Troll Company v. Uneeda Doll Company

Danish carver Thomas Dam created the iconic troll dolls in the late 1950s. By the early 1960s, Dam was selling the dolls in the United States. Dam then formed a company, Dam Things Establishment, which licensed Uneeda Doll Company (Uneeda) (defendant) to market its own line of troll dolls. Dam’s company also obtained a United States copyright in the doll. However, the copyright became invalid due to a defect in the copyright notice, causing the troll dolls to enter the public domain. Uneeda continued selling its troll dolls, albeit only periodically, until the 1990s. After Dam’s death in 1989, his heirs assigned exclusive rights in the troll dolls to the Denmark-based Troll Company (plaintiff). In 1994 the United States enacted the Uruguay Round Agreements Act (URAA). Effective as of 1996, the URAA restored copyrights for foreign works that had lapsed for reasons involving noncompliance with formalities, including copyright-notice requirements. Dam’s original United States copyright, now owned by the Troll Company, was thus restored. The statute provided that after copyright restoration, parties that commercially relied on a work’s public-domain status would be allowed one year to liquidate their now-infringing inventory. Uneeda, whose last sale of troll dolls occurred no later than 1996, began selling its dolls again in 2005. The Troll Company served Uneeda a notice of intent to enforce its copyright, and then the Troll Company sought a preliminary injunction in federal district court. The court granted the injunction, which prevented Uneeda from making further sales of the dolls. Uneeda appealed. The United States Court of Appeals for the Second Circuit granted certiorari.