LANCE M. AFRICK, District Judge.
Before the Court is a motion
According to the complaint, plaintiff, Express Lien, Inc. ("Zlien"), is an internet based business that sells legal "self-help" forms to parties in the construction industry, provides assistance in the filing of these forms, and compiles and provides extensive information resources and tools for clients.
Zlien alleges that every page of its website is marked with a copyright notice and that the website has been registered for copyright protection.
Zlien states that at various times, during inspection of various websites, it discovered that its copyrighted material was being publicly displayed and distributed by defendant, National Association of Credit Management ("NACM"), through its website, nacm.org.
On May 20, 2013, Zlien filed this lawsuit against NACM, asserting claims of copyright infringement, trade dress infringement, and unfair competition.
Zlien further alleges that its website design, including the color, code elements, and orientation is widely recognized by consumers and that it has become a valuable indicator of the source and origin of the information provided which, as a result, drives Zliens' sales and position as a leader in its field.
Zlien claims it is entitled to judgment and relief against NACM for NACM's copyright infringement in violation of 17 U.S.C. § 501 and trade dress infringement and unfair competition in violation of 15 U.S.C. § 1125(a).
On July 25, 2013, NACM filed a motion to dismiss plaintiff's complaint for failure to state a claim pursuant to Federal Rule of Civil Procedure 12(b)(6).
A district court may dismiss a complaint, or any part of it, for failure to state a claim upon which relief can be granted if the plaintiff has not set forth a factual allegation in support of his claim that would entitle him to relief. Fed. R. Civ. Proc. 12(b)(6); Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007); Cuvillier v. Taylor, 503 F.3d 397, 401 (5th Cir. 2007). As the Fifth Circuit explained in Gonzalez v. Kay:
577 F.3d 600, 603 (5th Cir. 2009).
This Court will not look beyond the factual allegations in the pleadings to determine whether relief should be granted. See Spivey v. Robertson, 197 F.3d 772, 774 (5th Cir. 1999); Baker v. Putnal, 75 F.3d 190, 196 (5th Cir. 1996). In assessing the complaint, a court must accept all well-pleaded facts as true and liberally construe all factual allegations in the light most favorable to the plaintiff. Spivey, 197 F.3d at 774; Lowrey v. Tex. A & M Univ. Sys., 117 F.3d 242, 247 (5th Cir. 1997). "Dismissal is appropriate when the complaint `on its face show[s] a bar to relief.'" Cutrer v. McMillan, 308 F. App'x 819, 820 (5th Cir. 2009) (quoting Clark v. Amoco Prod. Co., 794 F.2d 967, 970 (5th Cir. 1986)).
NACM argues that Zlien's copyright claim must be dismissed because Zlien cannot copyright a state statute. Zlien responds that the content of its website qualifies as a "compilation," and that it did not limit its claim of copyright infringement solely to the text of a statute.
"A `compilation' is a work formed by the collection and assembling of preexisting materials or of data that are selected, coordinated, or arranged in such a way that the resulting work as a whole constitutes an original work of authorship. The term `compilation' includes collective works." 17 U.S.C. § 101. "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." 17 U.S.C. § 103(b). "Copyright protection may extend to such a compilation, even if the material of which it is composed is not copyrightable itself or is already subject to a previous copyright." Apple Barrel Prods., Inc. v. Beard, 730 F.2d 384, 387 (5th Cir. 1984).
NACM argues that "the material at issue" is not a compilation as a matter of law because plaintiff copied the entire California private lien statute verbatim and did not add any original content. However, Zlien alleged in its complaint that the "state-by-state informational resources include the answers to several Frequently Asked Questions ("FAQs") for each state, segregated between private projects and public projects, and compilations of selected text from each state's statutes concerning mechanics lien and bond claim law."
NACM argues that Zlien failed to state a claim for a trade dress violation because it did not allege the existence of a valid trademark. As Zlien notes, however, Section 43(a) of the Lanham Act can be used "to protect a product's appearance, or `trade dress,' without having a registered trademark." Healthpoint, Ltd. v. River's Edge Pharmaceuticals, L.L.C., No. 03-984, 2005 WL 356839, at *4 (W.D. Tex. Feb. 14, 2005) (citing Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763 (1992); Eppendorf-Netheler-Hinz GMBH v. Ritter GMBH, 289 F.3d 351, 354-55 (5th Cir. 2002); Allied Marketing Group, Inc. v. CDL Marketing, Inc., 878 F.2d 806, 812 (5th Cir. 1989)).
The Fifth Circuit follows a two-step analysis in determining whether there has been an infringement of trade dress under the Lanham Act. Allied Marketing Grp., 878 F.2d at 813. "First, the court must determine whether the trade dress is protected under the Act. This first inquiry encompasses three issues: (1) distinctiveness, (2) `secondary meaning,' and (3) `functionality.'" Id. Second, "[i]f a court determines that the trade dress is protected—because it is non-functional and is either distinctive or has acquired secondary meaning, the court must then determine whether the trade dress has been infringed. Infringement is shown by demonstrating that the substantial similarity in trade dress is likely to confuse consumers." Id.
NACM argues that a comparison of the two websites reveals no trade dress violation. NACM argues that apart from the actual California statute, there are no similarities between the two web pages that could plausibly support a trade dress claim. Although this Court need not, as NACM suggests, accept as true conclusory allegations, unwarranted factual inferences, or legal conclusions, Zlien alleges that the website design, including the color, code elements, and orientation is widely recognized by consumers and has become a valuable indicator of the source and origin of the information in its website. Zlien alleges that NACM copied its stylistic choices along with the content of the website, including the color, font, and hyperlinks, in a manner that is confusingly similar to Zlien's website. The fact that the NACM webpage relating to the California mechanics lien statute has several differences from a corresponding Zlien webpage does not show that Zlien has failed to state a claim upon which relief can be granted.
Finally, NACM argues that its website predates Zlien's website and that it developed the look, feel, style, and font of its website before plaintiff even existed as a company. This argument necessarily turns on matters outside the pleadings. As previously stated, given the early stage of the proceedings and the limited and incomplete record with respect to the claims asserted in this matter, the Court declines the opportunity to consider matters outside the pleadings or to treat this motion as one for summary judgment. See Fed. R. Civ. P. 12(d).
In light of the foregoing,