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As studios capitalize on works in the public domain, including “The Wizard of Oz,” Warner Bros. has won a key court ruling that could give creators pause in how much leeway they have in exploiting individual characters from classic stories.

At issue is a merchandiser who sold products such as t-shirts, figurines, water globes and action figures based on public-domain publicity images from “The Wizard of Oz” and “Gone With the Wind,” as well as several animated short films from cat-and-mouse duo Tom & Jerry. In a ruling issued Tuesday, the 8th Circuit Court of Appeals largely sided with Warner Bros.’ contention that even though the images were in the public domain, Avela Inc. modified the material enough to evoke the characters in the movies that are still under the studio’s copyright protection.

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“Even if we assume that each composite work is composed entirely of faithful extracts from public-domain materials, the new arrangement of the extracts in the composite work is a new increment of expression that evokes the film character in a way that individual items of public domain material did not,” the court stated in its ruling.

Decision could be a warning shot to other studios and producers developing Wizard of Oz projects, including Disney, which is planning “Oz: The Great and Powerful,” to be directed by Sam Raimi. Although the L. Frank Baum book, written more than 100 years ago, is in the public domain, the ruling adds a layer of complexity. Other studios will have to be cautious about which character traits belong to the book and which belong to the 1939 MGM classic.

The court did say that the merchandiser was allowed to make products based on the images in the publicity materials, but Avela is limited largely to reproducing the photos as is. The publicity stills were sent out to theaters, newspapers and magazines — without a copyright notice attached — to build buzz for “Wizard of Oz” and “Gone With the Wind” some 75 years ago.

“At the very least, the scope of the film copyrights covers all visual depictions of the film characters at issue, except for any aspects of the characters that were injected into the public domain by the publicity materials,” the court said.

The latest ruling also further bolsters legal case law that characters, and not just the movies and TV shows they appear in, are protected by copyright “to the extent that such characters are sufficiently distinctive,” the court said.Carole Handler, an attorney at Lathrop & Gage and an adjunct professor at the USC School of Law, said this decision and other case law supports “characters having an independent copyright and, in a sense, having an immortality that takes them beyond the episodes in which they appear.”

As an example, the court said that “the printed phrase ‘There is no place like home’ from the book ‘The Wizard of Oz’ and a publicity image of Judy Garland as Dorothy, viewed side by side in uncombined form, are still two separate works, one literary and one a picture of an actor in a costume. In contrast, a t-shirt printed with the phrase ‘There’s no place like home’ along with the same image of Judy Garland as Dorothy is a new single work that evokes the film character of Dorothy much more strongly than two separate works.”

The court cited a 1989 Second Circuit Court of Appeals decision ruling that the creator of an “Amos & Andy” musical could not make any work he wished even though pre-1948 “Amos & Andy” scripts were in the public domain. CBS still had a copyright on scripts after 1948, and the court ruled that it could still claim ownership of “further delineation of the characters.”