The Philadelphia Phillies Phanatic mascot reacts with Philadelphia Phillies right fielder Bryce Harper (3) during before the game gains the Atlanta Braves at Citizens Bank Park. Mandatory Credit: James Lang-USA TODAY Sports

A Manhattan magistrate judge has recommended that the Philadelphia Phillies can continue using their famous Phillie Phanatic mascot, in a copyright dispute between the baseball team and the green creature's original creators.

Former Muppet designer Bonnie Erickson — who created characters including Miss Piggy and hecklers Statler and Waldorf — and her husband Wayde Harrison terminated the Phillies' rights in their original mascot design, but the Phillies should be allowed to continue using their own modified version of the Phanatic, U.S. Magistrate Judge Sarah Netburn said Tuesday.

Among other things, Netburn also said Harrison/Erickson Inc's copyright in the original mascot was valid and the Phillies weren't co-creators of it.

"The most critical issue in our case was whether we could continue to utilize the redesigned Phanatic," the Phillies' attorney David Wolfsohn of Duane Morris said in a Wednesday email. "We are pleased that Judge Netburn agreed with us that the redesigned Phanatic is a derivative work."

Harrison/Erickson's attorney Paul Montclare of Mitchell Silberberg & Knupp didn't immediately respond to a request for comment.

H/E designed the Phillie Phanatic in 1978 following Jim Henson's recommendation of Erickson's work, and assigned its copyright to the team in 1984. H/E notified the Phillies in 2018 that it was terminating the grant, under a provision of the Copyright Act that allows artists to terminate assignments after 35 years by giving notice at least two years in advance. H/E said they told the Phillies that they wanted to renegotiate the agreement for "a fair price."

After receiving the notice, the Phillies hired an artist to create a modified version of the Phanatic. The team sued H/E in Manhattan in 2019, arguing among other things that it didn't have the right to terminate the assignment, its copyright was unenforceable, and the team was a co-author of the original Phanatic.

H/E raised several defenses and counterclaims, including that it was the sole creator of the Phanatic and that the team infringed its copyrights by continuing to use the Phanatic after the termination took effect in 2020.

In her Tuesday report, Judge Netburn said that H/E's copyright in the original mascot was valid, as was its termination, but that the Phillies' redesigned Phanatic was unaffected based on an exception in the Copyright Act that allows a grantee to continue to use derivative works created before the grant's termination.

H/E argued the new design wasn't original enough to be a derivative work because it was a "slavish copy" of its Phanatic. The Phillies said they made several "non-trivial" changes to the mascot, including a new snout shape, eyes, jersey and shoes.

Netburn said that the new Phanatic was a derivative work. Although the changes were "no great strokes of brilliance," Netburn said "a compilation of minimally creative elements, no matter how crude, humble or obvious, can render a work a derivative."

Netburn also said the parties hadn't yet analyzed whether hundreds of pieces of Phillies merchandise featuring the Phanatic were derivative works, and recommended denying a ruling on those claims.

The case is The Phillies v. Harrison/Erickson, U.S. District Court for the Southern District of New York, No. 1:19-cv-07239.

For the Phillies: David Wolfsohn of Duane Morris

For H/E: Paul Montclare of Mitchell Silberberg & Knupp

Philadelphia Phillies sue to keep their 'beloved' Phillie Phanatic

Source: Reuters

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