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Click here for the full text of this decision FACTS:Jane Galiano’s company, Gianna Inc., contracted with Harrah’s Entertainment to design employee uniforms. Gianna produced several sketches of the proposed uniforms. Gianna then entered into an agreement with other manufacturers to make the uniforms, based on Gianna’s designs, to be used by Harrah’s. The Gianna/Harrah’s agreement expired by its own terms on Dec. 1, 1995. Efforts to renegotiate terms failed, and an agreement purporting to settle all disputes was entered into in May 1996. Harrah’s continued to order Gianna-designed uniforms from the manufacturers. Gianna sought copyright protection in October 1999 for a collection called “Uniform and Costume Collection submitted to Harrah’s Operating Company, Inc.” The collection was identified as artwork for wearing apparel, and classified as two-dimensional artwork. The collection included illustrations and sketches of more than 50 shirts, blouses, vests, jackets, pants, shorts, ensembles, costumes and unique headgears. The collection also included multiple pages of silk-screened artwork. Galiano was identified as the author. After securing copyright protection, Gianna sued Harrah’s for breach of the May 1996 settlement and copyright infringement. Harrah’s filed a counterclaim for fraud and misuse of the Copyright Office. The district court granted Harrah’s motion for summary judgment on the infringement claim; denied Gianna’s motion for summary judgment on Harrah’s fraud claim; and awarded Harrah’s attorneys’ fees. The district court found that Gianna’s copyright was for the illustrations and artwork Gianna submitted with its application for copyright protection; it did not extend to the uniforms themselves. HOLDING:Affirmed in part; dismissed in part; vacated and remanded in part. The court confirms that this case involves “pictorial, graphic, and sculptural works,” which are discussed under 17 U.S.C. 101. However, if an item qualifies as a “useful article” under the act, the court explains, copyright protection can be had only to the extent that its artwork or creative design is separable from the utilitarian aspects of the work. The court says this raises two questions. The first � is the asset for which the creator seeks copyright protection a “useful” article � is easy to answer: there is “little doubt” that clothing possesses utilitarian aesthetic value.” The second question � does the item incorporate features that can be identified separately from, and exist independently of, the utilitarian aspects of the item is harder, the court says. The court notes that several different tests have developed in the circuit courts to define what “conceptual separability” is. The most comprehensive is Pivot Point Int’l Inc. v. Charlene Prods. Inc., 372 F.3d 913 (7th Cir. 2004) (en banc), but the court ultimately decides not to follow that case, noting that its full reach has not yet been fleshed out, that it doesn’t entirely square with basic copyright law treatises, and that the case law applying Pivot Point is uneven. Under Pivot Point, Gianna may have had a case, the court believes. But without it, applying basic copyright treatise principles, the court finds that Gianna has not made a showing that its designs are marketable independently of their utilitarian function as casino uniforms. “Gianna correctly notes that there are costume museums and that they are replete with extravagant designs that might also have utilitarian qualities,” the court notes, “But Gianna does not demonstrate that its designs describe such material.” After affirming the district court’s grant of summary judgment to Harrah’s on the infringement claim, the court then finds that it does not have jurisdiction over the fraud counterclaim because the issue was not properly certified for appeal by the district court. The court reverses the district court’s award of attorneys’ fees, however. Though agreeing that the Copyright Act allows a trial court to award fees in its discretion, the district court is supposed to consider several factors before awarding them, such as the copyright claim’s: “(1) frivolousness; (2) motivation; (3) objective unreasonableness; and (4) the need in particular circumstances to advance considerations of compensation and deterrence.” The court observes that the district court did not consider any of these factors, and, further, appears to have assumed that if it erred by not considering these factors, then this court would fix the mistake. “We cannot review a district court’s decision for abuse of discretion where that court effectively delegates the underlying issue to us without making a substantive ruling of its own. Although we view this suit to be far from frivolous � this is a close question of law � remand is appropriate. The district court should provide [an] analysis in its ensuing opinion so that its ruling can, if needed, be reviewed on appeal.” OPINION:Smith, J.; Davis, Smith and Demoss, JJ.

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