(CN) – Two former business partners who dispute ownership of “trailer trash” dolls both lost motions for summary judgment, because factual issues must be determined in their partnership agreement. The case was spawned when Paul Montwillo began dressing Barbie dolls with wigs, make-up and different clothing.
Montwillo’s “Trailer Trash Barbie” dolls hit stores in 1996, appearing in William Tull’s In-Jean-ious Active store in San Francisco. Barbie’s corporate parent, Mattel, sued Montwillo and In-Jean-ious Active for trademark infringement, and Montwillo agreed to stop using Barbie as the model for his dolls.
After the Mattel suit, Montwillo and Tull entered into a partnership to create and distribute dolls that did not violate Mattel’s trademarks. Their agreement specified that Tull would handle the business matters while Montwillo would be given artistic duties.
A year later the men converted the partnership into a company, Arsenic & Apple Pie LLC. Between 1998 and the demise of the partnership in 2004, Arsenic & Apple Pie produced at least three Trailer Trash Doll models, the “Blond Drag Queen” and “Redhead Drag Queen” models, and the company’s hallmark “Trailer Trash Doll” model.
The company turned an annual profit only once, in 2000.
Tull claims he learned that Montwillo filed for bankruptcy in March 2002. Pursuant to the terms of the partnership agreement, this put Montwillo’s ownership interest in the partnership up for sale and Tull offered to buy it for $1. Montwillo rejected the offer, claiming he and Tull had talked about the value of Montwillo’s ownership and determined the value was $16,000.
After the company was dissolved in 2004 and its assets split to pay debt, Montwillo filed copyright registrations for two undeveloped doll concepts, the “Talking Pregnant Trailer Trash Doll” and the “Male Mullet Trailer Trash Doll.” Montwillo also sent Tull a letter stating he disagreed with the dissolution of Arsenic & Apple Pie and asserted ownership of five Trailer Trash doll designs.
Montwillo eventually sued Tull in the San Francisco Federal Court, alleging copyright violations. Tull counterclaimed for conversion. Both men filed cross-motions for summary judgment; Judge Susan Illston rejected both motions.
Illston ruled that because the requisite level for creativity is “extremely low,” Tull’s argument that the Trailer Trash Dolls constitute unprotectable stock images is improper because Montwillo did make artistic decisions regarding the dolls’ appearances.
Likewise, there is a factual issue regarding whether Montwillo gave the partnership an implied nonexclusive license to use the dolls.
Since “numerous issues of fact” remain, summary judgment for either party is inappropriate now, Judge Illston ruled.