ORDER

TIMOTHY M. BURGESS, District Judge.

I. INTRODUCTION

This is an action by Plaintiff Alaska Stock, LLC ("Alaska Stock") against Pearson Education, Inc. ("Pearson") and several pseudonymously named parties for copyright infringement and fraud.1 Pearson has moved for summary judgment and Alaska Stock has cross-moved for partial summary judgment.2 Each motion is opposed and has been fully briefed. For the reasons discussed below, Pearson's motion at Docket 92 is GRANTED, in part, and DENIED, in part, and Alaska Stock's motion at Docket 99 is DENIED.

II. FACTUAL BACKGROUND

Many of the facts underlying this case are undisputed. Alaska Stock is a stock photography company that licenses the photographs taken by approximately 200 photographers to a number of publishers, including Pearson.3 Between 1999 and 2007, Pearson paid Alaska Stock for limited licenses to use copies of specific photographs in its education publications.4 The licenses expressly limited the number of copies Pearson was permitted to use, the allowable distribution area, and included several other limitations.5

Each time Pearson sought to obtain a license, Pearson sent Alaska Stock a "billing request."6 Each of Pearson's requests contained similar language and information. For example, on or about June 20, 2002, Pearson sent Alaska Stock a request to use image 33,7 a photo of a man with a frosted beard and face.8 Pearson informed Alaska Stock that it would use a 1/4-page reproduction of the image in a particular textbook, that the image would be used only in the first edition of the book, that circulation of the book would be "under 40,000 copies," that the book would be printed in Spanish, and that the book's distribution would be limited to the "United States, its territories and possessions, United States Department of Defense Schools, and Canada []."9

Alaska Stock responded to Pearson's billing requests by sending invoices. Each invoice expressly detailed the scope of the license and the price Pearson was required to pay for its use of the image.10 For example, in response to Pearson's June 20, 2002 request to use image 33, Alaska Stock sent Pearson an invoice dated July 1, 2002.11 The invoice provided that, for a specific price, Pearson would have "[o]ne time, non-exclusive North American Spanish language reproduction rights" for "one edition" of the specified textbook, "with a press run limited to 40,000 or less."12 The invoice also stated that "[n]o electronic use rights [were] allowed under th[e] license" and that "teacher editions, ancillaries and/or related materials [we]re available for additional fees."13 In bold print at the bottom of the invoice, Alaska Stock stated that any use beyond the terms stated in the invoice "must be negotiated and paid for before use."14

Effective July 19, 2006, Alaska Stock and Pearson entered into a "preferred vender agreement" ("PVA"), which established pricing terms for Pearson's use of Alaska Stock's photographs.15 The PVA set a base rate for up to a full-page photograph, with distribution of up to 100,000 copies in North America, but allowing up to ten percent distribution abroad and up to five percent distribution by e-book.16 If distribution was to exceed 100,000, a percentage was to be added to the "base rate."17 If distribution was to exceed 500,000, a higher percentage was to be added to the base rate.18

After the PVA was executed, Pearson continued to send billing requests and Alaska Stock continued to send licenses. For example, on or about August 17, 2007, Alaska Stock sent Pearson an invoice, licensing Pearson to use image 147, a photograph of a caribou overlooking a lake.19 The license granted Pearson "[o]ne time, non-exclusive North American English and Spanish language reproduction rights" as "a two[-]page spread used once" in "one edition of the print and electronic versions" of the specified textbook, with a press run of "up to 100,000."20 The invoice also stated that payment for use of the image must be made "before use of the image[] t[ook] place."21

In May 2008, Alaska Stock received a billing request from Pearson in which it sought to reuse a photograph it previously used in a 2006 publication.22 Alaska Stock found the request "odd" for two reasons: (1) Pearson had last been licensed to use the photograph in a 2001 publication, not a 2006 publication; and (2) Pearson had requested permission to reproduce only 5,000 copies of the photograph, a quantity which Alaska Stock perceived to be very low for an education publication.23 Alaska Stock contacted Pearson on May 13, 2008.24 After exchanging numerous emails, Pearson disclosed on July 8, 2008, that it had printed over 350,000 copies of the publication in which the photograph was used.25 Pearson's 2001 license authorized it to print only 40,000 copies.26 Pearson described the incident to Alaska Stock as "a project that fell through the cracks" and requested a price and retroactive license for the print overages.27

Following Pearson's disclosure, Alaska Stock began to wonder whether Pearson had reproduced photographs beyond the limits of its other licenses.28 On July 22, 2008, Alaska Stock asked Pearson for print quantity information on 25-30 other licenses.29 On September 22, 2008, after Alaska Stock made several follow-up inquiries, Pearson disclosed two more instances in which it had exceeded the authorized print quantity.30 On three occasions between late 2008 and early 2009, Pearson provided limited additional information, but did not disclose any additional instances of overprinting.31

Between December 2008 and July 2011, many of the photographers whose images were licensed to Pearson executed agreements in which they assigned ownership of their copyrights to Alaska Stock.32 The assignment agreements all contain language equal or substantially similar to the following:

By the end of July 2011, the images underlying Alaska Stock's claims were re-registered with the Copyright Office and new certificates of registration were issued, listing Alaska Stock as the registered copyright owner.34

On August 12, 2011, Alaska Stock filed its currently pending complaint against Pearson, alleging that Pearson committed copyright infringement by exceeding the scope of its licenses (or, in one case, using a photograph without a license) with respect to over 200 of its photographs.35 Alaska Stock also asserts several counts of fraud, asserting that Pearson knew at the time it requested various licenses that it would exceed the requested quantities.36 Prior to filing its summary judgment motion, Alaska Stock moved to voluntarily dismiss 70 of its copyright infringement claims, leaving 147 claims unresolved.37 Alaska Stock's motion for partial summary judgment seeks adjudication in its favor on 27 of those claims.38

In support of its motion for summary judgment, Alaska Stock has provided reports, disclosed by Pearson during discovery, indicating that, with respect to each of the 27 images, Pearson either printed in excess of its license or printed without a license.39 Pearson does not challenge the fact that it either exceeded the print quantity limitations of its licenses or printed without a license in the 27 instances. Instead, Pearson argues: (1) that the claims are barred by the statute of limitations; (2) that Alaska Stock lacks standing; (3) that the underlying images were not properly registered; (4) that Alaska Stock's allegations give rise to a breach of contract action, not a copyright infringement action; (5) that Pearson's overprinting was covered by the PVA; (6) that, with respect to one of the claims, Pearson had an implied license; and (7) that, with respect to 78 of Alaska Stock's claims, it is entitled to summary judgment because Alaska Stock has not supported the claims with evidence.40

III. LEGAL STANDARD

Summary judgment is warranted when the pleadings and the evidence in the record "show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law."41 An issue is genuine only if there is sufficient evidence for a reasonable fact-finder to find for the non-moving party, and material only if the fact may affect the outcome of the case.42

Generally, it is the moving party that must demonstrate that it is entitled to summary judgment.43 The moving party bears the initial burden of identifying the elements of the claim or defense and evidence that it believes demonstrates the absence of an issue of material fact.44 Where the non-moving party has the burden at trial, however, the moving party is not required to produce evidence negating or disproving every essential element of the non-moving party's case.45 Instead, the moving party's burden is met by pointing out that there is an absence of evidence supporting the non-moving party's claim.46 The burden then shifts to the non-moving party to show that there is a genuine issue of material fact that must be resolved at trial.47 The non-moving party must make an affirmative showing on all matters placed in issue by the motion as to which it has the burden of proof at trial.48

IV. DISCUSSION

A. Alaska Stock's Summary Judgment Motion

Alaska Stock moves for partial summary judgment solely on the issue of liability on 27 of its copyright infringement claims. Pearson opposes the motion, arguing that material questions of fact exist with respect to: (1) whether the claims are time-barred; (2) whether Alaska Stock has standing to bring the claims; (3) whether the images underlying the claims have been properly registered; and (4) whether, with respect to the image for which Pearson did not have an express license, Pearson had an implied license.49

1. Statute of Limitations

Pearson argues, both in opposition to Alaska Stock's motion and in support of its own motion, that Alaska Stock's claims are barred by the statute of limitations.50

The Copyright Act provides that "[n]o civil action shall be maintained under the provisions of [the Act] unless it is commenced within three years after the claim accrued."51 A claim for copyright infringement "accrues when one has knowledge of a violation or is chargeable with such knowledge."52 "[T]he statute of limitations does not prohibit recovery of damages incurred more than three years prior to the filing of suit if the copyright plaintiff was unaware of the infringement" and the plaintiff's "lack of knowledge was reasonable under the circumstances."53 Put another way, "[a] claim for copyright infringement accrues on the date that a reasonable investigation would have put the rights holder on notice that potentially infringing conduct has occurred."54

Alaska Stock filed its complaint on August 12, 2011.55 Accordingly, Alaska Stock's claims will be time-barred if it knew or should have known of Pearson's infringement before August 12, 2008. In support of its statute of limitations argument, Pearson asserts that Alaska Stock's claims accrued no later than May 2008, several months outside of the statute of limitations period.56 Specifically, Pearson argues that Alaska Stock's suspicions in May 2008 that Pearson was over-printing with respect to a single image "trigger[ed] the accrual period on all of [Alaska Stock's] claims of alleged copyright infringement."57 With limited exception, the Court disagrees.

The parties do not dispute that Pearson's May 2008 billing request was the first indication Alaska Stock had that something was amiss. Alaska Stock found the request "odd" because Pearson requested only 5,000 copies of the image and because Pearson referenced an earlier use of the photograph in a publication for which Alaska Stock had no record of having issued a license.58 On May 13, 2008, Alaska Stock contacted Pearson to investigate, specifically asking for information regarding Pearson's prior use of the photograph.59 After exchanging several emails, on July 8, 2008, Pearson informed Alaska Stock that it had printed over 350,000 copies of the image, even though it was licensed to print only 40,000 copies, and that the textbook edition in which the image appeared was not the edition for which Pearson had requested the license.60 Because Alaska Stock reasonably learned of Pearson's overprinting of the image on July 8, 2008, Alaska Stock's copyright infringement claim with respect to that license also accrued on July 8, 2008. Because Alaska Stock did not file its Complaint until August 12, 2011, the Court agrees that the infringement claims related the July 8, 2008 disclosure are likely time-barred.

However, the parties have used an "all or nothing" approach in briefing the statute of limitations issue and did not identify for the Court the claim or claims linked to this particular overuse by Pearson. From the record, it appears that the book title and ISBN number discussed in the parties' May 2008 through July 2008 email exchanges match the title and ISBN number associated with images 18 and 19 in Exhibit 1 to the complaint.61 But the approximately 350,000 copies disclosed by Pearson in the email exchange do not match the quantity associated with those images in the documents submitted by Alaska Stock in support of its summary judgment motion.62 Consequently, the Court is unable to conclude that the claims associated with images 18 and 19 are barred by the statute of limitations. This uncertainty precludes summary judgment on these two claims.

Apart from the two claims discussed above, the Court is not persuaded by Pearson's argument that Alaska Stock's copyright infringement claims accrued outside of the three-year limitations period. Despite Alaska Stock's frequent requests for Pearson's print run information related to other licenses, Pearson did not provide any such information until September 22, 2008, when it disclosed only two additional instances of overprinting.63 The Court rejects Pearson's argument that the May 2008 billing request or single disclosure of overprinting, which Pearson described to Alaska Stock as a "project that fell through the cracks,"64 served to put Alaska Stock on notice that Pearson exceeded the scope of its licenses in numerous other instances or provided Alaska Stock with a sufficient factual basis to bring its remaining copyright infringement and fraud claims.

In sum, issues of fact preclude summary judgment in favor of Alaska Stock on the claims associated with images 18 and 19. With respect to the remaining 25 claims raised in Alaska Stock's motion, Pearson has not met its burden of proving that these claims are time-barred.65

2. Standing

Pearson next argues that Alaska Stock does not have standing to assert its copyright infringement claims because it was assigned only "the bare right to sue" and was not granted actual ownership of the copyrights.66

The Copyright Act restricts the individuals and entities who are entitled to bring an action for infringement to those who qualify as "the legal or beneficial owner of an exclusive right under a copyright."67 These "exclusive rights" are defined in 17 U.S.C. § 106 and include, for example, "the right to reproduce the copyrighted work, and to distribute copies of the work by selling, renting, leasing, or lending."68 The "right to sue" is not an exclusive right under the Copyright Act.69 Yet the right to sue, even for past infringement, may be transferred to another party if ownership of an exclusive right is also transferred.70

In determining whether an agreement has transferred an exclusive right, in addition to the right to sue, courts "look not just at the labels parties use but also at the substance and effect of the contract."71 If the "substance and effect of the contract" demonstrate that a plaintiff has only "the bare right to sue," the plaintiff lacks standing.72 In analyzing a particular contract, courts look at what was actually assigned and the extent to which the right to exploit exclusive rights under the Copyright Act was expressly limited.73

Ninth Circuit authority directly relevant to Pearson's standing argument is limited. In Silvers v. Sony Pictures Entertainment, the Ninth Circuit established that "[t]he bare assignment of an accrued cause of action is impermissible" under the Copyright Act.74 Silvers involved an assignment in which the copyright owner expressly retained all ownership and exclusive rights, and assigned to the plaintiff only the "right, title and interest in and to any claims and causes of action against [the defendant]."75

Following Silvers, in Nafal v. Carter, the Ninth Circuit affirmed the decision of a district court in a case involving a less straightforward assignment.76 The district court in Nafal had examined a contract purporting to assign "an undivided one-half (50%) interest" in an exclusive license pertaining to a copyrighted song.77 The written agreement, however, expressly prohibited the plaintiff from exercising decision-making authority, severely limited his ability to exploit exclusive rights, required him to file the pending lawsuit but prohibited him from filing any other lawsuit, and left the him "utterly impotent to decide how and when to enforce the [l]icense [a]greement against infringers."78 Under those circumstances, the district court found that, despite "the label that the parties put on the agreement," the "substance of what was given to the [plaintiff]" in the assignment was nothing more than the bare right to sue.79

More recently, in Righthaven LLC v. Hoehn, the Ninth Circuit considered an assignment agreement that purported to transfer both the right to sue and various exclusive rights, but was limited by a pre-existing contract.80 The language of the assignment agreement in Righthaven provided, in part, that "subject to [the assignor's] rights of reversion," Righthaven was granted "all copyrights requisite to have Righthaven recognized as the copyright owner of the [relevant work] for purposes of Righthaven being able to claim ownership as well as the right to seek redress for past, present, and future infringements of the copyright."81

Prior to executing the assignment, however, Righthaven entered into a separate contract with the assignor, which placed "limits on what Righthaven could do with any copyright assigned to it."82 This earlier contract provided, for example, that the assignor retained the "unfettered and exclusive ability" to exploit any copyright assigned to Righthaven and that Righthaven had "no right or license" to exploit the work or participate in any royalties associated with exploitation of the work.83 The Ninth Circuit concluded that, "[w]ithout any of those rights," the later assignment agreement effectively "left [Righthaven] with the bare right to sue, which [was] insufficient for standing under the Copyright Act."84 Importantly, it was not the language of Righthaven's assignment agreement, but rather the limits placed on the assignment by the earlier contract, that led the Ninth Circuit to conclude that Righthaven did not possess any exclusive rights under the Copyright Act.85

Here, Pearson asserts that questions of fact exist regarding Alaska Stock's standing to bring this action. The Court disagrees. Unlike the agreements at issue in Nafal or Righthaven, the "substance and effect" of the written assignments in this case reflect a true, albeit temporary, transfer of ownership interest.86 Indeed, even the copyright certificates themselves list Alaska Stock as the registered owner.87 Although Pearson points to evidence that the assignments were made for the purpose of facilitating litigation, including the fact that Alaska Stock has agreed to reassign ownership upon completion of the litigation, the photographers' reasons for assigning ownership does not make the transfer of ownership any less effective. Property rights are transferred every day for any number of reasons and for varying periods of time; copyrights are no different.88 The Ninth Circuit has never suggested that the reason an assignment is made — even if that reason is simply to facilitate litigation — or an assignment's temporary nature will transform an otherwise effective assignment of ownership into an assignment of the bare right to sue.89 Rather, the problem arises where the assignor labels an assignment a transfer of ownership, but expressly reserves the exclusive rights in the copyright to itself. Those are not the facts presented here.

In sum, the Court is not convinced that Alaska Stock lacks standing to bring this action.

3. Copyright Registration

Pearson also challenges the validity of Alaska Stock's copyright registrations. Specifically, Pearson argues that Alaska Stock has failed to provide copies of the deposits (the actual photographs) on file with the Copyright Office and has therefore failed to establish that it owns copyrights to those images.

A registered copyright is generally a precondition to a copyright infringement claim.90 Because ownership of a valid copyright is a prerequisite to filing an infringement action, the plaintiff bears the burden of proof.91 Under 17 U.S.C. § 401(c), a certificate of registration made within five years after first publication of the work constitutes prima facie evidence of the validity of the copyright and entitles the holder to a "rebuttable presumption" of validity.92 A presumption of validity "shifts to the defendant the burden to prove the invalidity of the plaintiff's copyright."93 Where the burden has shifted, the "defendant must [] offer some evidence or proof to dispute or deny the plaintiff's prima facie case of infringement."94 However, absent a certificate of registration within the five-year timeframe, there exists no presumption of validity, and the "evidentiary weight to be accorded the certificate ... shall be within the discretion of the court."95

Here, Alaska Stock submitted certificates of registration for each of the images with respect to which it seeks summary judgment.96 The certificates indicate that the images pertaining to 26 of the claims were first published more than five years ago.97 Accordingly, the certificates of registration relating to these 26 claims are not entitled to a presumption of validity and Alaska Stock retains the burden of proving that the underlying images are in fact the images for which the certificates of registration were issued.

The certificates themselves do not include a meaningful description of the images to which they apply. Each certificate merely provides a series of numbers and letters as the "Title of Work," and lists "photograph(s)" as the work created by the author.98 In addition to the certificates, Alaska Stock has submitted the declaration of its president, stating that "[e]ach of the Photographs is the subject of a valid Certificate of Registration issued by the Register of Copyrights."99

In response to Pearson's challenge, Alaska Stock cites the general rule governing summary judgment motions, asserting that Pearson has not "come forward with specific facts showing that there is a genuine issue for trial" and cannot prevent summary judgment merely by stating that Alaska Stock has not presented evidence of the deposits.100 While this typically is the standard, ownership of a valid copyright is pre-condition to bringing a copyright infringement action and, in the absence of the presumption of validity, Alaska Stock retains the burden of proving that the images which are the subject of its claims are the images registered with the Copyright Office.101

There is little law directly on point, and the briefing provides little guidance. Pearson cites two cases; Alaska Stock cites none.

In Corbis Corp. v. Amazon.com, Inc., the Western District of Washington considered a substantially similar argument, in which the defendant asserted that it was entitled to summary judgment because the plaintiff, by not showing that a particular photograph was covered by the certificates of registration in the record, failed to prove that the photograph had been registered by the Copyright Office.102 Although the plaintiff submitted the relevant copyright certificates, the Court explained that the certificates were only prima facie evidence of "the facts stated in the certificate."103 The court observed that there was nothing on the face of the certificates to confirm that the particular photograph had been included in the deposited images.104 It found that "[t]he only way to determine with any certainty whether [the registration certificate] covered the [photo] [wa]s to review the deposits included with the registration applications."105 Without the deposits, the court concluded that the plaintiff "c[ould] not show that the [photo] [wa]s among the photographs covered by [the][r]egistration[s]."106 On this basis, the court found that "a legitimate question of fact" remained "regarding whether the [photo] [wa]s protected" by the submitted copyright certificates such that neither party was entitled to summary judgment.107

In Lanard Toys Ltd. v. Novelty, Inc., the Central District of California considered this issue in the context of a motion for preliminary injunction.108 In assessing whether the plaintiff was likely to succeed on the merits, the court examined whether the plaintiff had established ownership in the allegedly infringed works.109 Specifically, the court considered the defendant's argument "that although [the] plaintiffs ha[d] produced copies of various copyright registrations," they had "not proffered any certified copies of the deposit materials from the Copyright Office showing exactly what [wa]s covered by each of the copyright registrations."110 The defendants asserted that without such evidence, "it [wa]s impossible for the [d]efendants (or the [c]ourt) to compare whatever works that may have been registered to the allegedly infringing products."111 The district court agreed, finding that the certificates of registration, even when combined with the declaration of the plaintiff, were insufficient evidence of ownership and denied the plaintiff's motion for preliminary injunction.112

Like the certificates in Corbis and Lanard Toys, the certificates of registration in this case do not provide the details necessary to confirm that the image or images relating to Alaska Stock's claims are the same images underlying the certificates of registration. Under these circumstances, the Court concludes that a genuine issue of material fact exists such that summary judgment in favor of Alaska Stock is inappropriate with respect to the 26 claims not covered by the presumption of validity.113

This leaves Alaska Stock's 27th claim, which corresponds to image 217. Because this image was registered within five years of its first publication, it is Pearson's burden to present evidence to "rebut" the presumption that the photographs were validly registered. Pearson has provided no such evidence. Accordingly, Pearson has not established a material issue of fact with respect to Pearson's ownership of a valid copyright in image 217.

4. Implied License

In most of its claims, Alaska Stock alleges that Pearson used photographs beyond the scope of express licenses. But, in its claim pertaining to image 217, Alaska Stock alleges that Pearson engaged in copyright infringement by printing the image with no license at all.114 Pearson does not dispute that it printed numerous copies of image 217 without an express license.115 However, Pearson argues that Alaska Stock is precluded from summary judgment on this claim because there is evidence that Pearson was impliedly licensed to use the image.116 Hesitantly, the Court agrees.

Although "transfers of copyright ownership must be in writing, "[a] nonexclusive license may be granted orally, or may even be implied from conduct."117 The "implied grant of a nonexclusive license to use a copyrighted work precludes a copyright infringement claim."118 Often, the parties' course of dealings will determine whether an implied license was given.119

In similar litigation against Pearson, other courts have reached differing conclusions on substantially the same argument. In Psihoyos Education v. Pearson, the Southern District of New York found that material issues of fact precluded summary judgment on the issue of an implied license, in part, because the parties' prior dealings suggested that, with the plaintiff's knowledge, Pearson sometimes published images before finalizing permission.120 But the court explained that "the question comes down to whether there was a `meeting of the minds' between the parties to permit the particular usage at issue" and indicated that "both parties to the transaction, not just the defendant" must have "intended that the defendant could use or copy the plaintiff's work without liability for copyright infringement."121 More recently, the District of Hawaii and the District of Arizona rejected Pearson's implied license arguments, finding no evidence in the parties' course of dealings to support the defense.122 Ultimately, whether Pearson can prevent summary judgment on this basis comes down to whether Pearson has provided evidence from which a reasonable juror could find that that an implied license existed.

Pearson supports its position, in part, by pointing to evidence that over a 12-year business relationship, Alaska Stock "never denied a request by Pearson for a license" and seemed to have a "policy of [] granting Pearson whatever rights it requested."123 The Court is not persuaded by this argument. As the District of Hawaii recently explained, the fact that there is no evidence that Alaska Stock ever refused a request by Pearson to use its photographs, "does not mean that [Alaska] Stock was barred from refusing a request" or that "Pearson was free to use the images in any way it wanted, without even requesting permission."124

Nevertheless, the Court finds that there exists at least some evidence to create a triable issue of fact with respect to whether Pearson had an implied license. For example, the following exchange took place at the deposition of Alaska Stock's president, Jeffrey Schultz:

Aside from this deposition excerpt, none of the evidence to which Pearson points suggests that Pearson was free to use a photograph for which it had no license, or to postpone requesting a license for more than six months after publishing an image.126 Although the Court has doubts about whether Pearson will be able to persuade a jury that the parties' course of conduct created an implied license with respect to image 217, there is evidence to create a material issue of fact for trial. Consequently, Alaska Stock's motion for summary judgment on the claim associated with image 217 is also denied.

B. Defendant's Summary Judgment Motion

Pearson moves for summary judgment on Alaska Stock's claims in their entirety.127 Pearson asserts that it is entitled to judgment in its favor because: (1) Alaska Stock's claims are barred by the statute of limitations; (2) Alaska Stock's allegations give rise to claims for breach of contract rather than copyright infringement; (3) Alaska Stock failed to timely disclose its damages calculations pursuant to Rule 26; and (4) Alaska Stock has not submitted evidence to support its fraud claims.128 Pearson also moves for summary judgment, with respect to 78 specific infringement claims, because Alaska Stock has no evidence to support the claims.129

For the reasons explained previously, Pearson's motion for summary judgment based on its statute of limitations defense is denied. For the reasons discussed below, the Court finds that Pearson is entitled to summary judgment on the 78 claims for which Alaska Stock has submitted no evidence, but rejects Pearson's other arguments.

1. Breach of Contract vs. Copyright Infringement

Pearson asserts that it is entitled to summary judgment on Alaska Stock's copyright infringement claims because any violation of the terms of its licenses amounted to a breach of covenants, which gives rise only to a breach of contract action.130 As a preliminary matter, the Court notes that the District of Hawaii recently rejected this argument in a substantially similar case against Pearson.131 Based on that decision, Pearson apparently withdrew this same argument from consideration in a similar copyright action pending in Arizona.132 The Court briefly explains why it agrees with the District of Hawaii's decision.

"To recover for copyright infringement based on breach of a license agreement, (1) the copying must exceed the scope of the defendant's license[,] and (2) the copyright owner's complaint must be grounded in an exclusive right of copyright (e.g., unlawful reproduction or distribution)."133 The contractual terms in a license that limit the license's scope are referred to as "conditions," the breach of which constitutes copyright infringement.134 All other license terms are referred to as "covenants," the breach of which is actionable only under contract law.135

In MDY Industries v. Blizzard Entertainment, the Ninth Circuit discussed the difference between liability for copyright infringement (the breach of a condition) and liability for breach of contract (the breach of a covenant), providing the following example:

Alaska Stock's claims that Pearson exceeded the scope of its various licenses with respect to the number of publications in which an image could appear is no different from the Ninth Circuit's example of the person who made a hundred copies of a book while licensed to make only one.

As the District of Hawaii recently concluded in Pacific Stock, because Alaska Stock's claims "go to exceeding the scope of an exclusive right of copyright granted in various licenses, as opposed to a covenant contained in those licenses," Alaska Stock can maintain its copyright infringement claims against Pearson.137

Accordingly, Pearson's request for summary judgment on this basis is denied.138

2. Rule 26 Disclosures

Pearson separately asserts that it is entitled to summary judgment because Alaska Stock failed to provide supplemental information regarding its damages calculations as required by Federal Rule of Civil Procedure 26.139

Rule 26(a)(1)(A)(iii) requires parties to make initial disclosures, including their computation of damages. Rule 37(c)(1) provides that if a party fails to provide disclosures under Rule 26(a), "the party is not allowed to use that information ... to supply evidence on a motion, at a hearing, or at a trial, unless the failure was substantially justified or is harmless."

In its October 2011 initial disclosures, Alaska Stock provided the following information regarding damages:

In response to Pearson's motion, Alaska Stock asserts that it could not calculate its actual damages or provide revenue numbers until Pearson disclosed its print run information and the revenue it received for the books in which Alaska Stock's images were printed.141 Alaska Stock also asserts that this information was not fully disclosed until August 21, 2012.142 Alaska Stock, in turn, supplemented its initial disclosures with its damages calculation information on November 16, 2012.143 Although Alaska Stock acknowledges that its disclosures were tardy, it argues that Pearson suffered no harm because it was already in possession of the information necessary to calculate the various damages Alaska Stock referred to in its initial disclosures.144

According to Pearson, because Alaska Stock was late in providing damages calculations, Pearson is entitled to summary judgment on all of Alaska Stock's claims.145 The Court disagrees and notes that the circumstances here are distinguishable from the cases Pearson cites in support of its argument. For example, unlike the plaintiff in Hoffman v. Impact Confections, Inc., there is no evidence here that Pearson, after disclosing the information which Alaska Stock needed to calculate its damages, ever contacted Alaska Stock to remind it of its obligation to produce the calculations.146 Instead, Pearson elected to raise the issue for the first time in its summary judgment motion.

This case is also unlike Use Techno Corp. v. Kenko USA, Inc., in which the plaintiff alleged numerous instances of false advertising and sought damages relating to the defendant's profits.147 When the plaintiff failed to provide its damages calculations, the defendant sought summary judgment, making the same argument Pearson makes here.148 Like Alaska Stock, the plaintiff argued that the untimely disclosure was harmless because the defendant already had the information regarding its own profits.149 The court rejected this argument, however, because the plaintiff had never identified the advertisements (out of thousands) that were allegedly false, making it impossible for the defendant to determine which subset of profits applied to the plaintiffs damages claim.150

Here, Pearson was not only already in possession of information regarding its profits and revenue, but could also independently identify the publications in which it had printed Alaska Stock's images beyond the limits of its licenses.151 The basis for the other damages identified in Alaska Stock's initial disclosures were similarly no mystery to Pearson — it easily could have estimated damages based on what it would have been charged under the parties' PVA, and could have reviewed 17 U.S.C. § 504(c) to determine potential statutory damages.

The Court agrees with Pearson that Alaska Stock was obligated to provide its damages information sooner than it did. However, the Court concludes that Alaska Stock's delay in disclosing the information was harmless. Pearson does not identify any specific surprise or prejudice it suffered as a result of the tardy disclosure, and it does not assert that Alaska Stock's failure to produce the information in a timely manner was the product of willfulness or bad faith.152 Moreover, at this point, a trial date has not yet been set and Pearson has been in possession of the relevant information for more than nine months.153 Under these circumstances, any violation of Rule 26(a) does not provide a basis for granting summary judgment.

3. Fraud Claims

Pearson seeks summary judgment on Alaska Stock's fraud claims on the basis that Alaska Stock "has not proffered any evidence of fraud."154 To prevail on a fraud claim in Alaska, a plaintiff must show: "(1) a false representation of fact; (2) knowledge of the falsity of the representation; (3) intention to induce reliance; (4) justifiable reliance; and (5) damages."155

Alaska Stock's fraud claims correspond to Pearson's overuse of Alaska Stock's photographs in three of Pearson's textbooks.156 Alaska Stock asserts that, at the time Pearson requested to use the photographs in the books, it knew that its actual uses would exceed the quantities for which it requested licenses.157 In opposition to Pearson's summary judgment motion, Alaska Stock submits information and records produced by Pearson to demonstrate that, in each of the three books, Pearson exceeded the limits of its licenses.158

As circumstantial evidence of Pearson's knowledge and intent, Alaska Stock points to Pearson's pre-publication print run forecast for one of the textbooks which shows that Pearson forecasted a greater number of books than the number of uses for which it requested licenses.159 Alaska Stock also provides Pearson's circulation history for prior editions of the textbook, which show that earlier editions of the book were circulated in numbers greater than the number of uses for which Pearson requested licenses.160 From this circumstantial evidence, a reasonable jury could find that Pearson requested licenses for a certain number of uses knowing that it would print more copies than the licenses authorized.161 The Court therefore concludes that Alaska Stock has presented sufficient evidence to create triable issues of fact on the fraud claims.162 Accordingly, Pearson's motion for summary judgment on these claims is denied.

4. Other Copyright Infringement Claims

Finally, Pearson seeks summary judgment on 78 of Alaska Stock's copyright infringement claims because Alaska Stock has presented no evidence to support them.163 Alaska Stock concedes that "Pearson's records demonstrate it did not exceed the print quantity limitations [in these] 78 instances."164 It asks the Court to limit entry of judgment to the "print quantity" aspect of the claims and to "exclud[e] [aspects of the claims related to] other license limits, such as geography territory or type of media."165 However, Alaska Stock points to no evidence to support these claims under any theory. Accordingly, the Court grants summary judgment in favor of Pearson on the claims corresponding to lines 105-107, 109-146, 149-157, 160-162, 166, 172-179, 183-184, 188-189, 194-197, 200-202, and 204-208 of Exhibit 1 to the complaint.

V. CONCLUSION

For the foregoing reasons, Alaska Stock's summary judgment motion at Docket 99 is DENIED, and Pearson's summary judgment motion at Docket 92 is GRANTED, in part, and DENIED, in part.