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Following jury verdict in favor of Beastie Boys on copyright infringement and Lanham Act claims, district court denies defendant Monster Energy Company’s motions for judgment as matter of law, for new trial, and for reduction in damages, finding that trial evidence supported jury’s findings of willful infringement, as well as false endorsement and intentional deception in violation of Lanham Act.
This ruling on post-trial motions follows protracted litigation between the Beastie Boys and Monster Energy Company, arising out of Monster’s creation and dissemination of a promotional video that contained portions of five Beastie Boys songs. The Beastie Boys asserted two claims of infringement for each of the five songs used in the video: one for infringement of the sound recording copyright, and another for infringement of the musical composition copyright. In each of these 10 claims, the Beastie Boys alleged an “unauthorized reproduction,” “distribution to the public,” and “public performance” that was “intentional and willful.” In their Lanham Act claim, the Beastie Boys alleged that Monster had made unauthorized use of the mark “Beastie Boys” and “the marks comprised of the legal and professional names” of individual members. As a result, the Beastie Boys alleged, “the public was confused into believing that plaintiffs sponsored, endorsed, and are associated with defendant Monster in promoting Monster’s products and promotional events.” The jury awarded the Beastie Boys, on the copyright claim, alternative awards of $1 million in actual damages and $1.2 million in statutory damages. On the Lanham Act claim, the jury awarded the Beastie Boys $500,000 in damages, having found that Monster had intended to deceive consumers.
After the verdict, Monster moved for judgment as a matter of law under Rule 50(b) on three issues: whether (1) its copyright infringement was willful, as required to recover enhanced statutory damages under the Copyright Act; (2) it is liable for false endorsement in violation of the Lanham Act; and (3) it intentionally deceived consumers, as required to recover monetary damages under the Lanham Act.
As to the copyright claim, Monster did not dispute liability, but disputed that its infringement was willful. The court declined to disturb the jury’s verdict, finding that the jury could have determined that Monster’s employee acted in reckless disregard of the Beastie Boys’ rights when he directed that the company use the Beastie Boys’ music in the video without seeking the Beastie Boys’ authorization.
As to the jury’s finding of liability on the Lanham Act claim, the jury found that “Monster used the Beastie Boys’ persona without permission, thereby suggesting a false endorsement of Monster’s products.” The court noted that to prevail on a false endorsement claim in the Second Circuit, a plaintiff must prove that the defendant (1) made a false or misleading representation of fact; (2) in commerce; (3) in connection with goods or services; and (4) that is likely to cause consumer confusion as to the origin, sponsorship, or approval of the goods or services. Here, the second and third elements were not disputed. To find liability, the jury had to make two determinations: first, that the video contained a false or misleading representation of fact—i.e., that it misleadingly implied that the Beastie Boys had endorsed Monster, when in fact it had not; and second, that consumers were likely to be confused by this false or misleading representation. The court reviewed the evidence and found that a jury could easily conclude that Monster used the Beastie Boys persona to suggest, misleadingly, that the band was endorsing Monster Energy: “The ubiquity of the band’s music ‘unquestionably br[ought] to mind’ the Beastie Boys, and the use of the names ‘Beastie Boys’ and ‘MCA’ in the credits drove the point home. It is, in sum, ‘hard to believe that anyone who had seen defendant[’s video] could ever thereafter disassociate it from plaintiff[s’ music].’”
Finally, Monster challenged the jury’s finding of intentionally deceptive conduct by Monster, a finding that allowed the imposition of money damages under the Lanham Act. While there was no direct evidence at trial of intentional deception, intentional deception can be proven by circumstantial evidence. Here, two firmly established facts supplied a basis on which a jury could infer intentional deception—that Monster intended to capitalize on the Beastie Boys’ goodwill and reputation and to convey the impression of an endorsement while knowing that the group had not endorsed Monster. Based on the testimony, the jury could have inferred that Monster used the Beastie Boys’ music and marks “with the intention of capitalizing on [its] reputation and goodwill and [on] any confusion” that resulted.
The court denied all of Monster’s motions for judgment and a new trial. The court also declined to reduce the jury’s award as to either category of copyright damages, because the damages awarded here—$1 million in actual damages and $1.2 million in statutory damages—were consistent with the trial evidence.