The U.S. Court of Appeals for the Ninth Circuit affirmed a district court’s holding that the family of the creator of the 1930s cartoon character Betty Boop lacked the requisite copyright or trademark rights to prevent a company from selling merchandise featuring the Betty Boop image. Fleischer Studios, Inc. v. A.V.E.L.A., Inc. et al., Case No. 09-56317 (9th Cir., Feb. 23, 2011) (Wallace, J.) (Graber, J., dissenting).

Plaintiff Fleischer Studios, formed by the family of Betty Boop creator Max Fleischer, sued defendants, including Art & Vintage Entertainment Licensing Agency, for copyright and trademark infringement for alleged unauthorized sale of products featuring the image of Betty Boop. The plaintiff asserted exclusive copyright ownership of the Betty Boop character as a result of a series of conveyances commencing with the creator transferring the Betty Boop copyrights to Paramount Pictures in 1941. The district court granted summary judgment to the defendants on the plaintiff’s copyright infringement claim on the grounds that the plaintiff failed to establish a clean chain of title. The district court granted summary judgment to the defendants on the plaintiff’s trademark infringement claim due to the plaintiff’s fractured use of the character’s name and image. Fleischer Studios appealed.

The 9th Circuit affirmed the grant of summary judgment to defendants. Concerning Fleischer Studios’ copyright claim, the court determined that the films featuring Betty Boop and the Betty Boop character each held separate copyrights pursuant to the applicable version of the Copyright Act. Fleischer Studios claimed exclusive ownership based upon conveyances made to it subsequent to the original transfer from the creator to Paramount. The court determined that Paramount was granted the copyrights to the Betty Boop films, but the purchase agreement at issue expressly carved out the transfer of the character rights. Further, Paramount transferred the copyrights to the Betty Boop character to a third party three years after the transfer of the film copyrights. Accordingly, the 9th Circuit found that Fleischer Studios’ chain of title regarding the Betty Boop character copyrights was broken at the Paramount link such that it did not possess copyright ownership to sustain the suit.

The court also affirmed the grant of summary judgment to the defendants on Fleischer Studios’ trademark infringement claim. The defendants’ allegedly infringing merchandise included Betty Boop dolls, t-shirts and handbags. The trademark infringement claim hinged on whether defendants’ use of the Betty Boop image was for functional or trademark purposes. The 9th Circuit determined that defendants were not using the Betty Boop image as a trademark but as a “functional aesthetic component” of the product. First, the defendants’ merchandise prominently displayed the image but was not marketed as “official” Betty Boop merchandise or as emanating or endorsed by the character’s creator. Second, no evidence existed of consumer complaints or confusion. Finally, the court determined that ruling in favor of Fleischer Studios would prevent the Betty Boop character from ever entering the public domain, in conflict with the 2003 Supreme Court decision in Dastar Corp. v. Twentieth Century Fox Film Corp.

In dissent, Circuit Judge Graber argued that the majority erred in failing to address what entity ultimately acquired copyright ownership to the Betty Boop character. Instead, Graber argued, the majority improperly adopted its own chain of title theory that was rejected by the district court and not raised by any parties on appeal. If the majority had considered the complete picture, the dissent explained, Fleischer Studios would have prevailed on its copyright claim.