November 1, 2017
from the United States District Court for the Northern
District of Illinois, Eastern Division. No. 1:15-cv-07484 -
Samuel Der-Yeghiayan, Judge.
Manion, Kanne, and Rovner, Circuit Judges.
Rovner, Circuit Judge.
firm LimeCoral, Ltd., sued the job website CareerBuilder,
LLC, for breach of copyright and breach of an alleged oral
agreement to pay LimeCoral for each annual renewal of a
graphic design that LimeCoral prepared for a job posting on
CareerBuilder's website. The district court entered
summary judgment in favor of CareerBuilder, finding that
CareerBuilder had an irrevocable, implied license to use
LimeCoral's designs that was not conditioned upon any
agreement to pay LimeCoral renewal fees. We affirm.
operates the online employment website
www.careerbuilder.com, where employers list job
openings and job seekers can post their resumes, browse job
openings by category, and submit employment applications.
Employers pay CareerBuilder to post their job openings, and
one option that CareerBuilder offers is a "premium job
branding" that incorporates customized HTML and static
and animated graphics into a job posting. As relevant here,
job postings were sold for a one-year term.
was a small design firm that prepared media files
incorporating customized graphic designs for premium job
brandings on the CareerBuilder website from 2008 through
2014. Brian Schoenholtz, a former employee of CareerBuilder,
was LimeCoral's principal.
entered into an Independent Contractor Agreement with
CareerBuilder on October 1, 2008 (the "2008
Agreement"), pursuant to which LimeCoral agreed to
prepare custom graphic designs on behalf of
CareerBuilder's employer clients and CareerBuilder agreed
to pay LimeCoral for those designs pursuant to a schedule of
fees set forth in an exhibit to be attached to the agreement.
CareerBuilder committed in this agreement to give LimeCoral
50 percent of its orders for online design services. The
agreement was for a term of six months. The agreement
specified that all graphic designs created for CareerBuilder
(included within the scope of "Confidential
Information" as defined in the contract) would
constitute the sole and exclusive property of CareerBuilder.
The agreement said nothing about LimeCoral's entitlement
to renewal fees when a CareerBuilder client renewed a job
terms, the 2008 Agreement expired at the end of six months.
The evidence indicates that the parties were unable to come
to terms on a new agreement. CareerBuilder, in particular,
was no longer willing to promise any particular percentage or
dollar amount of its design business to LimeCoral as
LimeCoral wished. (Later proposed agreements ran into the
same impasse.) LimeCoral and CareerBuilder nonetheless agreed
to continue doing business with one another, albeit without a
written agreement. Over the course of the next six years, the
relationship between the parties went on largely as before.
LimeCoral continued to prepare media files incorporating
custom graphic designs (more than 2, 000, all told) at the
request of CareerBuilder in exchange for a design fee-
typically $3, 000 for each new design. However, as there was
no longer a written agreement transferring ownership of the
copyright on the designs to CareerBuilder, LimeCoral retained
ownership of the copyright and, as discussed below,
implicitly granted CareerBuilder a license to use the
designs. What the parties dispute is whether the license was
unconditional and irrevocable, or subject to
CareerBuilder's alleged agreement to pay LimeCoral an
annual renewal fee for every design that CareerBuilder
continued to use beyond the initial period of one year.
practice, when an employer renewed a job posting with
CareerBuilder, it would pay a fee to CareerBuilder-$10, 000
or more, according to LimeCoral. If the employer wanted an
entirely new design for its posting, then CareerBuilder would
commission LimeCoral or one of its other vendors to prepare
the design, without regard to who had designed the original.
If, however, the employer wanted to stick with the original
design but make revisions to it (to incorporate a new company
logo, for example), CareerBuilder routinely would, for the
sake of efficiency, have the vendor who prepared the original
design make the changes, and the vendor would be paid for
those changes. Thus, whenever revisions to a LimeCoral design
for a renewed job posting were called for, CareerBuilder
would pay LimeCoral a flat fee for those modifications
(typically $1500), however large or small the degree of work
parties disagree as to the import of the revision fees.
LimeCoral characterizes them as a practice of CareerBuilder
paying it a fee for any renewal, given that it
received the same fee even when the requisite revisions
involved only an insignificant amount of work. CareerBuilder,
on the other hand, insists that it only paid LimeCoral a fee
when revisions were required in connection with a renewal,
such that the fees were genuinely tied to the revisions
rather than the renewals.
is evidence in the record that confirms Career-Builder's
understanding of the practice. In his deposition, Schoenholtz
said he "believe[d]" it to be the case both that
LimeCoral had never sought a renewal fee when revisions to
the original design were not called for and that
CareerBuilder had never paid it a fee on renewal in the
absence of revisions. R. 32-1 at 59, Schoenholtz Dep. 230-31.
Additionally, email correspondence between Schoenholtz and
CareerBuilder makes explicit the connection between fees and
revisions to renewed postings. In a January 2012 email to
Schoenholtz, CareerBuilder's production manager, Molly
Thanks for reaching out, Brian. Go ahead and start the
revisions so as not to hold anything up. In the meantime,
I'll have a conversation with Hyemi and Loren about when
to pay designers for revisions. Personally, I've always
paid once the client has renewed and requested edits. If we
get more money then you get more money for the work you do.
If it's just a minor revision and not ...