United States District Court, D. Colorado
STATE REGULATORY REGISTRY, LLC, a Washington, D.C. limited liability company, Plaintiff,
BILLY GLENN BARTHOLOMEW, an individual, MTI SERVICES CORPORATION, a Colorado corporation, and CAREY GREEN, an individual, Defendants.
A. BRIMMER Chief United States District Judge
matter is before the Court on Plaintiff's Motion for
Partial Summary Judgment [Docket No. 58] and Defendant
Green's Motion for Partial Summary Judgment [Docket No.
72]. The Court has jurisdiction under 28 U.S.C. § 1331.
State Regulatory Registry, LLC (“SRR”) operates
the Nationwide Mortgage Licensing System and Registry
(“NMLS”). Docket No. 58 at 2, ¶ 1. In this
role, plaintiff develops and administers the SAFE Mortgage
Loan Originator National Test (“SAFE MLO Test”),
which is a national licensing examination that tests the
competency of potential mortgage loan originators.
Id., ¶ 2. The Secure and Fair Enforcement for
Mortgage Licensing Act of 2008 (“SAFE Act”)
requires that mortgage loan originators pass the SAFE MLO
Test to be licensed. Id., ¶ 3.
develop questions used in the SAFE MLO Test, plaintiff relies
upon Subject Matter Experts (“SEES”), who are
members of the mortgage loan origination community who
volunteer to review test questions used on the exam.
Id. at 3, ¶ 8. Some of the questions in the SAFE
MLO Test are the subject of three copyright registrations by
plaintiff with the United States Copyright Office - the
'646, '308, and '249 copyrights. Id. at
4, ¶ 15. Plaintiff takes significant measures to ensure
the confidentiality of its test questions, such as storing
questions in a secure database with limited access rights and
implementing both video and audio surveillance of test
takers. Id., ¶ 17. Test takers must sign an
agreement to maintain the confidentiality of the test.
Id. at 5-6, ¶¶ 28, 31. Plaintiff also
requires SEES to sign confidentiality agreements agreeing to
“keep strictly confidential” all test items and
verifying that the SEES have no conflicts of interest.
Id. at 4, ¶ 17; id. at 5, ¶ 21.
If a test question becomes publicly known, it cannot be used
on an examination and it loses its value to plaintiff.
Id. at 4, ¶ 14. Further, because plaintiff
reuses its test questions, advance access to those questions
may give a test taker an unfair advantage on the exam.
Id. at 3, ¶ 5.
MTI Services Corporation (“MTI”) is an
NMLS-approved mortgage educator. Id. at 5,
¶¶ 22-23. Among its test preparation materials, MTI
offers for sale practice SAFE MLO Test questions.
Id., ¶ 24. Defendant Carey Green was an MTI
customer in 2013 and purchased testing materials containing
MTI's practice questions. Id. at 6, ¶ 30.
While an MTI customer, Green took screen shots of MTI
materials, including MTI practice test questions.
Id., ¶ 32. In March 2013, Green sat for the
SAFE MLO Test. Id., ¶ 31. Green was aware that
he had an obligation to keep the test materials confidential.
Id. Moreover, at one point, Green also received
eight to ten test questions from a fellow test taker that the
individual had remembered. Id., ¶ 34.
2013, Green launched a website at PasstheSafeExam.com that
offered for sale practice questions for the SAFE MLO Test.
Id., ¶ 33. Approximately ninety percent of the
questions provided on Green's site were based on
MTI's questions. Id.Green received feedback from
his customers noting the similarities between his questions
and the SAFE MLO Test, including: (1) “You were right
my friend, several of the questions on the exam were word for
word on your practice test. How did you do that?”; (2)
“I even saw some of the exact questions today as I was
testing”; (3) “The practice quizzes really helped
because some were actually on the test”; and (4)
“I couldn't believe how many of the questions I saw
on my test were similar to your practice test
questions.” Id. at 8, ¶ 46.
Billy Glenn Bartholomew, a former SAFE MLO Test taker,
id. at 5, ¶ 28, has been employed with MTI
since 2016. Id., ¶ 25. Bartholomew offers tutoring
services to individuals who have failed the SAFE MLO Test.
Id., ¶ 27. Bartholomew worked with plaintiff as
an SME on its National Test Maintenance Committee.
Id. at 3, ¶ 9. Committee members are assigned
to draft new test questions, which are reviewed by the full
committee for approval. Id., ¶
During committee meetings, existing test questions are
reviewed to ensure that they remain accurate and up-to-date.
Id., ¶¶ 10-11. These meetings have
traditionally been held online, with meeting facilitators and
committee members participating via a secure internet-based
platform or by telephone. Id. at 6, ¶ 35. To
ensure the confidentiality of these meetings, committee
members are instructed to participate from a “private
or semi-private location” and are instructed not to
allow others to view their computer screens or listen to the
conference call. Id., ¶ 36.
an early 2017 virtual committee meeting, in which Bartholomew
participated, the meeting facilitators heard the sound of a
cellular telephone camera at 8, ¶ 25. MTI and Green
dispute this statement on the basis that Bartholomew
“testified that his only role with MTI in 2016 was
teaching continuing education courses. Docket No. 92 at 3,
¶ 25; Docket No. 98 at 3, ¶ 25. Bartholomew, when
asked his job title, stated “[a]ccording to the
business card they gave me I think it says education
director.” Docket No. 58-12 at 4, 21:10-12. The Court
does not find that Bartholomew's job title is a material
fact for purposes of this motion. taking photographs.
Id., ¶ 37. The facilitators immediately stopped
the meeting and informed participants that the test was
confidential and copyright protected. Id. at 7,
¶ 38. They further instructed that the test was not to
be photographed or shared outside of the meeting.
subsequent virtual meeting on May 15, 2017, in which
Bartholomew again participated, Bartholomew was observed via
his computer web camera taking photographs of his computer
screen. Id., ¶ 39. This occurred after a number
of test questions had been displayed on the screen.
Id. The facilitators took a video of
Bartholomew's actions and ended the meeting. Id.
Bartholomew admitted to taking multiple photographs of test
questions during this meeting, id., ¶ 40,
claims that he took photographs of the screen to make up for
his poor eyesight, as he was having difficulty seeing the
screen and could enlarge the photographs to render them
readable. Docket No. 84 at 6-7, ¶¶ 11-13. Plaintiff
disputes Bartholomew's explanation because
“Bartholomew has produced no medical records or
documents to verify his vision problems . . . [and] never
told anyone he was having difficulty viewing the screen
during virtual meetings.” Docket No. 99 at 4, ¶
course of investigating the matters at issue in this lawsuit,
plaintiff purchased SAFE MLO Test preparation materials from
MTI and Green. Docket No. 58 at 7, ¶ 43. Plaintiff
claims that it has identified 81 test questions that have
been infringed by defendants. Id., ¶
These 81 test questions are the only questions for which
plaintiff seeks summary judgment on its copyright claims.
filed this lawsuit on July 28, 2017. Docket No. 1. It asserts
claims for (1) copyright infringement as to all defendants;
(2) contributory copyright infringement as to Bartholomew;
(3) common law misappropriation of trade secrets as to all
defendants; (4) misappropriation of trade secrets under the
Defend Trade Secrets Act (“DTSA”), 18 U.S.C.
§ 1831 et seq.; (5) breach of contract as to
all defendants; and (6) tortious interference with a contract
as to MTI and Green. Docket No. 132 at 19-29.
December 5, 2018, plaintiff filed a motion for partial
summary judgment, seeking judgment in its favor on its
copyright infringement, contributory copyright infringement,
common law and federal law trade secret misappropriation
claims and on its breach of contract claim against
Bartholomew. Docket No. 58 at 8-19. Each defendant separately
filed a response. See Docket No. 84
(Bartholomew's response); Docket No. 92 (MTI's
response); and Docket No. 98 (Green's response). On
December 13, 2018, Green filed an amended motion for partial
summary judgment. Docket No. 72. Green seeks summary judgment
entered in his favor on plaintiff's copyright
infringement and trade secret misappropriation claims.
Id. at 4-6. Plaintiff filed a response, Docket No.
88, but Green did not file a reply.
judgment is warranted under Federal Rule of Civil Procedure
56 when the “movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to
judgment as a matter of law.” Fed.R.Civ.P. 56(a);
see Anderson v. Liberty Lobby, Inc., 477 U.S. 242,
248-50 (1986). A disputed fact is “material” if
under the relevant substantive law it is essential to proper
disposition of the claim. Wright v. Abbott Labs.,
Inc., 259 F.3d 1226, 1231-32 (10th Cir. 2001). Only
disputes over material facts can create a genuine issue for
trial and preclude summary judgment. Faustin v. City
& Cty. of Denver, 423 F.3d 1192, 1198 (10th Cir.
2005). An issue is “genuine” if the evidence is
such that it might lead a reasonable jury to return a verdict
for the nonmoving party. Allen v. Muskogee, 119 F.3d
837, 839 (10th Cir. 1997).
“the moving party does not bear the ultimate burden of
persuasion at trial, it may satisfy its burden at the summary
judgment stage by identifying a lack of evidence for the
nonmovant on an essential element of the nonmovant's
claim.” Bausman v. Interstate Brands Corp.,
252 F.3d 1111, 1115 (10th Cir. 2001) (internal quotation
marks omitted) (quoting Adler v. Wal-Mart Stores,
Inc., 144 F.3d 664, 671 (10th Cir. 1998)). “Once
the moving party meets this burden, the burden shifts to the
nonmoving party to demonstrate a genuine issue for trial on a
material matter.” Concrete Works of Colo., Inc. v.
City & Cty. of Denver, 36 F.3d 1513, 1518 (10th Cir.
1994). The nonmoving party may not rest solely on the
allegations in the pleadings, but instead must designate
“specific facts showing that there is a genuine issue
for trial.” Celotex Corp. v. Catrett, 477 U.S.
317, 324 (1986) (internal quotation marks omitted). “To
avoid summary judgment, the nonmovant must establish, at a
minimum, an inference of the presence of each element
essential to the case.” Bausman, 252 F.3d at
1115. When considering a motion for summary judgment, a court
must view the evidence in the light most favorable to the
non-moving party. Id. However, where, as here, there
are cross motions for summary judgment, the reasonable
inferences drawn from affidavits, attached exhibits, and
depositions are rendered in the light most favorable to the
non-prevailing party. Jacklovich v. Simmons, 392
F.3d 420, 425 (10th Cir. 2004). Furthermore, “[w]hen
the parties file cross motions for summary judgment, we are
entitled to assume that no evidence needs to be considered
other than that filed by the parties, but summary judgment is
nevertheless inappropriate if disputes remain as to material
facts.” Atlantic Richfield Co. v. Farm Credit Bank
of Wichita, 226 F.3d 1138, 1148 (10th Cir. 2000)
(internal quotation marks omitted).
argues that it is entitled to summary judgment on its
copyright infringement, contributory copyright infringement,
and trade secret misappropriation claims. It also contends
that it is entitled to summary judgment on its breach of
contract claim against Bartholomew. Green argues that he is
entitled to summary judgment on plaintiff's copyright
infringement and misappropriation of trade secrets claims.
Preliminary Evidentiary Matters
opposition to plaintiff's motion for summary judgment,
MTI argues that plaintiff has no competent evidence of
substantial similarity between the copyrighted works and the
alleged infringing works because (1) plaintiff's accused
questions comparison chart (“comparison chart”)
[Docket No. 58-5] is inadmissible hearsay and (2) the
comparison chart is barred by the best evidence rule. Docket
No. 92 at 10-12.
attached to its motion for summary judgment a
“Comparison Chart of Actual SAFE MLO Test Questions and
Infringing Questions from Defendants' Practice Materials,
” which sets out a copyrighted question, its
registration number, a purportedly infringing MTI practice
question, and, if applicable, the allegations regarding when
MTI and Green infringed upon the question or the alleged date
that Bartholomew had access to that question. See
Docket No. 58-5. Accompanying the comparison chart is a
declaration of Peter Marks, plaintiff's Vice President of
Mortgage Testing and Education Programs, in which he
discussed the creation of the comparison chart. See,
e.g., Docket No. 58-1 at 9, ¶ 37. Plaintiff also
submitted with its reply [Docket No. 103] an additional
declaration from Mr. Marks, in which he discusses the
development of the comparison chart in more detail. Docket
MTI argues that the comparison chart “is comprised of
testimony as to the contents of business records, but nothing
more.” Docket No. 92 at 11. It contends that
“Marks' declaration [does not] contain any basis to
assert personal knowledge of the contents of the records he
summarizes in the chart.” Id. at 11-12. MTI
argues that the accused chart is hearsay because it is
offered to prove the truth of the matter asserted - namely,
that “each document that was reviewed to compile the
chart” shows that (1) plaintiff owns the accused
questions and (2) plaintiff owns the copyrights to the
accused questions. Id. at 12.
unclear whether MTI challenges only the comparison chart or
Mr. Marks' declaration discussing the chart as well.
Nevertheless, the Court finds that they both may be
considered on this motion for summary judgment. “At the
summary judgment stage, the parties need not submit evidence
in a form admissible at trial; however, the content or the
substance of the evidence must be admissible.”
Bryant v. Farmers Ins. Exchange, 432 F.3d 1114, 1122
(10th Cir. 2005). “An affidavit or declaration used to
support or oppose a motion must be made on personal
knowledge, set out facts that would be admissible in
evidence, and show that the affiant or declarant is competent
to testify on the matters stated.” Fed.R.Civ.P.
56(c)(4). Thus, “if [the] evidence is presented in the
form of an affidavit, the Rules of Civil Procedure
specifically require a certain type of admissibility,
i.e., the evidence must be based on personal
knowledge.” Bryant, 432 F.3d at 1122. MTI,
however, makes no argument that plaintiff could not present
this evidence in a form that would be admissible at trial -
“the only appropriate basis on which to raise an
evidentiary objection at the summary judgment phase.”
Securities & Exchange Comm'n v. Mahabub, No.
15-cv-2118-WJM-MLC, 2017 WL 6555039, at *2 (D. Colo. Dec. 22,
Court finds that Mr. Marks' declaration is based on
personal knowledge. Mr. Marks, as plaintiff's vice
president, claims to have personal knowledge of the
company's test offerings, copyrights, and business
records. See Docket No. 58-1; Bryant, 432
F.3d at 1123 (finding that supervisor had sufficient personal
knowledge of audit data based on her position as supervisor
and on declaration that she reviewed all relevant audit
records). Mr. Marks further demonstrates a personal
knowledge of the information contained in the comparison
chart. Docket No. 58-1 at 9, ¶ 37. As such, Mr.
Marks' personal knowledge allows him to introduce the
comparison chart. The Court finds that the comparison chart
is not barred for this reason. See State Office Sys.,
Inc. v. Olivetti Corp. of Am., 762 F.2d 843, 845 (10th
Cir. 1985) (finding that district court did not abuse its
discretion in determining that president and plaintiff
company's testimony about summary evidence satisfied
foundational requirement of proving that the summary was
based on business records admissible under Rule 803(6)).
Court also finds that the comparison chart is not barred by
the best evidence rule, which provides that “[a]n
original writing, recording, or photograph is required in
order to prove its content unless these rules or a federal
statute provides otherwise.” Fed.R.Evid. 1002. Again,
MTI makes no argument that the underlying evidence contained
in the chart could not be admitted at trial. MTI's
best-evidence-rule argument is based on a contention that
“Marks' testimony is inadmissible to prove the
contents” of the copyrights. Docket No. 92 at 13. As
set out above, this is incorrect, as Mr. Marks can
competently testify as to plaintiff's copyrights because
he has personal knowledge regarding the certificates, which
would be self-authenticating, see ABKCO Music, Inc. v.
Sagan, 2017 WL 3236443, at *4 (S.D.N.Y. July 31, 2017),
and which test questions the copyrights cover. Further, as
Mr. Marks explained,  plaintiff's test questions are
stored in a secure electronic database. Docket No. 103-1 at
4, ¶ 8. Plaintiff does not maintain individual
tests or copyright individual tests. Id., ¶ 10.
Rather, it periodically registers its database of test
questions in use. Id., ¶¶ 10-11. Because
the underlying contents of the chart are admissible at trial,
the Court finds that the chart does not violate the best
evidence rule. The Court will consider plaintiff's
comparison chart in its summary judgment
prevail on a copyright infringement claim, a plaintiff must
demonstrate that (1) the plaintiff owns a valid copyright,
and (2) the defendant copied the protectable elements of the
work. Enterprise Mgmt. Ltd., Inc. v. Warrick, 717
F.3d 1112, 1117 (10th Cir. 2013).
Ownership of Copyright
plaintiff's presentation of a certificate of registration
from the U.S. Copyright Office usually constitutes prima
facie evidence of a valid copyright and of the facts stated
in the certificate.” Palladium Music v.
EatSleepMusic, Inc., 398 F.3d 1193, 1196 (10th Cir.
2005) (citing 17 U.S.C. § 410(c)). The defendant has the
burden of overcoming this presumption of validity.
Id. A defendant can overcome the presumption with a
showing that (1) the certificate contains inaccurate
information; (2) “the inaccurate information was
included on the application for copyright registration with
knowledge that it was inaccurate”; and (3) “the
inaccuracy of the information, if known, would have caused
the Register of Copyrights to refuse registration.” 17
U.S.C. § 411(b)(1).
undisputed that certain SAFE MLO Test questions are the
subject of three copyright registrations - the '646,
'308, and '249 copyrights. Docket No. 58 at 4, ¶
15. MTI argues that plaintiff's copyrights are invalid
because it knowingly misrepresented to the U.S. Copyright
Office that it was the sole author of the '646 and
'308 copyrights even though, according to MTI, many of
the questions contained in those copyrights had been
previously published. Docket No. 92 at 14. Specifically, it
contends that at least 32 of the questions appearing on these
copyrights were authored by another testing company, Pearson
VUE,  and that plaintiff knew that Pearson VUE
had published those questions before plaintiff acquired them.
Id. at 15. In support, it cites to those 32
questions, produced by plaintiff in discovery, that were
authored by Pearson VUE and were allegedly included in
plaintiff's copyright applications. See Docket
No. 91-2. Thus, according to MTI, plaintiff knowingly
misrepresented its authorship of the questions in its
application to the Copyright Office, and its copyrights are
accordingly invalid. Docket No. 92 at 15. Plaintiff counters
that it “has taken steps to ensure that only questions
authored by [plaintiff] are registered, ” and, after
reviewing its registered items, none of the 32 questions
referenced by MTI were included in its copyright
registrations. Docket No. 103 at 7.
plaintiff may have indicated in its initial comparison chart
produced in discovery that it was pursuing infringement
claims based on 32 questions authored by a different entity,
implying that it had obtained copyright protection for those
questions, MTI has produced no credible evidence
demonstrating that any question contained in plaintiff's
copyright application was authored by another person. MTI has
failed to meet its burden of demonstrating that the copyright
applications contained inaccurate information so as to defeat
the presumption of validity that stems from plaintiff's
copyright registrations. The evidence before the Court
demonstrates that no genuine issue of material fact exists as
to the validity of plaintiff's '646, '308, and
Copying of the Protected Work
plaintiff may prove copying either with direct evidence or by
showing the alleged infringer had access to the copyrighted
work and ‘there are probative similarities between the
copyrighted material and the allegedly copied
material.'” Warrick, 717 F.3d at 1117
(quoting La Resolana Architects, PA v. Reno, Inc.,
555 F.3d 1171, 1178 (10th Cir. 2009)). “Direct evidence
usually requires a witness to the physical act of
copying.” Civility Experts Worldwide v. Molly
Manners, LLC, 167 F.Supp.3d 1179, 1189 (D. Colo. 2016)
(internal quotation omitted). Because “[d]irect proof
of copying is rare, ” “plaintiffs will typically
rely on the indirect method of proof.” Gates Rubber
Co. v. Bando Chem. Indus., Ltd., 9 F.3d 823, 833 (10th
establish the first prong of the indirect method of proving
copyright infringement - access to the copyrighted work - a
plaintiff must show that “the defendant had a
reasonable opportunity to view or an opportunity to copy the
allegedly infringed work.” La Resolana, 555
F.3d at 1178 (internal quotation marks and alteration marks
omitted). If the plaintiff is unable to demonstrate access,
access may be inferred if the works are “strikingly
similar” - in other words, if the similarity between
the works is “so striking that the possibilities of
independent creation, coincidence and prior common source
are, as a practical matter, precluded.” Id. at
1179 (internal quotations omitted).
argues that defendants' access to its copyrighted
materials is apparent: (1) both Bartholomew and Green had
access to the copyrighted questions when they sat for the
SAFE MLO Test; (2) Bartholomew spent time on plaintiff's
National Test Maintenance Committee, which allowed him to
review numerous SRR test questions; (3) Bartholomew admitted
to taking photographs of test questions during a committee
meeting; (4) MTI had access to the copyrighted work by virtue
of its relationship with Bartholomew and its interactions
with its test-taking customers; (5) Green received eight to
ten SRR test questions from a customer who had taken the
examination; and (6) MTI and Green sold practice test
questions that are “probatively similar” to
plaintiff's questions. Docket No. 58 at 11-12. MTI and
Bartholomew do not deny that they had access to the
copyrighted materials. See Docket Nos. 84 and 92.
Green argues that “[t]here is no evidence that [he]
ever had any access to materials identified as being subject
to the Plaintiff's copyright.” Docket No. 98 at 4.
Sitting for the Exam
first argues that Bartholomew and Green had access to the
copyrighted questions because they sat for the SAFE MLO Test.
In similar cases where copyright infringement allegations are
based upon alleged copying of standardized test questions,
courts have found access to the copyrighted questions where
an alleged infringer sat for the examination. See
Nat'l Bd. of Med. Examiners v. Optima Univ. LLC,
2011 WL 7615071, at *6 (W.D. Tenn. Sept. 29, 2011)
(“When taking the exams, [defendants] had the
opportunity to view secure USMLE material”); Assoc.
of Am. Med. Colleges v. Mikaelian, 571 F.Supp. 144, 150
(E.D. Pa. 1983) (defendant had access to MCAT questions when
he took the test on eight occasions).
to establish access, plaintiff must show that “the
defendant had a reasonable opportunity to view or an
opportunity to copy the allegedly infringed
work.” La Resolana, 555 F.3d at 1178
(emphasis added). In Mikaelian, the court
specifically noted that the individual defendant had access
to the copyrighted materials because, on five of the
occasions that he took the test, “he took the MCAT from
test booklets containing these questions [that were allegedly
infringed].” 571 F.Supp. at 150. Here, plaintiff has
not proven that, when Bartholomew or Green took the SAFE MLO
Test, they accessed one or more of the allegedly infringed
questions that are the subject of this summary judgment
motion. For example, plaintiff has not set out the date that
Bartholomew sat for the SAFE MLO Test. See Docket
No. 58. Bartholomew testified that he took the test in 2007
or 2008. Docket No. 58-12 at 3, 18:10-11. But plaintif f has
made no allegation - let alone proven - that Bartholomew
accessed any of the questions at issue in plaintiff's
summary judgment motion during this examination. See
Docket No. 58; see also Docket No. 58-5. Further,
Green sat for the test in March 2013. Docket No. 58 at 6,
¶ 31. But Green disputes that he had access to any of
the copyrighted materials when he took that test. Docket No.
98 at 4. Again, plaintiff has not made any allegation that
Green accessed one of the questions at issue here when he sat
for the examination. See Docket No. 58. The Court
finds that plaintiff cannot establish the individual
defendants' access to the copyrighted questions at issue
here solely because they took the SAFE MLO Test.