Amazon. As the Supreme Court explained, the
traditional contract law definition of a seller as the person who passes title should
govern unless Congress expressly expands that definition. Pinter, 486 U.S. at 642. Unlike the Securities Act, Congress did not expressly expand that definition in the Patent
Act. So Pinter teaches that its ordinary meaning applies and the seller is limited to the
party that held and transferred title.
Milo & Gabby also relies on North American Philips Corp. v. American Vending
Sales, Inc. for its claim that Amazon is liable as a seller under 271(a) notwithstanding
the undisputed fact that Amazon did not transfer title of the pillowcases. (Br. at 24.)
In Philips, this Court addressed the location in which a sale of an allegedly infringing
article took place to determine whether jurisdiction was proper in Illinois. 35 F.3d
1576, 157880 (Fed. Cir. 1994). The defendant argued that jurisdiction should only be
proper in the place where legal title passes instead of the place of contracting or de28
livery. Id. at 1579. Milo & Gabby excerpts a sentence from this Courts discussion of
why it would be inappropriate for jurisdiction to only be proper where title transferred: Appellees have pointed to no policy that would be furthered by according
controlling significance to the passage of legal title here. Id. at 157980. Milo &
Gabby offers no explanation for why this jurisdictional analysis is relevant here. Philips
answered a questionwhere a sale took placethat differs from the question raised
in this appealwho was the seller. Philips has no relevance here.
This Court should focus on the undisputed facts here through the lens of cases
that actually address and discuss the definition of sell in 271(a). According to those
cases, selling requires transferring title to a buyer for a price. All the parties and the
district court agreed that Amazon never had title to the pillowcases. For each of these
sales, it is undisputed that only the third-party sellers had or transferred title. Therefore, Amazon could not and did not sell the pillowcases.
Amazon Did Not Sell the Pillowcases Even Under the Three
U.C.C. Sections Cited by Milo & Gabby.
1.
Amazon Did Not Act as a Consignee for the ThirdParty Sellers Under U.C.C. 9-319.
Setting aside a passing reference in response to Amazons motion for summary

judgment, Milo & Gabby argues for the first time on appeal that Amazon was the
seller of the pillowcases under 271(a) because it purportedly acted as a consignee. In
opposing Amazons motion for summary judgment, Milo & Gabby mentioned the
word consign twice without any explanation about why Amazon should be considered a consignee or how that affects the outcome of this case:
29
If anything, Amazons status regarding the infringing products is analogous to that of a consignee of the products. And as a consignee, while
the goods are in the possession of [Amazon], [Amazon] is deemed to
have rights and title to the goods identical to those the consignor had or
had power to transfer.
(A597 (citing Wash. Rev. Code 62A.9A-319 (codifying U.C.C. 9-319)).) Without
an explanation for this passing reference, the district court did not have an opportunity to analyze this issue. Therefore, this Court should not address Milo & Gabbys consignment argument. See Cisneros v. UNUM Life Ins. Co. of Am., 134 F.3d 939, 948 (9th
Cir. 1998) (declining to review an argument mentioned in passing in summary judgment briefing but not fully developed before the district court). Further confirming its
waiver, after summary judgment Milo & Gabby did not pursue this argument at trial.
Even if Milo & Gabby had provided the district court with enough to rule on
this issue, Milo & Gabby still would not have prevailed. A consignment relationship is
just a particular form of an agency relationship. A true consignment sale is merely an
agency coupled with a bailment. . . . 3A Anderson U.C.C. 2-326:41 (3d ed. 2015).
Agency is a crucial element of the consignment relationship existing between a principal and a traditional factor; in effect, a consignment is a special kind of agency involving the delivery of goods to one who may be a broker for the purpose of finding
a purchaser for the goods. 32 Am. Jur. 2d Factors & Commission Merchants 5
(2016). Without agency, there can be no consignment.
An agency relationship generally arises when two parties consent that one
shall act under the control of the other. Multicare Health Sys. v. Maplehurst Bakeries, Inc.,
265 F. Appx 685, 686 (9th Cir. 2008). In Multicare Health, the Ninth Circuit explained
that the record did not show that one party acted under the others control. Id. at
30
68687. To the contrary, the contract between [the two parties] explicitly disclaimed
the existence of an agency relationship between the two parties. Id. at 687.
In this case, Milo & Gabby has never attempted to meet its burden to prove
that Amazon acted as an agent for the purpose of finding a purchaser of the pillowcases. See Atrium of Princeton, LLC v. N.L.R.B., 684 F.3d 1310, 1315 (D.C. Cir. 2012)
([T]he party asserting that a relationship of agency exists generally has the burden in
litigation of establishing its existence. (quoting Restatement (Third) of Agency 1.02
cmt. d (2006))); see also 3 C.J.S. Agency 541 (The party asserting the existence of an
agency relationship has the burden of proving the existence, extent, and nature of the
relationship, affirmatively, including the burden to prove apparent authority or estoppel, and the scope of authority sought to be imposed.).
Milo & Gabby cannot meet its burden. Like the parties in Multicare Health, Amazon and the third-party sellers expressly disclaimed an agency relationship. Every
third-party seller agreed to the terms in Amazons Business Solutions Agreement.
(A2140.) That agreement explicitly disclaims the existence of an agency relationship
between Amazon and the third-party sellers: [N]othing in this Agreement will create
any partnership, joint venture, agency, franchise, sales representative, or employment
relationship between us. (A2727.) Beyond the explicit disclaimer in the Business Solutions Agreement, Amazon did not have the authority to sell the pillowcases on behalf of the third-party sellers. (A232930.)
Milo & Gabbys consignment theory also is undermined by the district courts
finding that Amazon did not offer to sell the pillowcases. The district court adopted
the jurys findings that Amazon did not provide the descriptions of the pillowcases,
31
set the price of the pillowcases, or set the quantity of pillowcases available.
(A241516.) The district court also concluded that Amazon did not offer to sell the
pillowcases, which implies that the third-party sellers themselves made the offers to
sell without Amazons involvement. (A2415.) Milo & Gabby does not challenge those
factual findings, which should now be accepted as true on appeal. See United States v.
Idaho, 210 F.3d 1067, 1073 (9th Cir. 2000), affd 533 U.S. 262 (2001) (explaining that
when a party does not challenge underlying factual findings, courts accept those
facts as given). Here the unchallenged facts make clear that Amazon did not act as an
agent selling products on behalf of the third-party sellers. If Amazon did not offer to
sell the pillowcases, then it could not have acted as a consignee charged with selling
pillowcases on behalf of the third-party sellers.
Fulfillment by Amazon, which only one seller utilized, does not change that
conclusion. Fulfillment by Amazon simply offers third-party sellers a shipping service
similar to FedEx. In fact, third-party sellers can use Fulfillment by Amazon to ship
products sold on any other website, just like a seller could ship a product with FedEx.
(A216465.) Imagine a third-party seller taking a product that it sold to a FedEx store
to ship to the buyer. A FedEx employee would wrap the product, place it in a FedEx
box, and stick a FedEx label to the box. By doing that, FedEx did not become the
third-party sellers agent for the purpose of selling the product. The same holds true
for Amazon.
Instead of addressing the agency relationship required for a consignment, Milo
& Gabby relies on an inapplicable section from U.C.C. Article 9. Article 9 addresses
the treatment of certain consignments in the context of secured transactions. U.C.C.
32
9-101 cmt. 1 ([Article 9] provides a comprehensive scheme for the regulation of

security interests in personal property and fixtures.). Article 9 does not do away with
the common law agency requirement. Instead, it defines a specific type of consignment relationship. See In re Music City RV, LLC, 304 S.W.3d 806, 809 (Tenn. 2010)
(Revised Article 9, however, does not define consignments so broadly as to include
all true consignment transactions. . . .). In instances where that specific definition is
satisfied, consignees (and ultimately their creditors) obtain a security interest in consigned goods superior to that of the consignors who own the goods. U.C.C. 9-319.
The purpose of the limited consignment relationship defined in Article 9 is to protect general creditors of the consignee from claims of consignors that have undisclosed consignment arrangements with the consignee that create secret liens on the
inventory. Overton v. Art Finance Partners LLC, No. 15-cv-3927, 2016 WL 413128, at
*9 (S.D.N.Y. Feb. 2, 2016). This case does not involve creditors rights or the application of Article 9. Article 9 provides no guidance about whether Amazon was authorized to sell the pillowcases as an agent of the third-party sellers.
Even if the Court were to look to Article 9, Amazon still would not fit its definition of a consignee. U.C.C. 9-102 establishes the following definition of consignment so that consigned goods will be property of the consignees bankruptcy estate if
all of these elements are satisfied:
Consignment means a transaction, regardless of its form, in which a
person delivers goods to a merchant for the purpose of sale and:
(A)
The merchant:
(i) deals in goods of that kind under a name other than the
name of the person making delivery;
33
(ii) is not an auctioneer; and

(iii) is not generally known by its creditors to be substantially engaged in selling the goods of others;
(B)
with respect to each delivery, the aggregate value of the

goods is $1,000 or more at the time of delivery;
(C)
the goods are not consumer goods immediately before delivery; and
(D)
the transaction does not create a security interest that secures an obligation.
U.C.C. 9-102 (a)(20). [T]he burden of proof falls on the party claiming applicability
of 9-102 (a)(2) to show that each element of the definition is satisfied. Overton, 2016
WL 413128, at *9. Milo & Gabby did not even attempt to demonstrate the applicability of this definition before the district court. Nor does it do so here.
Setting aside Milo & Gabbys failure to meet its burden, the evidence demonstrates that Article 9s definition of consignment does not apply here. First, only one
of the ten third-party sellersFAC Systemused Amazons fulfillment services. Milo
& Gaby does not suggest that the remaining nine third-party sellers ever delivered
their pillowcases to Amazon. Second, and more importantly, the definition of consignment in Article 9 requires delivery of goods to the consignee for the purpose of
sale by the consignee. This is clear from the definition itself, which refers to whether the
consignee is substantially engaged in selling the goods of others. U.C.C. 9102(a)(20)(A)(iii). The commentary to this section also explains that an intermediate
company that merely ships products for the owner is not a consignee: [I]f a merchant-processor-bailee will not be selling the goods itself but will be delivering to buyers to which the owner-bailor agreed to sell the goods, the transaction would not be a
34
consignment. U.C.C. 9-102 cmt. 14. Here the evidence establishes that Amazon
was not authorized to sell the pillowcases and that the pillowcases were never delivered to Amazon for sale by Amazon. So Amazon was not a consignee under 9-102.
In support of its consignment theory, Milo & Gabby also cites Falk v. Brennan,
414 U.S. 190 (1973). (Br. at 25.) Falk does not address the circumstances giving rise to
an agency or consignment relationship, much less support a finding of a such a relationship here. Instead, the case addresses the dollar volume limitation in the Fair Labor Standards Act, which is measured by annual gross volume of sales made or business done. 414 U.S. 190, 197 (1973). The Court was specifically addressing whether
the commissions received by an apartment rental company rather than the total rent
collected met the level of annual gross volume of sales made or business done. Id. Milo & Gabby quotes two sentences of dicta where the Court explained that a consignment seller might be in a position similar to a seller in terms of the amount of business done for the purposes of the Fair Labor Standards Act:
For example, a consignment sellers gross sales might properly be measured by his gross receipts from sales of the product, even though he did
not actually hold title to the product that he sold. Realistically, such a seller is in the business of selling the product that is consigned to him, and
he is functionally in a position no different from that of a seller who has
purchased the product before resale.
Id. at 199. Given that the Court decided Falk in the context of the Fair Labor Standards Act and that Falk does not address whether a party acted as a consignee, it does
not change the conclusion that Amazon did not act as an agent or consignee for the
third-party sellers in this case.
35
2.
Amazon Did Not Act as a Person in the Position of the

Third-Party Sellers Under U.C.C. 2-707.
Milo & Gabbys next U.C.C. argument fares no better. To start, 2-707 does
not apply to determining whether Amazon sold the pillowcases for purposes of patent
infringement. Section 2-707 falls within a part of the U.C.C. addressing the remedies
available to parties when contracts are not fulfilled. U.C.C. 2-707 extends to persons regarded as being in the position of the seller certain of the remedies available to
the seller. 4A Part I Anderson U.C.C. 2-707:3 (3d ed. 2015). Section 2-707 does
not, however, create an additional class of defendants who may be held liable as a
seller. Id.
Even if 2-707 somehow did create an additional class of seller liability, Amazon does not qualify as a person in the position of a seller. A person in the position of a seller includes an agent who has paid or become responsible for the price
of goods on behalf of his principal or anyone who otherwise holds a security interest
or other right in goods similar to that of a seller. U.C.C. 2-707(a) . Milo & Gabby
argues that Amazon acted as a person in the position of a seller under this section
by fulfilling and shipping orders for one of the third-party sellers. (Br. at 2627.)4 In
making its argument, Milo & Gabby truncated this section by omitting the first part of
the definition that requires an agency relationship. (Br. at 2627.) Setting aside Milo &
Milo & Gabby also mentions that Amazon can freely commingle the accused
products with its own. (Br. at 26.) Amazon did not commingle the pillowcases at issue in this case because only one third-party seller used Fulfillment by Amazon and
Amazon itself did not offer to sell any of the pillowcases. (A229697; A230610;
A2325.) Therefore, there were not multiple sellers whose pillowcases could have been
commingled at fulfillment centers.
4
36
Gabbys tacit admission that Amazon did not act as an agent for the third-party
sellers, Amazon does not meet the second half of the definition either.
Amazon did not have a security interest in or any other right to the pillowcases.
(A49596; A2146; A216364.) The jurys finding that Amazon did not offer to sell
the pillowcases supports this conclusion. If Amazon did not offer to sell the pillowcases, how could Amazon act in the position of a seller of the pillowcases? By its plain
terms, 2-707 does not apply to Amazon.
3.
Amazon Did Not Act as a Seller in a Sale-or-Return

Transaction Under U.C.C. 2-326.
Once again, Milo & Gabby raises a new argument for the first time on appeal
that should not be considered by this Court. See Hillis, 626 F.3d 1014, 1019 (9th Cir.
2010). Milo & Gabby implies that Amazon acted as a seller in a sale-or-return transaction under U.C.C. 2-326. (Br. at 27.) Milo & Gabby, however, never mentioned saleor-return transactions once before the district court. (A59497.)
Moreover, this case does not involve such a transaction. A sale-or-return transaction is a sale to a merchant whose unwillingness to buy is overcome only by the
sellers engagement to take back the goods (or any commercial unit of goods) in lieu
of payment if they fail to be resold. U.C.C. 2-326 n.1. A sale-or-return transaction
deals with a power given by the contract to turn back the goods even though they
are wholly as warranted. Id. n.2. In other words, a sale-or-return transaction gives a
buyer the right to return the goods for any reason, not just nonconformity of the
goods.
37
For a sale-or-return transaction to occur, a sale must occurnot just a shipment for other purposes. When a warehouse . . . serves as a distribution center for its
customer, there is no sale or return between the customer and the warehouse. 3A
Anderson U.C.C. 2-326:20. For example, in Walter E. Heller & Co. Se. v. Riviana
Foods, Inc., a defendant used a warehouse to store and deliver food that it sold to its
military customers. 648 F.2d 1059, 105960 (5th Cir. 1981). In that case, the court explained that a sale-or-return transaction only occurs if the goods [ar]e delivered for
sale. Id. at 1061. Because the warehouse had no independent authority to sell defendants merchandise, no sale-or-return transaction occurred. Id. at 1062.
Just like Heller, a third-party seller using Fulfillment by Amazon as a distribution center does not create a sale-or-return transaction. The pillowcases sent by a
third-party seller to an Amazon fulfillment center were not sold to Amazon.
(A49293; A216364.) In addition, Amazon does not have independent authority to
sell third-party products delivered to a fulfillment center. (A2164.) Therefore, U.C.C.
2-326 is inapplicable here and cannot serve as a basis for patent infringement liability for purposes of 271(a).
Even using Milo & Gabbys proposed definition of sell based on these three
U.C.C. sections, Amazon did not sell the pillowcases. If this Court makes it past Milo
& Gabbys waiver, Milo & Gabby still cannot prove that Amazon committed direct
patent infringement.
38
AMAZON IS NOT LIABLE FOR DIRECT COPYRIGHT

INFRINGEMENT.
The Copyright Act grants copyright holders a bundle of exclusive rights. See 17
U.S.C. 106. Before the district court, Milo & Gabby focused mainly on its argument
that Amazon violated its right to reproduce the copyrighted work in copies by posting photographs of the pillowcases on its website. See id. 106(1). Milo & Gabby
abandons that argument on appeal and instead claims only that Amazon violated its
right to distribute copies . . . to the public by shipping the physical pillowcases. See
id. 106(3). Milo & Gabbys claim for direct copyright infringement fails under either
theory.
Amazon Did Not Distribute the Pillowcases by Sale.
To be liable for direct copyright infringement, a party must distribute copies5
of the copyrighted work to the public by sale or other transfer of ownership. 17
U.S.C. 106(3) (emphasis added). In other words, to distribute an allegedly infringing
product, one has to sell it. Even Milo & Gabby recognizes that distribution requires a
sale. (See Br. at 30 (The Copyright Act defines copyright infringement as a distribution of unauthorized copies of a work by sale or other transfer of ownership. (empha-
Milo & Gabby claims that Amazon conceded that the accused products are substantially similar to Milo [and] Gabbys proprietary intellectual property. (Br. at 31.)
Once again, Milo & Gabby plays fast and loose with the record in this case. In making
this statement, Milo & Gabby cites the parties joint pretrial order. (Br. at 31 (citing
A242526).) That filing only pertained to Milo & Gabbys patent infringement claim
as that was the only claim going to trial. The filing said nothing about the copyright
infringement claim. Amazon has never admitted that Milo & Gabby has valid copyrights or that the pillowcases copied those copyrights.
5
39
sis added)).) Like the Patent Act, the Copyright Act does not define sale, and, thus,
it takes its ordinary meaning.
As discussed above, the undisputed evidence shows that Amazon never sold or
otherwise transferred ownership of the pillowcases. See supra subsections I(B)(C).
Amazon never had title to any of the pillowcases, so Amazon never had an ability to
transfer that title through a sale or otherwise. (A49293; A216364.) Only the thirdparty sellers had title to the pillowcases and the ability to sell them. (A49293;
A216364.) Therefore, only the third-party sellers, not Amazon, could have distributed the pillowcases under 106(3).
Milo & Gabby does not dispute those facts. Instead, Milo & Gabby argues that
Amazon stored and shipped some of the pillowcases and that somehow constitutes
distributing a work by sale. (Br. at 3234.) Milo & Gabby does not cite a single case to
support its conclusion that storing and shipping a product meets the statutory definition of distribution by sale. Milo & Gabby can find no case to support its argument.
Just like the logical problem with Milo & Gabbys patent infringement argument, this would extend copyright infringement far beyond its current boundaries.
Under Milo & Gabbys definition of distribution with no sale requirement, shipping
companies like the U.S. Postal Service, UPS, and FedEx could be liable for direct
copyright infringement for shipping a product dropped off by a third party. This
Court should reject Milo & Gabbys invitation to extend direct copyright infringement
to those situations.
40
Amazon Did Not Actively Participate in or Directly Cause

Any Copying of Images of the Pillowcases.6
Not only did Amazon not distribute the pillowcases under 106(3), but Amazon did not copy images of the pillowcases within the meaning of the Copyright Act.
Cases across the country, starting with Religious Technology Center v. Netcom On-Line
Communication Services, Inc., 907 F. Supp. 1361 (N.D. Cal. 1995), have established that a
defendant cannot be held liable for direct copyright infringement when the defendant
did not actively participate in or directly cause the alleged copying. In Netcom, a thirdparty customer of an Internet service provider (ISP) posted a copyrighted work that
was automatically reproduced by the ISPs computer. Id. at 136970. The district
court refused to impose direct liability on the ISP, reasoning that [a]lthough copyright is a strict liability statute, there should still be some element of volition or causation which is lacking where a defendants system is merely used to create a copy by a
third party. Id. at 1370; see also, e.g., Online Policy Grp. v. Diebold, Inc., 337 F. Supp. 2d
1195, 1199 (N.D. Cal. 2004) (explaining that to be liable for direct copyright infringement, the defendant must both actively engage in and directly cause the copying).
Appellate courts, including the Ninth Circuit, have followed the approach Netcom established. In Fox Broadcasting Co., Inc. v. Dish Network, L.L.C., the Ninth Circuit
concluded that the mere fact that Dish Network operat[ed] a [DVR] system used to
make copies at the users command does not mean that the system operator, rather
Milo & Gabbys brief does not expressly argue that Amazon committed direct
copyright infringement by copying images of the pillowcases. But given some ambiguous references in Milo & Gabbys brief, (Br. at 14, 3132), and the evolution of its
arguments throughout this case, Amazon includes this explanation of why it did not
copy images of the pillowcases out of an abundance of caution.
6
41
than the user, caused copies to be made. 747 F.3d 1060, 1067 (9th Cir. 2013). Infringement of the reproduction right requires copying by the defendant, which comprises a requirement that the defendant cause the copying. Id. (internal citation omitted); see also Cartoon Network LP, LLLP v. CSC Holdings, Inc., 536 F.3d 121, 133 (2d Cir.
2008) ([C]opies produced by [a DVR] system are made by the [DVR] customer, and
Cablevisions contribution to this reproduction by providing the system does not warrant the imposition of direct liability.); Parker v. Google, Inc., 242 F. Appx 833, 836 (3d
Cir. 2007) (concluding that Google did not commit direct copyright infringement by
automatically copying and archiving an online bulletin board where a third-party had
posted copyrighted material); CoStar Grp., Inc. v. LoopNet, Inc., 373 F.3d 544, 550 (4th
Cir. 2004) ([T]o establish direct liability under . . . the Act, something more must be
shown than mere ownership of a machine used by others to make illegal copies.).
Congress even relied on Netcom when passing the DMCA, explaining that a party cannot be held liable for direct copyright infringement for passive, automated acts
in a technological process initiated by a third party:
As to direct infringement, liability is ruled out for passive, automatic acts engaged in through a technological process initiated by another.
Thus the bill essentially codifies the result in the leading and most
thoughtful judicial decision to date: Religious Technology Center v. Netcom OnLine Communication Services, Inc., 907 F. Supp. 1361 (N.D. Cal. 1995).
H.R. REP. NO. 105551(I), at 11 (1998).
Amazon did not actively engage in or directly cause any copying of images of
the pillowcases. When third-party sellers list products for sale on Amazon, the thirdparty seller provides the images. (A495, A214445.) In this case, the third-party sellers
42
provided all of the images of the pillowcases used in their listings. (A2145.) Amazon
did not modify the images that the third-party sellers provided. (A2146.) Instead,
software used those images and other information provided by the third-party sellers
to automatically create a product-detail page. (A495.) Under Netcom and the other cases addressing this issue, Amazons operation of software that used a third-party sellers inputs to automatically create a product listing does not mean that Amazon itself
copied any images of the pillowcases.
The Digital Millennium Copyright Act Safe Harbor Protects
Amazon from Copyright Liability for Any Copying of
Images of the Pillowcases.
The Court does not even need to address the DMCA safe harbor under 17
U.S.C. 512(c) given Milo & Gabbys move away from its argument that Amazon
committed copyright infringement by displaying images of the pillowcases on its website. If, however, the Court finds that Milo & Gabby has raised that argument on appeal, then the DMCA safe harbor applies.
Congress enacted the DMCA in 1998 to resolve the unique copyright enforcement problems caused by the widespread use of the Internet. See Ellison v. Robertson,
357 F.3d 1072, 1076 (9th Cir. 2004). Tackling these problems required Congress to
balance competing interests. On one side, Congress recognized that copyright owners
needed a mechanism for addressing potentially infringing conduct in the modern era
when digital works can be copied and distributed worldwide virtually instantaneously. S. REP. NO. 105190, at 8 (1998). On the other side, Congress needed to provide
greater certainty to service providers concerning their legal exposure for infringements that may occur in the course of their activities. S. REP. NO. 105190, at 20
43
(1998); H.R. REP. NO. 105551(II), at 4950 (1998). This balancing act resulted in a
statute that creates strong incentives for service providers and copyright owners to
cooperate to detect and deal with copyright infringements that take place in the digital
network environment. H.R. REP. NO. 105551(II), at 49 (1998).
The DMCA creates a safe harbor to protect ISPs that cooperate in this process
from monetary relief . . . for infringement of copyright. 17 U.S.C. 512(c). To get
protection under the safe harbor, the ISP must first show that it has set up the following general business practices that align with the DMCA:
(A)
[The ISP] has adopted and reasonably implemented, and informs

subscribers and account holders of the service providers system
or network of, a policy that provides for the termination in appropriate circumstances of subscribers and account holders of the
service providers system or network who are repeat infringers;
and
(B)
accommodates and does not interfere with standard technical

measures.
Id. 512(i). If the ISP meets those threshold conditions, then it still must show that it
satisfies the following requirements in each specific case:
(A)
[The ISP] (i) does not have actual knowledge that the material or
an activity using the material on the system or network is infringing; (ii) in the absence of such actual knowledge, is not aware of
facts or circumstances from which infringing activity is apparent;
or (iii) upon obtaining such knowledge or awareness, acts expeditiously to remove, or disable access to, the material;
(B)
does not receive a financial benefit directly attributable to the infringing activity, in a case in which the service provider has the
right and ability to control such activity; and
44
(C)
upon notification of claimed infringement . . . responds expeditiously to remove, or disable access to, the material that is claimed
to be infringing or to be the subject of infringing activity.
Id. 512(c).
Amazon met all of these conditions. Even though Milo & Gabby did not attempt to engage in the DMCAs process by reaching out to Amazon before filing suit,
(A2054, A217677), Amazon cooperated fully by removing the pillowcases and the
third-party sellers as soon as it received notice of potential copyright infringement,
(A218384, A150). Based on Amazons actions, the district court determined that
Amazon satisfied each of the DMCAs safe harbor eligibility criteria. (A3539.)
Milo & Gabby does not attack the district courts analysis of the safe harbor eligibility criteria and its conclusion that Amazon satisfied each of them. (Br. at 3637.)
Instead, Milo & Gabby claims that the district court should not have applied the
DMCA safe harbor because it does not apply to [the] distribution of physical goods.
(Br. at 36.) This criticism stems from the evolution of Milo & Gabbys argument.
When Milo & Gabby argued in the district court that Amazon committed direct copyright infringement under 17 U.S.C. 106(1) by displaying images of the pillowcases
provided by the third-party sellers on its website, the DMCA safe harbor protected
Amazon in its role as an ISP. The district court did not apply that safe harbor to Milo
& Gabbys argument about Amazon shipping the physical pillowcases. The district
court ruled against Milo & Gabby on that argument for a different reason. (See A33.)
By abandoning its argument concerning Amazons display of images provided by
third-party sellers, Milo & Gabby should not be able to attack the district courts correct application of the DMCA safe harbor. If Milo & Gabby tries to maintain the
45
same argument it raised before the district courtthat Amazon should be liable for
displaying images of the pillowcases provided by the third-party sellersthen the
DMCA safe harbor still applies.
AMAZON IS NOT LIABLE FOR A LANHAM ACT PALMING-OFF
CLAIM.
Federal Rule of Civil Procedure 8 requires a plaintiff to include a short and
plain statement of the claim in its complaint. Fed. R. Civ. Proc. 8(a)(2). Although a
statement alleging a claim can be short and plain, it still must be included in the
complaint. Federal Rule of Civil Procedure 8(a)(2) requires that the allegations in the
complaint give the defendant fair notice of what the plaintiffs claim is and the
grounds upon which it rests. Pickern v. Pier 1 Imports (U.S.), Inc., 457 F.3d 963, 968
(9th Cir. 2006) (internal quotation and citation omitted). Milo & Gabby gave Amazon
no fair notice of a Lanham Act palming-off claim, a claim that would fail on the merits in any event.
Milo & Gabby Did Not Plead a Palming-Off Theory in Its
Complaint.
Of the seven claims included in Milo & Gabbys complaint, only two alleged
violations of the Lanham Act. (A157, A158.) The first Lanham Act claim was for a
false designation of origin. (A157.) The second Lanham Act claim was for trademark
counterfeiting. (A158.) Neither of those claims referenced a palming-off theory.
Milo & Gabby never attempted to plead a palming-off claim under the Lanham
Act in its complaint even after the district court dismissed both of its Lanham Act
claims. The district court dismissed the Lanham Act trademark counterfeiting claim at
the motion-to-dismiss stage, finding that Milo & Gabby failed to present plausible fac46
tual support that anyone reproduced Milo & Gabbys registered mark. (A1819.) The
court, however, dismissed this claim without prejudice and with leave to amend.
(A20, A22.) Yet, Milo & Gabby did not take that opportunity to amend its complaint.
At that point, Milo & Gabby had only one Lanham Act claim remaining, its false designation of origin claim. Amazon challenged that claim in its motion for summary
judgment. (A44954.) In response, Milo & Gabby crafted three theories of Lanham
Act violations that had never been raised before in the case. (A58894.) One of those
new theories was the palming-off claim that Milo & Gabby complains about in this
appeal. (A58894.)
Not being able to point to anything in the complaint alleging a palming-off
theory, Milo & Gabby resorts to citing its response to Amazons motion to dismiss
describing its state law unfair competition claim. Milo & Gabby claims that it sufficiently pled its Lanham Act palming-off claim by referring to a palming-off claim in
this briefing. (Br. at 4041.) That briefing shows that, if anything, such a palming-off
theory only related to Milo & Gabbys state law unfair competition claim: Palming
off is the most classic form of unfair competition. (A262.) The district court granted
Amazons motion to dismiss that unfair competition claim. (A812.) Once again, the
court dismissed this claim without prejudice. (A12.) Yet, Milo & Gabby never
amended its complaint to try to plead a Lanham Act palming-off claim.
Rule 8 requires plaintiffs to put defendants on fair notice by pleading the claims
alleged in a complaint, not in subsequent briefing, to prevent the very conduct that
occurred in this case. Milo & Gabby treated the allegations in its complaint as malleable, bending and stretching them to fit its changing needs as the case developed.
47
When Milo & Gabby lost on one theory, it would attempt to raise a new theory without providing Amazon fair notice. Milo & Gabby continues to employ this strategy
even on appeal. Having never raised a palming-off theory under the Lanham Act in its
complaint, Milo & Gabby should not get the opportunity to reverse the case it already
pursued and lost to try a new approach.
In one last-ditch effort, Milo & Gabby claims that it provided fair notice to
Amazon of its palming-off theory because Amazons counsel had a billing entry totaling less than one hour for researching a Lanham Act palming-off claim. (Br. at 42.)
That billing entry does not change the analysis. In a case where Milo & Gabby
changed theories on multiple occasions, Amazon should not be faulted for its attorneys research of the requirements of claims that it theorized Milo & Gabby might attempt to raise. That research did not relate to the claims actually included in Milo &
Gabbys complaint. That research did not relieve Milo & Gabby of its burden under
Rule 8 to provide fair notice that it intended to pursue such a claim. Milo & Gabby
never provided that notice. Therefore, this Court should not allow Milo & Gabby to
pursue a Lanham Act palming-off claim.
Even If Milo & Gabby Had Pled a Palming-Off Theory, the
Claim Would Still Fail.
Even rewriting history as Milo & Gabby hopes to do could not revive its
flawed Lanham Act claim. To sustain a palming-off theory under the Lanham Act,
Milo & Gabby must prove an unauthorized substitution of the goods of one manufacturer when the goods of another are requested by the customer. K-S-H Plastics, Inc.
48
v. Carolite, Inc., 408 F.2d 54, 59 (9th Cir. 1969). Milo & Gabby cannot carry that burden.
Milo & Gabby has no evidence that Amazon substituted goods made by another party in response to a customer order specifically requesting Milo & Gabby pillowcases. In fact, the undisputed evidence shows the opposite. All of the productdetail pages for the pillowcases identified a third party other than Milo & Gabby as
the manufacturer of the product. (A247991, A251336.) The product-detail pages
stated, for example, by Cute Pillowcase or by Monaqo. (A247991, A251336.)
None of those pages identified Milo & Gabby as the seller or manufacturer.
(A247991, A251336.) None of those pages even included the words Milo & Gabby. (A247991, A251336.) So no evidence suggests that any customer requested a
Milo & Gabby pillowcase. Nor is there any evidence that suggests Amazon intentionally substituted pillowcases manufactured or sold by third parties in response to a request for Milo & Gabby pillowcases. This provides yet another reason for this Court
to affirm the district courts dismissal of Milo & Gabbys Lanham Act claim.
THE ATTORNEY-FEE AWARD IS NOT RIPE FOR REVIEW.
At the end of its brief, Milo & Gabby seeks reversal of the district courts attorney-fee award without any citation or explanation of the context for that ruling.
The full context shows that, although the district court properly determined that Amazon is entitled to fees and costs,7 that decision is not yet ripe for this Courts review.
Contrary to the impression left by Milo & Gabbys paragraph on this issue, (Br.
at 43), the district court awarded attorney fees due to conduct that reached beyond
Milo & Gabbys attempt to assert a Lanham Act palming-off claim. Among other
things, the district court noted that Milo & Gabby pled a trademark counterfeiting
7
49
This Court has held that a district court order granting sanctions or attorney
fees is a separate order which is not final and appealable until the district court has
decided the amount of sanctions. Orenshteyn v. Citrix Sys., Inc., 691 F.3d 1356, 1358
(Fed. Cir. 2012); see also Falana v. Kent State Univ., 669 F.3d 1349, 135962 (Fed. Cir.
2012). For example, in Falana, a defendant tried to appeal a final district court decision
on inventorship as well as a non-final award of unquantified attorney fees. 669 F.3d at
135960. Although the Court reviewed the decision on inventorship, the Court refused to exercise pendent jurisdiction over the unquantified attorney-fee award. Id. at
135962. The Court explained that [t]his rule prevents piecemeal appeals involving . . . a first appeal to contest the exceptional finding per se, and a second appeal to
contest the amount of the attorney fees. Id. at 1360 (internal citation and quotation
marks omitted). Although Falana dealt with attorney fees awarded under the Patent
Act, the same reasoning applies to the attorney fees awarded by the district court in
this case under the Lanham Act. Compare 35 U.S.C. 285 (The court in exceptional
cases may award reasonable attorney fees to the prevailing party.), with 15 U.S.C.
claim with nothing more than a formulaic recitation of the elements establishing liability. (A61.) Then when Milo & Gabby could not support its remaining Lanham Act
claim with evidence of an enforceable mark, Milo & Gabby raised three unpleaded
theories of Lanham Act liability in summary-judgment briefing. (See A63 (In this
case, Plaintiffs essentially pursued a claim for which they had no evidentiary basis, and
then attempted to circumvent that problem by improperly raising legal arguments
never pled in the Complaint.).) Finally, Milo & Gabby ignored the district courts
dismissal of its Lanham Act claim and stated that it would continue to pursue the
dismissed Lanham Act claim in the case. (A64.) All of this conduct taken together
shows that the district court did not abuse its discretion in awarding attorney fees. See
Boney, 127 F.3d at 825.
50
1117(a) (The court in exceptional cases may award reasonable attorney fees to the
prevailing party.).
In this case, the district court has not yet entered an order determining the
amount of attorney fees that Milo & Gabby must pay. In granting Amazons motion
for fees, the district court requested additional briefing with documentation supporting the requested fees. (A64.) After the parties provided that briefing, the Court ordered Amazon to submit a new calculation of the fees deducting certain amounts.
(A76.) Amazon provided that recalculation. (A164851.) The district court, however,
has not yet ruled on the final amount to be awarded. Therefore, the district courts
order granting attorney fees is not yet ripe for this Courts review under Orenshteyn and
Falana. While reversing the order granting attorney fees could potentially eliminate a
second appeal, affirming the order could result in a separate appeal concerning the
amount of fees. Therefore, the Court should not address Milo & Gabbys argument
concerning the district courts order granting attorney fees.
CONCLUSION AND STATEMENT OF RELIEF SOUGHT
This Court should affirm the district courts rulings on Milo & Gabbys direct
patent infringement, direct copyright infringement, and Lanham Act claims. First, Milo & Gabby failed to show that Amazon committed direct patent infringement, even
under its new sell theory. Second, Milo & Gabby failed to prove that Amazon committed direct copyright infringement, because Amazon did not distribute the pillowcases by sale. Third, this Court should not allow Milo & Gabby to pursue an unpleaded palming-off claim under the Lanham Act, a claim that fails on the merits in any
51
event. Finally, the Court should refuse to review the district courts non-final attorneyfee award.
April 21, 2016
Respectfully submitted,
/s/ John M. Hughes
John M. Hughes
Katherine L.I. Hacker
Joseph W. Doman
BARTLIT BECK HERMAN
PALENCHAR & SCOTT LLP
1899 Wynkoop Street, 8th Floor
Denver, CO 80202
Tel: (303) 592-3100
Fax: (303) 592-3140
john.hughes@bartlit-beck.com
kat.hacker@bartlit-beck.com
daniel.taylor@bartlit-beck.com
AMAZON.COM, INC.
52
PROOF OF SERVICE
I hereby certify that on April 21, 2016, I electronically filed the foregoing Response Brief of Defendant-Appellee Amazon with the Clerk of the United States
Court of Appeals for the Federal Circuit using the CM/ECF system, which will send
notice of such filing to all registered CM/ECF users. I further certify that the foregoing was served via electronic mail upon the following:
Philip P. Mann
Timothy J. Billick
MANN LAW GROUP
(206) 436-0900
tim@mannlawgroup.com
John Whitaker
WHITAKER LAW GROUP
(206) 436-8500
john@wlawgrp.com
Counsel for Plaintiff-Appellant
/s/ John M. Hughes
John M. Hughes
AMAZON.COM, INC.
53
CERTIFICATE OF COMPLIANCE
1.
This brief complies with the type-volume limitation of Federal Rule of
Appellate Procedure 32(a)(7)(B) because this brief contains 13,635 words, excluding
the parts of the brief exempted by Federal Rule of Appellate Procedure
32(a)(7)(B)(iii).
2.
This brief complies with the typeface requirements of Federal Rule of
Appellate Procedure 32(a)(5) and the type style requirements of Federal Rule of Appellate Procedure 32(a)(6) because this brief has been prepared in a proportionally
spaced typeface using Microsoft Word version 2016 in 14-point, Garamond font.
April 21, 2016
/s/ John M. Hughes

John M. Hughes
AMAZON.COM, INC.
54
20161290

MILO & GABBY LLC, KAREN KELLER,
Plaintiffs - Appellants
v.
AMAZON.COM, INC.,
Defendant - Appellee
DA FANG SUN, aka Seth L, CHONGQIN WORLD FIRST
ELECTRONIC COMMERCE CO., LTD., aka Wotefusi, T. LIU, aka Bin
Deal, FAC SYSTEM, aka FAC System LLC, DINGDING ZOU, aka
Happy Sunday, QIUMEI ZHANG, aka Hitece, CHARLOTTE XIA,
Defendants.
Appeal from the United States District Court from
the Western District of Washington in Case No.2:13-cv-01932,
Judge Ricardo S. Martinez.
REPLYBRIEFOFPLAINTIFFSAPPELLANTS
PHILIP P. MANN
TIMOTHY J. BILLICK
MANN LAW GROUP
Seattle, WA 98101
(206) 436-0900
tim@mannlawgroup.com
Milo & Gabby and Karen Keller
JOHN WHITAKER
WHITAKER LAW GROUP
Seattle, WA 98101
206-436-8500
john@whitaker.law
Milo &Gabby LLC and Karen Keller
June 8, 2016
_______________________________________________________________________
Spade & Archer Printing
CERTIFICATEOFINTEREST
Counsel for Appellants Milo & Gabby LLC and Karen Keller
certifies the following:
1.

2.
The name of the real party in interest (if the party named in the
caption is not the real party in interest) represented by me is:
3.
The parent companies, subsidiaries (except wholly-owned

subsidiaries), and affiliates that have issued shares to the public,
of the party or amicus represented by me are:
None.
4.
The name of all law firms and the partners or associates that
appeared for the party or amicus now represented by me in the
trial court or agency or are expected to appear in this court are:
MANN LAW GROUP
Philip P. Mann
Timothy J. Billick
WHITAKER LAW GROUP

John Whitaker
Dated:June8,2016.
/s/
PhilipP.Mann
PhilipP.Mann
TABLEOFCONTENTS
I.
II.
Amazon Has Itself Created A Safe Haven For Knock-Off Artists

Leeching Off Of Small Businesses...................................................5
A.
By Opening The Online Marketplace...to Third Party

Sellers Around The World Amazon Harms Those Already
Here...........................................................................................5
B.
Amazon Itself Does Not Even Truly Know Who Its Affiliates
Are Or Where They Are Located.............................................7
Amazon Is Directly Liable As A Seller Of The Accused Products..9

A.
Being A Seller Does Not Require Holding Legal Title........9

1.
Amazon Ignores The Core Issue That Holding Legal Title

Is Not Necessary To Be A Seller....................................10
2.
Amazon Is In Fact A Common Law Consignee................12
B.
Milo & Gabby Did Not Waive The Argument That Amazon
Is In Effect A Seller Of The Accused Products..................15
1.
Complaint...........................................................................15
2.
Motion to Dismiss..............................................................16
3.
Summary Judgment..........................................................18
(a)
Milo & Gabbys Summary Judgment Argument

Explicitly Accuses Amazon Of Being The Actual Seller
Of The Accused Products..............................................18
(b)
Amazons Own Reply Brief Acknowledges Milo &

Gabbys Position............................................................20
(c)
The District Courts Order Acknowledges Milo &

Gabbys Argument........................................................20
ii
4.
Motions In Limine.............................................................22
5.
At Trial...............................................................................23
III.
Amazon Is Liable For Direct Copyright Infringement..................24
IV.
Milo & Gabby Properly Pled And Advanced Its Passing Off
Theory At Every Stage Of This Case.............................................27
V.
Attorneys Fees.................................................................................30
VI.
Response To Amicus eBay, Inc.......................................................31

TABLEOFAUTHORITIES
TABLEOFCASES
Bailey v. United States, 516 U.S. 137, 146 (1995)..................................25

Bell Atl. Corp. v. Twombly, 550 U.S. 544, 562-63 (2007).......................30
Halo Elecs., Inc. v. Pulse Elecs., Inc., 769 F.3d 1371, 1379 (Fed. Cir.
2014)..........................................................................................................11
Inland Steel Co. v. LTV Steel Co., 364 F.3d 1318, 131920 (Fed. Cir.
2004)..........................................................................................................31
Lakesouth Holdings, LLC v. Wal-Mart Stores, Inc., Civil Case No. 14cv-1877 (TXND 2014)...............................................................................34
Nike, Inc. v. Wal-Mart Stores, Inc., Civil Case No. 8-cv-5840 (ILND
2008)..........................................................................................................34
NTP, Inc. v. Research In Motion, Ltd., 418 F.3d 1282, 1319 (Fed. Cir.
2005)..........................................................................................................11
Parks v. Atlanta News Agency, Inc., 115 Ga. App. 842...........................13
iii
Pfaff v. Wells Elecs. Inc., 525 U.S. 55, 67 (1998).....................................10

Pinter v. Dahl, 486 U.S. 622, 642-43 (1988)............................................10
Yeti Coolers, LLC v. Wal-Mart Stores, Inc., Civil Case No. 16-cv-0454
(TXWD 2016).............................................................................................34
Zoltek Corp. v. United States, 672 F.3d 1309, 1323 (Fed. Cir. 2012) (en
banc)..........................................................................................................11
TABLEOFSTATUTES
35 U.S.C 271(a)........................................................................................1
17 U.S.C. 106(3).....................................................................................25
15 U.S.C. 1125(a)(1)...............................................................................28
iv
INTRODUCTION
In 1952, Congress enacted 35 U.S.C 271(a), which expressly
statesthat,whoeverwithoutauthority...makes,uses, offerstosell,or
sells...any patented invention...infringes the patent. (Emphasis
supplied.)Insodoing,CongressnotAmazonandnoteBayspecified
whatactsconstitutepatentinfringementandwhatactionsgiveriseto
liabilityunderthePatentAct.
Byenacting271(a),Congressmadeclearthat(1)offeringtosell,
or (2)sellingapatentedinventionwithoutauthorityis sufficient,on
itsown,toconstitutedirectpatentinfringement.Itisalreadythelaw
that either offering an infringing product for sale, or selling an
infringing product is an act of direct patent infringement. Amazon's
protestations notwithstanding, there is no requirement that an
infringer actually manufacture theproduct itself. It is not adefense
that someone else is more responsible for causing the infringement.
Anditiscertainlynotadefensethatfollowingthepatentlawsofthis
countryisinconvenient,burdensomeandmightdepriveconsumersof
readilyavailable,lowcost,imitationgoods.
1
ThefundamentalquestioninthiscaseremainswhetherAmazon's
variousclaims thatitonlyfacilitatesthirdpartysales,thatitonly
fulfillsorders,thatitdoesnottaketitle,etc.,shouldshielditfrom
liability for the admittedly infringing products that were (1)
indisputablyofferedforsaleonAmazon'ssite,(2)indisputablyshipped
from Amazon's fulfillment centers by Amazon personnel and (3)
indisputably infringe Milo & Gabby's patent, copyright and other
intellectualpropertyrights.
Intheproceedingsbelow,theDistrictCourterredinitsfocuson
titlealegalconceptcreatedcenturiesagoprincipallytoclarifywho
bears the risk of loss while goods are being shipped. There is no
precedentinthisoranyothercourtthatanoffertosellorsaleofan
infringingproductrequires thattheseller,itself,holdlegaltitleto
theproduct.Indeed,andasnotedinMilo&Gabby'sopeningbrief,(1)
theSupremeCourthasalreadyheldthatholdingtitleisnotnecessary
inordertobeasellerofsecurities,(2)thisCourthasalreadyheld
thattheordinarymeaningofofferandsellcontrolinthepatent
context, and (3) various forms of selling, wherein title is held by
2
someone other than the seller, (e.g., consignment sales) are in

widespread,ordinaryuse.
Againitisundisputedthatunscrupulousoverseascopyistshave
created products that infringe Milo & Gabby's design patents and
copyrights.Itisundisputedthattheseproductshavebeenintroduced
intotheU.SmarketthroughAmazon.Itisundisputed thatAmazon
providesthesecopyistswithadvertising,billing,warehousing,shipping
andotherservicesthatmakeitpossibleandpracticalforthemtoreach
andenjoythebenefitsoftheU.S.market.Anditisundisputedthat
Milo & Gabby can do nothing against these copyists for the simple
reason that they are overseas, flybynight, largely anonymous, and
wellbeyondthereachofU.S.courts.
Againstthisbackground,andwhileacknowledgingthatMilo&
Gabby are indeed innocent victims, both Amazon and the District
Courtessentiallysay,toughluck. 1 ThisignoresthatCongress,more
1 And the hard-hearted Amicus, eBay, appears to suggest that

any sympathy for Milo & Gabby is misplaced and that the District
Court was wrong even to express misgivings about the result in this
case.
3
thansixtyyearsago,alreadyprovidedaremedyintheformof271(a)
thatalreadyimposesdirectpatentinfringementliabilityoneveryonein
thedistributionchain,frommanufacturer,toimporter,toseller,toend
user.Thereisnothinginthelegislativehistoryof271(a)toshowthat
Congress intended any of these parties to escape liability simply
because, onehalf century later,businesswould bedonelargely with
credit cards and computer screens rather than through cash
transactionsinaphysicalstore.Indeed,hadCongressbeenawarethat
one day, any anonymous overseas copyist could, with minimal
investment andliterallywithinminutes,entertheU.S.marketfrom
thousandsofmilesawaysimplybyopeninganonlineAmazonaccount,
itis likely Congress wouldhavetaken additional stepstocurbsuch
abuses,
not
foster
them.
Milo&Gabbyrespectfullysubmitthatexistinglawissufficientto
remedytheharmstheyhavesufferedandthatargumentsbasedonthe
supposednewworldofonlinebusinessarelargelyredherrings.
REPLYTOAMAZONSARGUMENTS
I.
AmazonHasItselfCreatedASafeHavenForKnockOff
ArtistsLeechingOffOfSmallBusinesses
As set out below, Amazon has created an online platform that
enables fastbuck artists literally around the globe to violate the

intellectualpropertyrightsofhardworkingAmericanbusinesseswith
impunity. And Amazon does so without implementing even the
slightestbarriertothatimproperconduct.Indeed,Amazonessentially
bragsthatithasenabledanyoneintheworldtoknockoffsuccessful
smallbusinessintenminutesorless.
A.
ByOpeningTheOnlineMarketplace...toThirdParty
SellersAroundTheWorldAmazonHarmsThose
AlreadyHere.
There is no question that Amazon has pioneered new forms of
commerce and offers a valuable service to consumers and producers

alike.Throughoutthislitigationandattrial,Appellantshavereadily
acknowledgedthevaluableservicethatAmazonprovides.Thereisno
question thatlegitimate andresponsibleproducers whoareperfectly
able and willing to abide by the laws of this country sign up with
Amazonandmaketheirproductsavailabletothebenefitofthemselves,
Amazon and consumers here. This, however, is not the issue, and
Appellants by no means wish to curtail or criticize the admittedly
helpfulandvaluableserviceAmazonprovides.
The problem hereis that byAmazon'sown admission,Amazon
makes it possible for virtually any thirdparty seller, virtually
anywhereintheworld,toentertheU.S.marketvirtuallyanonymously
and, as a practical matter, entirely free of any fear of U.S. courts.
Amazon makes it possible for such third parties to enter the U.S.
marketwithoutaphysicalpresencehere. Amazonmakesitpossible
forthemtodosowithoutmaintainingawarehousehere. Suchthird
partiesdonotneedanyemployeeshere. Nordotheyneedanybank
accountshere. Theydonotneedtoengageadvertisingprofessionals
here.Indeed,alltheyneedtodoisspendabouttenminutessigningup
on the Amazon website and clicking the appropriate boxes when
prompted to do so. As the District Court itself learned in the
proceedings below, they do not even need to provide accurate and
truthfulinformationaboutwhotheyareandwheretheyareactually
located. Whatsuch thirdparties clearly donot needtodoiscareor
6
worry whether their products infringe the copyrights, patents and

otherintellectualpropertyrightsofothers,suchasMilo&Gabbyhere.
ByenteringtheU.Smarket through Amazon'swebsiteandservices,
they are effectively shielded from liability for patent and copyright
infringementandtheyknowit.
B.
AmazonItselfDoesNotEvenTrulyKnowWhoIts
AffiliatesAreOrWhereTheyAreLocated
Amazons suggestion that Milo & Gabby should leave Amazon
alone and proceed instead against the overseas suppliers borders on

thehumorous,giventheactualhistoryofthiscase.ThefactisAmazon
itself is not too sure who these people really are or where they are
actuallylocated.
AtAmazon'sinsistence(andoverMilo&Gabbysobjection),the
approximatelyonedozenthirdpartysellersAmazonidentifiedasbeing
responsiblefortheinfringinggoodswereaddedasdefendantsshortly
before trial. See Dkt 68, A117. The District Court itself mailed out
noticestoeachofthethirdpartysellersusingthenamesandaddresses
providedbyAmazon.Inallinstances,thenoticeswerereturnedtothe
Court as undeliverable due to faulty information regarding the
7
addressoridentityoftheintendedrecipient.Dkt75,A117;Dkt117,
A123;Dkt158,A128;Dkt168,A130.IfAmazonitselfdoesnotactually
know who these thirdparties really are or where they are actually
located,howrealisticisittoexpectMilo&Gabbyandothersimilarly
situated small, domestic business people to do what a wellfunded
corporatebehemothsuchasAmazoncannot?
Again,Congress,throughenactmentof271(a)madeclearthat
thosewhoofferorsellinfringingproductsareindependentlyliablefor
direct patent infringement regardless of whether the actual
manufacturercanbebroughttobar.Amazonmaywellbeabletoseek
indemnityfromthevarioussuppliersitpermittedtouseitsplatform.
Butthepracticalinabilitytofindthesesuppliersorbringthembeforea
U.S.courtdoesnot,andshouldnot,dictatethatMilo&Gabbybeleft
without a remedy. Congress already answered that question to the
contraryinenacting271(a).
II.
AmazonIsDirectlyLiableAsASellerOfTheAccused
Products
AsexplainedatlengthinMilo&Gabbysopeningbrief,Amazon
is the true seller of the accused products. The District Court

committedreversibleerrorwhenitconcludedthatAmazoncouldnotbe
the seller of the accused products for no reason other than that
Amazon does not acquire legal title to those products. The record
makesclearthatMilo&Gabbyspositionnowonappealistheexact
sameposition thatithasmadesincefilingtheoriginalcomplaintin
thismatter.
A.
BeingASellerDoesNotRequireHoldingLegalTitle
Thecoreissuehere,asithasalwaysbeen,iswhetherAmazonis
aselleroftheaccusedproducts.TheDistrictCourterroneouslyheld
thatinordertobeaselleranentitymustholdlegaltitle.A33.Inits
opening brief, Milo & Gabby demonstrated that there is no such
requirement in the law, and Amazon has not even attempted to
substantiate the District Courts holding. Rather, Amazon makes
debaters points aboutirrelevantdifferencesbetweenthecaseatbar
and the authorities cited in Milo & Gabbys brief. Conspicuously
9
absent,however,isanychallengetothefundamentalruleoflawthat
holdingtitleisunnecessaryforanentitytobeasellerofaproduct.
1.
AmazonIgnoresTheCoreIssueThatHoldingLegal
TitleIsNotNecessaryToBeASeller
Amazon hasdoubleddown onitsposition thatunlessanentity

actuallyholdslegaltitletoaproduct,thatentitycannot,asamatter
oflaw,beasellerofthatproduct.AmazonBriefat20.Notsurprisingly,
Amazonfailstociteevenonesingleauthoritytosupportitsposition.It
doesnotbecauseitcannot.Thatisnotthelaw.Quitethecontrary.
Again,Milo&GabbyandAmazonareinagreementthatwhatit
means to be a seller is governed bytraditional contract principles.
See, e.g., Pfaff v. Wells Elecs. Inc., 525 U.S. 55, 67 (1998). Under
traditional contract principles, a person may offer or sell property
without necessarily being the person who transfers title to, orother
interestin,thatproperty.Pinterv.Dahl,486U.S.622,64243(1988).
Thereisnothingambiguousaboutthosestatements.
Milo & Gabby cited numerous authorities making clear that
actuallyholdingtitleisnotarequirementforapartytobeaseller.
10
Milo&GabbyOpeningBriefat2228.Confusingly,Amazonresponds
byurgingthisCourttofocusontheundisputedfactsherethroughthe
lensofcasesthatactuallyaddressanddiscussthedefinitionofsellin
271(a).Accordingtothosecases,sellingrequirestransferringtitleto
abuyerforaprice.Amazon Briefat29.Conspicuouslyabsentfrom
Amazonsbrief,however,isevenonesinglecasethatactuallysupports
its position. Rather, Amazon citestwocasesthatsaynothing except
thatthetermsaleshouldbegivenitsordinarycontractmeaningin
thecontextofpatentinfringement. Id.;See NTP,Inc.v.ResearchIn
Motion,Ltd.,418F.3d1282,1319(Fed.Cir.2005),abrogatedonother
grounds by Zoltek Corp. v.United States,672F.3d 1309,1323(Fed.
Cir. 2012) (en banc); Halo Elecs., Inc. v. Pulse Elecs., Inc., 769 F.3d
1371,1379(Fed.Cir.2014)(relyingontheordinarymeaningofsale
for patent infringement analysis). Again, this dispute is not about
whether a sale occurred. That is undisputed. The only dispute is
aboutwhetherthesellermustbetheentitythatactuallyheldtitle
or whether it can be an entity that was directly responsible for the
transferoccurring.
11
AcceptingAmazonspositionatfacevaluethatasalerequires
transferoflegaltitlenothinginthatpositionurgestheconclusion
thateverysellermustactuallybetheentitythatholdstitle;rather,it
onlyrequiresthattitlemustpass.Thereisnothinginconsistentabout
lawthatrequiresthetransferoftitleinorderforasaletooccur,yet
leaveroomforanentitythatdoesnotholdtitletobetheseller.Indeed,
thenumerousauthoritiescitedbyMilo&Gabbydemonstratethatsuch
aneventoccursallthetime.
2.
AmazonIsInFactACommonLawConsignee
Inits openingbrief, Milo&Gabbycitesnumerousexamples of

instanceswhereanentityisconsideredasellerdespiteneverholding
legaltitletotheproductbeingsold.Milo&GabbyOpeningBriefat22
28. ThoseexamplesilluminatetheerrormadebytheDistrictCourt
whenitconcludedthatAmazoncannotbeasellerforsolelybecauseit
did not hold legal title. Amazon identifies irrelevant distinctions
betweenitselfandeachoftheexamplesMilo&Gabbypresented.But
Amazon never even challenges the fundamental tenet that holding
title is not a requirement for being a seller of a product. Amazon
12
effectively concedes, as it must, that holding title is unnecessary to

supportaholdingthatanentityisaseller.
In one particularly compelling example, Milo & Gabby
demonstrated that Amazon likely satisfies the U.C.C. definition of a
consignmentseller,andaconsignmentsellerisundeniablyaseller
thatneverholdstitletotheconsignedgoods.Milo&GabbyOpening
Brief at25. In response, Amazon arguesthat it isnot aconsignee
undertheparticularU.C.C.definition.AmazonBriefat2936,33.But
giventhatordinarycontractprinciplesmustbeconsidered,itishelpful
toreviewthecommonlawmeaningofconsignment.Underthecommon
law,aconsignmentissimplyentrustingofgoodstoanothertosellfor
the consignor. Blacks Law Dictionary (6th ed. 1990). Blacks Law
Dictionarygoesontonotethatinacommercialsense,[consignment]
ordinarilyimpliesanagencyanddenotesthatpropertyiscommittedto
the consignee for care or sale. Id. (quoting Parks v. Atlanta News
Agency,Inc.,115Ga.App.842).Itisundisputedthattheinstantfacts
constitute a common law consignment. The accused products were
undeniablydeliveredtoAmazonforcareandsale.A526,A534543.
13
Inaddition,Amazonsclaimthatitwasnottheagentofitsthird
partyaffiliatesisflatlyuntrue,asaresomanyofitsfactualassertions.
ContrarytoAmazons argument now,Amazonsownevidenceproves
thatAmazonwaswasexplicitlydesignatedastheagentofitsaffiliate
forthepurposeofconsummatingthatsale.Morespecifically,Amazons
ownagreementsrecitethat:
You authorize Amazon Payments, Inc. ("Amazon
Payments") to act as your agent for purposes of processing
payments, refunds and adjustments for Your Transactions,
receiving and holding Sales Proceeds on your behalf,
remitting Sales Proceeds to your Bank Account, charging
your Credit Card, and paying Amazon and its Affiliates
amounts you owe in accordance with this Agreement or
other agreements you may have with Amazon Affiliates.
A2767 (emphasis added)
Accordingly, Amazonsposition thatnoagencyrelationshipwas
created is belied by its own documents used at trial! Amazon is
undeniablyanagentforthepurposeofmakingthesale,evenifforno
other purpose. But that is the only purpose that matters. Hence,
Amazonistheconsignee.Nothingmoreneedbeshown.Usingordinary
commonlawcontractprinciples,asthepartiesagreeshouldbedone,
14
Amazon easily satisfies the common law definition of at least a

consignmentseller.
B.
Milo&GabbyDidNotWaiveTheArgumentThatAmazon
IsInEffectASellerOfTheAccusedProducts
AmazonmakesthenonsensicalclaimthatMilo&Gabysomehow
waived the core argument being presented to this Court that

Amazonistherealselleroftheaccusedproductsregardlessofwho
holds legal title by having not raised it before the District Court.
Amazon Brief at 24. Amazonsassertion issoplainly falsethatitis
hardtoimaginewhereitcamefrom.Milo&Gabbyhascontinuously
argued, at literally every step ofthis litigation, thatAmazon isthe
realselleroftheaccusedproducts.
1.
Complaint
AsimpleinspectionofthethecomplaintdemonstratesthatMilo
& Gabby have all along accused Amazon of being the actual seller.
Paragraph 13 of the complaint expressly states that, Amazon.com,
Inc.,withouteithertheknowledgeorauthorizationofMilo&Gabby,
began selling direct knockoff copies of Milo & Gabbys Cozy
Companion Products. Count I of the complaint, alleging patent
15
infringement, expressly states that, Amazon is...selling, offering for

sale, and/or importing the Amazon knockoffs which are virtually
indistinguishable (but for quality) from Plaintiff Milo & Gabbys
patented designs, and that, Defendant Amazons actions constitute
patent infringement under 35 U.S.C. 271, et seq. (Emphasis
supplied.)
2.
MotiontoDismiss
Milo&Gabbyemphasizeditspositioninbriefsatthepleadings
stage. Amazon initially filed a motion to dismiss certain of Milo &
Gabbysclaimsraisedinthecomplaint.Dkt8,A109.Inthatpleading,
Amazonfirstassertedthatitwasnotaselleroftheaccusedproducts.
AInopposition,Milo&Gabbyclearlysetoutitspositionthatindeed
Amazonisaselleroftheaccusedproducts.Morespecifically,Milo&
Gabbyarguedthat:
Amazon argues that it does not sell the Amazon knockoffs, but reality compels quite a different conclusion. In
short, Amazon suggests that because it did not itself
manufacture the products in question, then it did nothing
wrong.
Amazons argument is tantamount to Wal-Mart
arguing that it does not sell anything on its own shelves
16
merely because it does not manufacture those products.

If there is a distinction between what Amazon does
and what any other brick-and-mortar retailer does, then
Amazon has kept that distinction well hidden. For too long
Amazon has hidden behind the fallacy that selling products
on the Internet is somehow different than selling products
through an ordinary retail storefront. Amazon attempts to
pretend that some other company, and not Amazon, is the
real seller of the knock-off products. But as set forth in the
facts alleged in the Complaint, such is not the case:
The products are advertised on the amazon.com domain
( 14)
Payment is made directly to Amazon
Amazon issues the invoice and tracking information
Amazon ships the products in a box that bears the
Amazon logo ( 21)
Amazon broadcasts email advertisements from its own
account (not the manufacturers) offering the knock-off
products ( 15)
This mysterious distinction between the seller of the
product and whatever Amazon chooses to call itself exists no
where except in Amazons brief. The truth is Amazon sells
the knock-off products. They may not manufacture the
products, but they undeniably sell them. Any suggestion
otherwise is nothing but smoke and mirrors.
A261, A259-266.
Accordingly, there was no question that Milo & Gabby
unequivocally regarded Amazon as the true seller of the accused
products.
17
3.
SummaryJudgment
AmazonclaimsthatMilo&Gabbyfailedto maintain itsearlier

positionatthesummaryjudgmentstage.Again,andinadditiontothe
otherpleadingsfiledpreviously,asimpleinspectionofMilo&Gabby's
oppositiontothemotionforsummaryjudgmentissufficienttoexpose
thisfalsehood.
(a)
Milo&GabbysSummaryJudgmentArgument
ExplicitlyAccusesAmazonOfBeingTheActual
SellerOfTheAccusedProducts
Milo&Gabbysbriefingonsummaryjudgmentexplicitlyargues
that Amazon is the real seller of the products. Indeed, the briefing
submittedonthisappealislargelycutandpastedfromthesummary
judgment briefing submitted to the District Court. Milo & Gabbys
summary judgment briefing explicitly accuses Amazon of being the
realselleroftheknockoffproducts.A597;A564A598(Therealityis
that in allmeaningfulrespects, Amazon istheparty that makes the
salesoftheinfringingproducts.)(emphasisadded).
Atpage30ofMilo&Gabby'sOppositiontoAmazon'sMotionfor
SummaryJudgment,Milo&Gabbyexpresslypointedoutandargued
18
that, Amazon is in the same position as a seller of the infringing

products, and that, under the UCC a "person in the position of a
seller" includes anyone who otherwise holds a security interest or
otherrightingoodssimilartothatofaseller.A597.Intheverynext
sentenceMilo&Gabbyexpresslyarguedthat,Intheinstantaction,
Amazon undeniable satisfies that definition. Id. Given the actual
recordinthiscase,forAmazontorepresenttothisCourtthatMilo&
GabbywaivedtheirargumentthatAmazonisaselleroftheinfringing
goodsrequiresalevelofcredulitythatnoresponsibletribunalshould
display.Again,Milo&Gabbydidnotraisethesaleissueattrialonly
because the District Court barred it from doing so not because it
agreed with the court, or otherwise acquiesced in its erroneous
conclusionthatAmazonisnotaselleroftheinfringinggoods.
19
(b)
AmazonsOwnReplyBriefAcknowledgesMilo&
GabbysPosition
Incredibly,althoughAmazonclaimsnowthatMilo&Gabbydid
notadvancetheargumentthatAmazonisthetrueselleroftheaccused
products,itsreplybriefonsummaryjudgmentprovesotherwise.More
specifically,initsreplybrief,Amazonstated:
M&Gs direct patent infringement claim fails because,
beyond argument of counsel characterizing Amazon as the
seller of the Accused Products, M&G makes no showing
of any triable issue of fact establishing that Amazon,
without authorization, made, used, offered to sell, sold, or
imported the patented inventions. See 35 U.S.C. 271(a).
The only evidence in the record is unrefuted evidence that
Amazon never had an ownership interest in any of the
Accused Products, and thus was never in a position to sell or
offer to sell those products.
A677-A678.
AmazonsdisagreementwithMilo&Gabbysargumentdoesnot
magically cause that argument to disappear. Even Amazons own
contemporaneouslanguagebeliesthetruthfulnessofitsclaimnow.
(c)
TheDistrictCourtsOrderAcknowledgesMilo&
GabbysArgument
IftherewereeventheslightestdoubtthatMilo&Gabbyargued
onsummaryjudgmentthatAmazonisthetrueselleroftheproducts,
20
thenoneneedonlylookattheDistrictCourtsorder.Inthatorder,the
DistrictCourtexpresslyacknowledgedthatMilo&Gabbydidinfact
allegethatAmazonisthetrueselleroftheaccusedproducts.
More particularly, the District Courts order on summary
judgmentstates:
Plaintiffs contend that Amazon is the real seller of the
knock-off products because: (1) the products are advertised
on the amazon.com domain; (2) [p]ayment is made directly
to Amazon; (3) Amazon issues the invoice and tracking
information; (4) Amazon ships the products in a box that
bears the Amazon Logo; and (5) Amazon broadcasts email
advertisements from its own account (not the
manufacturers) offering the knock-off products.
A26-A27 (internal quotations omitted).
IfMilo&GabbydidnotarguethatAmazonwastherealseller
oftheaccusedproducts,thenwhydidtheDistrictCourtsaythatitdid,
and why did it even address the argument separately? Amazons
mischaracterization of Milo & Gabbys summary judgment briefing
simplyhasnobasisinreality.
21
4.
MotionsInLimine
PerhapsthemostglaringweaknessofAmazonsclaimnowisthat
itisdiametricallyopposedtoitsownpositionimmediatelybeforetrial.
Contrary to its current claim, just before trial Amazon had become
concernedthatMilo&Gabbywould notstop arguingAmazonwasin
factthetrueselleroftheaccusedproducts.SoconcernedwasAmazon
thatitfiledamotioninliminespecificallyrequestingtheDistrictCourt
toorderMilo&Gabbytostopmakingthatexactargument.A1126.
More specifically, in its motions in limine, Amazon urged the
District Court to bar Milo & Gabby from continuing to argue that
Amazon istherealselleroftheknockoffproducts.Amazon stated
that [t]he draft of Milo & Gabbys pretrial statement served on
Amazon continues to assert that Milo & Gabby will prove patent
infringement based on sales of the accused pillowcases and appears
ready to refer to Amazon as the seller of the accused pillowcases,
directlycontrarytotheCourtssummaryjudgmentruling.A1126.
So at trial Amazon urged the District Court to order Milo &
GabbytostoparguingthatAmazonistherealseller,yetAmazonnow
22
arguesthatMilo&Gabbynevermadethatargumentinthefirstplace.
ItisdifficulttounderstandhowMilo&Gabby continued tomakean
argumentthatithadnevermadebefore.
5.
AtTrial
At trial, the District Court, over Milo & Gabby's objection,

declinedtoletMilo&GabbyarguethatAmazonwasanactualseller,
andonatleasttwooccasionstoldtheJurythat,TheCourthasalso
previouslydeterminedthatAmazonhasnotsoldanyoftheallegedly
infringingproducts.A86.BecauseMilo&Gabbydidnotopenlydefy
theCourtandattempttopresentthesellingissueanyway doesnot
meanthatMilo&Gabbywaivedtheissue.Indeed,thecentralissuein
thisappealiswhethertheDistrictCourterredinitsanalysisofwhat
constitutesasaleinthefirstplace. Again,complyingwithordersof
theCourtandtryingtheissuesdirectedbytheCourtdoesnotinany
way, shape or form constitute waiver. Again, Amazon grossly
misrepresentsthefactsandrecordinthisaction.
Inshort,fromthefilingofthecomplaintuntiltheDistrictCourt
ordered Milo & Gabby to stop at trial, Milo & Gabby have always
23
maintained that Amazon is in fact a seller of the accused products.

Amazons assertion that Milo & Gabby waived that argument is
meritlessandbeliedbytherecord.
III. AmazonIsLiableForDirectCopyrightInfringement
Amazondevotesalmostitsentireargumentregardingcopyright
infringementtoimagesthatitdisplayedonitswebsite.However,as
discussedinMilo&Gabbysopeningbrief,itisAmazonsdistribution
oftheactualaccusedproducts(pillowcaseswhicharealsoprotectedby
separate copyright registrations) constitutes a separate act of
infringement. Milo &Gabby OpeningBrief at2932.Again, Amazon
arguesthatitcanescapeliabilitybecauseitisnotthesellerofthe
pillowcases.AmazonBriefat3940.Butbasedontheabove,Amazons
argumentfailsbecausethefactsandlawcompeltheconclusionthat
Amazonistheselleroftheproducts.
Stillfurther,Amazonconvenientlyomitsacrucialelementofits
analysis. Although Amazon cites the proper statute, it grossly
mischaracterizes what acts may constitute copyright infringement.
Infringement occurs when one distributes an unauthorized copy by
24
sale or other transfer of ownership. 17 U.S.C. 106(3)(emphasis

added).Initsbriefing,Amazonchosetohighlightthewordsaleinthe
statutewhileomittinganydiscussionatallregardingwhetherithad
performedsomeothertransferofownership.
Amazons entire title position falls flatly on its face when
confrontedwiththelanguageoftheCopyrightActthatanytransferof
ownership,whetherasaleornot,issufficienttoconstitutecopyright
infringement.Itisanaxiomaticprincipleofstatutoryconstructionthat
words in a statute should not be rendered superfluous and that a
proper construction must give effect, if possible, to every clause and
word of the statute. See Bailey v. United States, 516 U.S. 137, 146
(1995)(WeassumethatCongressusedtwotermsbecauseitintended
each term to have a particular, nonsuperfluous meaning.) (rejecting
interpretationthatwouldhavemadeusesandcarriesredundantin
statute penalizing using or carrying a firearm in commission of
offense).
Congressmusthaveintendedforthelanguagetobebroaderthan
Amazonsnarrowdefinitionofasaleotherwiseitwouldnothaveused
25
thewordsorothertransferofownership.Althoughthereisadearth
ofcaselawconcerningthebreadthofthatadditionallanguage,itmust
necessarilyenvisionmorethanatransactionwhichwouldbestrictly
considered a sale. But if accepted, Amazons construction of the
copyright act would render the words other transfer of ownership
superfluous.
Given the foregoing, and the undeniable fact that by Amazons
own admission, the single distinction between a transaction that
Amazon facilitates (whatever that means) and a transaction that
evenAmazonconcedesisasaleisthatAmazondoesnottaketitleto
theproducts.Giventhatthetermothertransferofownershipmust
necessarily encompass something more broad that even Amazons
narrow definition of a sale, then Amazons facilitates transaction
mustfallwithin thescope of106(3). Foratleastthisreason,the
District Court committed reversible error by ruling that only a
transaction that encompasses passage of title from the seller to the
buyercanconstituteinfringement.TheDistrictCourt'srulingshould
26
be reversed and this matter should be remanded for further

consideration.
IV.
Milo&GabbyProperlyPledAndAdvancedItsPassingOff
TheoryAtEveryStageOfThisCase
Again,whenthefactsandlawareagainstyou,arguewaiver.At
least three times in its brief, Amazon makes the claim that Milo &
Gabbyhavepursued,ameritlessLanhamActpalmingoffclaimthatit
failedtopleadinitscomplaintandraisedforthefirsttimeinresponse
to a motion for summary judgment. How Amazon can repeat this
falsehood,giventheproceedingsbelow,defiesexplanation.
TheoriginalcomplaintfiledbyMilo&GabbyonOctober24,2013
expressly states, at Paragraph 16, that, the Amazon knockoffs are
marketedusingusingMilo&Gabbysownmarketingmaterialsand
that, Amazon is misrepresenting to the public that it would be
purchasingauthenticMilo&Gabbyproducts...A153,A150A202.At
paragraph 18 the complaint expressly states, Although consumers
believetheyarepurchasinglegitimateMilo&Gabbyproducts,Amazon
infactdeliverstothoseconsumerstheAmazonknockoffs,whichdiffer
substantiallyinqualityfromtheMilo&Gabbyproducts.Showinga
27
genuine product in advertising while delivering a different product

afterthesaleisclassicpalmingoffandhaslongbeenconsideredaper
seviolationoftheLanhamAct.
As to the specific causes of action set out in Milo & Gabby's
originalcomplaint,CountIV,whichallegesviolationsoftheLanham
Act,specificallyallegesthat,AmazonsunauthorizeduseofPlaintiffs
marketingmaterialsanditsreproductionandemulationofPlaintiffs
photographs, images, and products are intended to cause confusion,
mistake or to deceive consumers as to the source of origin of their
products,that,Defendantsactionsarelikelytocausemembersofthe
publicwhosearchforMilo&Gabbysgenuineproductstobelievethat
the goods being offered for sale, sold, and imported by Amazon to
believe that the Amazon knockoffs have an affiliation, connection,
association,origin,orsponsorshiprelationshipwithMilo&Gabbyand
that Defendants actions constitute a false designation of origin in
violationoftheLanhamAct,15U.S.C.1125(a)(1).
Furthermore, aslongagoasDecember 16,2013(lessthan two
monthsafterthecomplaintwasfiled)Milo&Gabby,inoppositionto
28
Amazon's motion to dismiss, expressly stated to both the Court and

Amazon (1) that Amazon uses Milo & Gabbys own advertising
materials which obviously promote Milo & Gabbys products.
(Complaintat16),(2)thattheproductsthatAmazonactuallysold
were not the products it advertised, i.e., Milo & Gabbys products;
rather,AmazonshippedtheAmazonknockoffs.(Complaintat18),
and(3)thatTheComplaintrecitesalltheclassic'palmingoff'facts:
RepresentingtothepublicthatthegoodsofferedandsoldbyAmazon
areinfacttheMilo&Gabbyproductswhentheyarenot.Accordingly,
atleastasearlyasDecember 16,2016,both Amazon andtheCourt
werefullyawareandonfairnoticethatMilo&Gabbywaspursuinga
claimforpalmingoff.
The final nail in this coffin, however, comes from the billing
records of Amazon's own attorneys, who, on August 14, 2014 billed
Amazon for Research[ing] requirements for passing off and false
advertising under the Lanham Act as alleged by Milo & Gabby.
(A1062 Emphasis supplied). Amazon's bizarre claim that it was
researchingtherequirementsofclaimsthatittheorizedMilo&Gabby
29
mightattempttoraiseisbeliedbythetimeentrydraftedbyAmazon's
owncounsel. Thetimeentrymakesclearthatthepassingoffclaim
beingresearchedwasallegedbyMilo&Gabby,undertheLanham
Act. Rather than simply come clean and admit an error, Amazon
continuestobullthrough itsfalseversionofevents,eventhough its
owncounsel'stimerecordsproveotherwise.
Thelawrequiresnomorethanfairnoticeofaparticularclaim.
See, e.g., Bell Atl. Corp. v. Twombly, 550 U.S. 544, 56263 (2007).
Amazon concedes that fair notice is all that is required. Certainly
actual notice satisfies that requirement. Amazons revisionist
explanation of its counsels time entry asmerely theorizing simply
ringshollow.
V.
AttorneysFees
Anawardofattorneysfeesisatwostepanalysis.Firstthecourt
mustdeterminewhetherattorneysfeesareappropriate;onlyoncethat
determinationhasbeenmadeintheaffirmativedoesthecourtneedto
determinetheamountofthoseattorneysfees.See,e.g., InlandSteel
Co. v.LTV Steel Co.,364 F.3d 1318,131920(Fed. Cir.2004) (The
30
questioninthiscaseiswhetherUSXisaprevailingpartyandthus
potentiallyeligiblefortheawardofattorneyfeesandcosts.).
ContrarytoAmazonsclaim,thisCourtmaysetasidetheDistrict
Courts award of attorneys fees as failing the first prong of the test
regardlessofwhethertheDistrictCourthasenteredafinalcalculation
astotheproperamount.Inotherwords,ifthisCourtagreeswithMilo
&Gabbythatithadinfactproperlyraisedthepalmingoffargument
below,asAmazonscounseladmittedinitstimerecords,thenAmazon
isnolongeraprevailingpartyundertheLanhamActandtheaward
would have been improperly granted. Accordingly, Milo & Gabby
respectfullyrequeststhatthisCourtvacatetheDistrictCourtsaward
ofattoneysfeesagainstMilo&Gabby.
VI.
ResponseToAmicuseBay,Inc.
eBay, Inc., as amicus curiae, argues in favor of Amazon for
essentially public policy reasons. In a nutshell, eBay argues for

affirmance of the District Courts ruling because to conclude that
Amazon (and not eBay) is a seller of the accused products in this
matter would somehow affect eBays business model. The problem
31
witheBaysargumentisthatitcompletelyignorestheissuesinthis
case.
AlthougheBaysubmitsaneighteenpagesubstantivebrief,eBay
devotesnotonesinglewordtothequestionofwhetherAmazon,inthis
matterandontheinstantfacts,hascrossedthelinefromsimplybeing
anonlineserviceprovidertoafullblownonlineretailer.Rather,eBay
confines its brief to its own circumstances which are devoid of the
particular motivating factors present in the instant matter. More
specifically, eBay and Amazon have fundamentally different online
marketplacesandthosedifferencesmaycompelverydifferentresults.
For example, consider the following comparison of the facts of the
instantmatterwitheBayscircumstances.
Conduct
Amazon
eBay
Transmits unsolicited emails advertising

particular products in its marketplace
Yes
No
Takes physical possession of products
Yes
No
Co-mingles products in warehouse
Yes
No
Boxes products for affiliates
Yes
No
Marks shipping boxes with own label
Yes
No
Offers free shipping
Yes
No
Gift wraps products sold through platform
Yes
No
32
Conduct
Amazon
eBay
Ships products when sold
Yes
No
Forces minimum pricing guidelines
Yes
No
Inshort, eBays sellingmodelisbarelyrelated,ifatall,tothe

instant facts. Amazons selling platform has incrementally added
individualservicestoitsmarketplaceuntilitisnowindistinguishable
fromanyotherbrickandmortarretailer.eBayissimplynothinglike
theAmazonplatformatissueinthismatter.eBaysbriefingcompletely
ignores the significant factual distinctions between eBays online
auctionhouseandAmazonsonlineconsignmentshop.
Finally, the thrust of eBays argument is apparently that it is
simplytoobigtoinfringe.Inotherwords,eBayarguesthatbecausethe
number of products sold using its platform is large, it should be
immune from liability for infringement. eBay Brief at 14. Such a
preposterouspositionisstunninginitsaudacity.eBayisnotaslarge
asWalMart,thetraditionalbrickandmortarretailer.Yetthereisno
dispute whatsoever that WalMart can be sued for patent and
trademarkinfringementforproductssoldthroughitsonlinestore.See,
33
e.g.,Nike,Inc.v.WalMartStores,Inc.,CivilCaseNo.8cv5840(ILND
2008)(design patent infringement case for shoes sold by WalMart);
LakesouthHoldings,LLCv.WalMartStores,Inc.,CivilCaseNo.14
cv1877(TXND2014)(onlinesalesofumbrellas); YetiCoolers,LLCv.
WalMartStores,Inc.,CivilCaseNo.16cv0454(TXWD2016)(online
salesofaccuseddrinkcoolers).eBaydoesnothingtodistinguisheither
itselforAmazonfromthesesimilarcompaniesperformingverysimilar
functions online. The law should treat similarlysituated defendants
the same, and Amazon should have no more immunity for its sales
thandoesWalMart.
CONCLUSION
For the foregoing reasons, Amazons opposition brief fails to
address the substantial errors identified by Milo & Gabby in its
opening brief. The District Court committed reversible error by
concludingthat,asamatteroflaw,anentitymustholdlegaltitlein
ordertobeasellerofaccusedproducts.Inaddition,theDistrictCourt
committedreversibleerrorbyoverlookingMilo&Gabbyspalmingoff
theorywhichithadproperlypled,andadvancedateachstageofthis
34
litigation.Foratleastthesereasons,andthosesetoutabove,Milo&
GabbyrespectfullyrequeststhattheDistrictCourtsrulingbevacated,
andthatthisCourtrulethatAmazonisaselleroftheaccusedproducts
asamatteroflaw.
Dated: June 8, 2016.
Respectfully submitted.

PhilipP.Mann
TimothyJ.Billick
MANNLAWGROUP
JohnWhitaker
WHITAKERLAWGROUP
1218ThirdAvenue,Suite1809
Seattle,Washington98101
(206)4360900
AttorneysforPlaintiffs/Appellants
Milo&GabbyLLCandKarenKeller
35

161290
Milo&GabbyLLCandKarenKeller,
PlaintiffsAppellants,
v.
Amazon.com,
DefendantAppellee.
CERTIFICATEOFSERVICE
Beingdulyswornaccordingtolaw,andbeingovertheageof18,
uponmyoathIdeposeandsaythat:
On thedate indicated below,Ielectronically filedtheforegoing
withtheClerkoftheCourtfortheUnitedStatesCourtofAppealsfor
theFederalCircuitbyusingtheappellateCM/ECF system.Icertify
thatallparticipantsinthecaseareregisteredCM/ECFusersandthat
servicewillbeaccomplishedbytheappellateCM/ECFsystem.
Dated:June8,2016.
/s/JohnWhitaker
JohnWhitaker
CERTIFICATEOFCOMPLIANCE
I hereby certify that this brief complies with the typevolume
limitationofFederalRuleofAppellateProcedure32(a)(7)(B).
Thisbriefcontains6,298words,excludingthepartsofthebrief
exempted by Federal Rule of Appellate Procedure 32(a)(&)B)(iii) and
FederalCircuitRuleofAppellateProcedure32(b).Thewordcountwas
performedbytheautomatedwordcountingfunctionofcounselsword
processingsoftware.
This brief complies with the typeface requirements of Federal
RulesofAppellateProcedure32(a)(5,6).Thisbriefhasbeenpreparedin
a proportionally spaced typeface using LibreOffice in a 14 point
CenturySchoolbookfont.
Dated:June8,2016.
/s/JohnWhitaker
JohnWhitaker
No. 16-1290
IN THE
United States Court of Appeals for the Federal Circuit

MILO & GABBY LLC AND KAREN KELLER,
Plaintiffs-Appellants,
v.
AMAZON.COM, INC.,
Defendant-Appellee,
DA FANG SUN, AKA SETH L, CHONGQIN WORLD FIRST
ELECTRONIC COMMERCE CO., LTD., AKA WOTEFUSI, T. LIU, AKA
BINGO DEAL, FAC SYSTEM, AKA FAC SYSTEM LLC, DINGDING ZOU,
AKA HAPPY SUNDAY, QIUMEI ZHANG, AKA HITECE, CHARLOTTE
XIA, NIMBLE JOY, AMANIALARASHI2165, MONAQO,
Defendants,
On Appeal from the United States District Court

for the Western District of Washington
No. 2:13-cv-01932-RSM
Hon. Ricardo S. Martinez
BRIEF OF EBAY INC. AS AMICUS

CURIAE IN SUPPORT OF APPELLEE
AMAZON.COM, INC. AND AFFIRMANCE
Mark P. Wine
ORRICK, HERRINGTON &
SUTCLIFFE LLP
2050 Main Street, Suite 1100
Irvine, CA 92614-8255
(949) 567-6700
Matthew H. Poppe
ORRICK, HERRINGTON &
SUTCLIFFE LLP
1000 Marsh Road
Menlo Park, CA 94025-1015
(650) 614-7400
Counsel for Amicus Curiae eBay Inc.
Counsel for Amicus Curiae certifies the following:
1. We represent eBay Inc.
2. That is the real name of the real party in interest.
3. eBay Inc. has no parent corporations and no publicly held
company owns 10 percent or more of its stock.
4. The following law firm and partners or associates who are
expected to appear in this Court are:
ORRICK, HERRINGTON & SUTCLIFFE LLP
Mark P. Wine, Matthew H. Poppe
Date: April 28, 2016

/s/Mark P. Wine
TABLE OF CONTENTS
Page
CERTIFICATE OF INTEREST ................................................................ i
TABLE OF AUTHORITIES .................................................................... iv
INTEREST OF THE AMICUS CURIAE ................................................. 1
INTRODUCTION ..................................................................................... 3
ARGUMENT ............................................................................................ 5
I.
An Online Marketplace Operator Does Not Itself Sell

Goods That Are Listed by Third Parties, Since It Never
Has Title to Those Goods. ...................................................... 5
II.
Public Policy Supports Not Holding Online

Marketplace Operators Such as Amazon and eBay
Liable as Direct Infringers When Their Users Sell
Infringing Goods..................................................................... 7
III.
A.
The Courts and Congress Have Immunized

Online Platform Providers from Claims for Direct
Copyright Infringement Based on the Conduct of
Their Users.................................................................... 7
B.
Online Platform Providers Are Also Protected

from Liability Based on User Conduct in Other
Areas of Intellectual Property Law and Beyond. ....... 10
The Policies That Have Led Courts and Congress to

Exempt Providers of Online Services from Liability in
Other Areas of Law Apply Even More Strongly in the
Context of Claims for Direct Patent Infringement. ............ 12
A.
Holding Online Platform Providers Liable for

Direct Patent Infringement Based on User
Conduct Would Have the Same or Worse
Negative Consequences as in Other Areas of Law..... 12
ii
B.
Forcing Online Marketplaces to Remove Listings

of Allegedly Infringing Products Would
Effectively Grant Patent Owners Preliminary
Injunctive Relief Without Having to Satisfy the
Applicable Standard.................................................... 16
CONCLUSION ....................................................................................... 18
CERTIFICATE OF SERVICE
iii
TABLE OF AUTHORITIES
Page(s)
Cases
ALS Scan, Inc. v. RemarQ Cmtys., Inc.,
239 F.3d 619 (4th Cir. 2001) ............................................................. 8, 9
Chrysler Motors Corp. v. Auto Body Panels of Ohio, Inc.,
908 F.2d 951 (Fed. Cir. 1990) ............................................................. 15
CoStar Grp. Inc. v. LoopNet, Inc.,
164 F. Supp. 2d 688 (D. Md. 2001) ...................................................... 8
Gentry v. eBay Inc.,
121 Cal. Rptr. 2d 703 (Cal. Ct. App. 2002) ..................................... 6, 11
Global-Tech Appliances, Inc. v. SEB S.A.,
563 U.S. 754 (2011) ....................................................................... 12, 14
Hendrickson v. eBay Inc.,
165 F. Supp. 2d 1082 (C.D. Cal. 2001) ......................................... 11, 13
Inman v. Technicolor USA, Inc.,
No. 2:11-cv-666-DSC, 2011 WL 5829024 (W.D. Pa.
Nov. 18, 2011) ....................................................................................... 6
Lockheed Martin Corp. v. Network Solutions, Inc.,
985 F. Supp. 949 (C.D. Cal. 1997) ................................................ 15, 16
Marobie-Fl, Inc. v. Natl Assn of Fire and Equip. Distribs.,
983 F. Supp. 1167 (N.D. Ill. 1997) ........................................................ 8
Mondo Polymers Techs., Inc. v. Monroeville Indus.
Moldings, Inc.,
No. 2:07-cv-1054, 2009 WL 3698432
(S.D. Ohio Nov. 3, 2009) ..................................................................... 15
Religious Tech. Ctr. v. Netcom On-Line Commcn Servs., Inc.,
907 F. Supp. 1361 (N.D. Cal. 1995) ...................................... 7, 8, 12, 14
iv
Stratton Oakmont, Inc. v. Prodigy Servs. Co.,

No. 31063/94, 1995 WL 323710
(N.Y. Sup. Ct. May 24, 1995) .............................................................. 10
Zeran v. America Online, Inc.,
129 F.3d 327 (4th Cir. 1997) ................................................... 10, 13, 17
Statutes
17 U.S.C. 512 ...................................................................................... 4, 9
17 U.S.C. 512(b)(2)(E)............................................................................. 9
17 U.S.C. 512(g) ...................................................................................... 9
17 U.S.C. 512(g)(2)................................................................................ 17
17 U.S.C. 512(g)(4)................................................................................ 17
35 U.S.C. 271 ........................................................................ 3, 15, 17, 18
35 U.S.C. 271(a) ...................................................................................... 1
47 U.S.C. 230 .............................................................................. 4, 10, 11
Other Authorities
H.R. Rep. No. 105-551(I) (1998) ................................................................ 9
8 Donald S. Chisum, Chisum on Patents 23.05[2] (2014) .................... 15
Mark Lemley and Carl Shapiro, Patent Holdup and Royalty
Stacking, 85 Tex. L. Rev. 1991 (2007) ................................................ 13
Mike Masnick, There Are 250,000 Active Patents That
Impact Smartphones; Representing One In Six Active
Patents Today (2012), http://tinyurl.com/glurgjs ............................... 13
USPTO Patent Full-Text and Image Database,
Class 604/358, http://tinyurl.com/orwy26y ..... 14
INTEREST OF THE AMICUS CURIAE1

Amicus eBay Inc. is a technology company that operates an online
marketplace on which millions of users can list products using eBays
automated product listing system. Through eBays platform, sellers of
goods of all sortshome wares, tech gadgets, clothing and morereach
over 162 million active buyers all over the world. There are currently
around 800 million active product listings on eBay.
This case presents a question of enormous practical importance:
namely whether, under 35 U.S.C. 271(a), a marketplace operator such
as eBay or Amazon sells each of the goods listed on its website such
that the marketplace operator is liable any time one of those goods
infringes a patent. eBay submits this brief to express its strong
agreement with, and provide additional legal support for, the district
courts conclusion that Amazon does not sell third-party-listed goods
The parties have consented to the filing of this brief. Pursuant to

Federal Rule of Appellate Procedure 29(c)(5), Amicus eBay Inc. states
that no counsel for any party authored this brief in whole or in part; no
party or counsel for any party contributed money that was intended to
fund preparing or submitting this brief; and no person other than eBay
Inc. and its counsel contributed money that was intended to fund
preparing or submitting this brief.
1
for purposes of 271(a). Reversing that ruling would have significant

ramifications for eBay and its users.
eBay takes seriously the intellectual property rights of others. For
example, eBay has a program that allows rights owners to bring
intellectual property violations to eBays attention, and it has spent
millions of dollars in its effort to remove counterfeit listings that
infringe trademarks and copyrights. However, patents are different.
Any of the hundreds of millions of products listed on eBay may
incorporate thousands of patented inventions. Patent analysis is legally
complex and uncertain and requires technical acumen in the field of the
invention. Absent a prior court order adjudicating that a listed product
infringes, it is not feasible for an online marketplace operator to police
its site for patent infringement. The rule advocated by Appellants
would expose companies like eBay to an unreasonable level of liability
and effectively hand patent owners unilateral power to demand the
takedown of any product they claim infringes their patents, whether
that claim is legitimate or not. As eBay and its users would suffer
under such a rule, eBay has a substantial interest in the question
presented here.
INTRODUCTION
This appeal presents the narrow question of whether a company
like Amazon or eBay, merely by providing an online marketplace that
enables millions of users to exchange goods with each other through an
automated product listing system, can be considered a seller of all of the
listed goods such that it is liable under 35 U.S.C. 271 whenever any of
those goods purportedly infringes a patent.
Amazons brief answers that question in the negative, supported
by a straightforward legal analysis regarding the meaning of sells in
Section 271. eBay fully agrees with that analysis.
The district court, in addressing the related question of whether
Amazon offers to sell listed goods and finding that Amazon does not do
so, said it was troubled by that outcome and felt it was an instance of
the law lag[ging] behind technology. A100. eBay submits this amicus
brief to address that concern and explain that, to the contrary, holding
that Amazon is not liable for direct patent infringement with respect to
goods listed on its site by third party users is consistent with prevailing
public policy regarding online marketplaces. Indeed, when courts found
online platform providers liable in other areas of law for the activities of
third parties on their platforms, Congress concluded they were out of

step with technology and supplanted those decisions with laws like the
Digital Millennium Copyright Act (DMCA), 17 U.S.C. 512 (1998), and
the Communications Decency Act (CDA), 47 U.S.C. 230 (1996), that
immunized online providers, among other things.
As courts and Congress have recognized, to do otherwise would
place an undue burden on companies that let third parties access and
post content on the Internet and would create perverse incentives
detrimental to all Internet users. In the context of online marketplaces,
holding companies like Amazon and eBay liable as sellers would force
them to defend against patent claims involving products they likely
have never possessed and technologies they do not understand. Given
the cost and difficulty of construing patents claiming unfamiliar
technology and applying them to unfamiliar products, it also would
incentivize online marketplace operators to respond to all notices of
infringement by immediately removing listings of the accused products,
whether or not the allegations have merit.2 In effect, patentees thus
As discussed in Section III, infra, this task would be much more

challenging and present different concerns than in the copyright and
trademark contexts.
2
would be afforded the benefits of a preliminary injunction without

having to make the requisite showing. The marketplace would shrink
with likely adverse effects on competition, prices, and consumer choice.
There would be an enormous potential for abuse, and all users of online
marketplacessellers and buyers alikewould suffer.
The present case does not illustrate these dangers well, since
Amazon does not dispute that the accused products infringe Appellants
design patent. However, the Courts ruling on what the term sell
encompasses will apply equally in cases involving disputed design
patents and even to utility patents covering complex technologies like
semiconductors, mobile phones, and medical devices. Imposing liability
would have far-reaching negative effects. eBay therefore urges the
Court to affirm the judgment and rule that Amazon did not sell the
accused products.
ARGUMENT
I.
An Online Marketplace Operator Does Not Itself Sell

Goods That Are Listed by Third Parties, Since It Never Has
Title to Those Goods.
Amazons brief explains that it does not sell the goods listed by
third parties on its online marketplace because it does not transfer title
of those goods to buyers. Rather, title passes directly from third-party

sellers to buyers, using Amazon merely to connect with each other and
(in one transaction out of the ten at issue in this case) to ship the goods.
Resp. Br. at 25-38.
eBay agrees with Amazons analysis and will not repeat it. eBay
merely notes that while it appears this question has never been
addressed for purposes of the Patent Act, courts have ruled in other
contexts that online marketplace operators are not sellers of the goods
listed on their sites by third parties. See, e.g., Inman v. Technicolor
USA, Inc., No. 2:11-cv-666-DSC, 2011 WL 5829024, *5-7 (W.D. Pa. Nov.
18, 2011) (holding that eBay was not a seller for purposes of assigning
strict liability for alleged product defects under Pennsylvania law);
Gentry v. eBay Inc., 121 Cal. Rptr. 2d 703, 711 (Cal. Ct. App. 2002)
(holding eBay not liable under a California statute relating to the sale
of collectibles because eBay is not in the business of selling or offering
to sell the collectibles at issue; rather, it is the individual defendants
who sold the items to plaintiffs, using eBay as a venue).
II.
Public Policy Supports Not Holding Online Marketplace

Operators Such as Amazon and eBay Liable as Direct
Infringers When Their Users Sell Infringing Goods.
The district courts misgivings about finding Amazon not liable for
direct patent infringement, see A100, were misplaced. In fact, that

result is fully in accord with established public policy.
A.
The Courts and Congress Have Immunized Online

Platform Providers from Claims for Direct Copyright
Infringement Based on the Conduct of Their Users.
In the early days of the Internet, courts were divided on whether

online platforms and service providers should be liable when their users
posted infringing or other wrongful content. The day was won by the
seminal case of Religious Tech. Ctr. v. Netcom On-Line Commcn Servs.,
Inc., 907 F. Supp. 1361 (N.D. Cal. 1995) (Netcom). There, copyright
infringement claims were filed against an online billboard service and
an internet access provider based on a users unauthorized posting of
copyrighted material. Id. at 1364. The court found the defendants not
liable because, like Amazon here, they [did] not create or control the
content of the information available to [their] subscribers; [they] merely
provide[d] access. Id. at 1372 (emphasis added); compare A32
(concluding that Amazon does not have the right and ability to control
the infringing material). Stated differently, the defendants had not

caused the unlawful copying by offering a system that acts without any
human intervention beyond the initial setting up of the system.
Netcom, 907 F. Supp. at 1368-69. Direct copyright infringement
requires some element of volition or causation which is lacking where a
defendants system is merely used to create a copy by a third party. Id.
at 1370. The defendants thus could be liable, if at all, only for
contributory copyright infringement.3 Id. at 1369, 1373.
Netcom heavily influenced subsequent court decisions. See, e.g.,
ALS Scan, Inc. v. RemarQ Cmtys., Inc., 239 F.3d 619, 621-22 (4th Cir.
2001) (we find the Netcom court reasoning more persuasive than the
contrary view); CoStar Grp. Inc. v. LoopNet, Inc., 164 F. Supp. 2d 688,
694-96 (D. Md. 2001) (the Netcom approach is more persuasive), affd,
373 F.3d 544 (4th Cir. 2004); Marobie-Fl, Inc. v. Natl Assn of Fire and
Equip. Distribs., 983 F. Supp. 1167, 1176-79 (N.D. Ill. 1997) (relying on
The district court granted Amazons motion to strike Appellants

allegations of indirect patent infringement. A5-23. Appellants do not
challenge that ruling on appeal. Therefore, eBay does not address
whether operators of online marketplaces should be liable for indirect
patent infringement when their users list infringing goods except to
note that similar claims have been narrowly circumscribed in copyright
and trademark law. See infra at 14 n.6.
3
Netcom to find an internet service provider not liable for direct

copyright infringement).
Even more impactfully, Congress codified Netcoms principles in
Title II of the Digital Millennium Copyright Act (DMCA), Pub. L. No.
105-304, tit. II, 202(a), 112 Stat. 2877 (codified at 17 U.S.C. 512
(1998)). The DMCAs legislative history expressly recognizes that the
Act essentially codifies the result in the leading and most thoughtful
judicial decision to date, namely Netcom, and overrules contrary
authority. H.R. Rep. No. 105-551(I), at 11 (1998); see also ALS Scan,
Inc., 239 F.3d at 622 (recognizing Congress codification of the Netcom
principles in Title II of the DMCA). The effect was that, [a]s to direct
infringement, liability is ruled out for passive, automatic acts engaged
in through a technological process initiated by another. H.R. Rep. No.
105-551(I), at 11; see 17 U.S.C. 512.4
The DMCA distinguishes between direct infringement and secondary

liability, treating each separately. H.R. Rep. No. 105-551(I), at 11. It
did not completely eliminate the possibility that online providers could
be secondarily liable for copyright infringement, but it erected a noticeand-takedown procedure to allow them to avoid such liability. See, e.g.,
17 U.S.C. 512(b)(2)(E), (g). Once again, no claims of indirect patent
infringement are at issue in this appeal, so eBay does not address the
extent to which that procedure or the policies that underlie it can or
should be applied in the patent context.
4
B.
Online Platform Providers Are Also Protected from

Liability Based on User Conduct in Other Areas of
Intellectual Property Law and Beyond.
The principles of Netcom have been extended beyond the realm of

copyright. For example, Congress granted providers of internet services
broad immunity from liability arising from content supplied by their
users when it passed the Communications Decency Act, Pub. L. No.
104-104, 509, 110 Stat. 56 (codified at 47 U.S.C. 230 (1996)). Section
230, which provides that no provider or user of an interactive service
shall be treated as the publisher or speaker of any information provided
by another information content provider, was in part a reaction to a
1995 decision that held service providers liable as publishers when
they assumed an editorial role with respect to third-party provided
information. See Zeran v. America Online, Inc., 129 F.3d 327, 331 (4th
Cir. 1997) (citing Stratton Oakmont, Inc. v. Prodigy Servs. Co., No.
31063/94, 1995 WL 323710 (N.Y. Sup. Ct. May 24, 1995)). Congress
purpose in providing this immunity was to maintain the robust nature
of Internet communication by ensuring that service providersthe
backbone of the internetdid not curtail access under the pressure of
crushing liability. Id. at 330. The protections of the CDA apply to
10
online marketplace operators. See, e.g., Gentry, 121 Cal. Rptr. 2d at 711
(upholding eBays immunity under 230 of the CDA from liability for
not posting a warranty of authenticity for items on its site that proved
to be counterfeit).
Immunity from liability has also been recognized in the context of
trademark infringement. For example, in Hendrickson v. eBay Inc., 165
F. Supp. 2d 1082 (C.D. Cal. 2001), the court held that eBay has no
affirmative duty to monitor its own website for potential trade dress
violation and would not be liable for damages based on third parties
posting of allegedly infringing content on eBays website without eBays
knowledge. Id. at 1095. eBay also would not be enjoined from allowing
violations to occur: such an injunction would effectively require eBay
to monitor the millions of new advertisements posted on its website
each day and determine, on its own, which of those advertisements
infringe Plaintiff's Lanham Act rights. Id. The court found no legal
authority for such a burdensome requirement.
The public policy underlying the above legislative acts and court
rulings equally supports the judgment below that Amazon is not liable
for patent infringement as an alleged seller of goods listed by its
11
users. Indeed, as discussed in the following section, the policy applies

even more strongly in the patent context. To prevail against operators
of online marketplaces based on goods listed for sale on their sites by
third parties, patentees should have to satisfy the strict requirements of
a claim for induced infringement. See Global-Tech Appliances, Inc. v.
SEB S.A., 563 U.S. 754,764-66 (2011) (to be liable for induced
infringement, the defendant must have known that the induced acts
would constitute patent infringement).
III. The Policies That Have Led Courts and Congress to
Exempt Providers of Online Services from Liability in
Other Areas of Law Apply Even More Strongly in the
Context of Claims for Direct Patent Infringement.
A.
Holding Online Platform Providers Liable for Direct

Patent Infringement Based on User Conduct Would
Have the Same or Worse Negative Consequences as in
Other Areas of Law.
As explained above, providers of online platforms and services are

not liable as direct infringers or wrongdoers when their users engage in
unlawful conduct on their websites. This immunity is justified by (1)
the lack of causation between a providers mere act of creating a website
that provides automated services to the public and customers use of the
website to violate the rights of others, Netcom, 907 F. Supp. at 1368-69;
12
(2) a providers inability, as a practical matter, to monitor the millions

of transactions that occur on its website, Hendrickson, 165 F. Supp. 2d
at 10955; and (3) the harmful effects widespread liability would have on
online providers and their users, Zeran, 129 F.3d at 330-31.
These concerns apply equallyindeed, more soto an online
marketplace operator accused of patent infringement. The customers of
Amazon and eBay list hundreds of millions of products for sale on their
websites. A2128-29. A single product may embody literally thousands
of patented inventions, many of which relate to a products internal
operations that cannot be evaluated based on the information in an
online product listing. See, e.g., Mark Lemley and Carl Shapiro, Patent
Holdup and Royalty Stacking, 85 Tex. L. Rev. 1991, 1991-92, 2027
(2007); Mike Masnick, There Are 250,000 Active Patents That Impact
Smartphones; Representing One In Six Active Patents Today (2012),
http://tinyurl.com/glurgjs. Even a seemingly low-tech product like a
diaper has generated over a thousand U.S. patents, most with multiple
Similarly, the district court noted below that [i]t is undisputed that
Amazon lacks the ability to analyze every image it receives from third
party sellers, compare the submitted image to all other copyrighted
images that exist in the world, and determine whether each submitted
image infringes someones copyright interest. A32.
5
13
claims. See USPTO Patent Full-Text and Image Database,

http://tinyurl.com/orwy26y (last visited April 27, 2016) (collecting 1,114
patents in classification 604/358, which covers diapers and similar
devices).
Patent infringement would thus require much more monitoring
and analysis to detect than other types of infringement. Indeed, the
task would be so enormous as to be impossible given the complexity of
patent analysis, the frequently uncertain meaning and scope of patent
claims, online marketplace operators unfamiliarity with most of the
technologies embodied in listed products, and the fact that, in the vast
majority of cases, companies like Amazon and eBay never possess the
listed goods.6
Not only do these complexities argue in favor of immunizing online

marketplace operators from liability for direct patent infringement,
they should also render futile most claims for indirect infringement
since they make it impossible to know whether listed products actually
infringe a given patent. See Global-Tech, 563 U.S. at 764-66 (describing
the knowledge requirement). Even claims for copyright and trademark
infringement are deemed too complex in most cases for secondary
liability to be imposed on online providers. See, e.g., Netcom, 907 F.
Supp. at 1374 (Where a [billboard] operator cannot reasonably verify a
claim of infringement, either because of a possible fair-use defense, the
lack of copyright notices on the copies, or the copyright holders failure
to provide the necessary documentation to show that there is a likely
infringement, the operators lack of knowledge will be found reasonable
6
14
While the patents at issue here are design patents that do not
involve complex technology, determining whether an item infringes a
design patent can still be challenging.7 Moreover, the term sells in 35
U.S.C. 271 must be given the same meaning for design patents and
utility patents alike. Thus, a ruling in this case that Amazon was a
seller of the accused pillowcases would mean that online marketplace
operators likely would be deemed the sellers of all products listed on
and there will be no liability for contributory infringement for allowing

the continued distribution of the works on its system.); Lockheed
Martin Corp. v. Network Solutions, Inc., 985 F. Supp. 949, 964 (C.D.
Cal. 1997) (the degree of uncertainty over infringing uses of domain
names makes it inappropriate to impose contributory [trademark]
liability on a domain name registry), affd, 194 F.3d 980 (9th Cir.
1999).
For example, design patents may raise such difficult issues as whether
a design is ornamental or functional, whether an ordinary observer
would consider two designs to be substantially the same, and whether
a patented design on a certain type of article is infringed by use of the
design on a different type of article. See, e.g., Chrysler Motors Corp. v.
Auto Body Panels of Ohio, Inc., 908 F.2d 951, 954 (Fed. Cir. 1990) (the
distinction between ornamental and functional is a complex issue and
one that continues to be the subject of considerable judicial attention);
Mondo Polymers Techs., Inc. v. Monroeville Indus. Moldings, Inc., No.
2:07-cv-1054, 2009 WL 3698432, *3 (S.D. Ohio Nov. 3, 2009) (in an
ordinary observer infringement inquiry, there are multiple potential
tracks that the relevant analysis might take); 8 Donald S. Chisum,
Chisum on Patents 23.05[2], at 23-186 (2014) (Whether a patent on
the design on a certain article of manufacture is infringed by use of the
identical design on a different article is a long-standing problem that
has never been satisfactorily resolved.).
7
15
their websites, including any products accused of infringing complex

utility patents.
B.
Forcing Online Marketplaces to Remove Listings of

Allegedly Infringing Products Would Effectively
Grant Patent Owners Preliminary Injunctive Relief
Without Having to Satisfy the Applicable Standard.
A likely consequence of such a ruling would be that operators of

online marketplaces would respond to every notice of alleged patent
infringement by removing the corresponding listings from their sites,
regardless of whether the listed products actually infringe, in order to
reduce their risk of liability. Every notice of infringement thus would
effectively operate as a preliminary injunction against the user who
listed the item for sale, without any showing that the patentee would be
likely to prevail on an infringement claim or suffer irreparable harm if
the listing remained. Cf. Lockheed Martin Corp., 985 F. Supp. at 965
(Such an expansion of contributory liability would give Lockheed a
right in gross to control all uses of [the trademarked term] in domain
names.). Patenteesespecially unscrupulous patent trollswould be
given unfair leverage in licensing negotiations and would have an
incentive to abuse the notice process. Competitors could accuse each
others products of infringement, resulting in entire classes of products
16
becoming unavailable through online marketplaces until litigation

resolves the disputes. Consumers would suffer most of all. Such
reductions of Internet commerce and communication are exactly the
results that Congress and the courts have sought to avoid. See, e.g.,
Zeran, 129 F.3d at 330 (observing that the DMCA was enacted, in part,
to maintain the robust nature of Internet communication).
Although Congress implemented a notice-and-takedown procedure
in the DMCA, it also gave alleged infringers the right to have their
content restored by providing an appropriate notice to the online service
provider. 17 U.S.C. 512(g)(2). The service provider can comply with
the notice without liability to the copyright owner. Id. 512(g)(4). The
dispute then becomes one between the copyright owner and the alleged
infringer. No such statutory safe harbor exists in patent law, however,
so an online marketplace operator treated as a seller would have to
choose between removing listed items accused of patent infringement
and risking patent infringement liability.
Considering these practicalities leads to the same conclusion as
reviewing the language of 35 U.S.C. 271, Congressional enactments
like the DMCA and CDA, and court decisions related to copyrights and
17
other areas of law: online marketplace operators like Amazon and eBay
should not be deemed sellers of the items listed by third parties on their
websites and they should not otherwise be held liable for direct patent
infringement based on those listings.
CONCLUSION
For the reasons stated above, eBay respectfully requests that the
Court affirm the judgment below that Amazon did not sell the accused
products and thus is not liable for patent infringement. Contrary to the
concerns expressed by the district court below, the result dictated by the
plain language of 35 U.S.C. 271 is not contrary to public policy.
Respectfully submitted,
/s/ Mark P. Wine
Mark P. Wine
2050 Main Street, Suite 1100
Irvine, CA 92614-8255
(949) 567-6700
Matthew H. Poppe
1000 Marsh Road
Menlo Park, CA 94025-1015
(650) 614-7400
April 28, 2016
18
This brief complies with the type-volume limitation of Fed. R. App.
P. 32(a)(7)(B)(i) because this brief contains 3820 words, excluding the
parts of the brief exempted by Fed. R. App. P. 32(a)(7)(B)(iii).
This brief complies with the typeface requirements of Fed. R. App.
P. 32(a)(5) and the type style requirements of Fed. R. App. P. 32(a)(6)
because this brief has been prepared in a proportionally spaced typeface
using Microsoft Word 2010 in Century Schoolbook 14-point font.
/s/Mark. P. Wine
CERTIFICATE OF SERVICE
I hereby certify that I electronically filed the foregoing with the
Clerk of the Court for the United States Court of Appeals for the
Federal Circuit by using the appellate CM/ECF system on April 28,
2016.
I certify that all participants in the case are registered CM/ECF
users and that service will be accomplished by the appellate CM/ECF
system.

/s/Mark P. Wine

Milo & Gabby V Amazon (Fed. Cir.) - Fully Briefed

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Milo & Gabby V Amazon (Fed. Cir.) - Fully Briefed

Uploaded by

Copyright:

Available Formats

161290

United States Court of Appeals

MILO & GABBY LLC, KAREN KELLER,

The full name of every party or amicus represented by me is:

The parent companies, subsidiaries (except wholly-owned

WHITAKER LAW GROUP

STATEMENT OF RELATED CASES..................................................1

APPELLATE JURISDICTIONAL STATEMENT................................2

STATEMENT OF THE ISSUES...........................................................3

STATEMENT OF THE CASE..............................................................4

The Underlying Dispute...............................................................6

The Proceedings Below................................................................9

The Trial Below..........................................................................11

STATEMENT OF THE RELEVANT FACTS.....................................13

Background of Appellants and Associated Intellectual Property.13

Background of the Dispute........................................................15

Amazon's Actions as a Seller.....................................................16

SUMMARY OF THE ARGUMENT....................................................20

Amazon Is A Seller Of The Accused Products........................22

Taking Legal Title Is Not Required In Order To Be A

Amazon Is A Person In The Position Of A Seller.........26

Sale or return Transactions...........................................27

Accused Products As A Matter Of Law................................27

Amazons Liability As The Seller For Patent And Copyright

Amazon Has Committed Copyright Infringement...................29

Amazon Has Already Admitted That The Accused Products

It Is Undisputed That Amazon Stored and Shipped the

Amazon's Own Witness Admitted That Amazon

Amazons Distribution Is A Sale Or Other Transfer Of

The DMCA Safe Harbor Provisions Do Not Apply To The

The District Court Erred By Dismissing Milo & Gabby's

The District Courts Dismissal..............................................37

The Complaint Details The Facts Supporting Milo &

The Elements Of Passing Off...........................................39

Milo & Gabbys Complaint Alleged Sufficient Facts To

Not Only Was Amazon Put On Fair Notice, Amazon

The Attorneys Fees Award Should Be Vacated...................43

This Court's jurisdiction isbasedon 28U.S.C.1295(a)(1),

This appeal is timely under Fed. R. App. P. 4. A final

Did the District Court err in holding that the Digital

Millenium Copyright Act provides a safe harbor against copyright

Did the District Court abuse its discretion in partially

In mid2013, the Kellers were shocked to discover that blatant

forward on the very narrow, limited question of whether Amazon

Milo & Gabby designed, sold, and distributed its products to

were never in serious factual dispute. What is in dispute, is how

judgment and motions to dismiss de novo. Questions of contract

Amazon cannot be a seller as a matter of law. A441A442.

This Court applies traditional contract principles to determine

The sales by Amazon of the accused products are essentially

true owner. Accordingly, taking legal title is unnecessary for a

Another example where a person to whom legal title is not

Questions of contract interpretation are questions of law.

court conducts de novo review of issues of law such as contract

copyright infringement and patent infringement claims based on its

distributecopiesofapictorialorsculpturalwork. 17U.S.C. 106;

113(b). The Copyright Act defines copyright infringement as a

the photographs on the associated packaging. See, A33, 39. Using

Amazon conceded that the accused products are substantially

infringement occurred; it merely denies that it is liable for that

When Amazon answered the complaint, it admitted that the

products to Amazon. A342 (You will ship Units to us in accordance

The above facts were confirmed at trial, when Amazon's only