(CN) - The 9th Circuit upheld a copyright infringement verdict against PC Onsite, a software developer that based its Quick Play Bingo game on the Fast Action Bingo created by Dream Games of Arizona.
PC Onsite performed software upgrade work for Dream Games' Fast Action Bingo electronic bingo game. When PC Onsite came out with a second version, Fast Action Bingo II, negotiations between the companies broke down.
Immediately after negotiations fell through, PC Onsite created Quick Play Bingo and sold it to two bingo parlors in Utah and three in Wyoming, states where gambling is illegal. Quick Play Bingo directly competed with Dream Games' bingo game, as the parlors had previously carried Fast Action Bingo.
After a six-day trial, a jury found PC Onsite liable for copyright infringement and awarded Dream Games $25,000 in statutory damages.
The district court had dismissed PC Onsite co-founder Garland Pierce from the case, ruling that he did not directly distribute or help develop Quick Play Bingo. The court also ruled that Dream Games could not recover actual damages, because the game was offered illegally in Utah and Wyoming.
PC Onsite appealed, and Dream Games cross-appealed for a partial new trial on Pierce's liability.
The federal appeals court in San Francisco rejected PC Onsite's objections to the material and instructions provided to the jury.
The court also upheld the statutory damage award, despite evidence that Fast Action Bingo had been operating illegally in two states.
"It would be absurd to deny a work the protection of a federal copyright because it is capable of illegal use in one or more states, but capable of perfectly legal use in other states," Judge Wardlaw wrote.
Finally, the court upheld the dismissal of Pierce from the case. If Dream Games wanted to argue a theory of secondary liability, the court ruled, it should have done so in the original or amended complaint.
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