Ninth Circuit raps Disney over use of stolen software for 'Beauty and the Beast'

SAN FRANCISCO (CN) — A Ninth Circuit panel decided Thursday that Walt Disney Pictures could have stopped one of its visual effects contractors from using copyrighted facial motion capture software in its 2017 live-action remake of “Beauty and the Beast.”

U.S. Circuit Judge Lucy Koh found in her opinion that a 2023 jury trial offered enough evidence to conclude Disney knew its contractor made unauthorized copies of facial motion capture software owned by San Francisco technology incubator Rearden. The three-judge appeals panel ruled that Disney vicariously committed copyright infringement by allowing its contractor, Digital Domain 3.0 (DD3), to use Rearden’s software.

The opinion reversed the trial court’s August 2024 ruling in Disney’s favor. The lower court determined that Rearden failed to show Disney could identify, recognize and supervise the infringing conduct in the first place.

The Ninth Circuit saw it differently.

“There was a legally sufficient evidentiary basis for the jury to find that Disney had the practical ability to supervise and control DD3’s infringing conduct,” said Koh, a Barack Obama appointee.

U.S. Circuit Judge Consuelo Callahan, appointed by George W. Bush, and U.S. Circuit Judge Bridget Bade, appointed by Donald Trump, rounded out the panel.

“Rearden thanks the Ninth Circuit for reinstating the jury’s verdict in its favor and hopes this published opinion will protect innovative software created by small companies like Rearden in the future,” said Rearden CEO Steve Perlman in a written statement.

Disney representatives didn’t immediately respond to requests for comment on the Ninth Circuit’s opinion.

In December 2023, the jury awarded Rearden $250,638 in damages and calculated Disney’s profits attributable to infringement as $345,098.

Though Rearden had sought as much as $38 million of Disney’s profits, Obama-appointed U.S. District Judge Jon Tigar agreed with the movie studio that the infringed technology contributed much less than that to the success of Disney’s remake of the 1991 animated feature of the same name.

DD3 was contracted by Disney and used Rearden’s MOVA software to help capture facial performances of Dan Stevens, who played the Beast in the remake, and to process that data into a tracked mesh, according to Tigar’s findings. But components other than MOVA software were needed to capture Stevens’s facial performance and process the tracked mesh.

Additionally, the panel affirmed Rearden was not entitled to demand a new jury for the appropriation of profits.

“Rearden does not challenge the district court’s ruling that disgorgement of profits is an equitable remedy, and thus the Seventh Amendment does not guarantee a jury trial right on the issue,” Koh said.

In its 2017 lawsuit against Disney, Rearden claimed an employee of one of its subsidiaries had sold the MOVA intellectual property to DD3 without authority.