Sheldon v. Metro-Goldwyn Pictures Corp.
United States Supreme Court
309 U.S. 390 (1940)
Sheldon (plaintiffs) brought a copyright infringement suit against Metro-Goldwyn Pictures Corp. (MGM) (defendant). Sheldon claimed that MGM made a movie that infringed upon the plaintiffs’ play. The district court found no infringement. The court of appeals reversed, finding infringement, enjoining MGM, and directing the district court to award damages on remand. The district court awarded the plaintiffs all of MGM’s net profits from the movie. The court of appeals reversed this amount of damages, finding that there should be an apportionment so as to give the plaintiffs only that part of the profits found to be attributable to MGM’s use of the copyrighted material. Specifically, the court of appeals agreed with MGM’s contention that the movie was profitable not because of the underlying copyrighted material, but because of what MGM had added to the story in its production: popular actors, professional scenery, and expert producers and directors. The court of appeals found that the correct apportionment to award the plaintiffs was one-fifth of MGM’s net profits. The plaintiffs appealed.
Rule of Law
Holding and Reasoning (Hughes, C.J.)
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