## Facts

- Walt Disney Productions owned copyrights in feature-length animated films and in original character designs and drawings associated with those films.
- Filmation, an animated-film producer, announced a “New Classics Collection,” including films with titles and characters drawn from the same public-domain stories Disney had previously used.
- Disney alleged Filmation’s projects, including *The New Adventures of Pinocchio*, copied Disney’s protected character depictions and film imagery.
- Filmation created internal, unfinished production materials for its planned films, including a script, storyboards, a story reel, models, and designs.
- Disney sued asserting federal copyright claims, Lanham Act claims, and California unfair-competition claims.
- Filmation moved for summary judgment on all claims.

## Issues

1. Whether Filmation’s fixed, internal production materials (e.g., scripts, storyboards, models, designs) could qualify as potentially infringing “copies” under the 1976 Copyright Act even though the films were unfinished and undistributed.
2. Whether the record required a finding, as a matter of law, that Filmation’s works were not substantially similar to Disney’s protected expression.
3. Whether Filmation was entitled to judgment as a matter of law on Disney’s Lanham Act and California unfair-competition claims based on alleged dissimilarity and lack of evidence of actual diverted sales.

## Decision

- The court denied Filmation’s motion for summary judgment in full.
- The court held that preliminary, fixed production materials can constitute potentially infringing “copies” under the Copyright Act.
- The court held that copyright infringement (including substantial similarity under an ordinary-observer approach) presented a question for the trier of fact.
- The court held that Disney’s Lanham Act and California unfair-competition theories presented triable issues.
- The court held that the trademark and unfair-competition claims did not fail solely because Disney lacked evidence of actual diversion of sales.

## Legal Principles

- Fixed, tangible pre-release production materials (including scripts, storyboards, story reels, models, and designs) may constitute “copies” for infringement purposes if the work is fixed in a material object from which it can be perceived or reproduced, with or without a machine.
- Copyright infringement may occur even without distribution of the allegedly infringing material; fixation, not commercial release, is sufficient to permit liability in appropriate circumstances.
- Substantial similarity between protectable expression and the accused work is commonly a fact question not suited to summary judgment when the record supports competing inferences.
- Likelihood of confusion under the Lanham Act and related state unfair-competition theories is fact-intensive and may present triable issues precluding summary judgment.
- Proof of actual diverted sales is not a required element of liability for trademark infringement or unfair competition, though it may bear on damages.

## Conclusion

The court allowed Disney’s copyright, Lanham Act, and California unfair-competition claims to proceed by holding that fixed internal production materials can be actionable “copies” and that substantial similarity and likelihood of confusion raised factual disputes unsuitable for summary judgment, without requiring proof of actual diverted sales.


Walt Disney Prods. v. Filmation Assocs., 628 F. Supp. 871 (C.D. Cal. 1986)