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Teter v. Glass Onion (W.D. Mo. July 12, 2010)

Teter v. Glass Onion (W.D. Mo. July 12, 2010)

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Published by Andrew Pequignot
Court (W.D. Mo.) finds that thumbnail images of artwork on gallery website are not fair use.
Court (W.D. Mo.) finds that thumbnail images of artwork on gallery website are not fair use.

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Published by: Andrew Pequignot on Jul 17, 2010
Copyright:Attribution Non-commercial

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08/13/2010

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IN THE UNITED STATES DISTRICT COURTFOR THE WESTERN DISTRICT OF MISSOURIST. JOSEPH DIVISION
)GARY LEON TETER, JR.,))Plaintiff,))v.) No. 08-6097-CV-SJ-FJG)GLASS ONION, INC.,))Defendant.)
ORDER
Pending before the Court is defendant Glass Onion, Inc.’s (“GOI”) Motion forSummary Judgment (Doc. No. 69) and plaintiff Gary L. Teter, Jr.’s Motion for PartialSummary Judgment (Doc. No. 70).
I.BACKGROUND
Teter is a renowned artist that paints fine art depicting historic scenes ofAmerican frontier life, and sells his work at selected art galleries. In January 2007, Bradand Diana Walpole, owners of Glass Onion, Inc. (“GOI”), entered negotiations with JimSanders, owner of Treasure Palace Ltd. (“TPL”) doing business as 83 Spring StreetGallery (“Gallery”), to purchase the Gallery and related assets. The real estate andasset purchase agreements were contingent, in part, on the Walpole’s obtaining asatisfactory agreement with Teter that he would continue his existing relationship withthe Gallery. At the time, Teter sold artwork to TPL for resale at the Gallery, allowedadvertisement of his artwork on the Gallery’s website and occasionally made personalvisits to the Gallery.
Case 5:08-cv-06097-FJG Document 139 Filed 07/12/10 Page 1 of 36
 
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A.Jamesport Meeting
On February 27, 2007, Brad and Diana Walpole met with Lee Teter, his wifeBarbara Teter, Teter’s daughter Shawnee Herbst and her husband Wyatt Herbst, atTeter’s home in Jamesport, Missouri. At the meeting, the parties came to anunderstanding that Teter’s relationship with 83 Spring Street Gallery would continue asit had existed under Jim Sanders’ ownership. Teter also informed the Walpoles thatShawnee would soon be joining the “family business,” Summer Field Fine Art (“SFFA”),and would handle publication of Teter’s work and generally act on his behalf. Anyagreement reached between the parties was not reduced to writing. Nonetheless, beingsatisfied with the outcome of the Jamesport meeting, on March 30, 2007, Jim Sandersand the Walpoles executed the asset purchase agreement and real estate contract,through which GOI purchased the 83 Spring Street Gallery from Jim Sanders, whichincluded the art inventory, the website, domain names and other real and intellectualproperty associated with TPL’s business.
B.GOI and Teter’s Business Relationship
Between May 18, 2007, and February 7, 2008, GOI and Teter entered intoapproximately eight sales transactions, through which GOI purchased original paintingsand prints in various quantities at a time. Teter received payment upon GOI’s receipt ofthe artwork. Each time GOI completed a sales transaction with Teter, GOI posted animage of the newly acquired work on the Gallery’s website.During late Spring 2007, GOI began revamping the Gallery’s website. On June30, 2007, Brad Walpole sent an email to SFFA that stated, “we are about to begin our
Case 5:08-cv-06097-FJG Document 139 Filed 07/12/10 Page 2 of 36
 
3website overhaul in earnest. . . . [m]ay we use pictures from your website to displayLee’s work that we are carrying?” (Doc. No. 71-12). Shawnee responded on July 2,2007, and stated, “I wanted to answer your question about your website makeover: Yes,use any images from Summer Field’s website.” (Doc. No. 71-13).On January 4, 2008, Barbara Teter sent a letter on behalf of Lee Teter to the“Authorized Lee Teter Galleries,” including 83 Spring Street Gallery, which informed thedealers of Lee and Barbara Teters’ official retirement from the publishing business, andannounced that Shawnee and Wyatt Herbst would be taking over SFFA. On March 27,2008, SFFA sent a proposed Dealership Agreement to GOI, which included the termsand conditions for becoming an authorized SFFA dealer, including minimum orderrequirements, assertion of rights over the advertisement of copyrighted material andterms of sale (Doc. No. 69-9).On April 24, 2008, GOI sent a letter to Shawnee informing that it would not agreeto the terms of the proposed Dealership Agreement, as written. GOI asserted itsposition that it had an “existing verbal agreement covering our relationship with SummerField Fine Art,” and referred to the February 27, 2007, meeting amongst the partieswhere Teter agreed that 83 Spring Street Gallery would continue to be an authorizeddealer with an exclusive territory that included the State of Arkansas as well as theBranson, Missouri metro area (Doc. No. 69-10).
C.Events Preceding the Instant Lawsuit
On May 20, 2008, Shawnee sent a letter to Mr. and Mrs. Walpole that“conclude[d] the permissible use of copyrighted images of Lee Teter art,” since any use
Case 5:08-cv-06097-FJG Document 139 Filed 07/12/10 Page 3 of 36

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