Chase Jarvis is a professional photographer who created several thousand photographic slides over a three-year period for K2, Inc. (“K2”), a maker of outdoor sporting goods. Unfortunately, this relationship eventually soured. Jarvis sued K2, alleging that it infringed his copyrights in his photographic images, lost many of the slides that he delivered and repeatedly failed to credit him when it used his images. The district court agreed that K2 was liable under each of these theories and awarded damages to Jarvis. However, the district court found that 24 of Jarvis’ images — contained in four K2 collage advertisements that combined Jarvis’ images with other images and graphics — were not infringed because the ads were covered by the collective works privilege of 17 U.S.C. § 201(c).1 Jarvis now appeals the district court’s damages awards and its ruling as to the collage ads’ privileged status.
We hold that the district court did not clearly err in any of its
damages calculations. It employed reasonable estimates of the market
value of the infringed images as well as the business lost by Jarvis
because of the lost images and failures to credit him. We do not agree
with the district court, however,
that the 24 images in the collage ads were privileged under § 201(c). The collage ads were derivative rather than collective works because they transformed Jarvis’ original images into new promotional posters.2 The collective works privilege therefore did not apply to the ads, and their online display
after K2’s term of use had expired infringed Jarvis’ copyrights in the underlying images. Accordingly, we reverse the district court’s ruling as to § 201(c) and remand for determinations of willfulness, actual and statutory damages and attorney’s fees with respect to the collage ads.