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Burden of Proof

'Harry Potter' Book Lawsuit: 'Legend of Rah and Muggles' Author Claims Trademark Violations

Aired July 5, 2000 - 12:30 p.m. ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: I am going to the bookstore right away.

UNIDENTIFIED FEMALE: It's all magic. I think that's the biggest key to Harry Potter.

TIM CANTWELL, FATHER OF "HARRY POTTER" FANS: It is incredible. My wife and my daughter just love them. They have read the first three books a couple of times each. Read a little bit about the woman who has written the books, it is quite a success story.

(END VIDEO CLIP)

VAN SUSTEREN: Today on BURDEN OF PROOF: Muggles, wizards, and magical adventures, 5.3 millions copy of the new "Harry Potter" book will be released this weekend. But a lawsuit accuses the author of stealing the magic.

ANNOUNCER: This is BURDEN OF PROOF with Roger Cossack and Greta Van Susteren.

VAN SUSTEREN: Hello and welcome to BURDEN OF PROOF. Roger is off today.

Children and parents are already lining up for the fourth book in the wildly popular Harry Potter series, and Hollywood is working overtime to release its first Harry Potter movie about the adventures of the boy wizard. Author J.K. Rowling is on top of the bestseller list, but writer Nancy Stouffer says that Rowling stole the Potter magic from her. In her lawsuit, Stouffer claims that there are too many similarities between the Potter series and a book she wrote in 1984. She's suing Rowling and Scholastic, the U.S. publisher of the Potter books, as well as Time Warner, the parent company of CNN.

Joining us today from Philadelphia is the author of "The Legend of Rah and Muggles," Nancy Stouffer. And also in Philadelphia is her lawyer Kevin Casey. And here in Washington, Kristin Macnamara (ph), trademark attorney Tom Olson (ph) and Ben Werner (ph). And in our back row, Liz Ceratti (ph) and Dave Denherder (ph).

In response to the lawsuit, Scholastic has released this statement: "Ms. Rowling's creative mind works in a world filled with myths and legends, but let there be no doubt that these books are her unique creations. Unfortunately, nowadays, success seems to breed not only imitation but also litigation.

Kevin, you are the lawyer for Nancy Stouffer, who is also one of our guests today, what is your reaction to these Scholastic remarks?

KEVIN CASEY, NANCY STOUFFER'S ATTORNEY: I think there is no doubt that author Rowling has taken characters and scenes from a number of different sources, some of them create no problem, such as the mythology that you mentioned, Greta, and some other sources, including other works, earlier works of writings of other people. And unfortunately, in this particular case, I think she borrowed some things from Nancy Stouffer.

VAN SUSTEREN: Nancy, let's talk about the borrowing. Your book, "Legend of Rah and Muggles," when did you write that?

LINDA STOUFFER, AUTHOR, "THE LEGEND OF RAH AND MUGGLES": It was written in 1984.

VAN SUSTEREN: And where was it distributed?

STOUFFER: It was distributed actually at different spots throughout the country, though primary on the East Coast. It was also marketed in the European market during the Nuremberg Book Fairs.

VAN SUSTEREN: Do you have any idea how many books were printed?

STOUFFER: There were approximately 100,000 copies of the first run printed.

VAN SUSTEREN: Now the title "Legend of Rah and Muggles," where did you get the term "muggles"?

STOUFFER: I derived the term from my son, who used to come up and pinch my cheek and tell me that he wanted to kiss me on my muggy, and that's where I came up with the term, and I started calling him a muggle.

VAN SUSTEREN: Do you know of any other use of the terms muggles? have you ever come across that term>

STOUFFER: Yes, I have. I have defended these same trademarks twice before, once in 1987, successfully in federal court, and once in 1992 against Stephen Bochco, who was using the term "muggle" for "Capital Critters."

I have since heard of other usages of the word muggle, but not within the same realm as my usage.

VAN SUSTEREN: Nancy, the issue that is presented in your lawsuit, and I will talk a bit with Kevin about it, isn't just the term "muggle," but also a sort of character similarity. Where do you see the character similarity between J.K. Rowling's writings and your book? STOUFFER: Well, I think the biggest problem here is a level playing field. My muggles are human characters, they just small human characters who are non-magical people. J.K. Rowling's are full-sized human characters as well, and it creates a confusion that is too difficult to overcome.

And there are other similarities. I have a "Larry Potter" character and she has a "Harry Potter" character. And I think those are really the two, although there are many other areas that we have problems with, those two major character problems really cause the unfair trade for me, and the usages of my mark. It's almost impossible to overcome them when the marketplace is not only driven by just published work, but also the derivative products, such as licensed products, such as toys or any other ancillary products. So when you have a confusion like that, there's no way that I have a capability to market my properties.

VAN SUSTEREN: Kevin, before we get to basis of Nancy's lawsuit against J.K. Rowling and others, including Time Warner, which is the parent company of CNN. There was a lawsuit filed, sort of a preemptive one filed by J.K. Rowling about six or eight months ago. What was that about?

CASEY: We were in negotiation, at the time, with counsel for Scholastic. And I remember it was the Monday before Thanksgiving, I believe that was the 22nd, they filed suit, actually Scholastic sued us first. We weren't about to go to court and try to resolve this dispute, we were trying to do it in the negotiation realm, and there suit was something called a declaratory judgment action, basically asking the court in New York to judge we did not have -- Nancy did not have trademark rights in "muggles," and that our unfair competition allegations were unfounded.

VAN SUSTEREN: Kevin, has Nancy actually, does she actually have a trademark?

CASEY: She has a trademark. There are two types of trademarks, basically, one is called a common law trademark, which is what Nancy has. That is, you establish through use of the mark, in association with consumers with your products, and you get rights that are able to be enforced. The second type is to get a federal trademark registration, we have applied for that, we have not yet obtained one.

VAN SUSTEREN: Nancy, what are you looking for in this lawsuit? what is the ideal goal for you?

STOUFFER: I want a level playing field. And I -- this is the third time that I've had to defend these trademarks. And what I want to make a point of here is that it is very difficult for a small business person, or an individual, to defend their own properties up against very huge corporate conglomerates. It is very, very costly. So, I mean, primarily, what I'm after here is a level playing field.

VAN SUSTEREN: Nancy, do you have some sense -- I mean, your allegation, in essence, is that there's been theft by another author?

STOUFFER: That's correct.

VAN SUSTEREN: Do you have any knowledge that this was deliberate, intentional, or could this be a coincidence and accidental, if indeed there is the similarities you set forth?

STOUFFER: I think I will let Kevin answer that one for me.

VAN SUSTEREN: Kevin, I pass the ball to you.

STOUFFER: Thank you. Let me jump right in. First, to characterize this as a theft, I think, only goes to half of the issue. Certainly, to borrow a number of the character names, and Nancy has alluded to a couple of the Larry and the Harry; Lily and Lily are identical character names; of course, "muggles" is sort of the flagship, and that identical; there is a "Nimbus" in Nancy's books, as well, as everyone knows the broomstick "Nimbus"; there is "keeper of the keys" is a character in Rowling's book and we have "keeper of the various characters," "keeper of the gardens," "keeper of the children," et cetera. These are just a few.

And once or twice, you can say, OK, there is a coincidence here. But by the time you get to six, seven, eight, you start thinking, hmm, looks to me like too much than a coincidence. That's half the case.

The other half is simply a trademark issue, and whether there was access, or whether there was mal-intent, or whether there was copying is irrelevant to the trademark case. We simply, as Nancy said, can't market our products using the "muggle" mark now without people thinking that people who are selling those products are Warner and Scholastic, rather than Nancy.

VAN SUSTEREN: All right, we are going to take a break. Up next, the fight over "muggles": What names are protected by trademark law? Stay with us.

(BEGIN LEGAL BRIEF)

The Jamaican government has ordered a stop on the illegal reception of U.S. satellite broadcasts in order to abide by international intellectual property laws.

Violators will be faced with a $1,500 fine or three months imprisonment.

(END LEGAL BRIEF)

(COMMERCIAL BREAK)

VAN SUSTEREN: Good news for our Internet-savvy viewers: You can now watch BURDEN OF PROOF live on the Worldwide Web. Just log onto cnn.com/burden. We now provide a live video feed Monday through Friday at 12:30 p.m. Eastern time. If you miss that live show, the program is available on the site at any time via video-on-demand. You can also interact with our show, and even join our chat room.

Young wizard Harry Potter's world is full of muggles, which is the word wizards use for humans. In Nancy Stouffer's book, muggles are little people who care for two orphaned boys and turn their world into a happy place. Nancy Stouffer says she, and not the author of the Harry Potter books, owns the "Muggles" trademark.

Tom, what is a trademark?

TOM OLSON, TRADEMARK ATTORNEY: A trademark is anything that you can use to identify one person's services or goods. For example, I'm sure that "CNN," for example, is a trademark, "BURDEN OF PROOF" is a trademark. They are things that identify a particular brand and the people associated with a particular brand or product.

VAN SUSTEREN: Can you trademark a word that is common in the vocabulary, or does it have to be a made-up word?

OLSON: No, you can trademark a common word, but you then need to show that people associate it uniquely with you as opposed to it being just a word that people don't associate with anyone in particularly.

VAN SUSTEREN: Now, Kevin talked about a common-law trademark versus a registered trademark. What is the difference?

OLSON: The U.S. government maintains a formal registration system so you can put people on notice. You know: We, CNN, claim that we own the trademark in those letters taken together. And I understand that the author here has not gotten that kind of trademark. There are also trademarks that one can own simply by using a mark and by it becoming extremely well-known to the public. And that's what a common-law trademark is.

VAN SUSTEREN: I mean, does a registered trademark have more weight or muscle than a common-law?

OLSON: It has somewhat more muscle than a common-law trademark.

VAN SUSTEREN: Kevin, what's it going to take to get the trademark for your client -- the registered trademark? What do you need to do?

CASEY: Well, the first thing we need to do, Greta, is to clear the wayside of at least one other person who has registered "muggles" as a trademark after we did. So we have some petitions in the federal government now to cancel those registrations.

VAN SUSTEREN: Isn't it first come, first served, though, if somebody has didn't it already?

CASEY: No, it's actually first use, is the general principle.

VAN SUSTEREN: And so once you have the -- once it is registered federally, does it apply internationally?

CASEY: No, each country has its own trademark laws. There's an exception in the European Union where you can get one trademark for the 16 or 17 European countries, but that's a relatively new development. And in the U.S., our U.S. trademark are only relevant to our territory.

VAN SUSTEREN: Tom, distinguish trademark from copyright.

OLSON: Sure. Copyright law protects a substantial work of authorship. For example, a novel as a whole is protected by copyright, or a movie or a poem. But copyright law doesn't protect just a single word or a short phrase. Like "muggles," for example, there would be no possible way to bring a copyright claim based on "muggles." And I understand that the author here has not brought any copyright claim, presumably recognizing that the copyright law doesn't protect short words or phrases.

VAN SUSTEREN: But what Kevin talking -- he was talking about the coincidence -- and so is Nancy -- the coincidence in plot, or name that's Larry Potter versus Harry Potter. Is that sort of a basis of a copyright issue more than trademark?

OLSON: Well, that -- typically, that's the kind of listing of similarities that you would see in a copyright claim, that's right.

VAN SUSTEREN: Nancy, do you have any information to suggest that J.K. Rowling ever had access to your book or was in a position of access to your book?

STOUFFER: Well, I'd rather really not get into the specifics, but obviously the law firm did quite a bit of research into my case before they decided to take on the case. And I think I'd really rather refer this question to Kevin and let him explain what can be said and what can't be said, at this point.

VAN SUSTEREN: Just as a backup, though, Nancy, was J.K. Rowling ever, you know, ever in the United States when your book was published? Do you have any information that would in any way make or at least expose to your book rather than having it simply as a coincidence?

STOUFFER: Well, her editor and her publisher were both exposed to my properties.

VAN SUSTEREN: Kevin, do you -- in your research, have you uncovered -- and I realize that part of a lawsuit is discovery and you get to find out information of the other side.

CASEY: Exactly.

VAN SUSTEREN: But do you have anything in terms of when you filed this lawsuit, do you have any information that suggested that there was access by J.K. Rowling to your client's work?

CASEY: Well, there are a number of things that we'll certainly pursue in discovery, perhaps with Ms. Rowling her several in a deposition. But there are at least three or four things. I'll try to summarize them quickly. We think she may have been in the Baltimore area in the late '80s on a work study program, which is one of the areas where Nancy's book was significantly distributed. It's curious that on one of the copyright registrations that Scholastic has obtained, Ms. Rowling is listed as a United States citizen, although we've been told that she hadn't been in the States before her books became famous and she came on tours.

As Nancy mentioned, her properties were displayed in 1987 in Germany at the Nuremberg Toy Show. I know that many of people in Europe, and perhaps Ms. Rowling, attended that show. One of the people that did attend was a London bookstore, and they apparently were interested in Nancy's products. And I think that bookstore may be one that Ms. Rowling frequented.

So there are a number of different ways -- as Nancy also said, some of the similarities or cross-connections in people, in editors and that kind of thing -- that it could have been accessible to Ms. Rowling. And it may very well have been innocent. She may have read it and came up, you know, years later with similar story lines and similar names out of her mind. But there's certainly ample evidence to suggest, although certainly no proof yet until we get discovery, as you mentioned, Greta, that there may have been some access.

VAN SUSTEREN: All right, we're going to take a break. When we come back, what does the future look like for Harry Potter?

(BEGIN Q&A)

Q: Why are New Hampshire lawmakers considering impeaching their Supreme Court chief justice?

A: New Hampshire Chief Justice David Brock is accused of intervening with a lower court judge in a case involving a state senator because the senator could help win pay raises for the bench.

(END Q&A)

(COMMERCIAL BREAK)

VAN SUSTEREN: "Harry Potter and the Goblet of Fire" is due out this weekend. And a movie based on the first book in the series is in the works. But a lawsuit is also pending against "Harry Potter" author J.K. Rowling.

Tom, lawyers oftentimes pick up complaints in reading them -- even before discovery, decide which side you'd prefer to represent.

OLSON: Sure.

VAN SUSTEREN: Which side -- in this case, which side would you --- if you could have your choice?

OLSON: Well, I guess this lawsuit I kind of put into a category that I see fairly frequently, in the same way that mushrooms pop up after a rainstorm, lawsuits like this pop up after successful books and movies come out. And I...

VAN SUSTEREN: Some weird similarities, though. You've got a similarity of the names. You've got some similarity in the characters. Now, I realize there isn't a copywrite claim. This is a trademark.

OLSON: Sure.

VAN SUSTEREN: Doesn't that sort of peak your interest?

OLSON: Well, it does. But the courts have seen cases with much longer and more powerful lists of similarities than this and have not found those to give rise to trademark or copywrite claims. For example, on the "Muggles," there was a Newbery award-winning book in 1958 that used that word.

VAN SUSTEREN: But you have Muggles and character similarities. It's not just Muggles alone.

OLSON: Well, it's not clear to me there are character similarities.

VAN SUSTEREN: Larry Potter versus Harry Potter.

OLSON: Sure. I understand that was in a different book. It's not the same book that is the principal one we are talking about here. That's in a different book. And, oftentimes, if you take two different books of hundreds of pages long, you can find some similarities like that. There are lots of characters in obscure novels that people have written that have names in them. And, once in a while, somebody will write a popular novel that will have a name that's similar to one in one of the hundreds of thousands of obscure novels that are out there.

VAN SUSTEREN: Kevin, I've been arguing your case, but do you want to respond to that?

CASEY: Well, certainly. The prior uses -- you mentioned there's a book called "The Gammage Cup" that used Muggles as a character. The key is not, as I see it, using Muggles alone as a character, which is the point Greta made, it's using Muggles as a trademark outside of the context of a character name in the book to sell products. Nancy sold many products and licensed others to sells products, including dolls, toys, magnets, etcetera.

It's the use of the Muggles name as a trademark, not necessarily as a character name alone, that's I think the strength of this case.

VAN SUSTEREN: But, OK, so you don't raise a copywrite claim, but does it bolster a trademark claim by virtue of the fact that there may be similars in terms of characters that might typically be copywrited?

CASEY: Absolutely. Unfair competition is a penumbra, a broad word, under which falls one category: trademarks. So everything that we are going to prove in terms of trademarks will certainly help our unfair competition claim. And the character names similarity beyond Muggles will certainly help the unfair competition and carry the trademark with it.

VAN SUSTEREN: Tom, if these -- a trademark case when it goes to trial, do you get a jury? OLSON: You'd get a jury if you were seeking damages, yes. If either side wants a jury, you would get a jury.

VAN SUSTEREN: Kevin, do you want damages for your client?

CASEY: Absolutely.

VAN SUSTEREN: What are you asking for?

CASEY: Well, right now like we'd like to settle with them. And 95 percent of this cases is due, so we are certainly open to discussions with them.

VAN SUSTEREN: Give me an idea of what you consider a good settlement on this case.

CASEY: Well, one thing we'd like to do is have, as Nancy says, a fair playing field, and to have the opportunity to market her own books and her own products with people associating her Muggles with her and not with Rowling and Scholastic. So, we're going to need to take some corrective advertising or something along those lines to make sure that happens. Whether she needs some licensing income or to get some money to help do that, I think that would be on the table as well.

You know, Nancy has received a number of death threats to her as a result of this litigation. She is now portrayed as the villain -- not only the victim in having her intellectual property, as you put it earlier, stolen, but certainly infringed. And we need some remedies there as well.

VAN SUSTEREN: Nancy, death threats, what kind of death threats have you gotten?

STOUFFER: Very obscene death threats, and repetitive and escalating.

VAN SUSTEREN: In what form? I mean, how are they communicated to you?

STOUFFER: Primarily by e-mail.

VAN SUSTEREN: And I guess -- I mean, are you doing anything about it?

STOUFFER: The FBI has been notified. In fact, another packet went out by the FBI by mail Saturday. The local officials are all notified as well.

VAN SUSTEREN: And are they taking it seriously? Do you get a sense that this is being taken seriously?

STOUFFER: It's taken very seriously. There has been extra watch put on my facility and my home. And we also have private security as well for special occasions.

VAN SUSTEREN: All Right, well, that's all the time we have for today.

Thanks to our guests and thank you for watching. And join me later tonight for a discussion of voyeur television on CNN "NEWSSTAND." Would you want a camera in every room of your house? That's at 10:00 p.m. Eastern time.

And tune into "TALKBACK LIVE" for the latest in presidential politics. Green Party candidate Ralph Nader is the guest at 3:00 p.m. Eastern, noon Pacific.

And of course, we'll be back tomorrow with another edition of BURDEN OF PROOF. We'll see you then.

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