Pleadings

Circle of Atonement, Inc.
v.
Foundation For A Course in Miracles, Inc.

THE PLEADINGS

CIRCLE OF ATONEMENT, INC. DECLARATORY RELIEF COMPLAINT	FOUNDATION FOR A COURSE IN MIRACLES, INC. FOUNDATION FOR INNER PEACE, INC. ANSWER AND COUNTERCLAIMS
1. Circle of Atonement, Inc. is a non-profit Arizona Corporation with its principal place of business in Sedona, Arizona.	1. Defendants are without knowledge or information sufficient to form a belief as to the truth of the allegations contained in paragraph 1 of the Complaint.
2. Upon information and belief, Defendant Foundation for A Course in Miracles (FACIM) is a not for profit New York Corporation with its headquarters in Roscoe, New York, and it is doing business in Arizona and throughout the world. Upon information and belief, FACIM is the present holder of a claimed copyright for a religious work A Course in Miracles.	2. Defendants admit that the Foundation for "A Course in Miracles", Inc. ("FACIM") is a not-for-profit New York corporation with its headquarters in Roscoe, New York. Defendants further admit that FACIM is the present owner of a copyright for the work "A Course in Miracles" (the "Work"). Defendants deny the remaining allegations contained in paragraph 2 of the Complaint.
3. Upon information and belief, Defendant Penguin Books (Penguin Books) is a New York corporation doing business in Arizona and throughout the world. Penguin is the claimed assignee or licensee with certain exclusive rights to the publication and distribution of A Course in Miracles.	3. Defendants are informed and believe that defendant Penguin Books USA, Inc. ("Penguin Books") was a New York Corporation doing business in Arizona. Defendants deny the remaining allegations contained in paragraph 3 of the Complaint.
4. Upon information and belief, Defendant Penguin Putnam, Inc. is a Delaware Corporation doing business in Arizona and throughout the world, and is the merged entity following a merger with Penguin Books and/or is the parent company to Penguin Books. (The Penguin entities are collectively referred to as Penguin.)	4. Defendants are informed and believe that defendant Penguin Putnam. Inc. ("Penguin") is a Delaware corporation doing business in Arizona and that Penguin Books has been merged into Penguin. Defendants deny the remaining allegations contained in paragraph 4 of the Complaint.
5. Upon information and belief, Defendant Foundation for Inner Peace (FIP) is a New York not for profit corporation with its principal place of business in Mill Valley, California, and it is doing business in Arizona and throughout the world. FIP is the former holder of a claimed copyright for A Course in Miracles and, upon information and belief, assigned all but a residual interest in the copyright to FACIM.	5. Defendants admit that the Foundation for Inner Peace, Inc. ("FIP") is a New York not-for-profit corporation. Defendants further admit that FIP is the former owner of the Work and that FIP has assigned ownership of the Work to FACIM. Defendants deny the remaining allegations contained in paragraph 5 of the Complaint.
6. This action is being brought seeking declaratory relief pursuant to Rule 57, Fed. Rules Civ. Proc. and 28 U.S.C. § 2201 to establish the right of Circle of Atonement to fairly use A Course in Miracles and other related works in its publications, and to establish the invalidity of the claimed copyright and trademark of A Course in Miracles.	6. Defendants state that plaintiff purports to bring the action seeking declaratory relief pursuant to Rule 57 of the Federal Rules of Civil Procedure and 28 U.S.C. §2201. Defendants deny the remaining allegations contained in paragraph 6 of the Complaint.
7. A present justiciable controversy exists because FACIM has refused to grant permission to Circle of Atonement to use portions of A Course in Miracles in a manuscript written for Circle of Atonement by Robert Perry, and FACIM further demands that Circle of Atonement cease and desist from distributing certain publications that use portions of A Course in Miracles. FACIM’s demands encompass use of the words A Course in Miracles and it has demanded that others cease and desist from use of the words.	7. Defendants admit that they have refused to grant plaintiff permission to infringe the copyright in the Work and have requested that plaintiff cease and desist from distributing materials that infringe the Work. To the extent the allegations in paragraph 7 of the Complaint state a conclusion of law, no response is required. Defendants deny the remaining allegations contained in paragraph 7 of the Complaint.
8. Jurisdiction is proper in that the claim for declaratory relief is based on federal subject matter jurisdiction pursuant to 28 U.S.C. §§ 1331 and 1338, and Plaintiff seeks a determination of the validity of the copyright pursuant to The Copyright Act of 1909 (as amended), 17 U.S.C. § 101, et. seq.,(the Copyright Act) the application of fair use principles pursuant to 17 U.S.C. § 107 , the Lanham Act, 15 U.S.C. §1051, et. seq. (The Trademark Act of 1946), and the consideration of First Amendment rights to free speech and freedom of religion found in the United States Constitution.	8. Defendants admit that this Court has subject matter jurisdiction pursuant to 28 U.S.C. §§1331 and 1338 because plaintiff purports to base its action on the Copyright Act of 1909 (as amended), 17 U.S.C. §101 et seq., and the Lanham Act, 15 U.S.C.§1051 et seq. Defendants deny the remaining allegations contained in paragraph 8 of the Complaint.
9. Venue is proper in Arizona pursuant to 28 U.S.C. §§ 1391(b) and (c), and 28 U.S.C. §1400(a) because each of the defendants is subject to personal jurisdiction in Arizona and thus resides in Arizona. Further, a substantial part of the events giving rise to the claim occurred in Arizona because this is where Circle of Atonement’s publication activities are generated and the letters sent by FACIM were received and intended to have their primary impact.	9. Defendants state that plaintiff has infringed its copyright in Arizona. Defendants deny the remaining allegations contained in paragraph 9 of the Complaint.
10. This action arises out of the scribing by Dr. Helen Schucman of a religious work entitled A Course in Miracles. The scribing occurred over a seven year period from 1965 to 1972.	10. Defendants admit that Dr. Helen Schucman is the author of the Work. Defendants further admit that Dr. Helen Schucman authored the Work during a period approximating seven years, between 1965 and 1972. Defendants deny the remaining allegations contained in paragraph 10 of the Complaint.
11. Dr. Schucman believed that she was scribing the actual words of Jesus as communicated in a voice to her, a process she described as a form of rapid inner dictation. Upon information and belief, Dr. Schucman expressly disavowed that any part of the text or organization of A Course in Miracles invoked her own creativity, expressing instead the belief that the voice would not allow her to inject her own creativity into the work.	11. Defendants admit that Dr. Schucman believed a voice had communicated with her and that she described the process of her authorship as a form of "rapid inner dictation." Defendants deny the remaining allegations contained in paragraph 11 of the Complaint
12. Many of the followers and students of A Course in Miracles believe A Course in Miracles to be the actual words of Jesus and the work is viewed by many of its believers as divine revelation in the nature of modern day scripture.	12. Defendants are without knowledge or information sufficient to form a belief as to the truth of the allegations contained in paragraph 12 of the Complaint
13. Defendant FIP has always expressed and perpetuated in print the belief that A Course in Miracles is divine revelation containing the words of Jesus with Dr Schucman acting only as a scribe.	13. Defendants deny the allegations contained in paragraph 13 of the Complaint.
14. Upon information and belief, FACIM’s public pronouncements can be fairly read to agree that A Course in Miracles contains divine revelation.	14. Defendants deny the allegations contained in paragraph 14 of the Complaint.
15. The Circle of Atonement teachings are based on the belief that A Course in Miracles is divine revelation in the nature of modern day scripture containing the words of Jesus	15. Defendants are without knowledge or information sufficient to form a belief as to the truth of the allegations contained in paragraph 15 of the Complaint.
16. Following the preparation of the manuscript of A Course in Miracles, upon information and belief, copies of the manuscript were disseminated to the public prior to any copyright protection and without restriction of any kind on its use.	16. Defendants deny the allegations contained in paragraph 16 of the Complaint.
17. In 1975, defendants allege that Dr. Schucman orally assigned any copyright interests in A Course in Miracles to the Foundation for Parasensory Investigation (FPI). In or around that same time, defendants allege that application was made by FPI for copyright registration of A Course in Miracles. In or around that same time, defendants allege that FPI changed its name to FIP.	17. Defendants admit that Dr. Schucman assigned her copyright interests in the Work to the Foundation for Parasensory Investigation ("FPI") in or around 1975, that FPI made an application for copyright registration of the Work, and that FPI changed its name to the Foundation for Inner Peace. Defendants deny the remaining allegations contained in paragraph 17 of the Complaint.
18. At the time of application for copyright registration of A Course in Miracles, FIP intended to register the copyright with Jesus as the author. When informed that copyright could not be granted to a non- physical author, FIP did not list the name of the believed true source, Jesus, but instead listed Anonymous (Helen Schucman).	18. Defendants admit that the copyright application identified the Work's author as "Anonymous (Helen Schucman)". Defendants deny the remaining allegations contained in paragraph 18 of the Complaint.
19. Upon information and belief, beginning with the initial distribution of A Course in Miracles, religious teaching centers, informal study and discussion groups and independent writings began to proliferate with A Course in Miracles as the scriptural or philosophical origin. Upon information and belief, these efforts were not discouraged, and were often undertaken with the approval or acknowledgement of FIP. Upon information and belief, there was certainly no substantial effort undertaken by FIP to legally restrain such publications nor were any legal actions instituted to enforce copyright restrictions.	19. Defendants admit that informal study in discussion groups, independent (non-infringing) writings, and teaching centers have been founded with "A Course in Miracles" as the spiritual or philosophical focus. Defendants further admit that as a general matter they have not discouraged and indeed have approved of these undertakings. Defendants deny the remaining allegations contained in paragraph 19 of the Complaint
20. Upon information and belief, these independent efforts increased the awareness and popularity of A Course in Miracles, and thus benefited FIP.	20. Defendants are without knowledge or information sufficient to form a belief as to the truth of the allegations contained in paragraph 20 of the Complaint.
21. Upon information and belief, sometime in the 1980’s, following Dr. Helen Schucman’s death, FIP began requesting, for the first time, that authors of some independent works obtain permission to use A Course in Miracles. However, upon information and belief, such use was routinely granted without qualification and failure to obtain permission or even to attribute the source of material did not result in any substantial enforcement activities by FIP demonstrative of a serious concern for maintaining the copyright.	21. Defendants deny the allegations contained in paragraph 21 of the Complaint.
22. Upon information and belief, following the publication of A Return to Love: Reflections on the Principles of a Course in Miracles by Mary Ann Williamson, a financially successful work based on the Course, FIP began to try to establish in the early 1990’s, for the first time, significant copyright restrictions.	22. Defendants deny the allegations contained in paragraph 22 of the Complaint.
23. In the alternative, by the time FIP sought to impose such restrictions, A Course in Miracles had already entered the public domain as a significant religious work, in the nature of scripture or divine revelation, and in the view of many, contained the words of Jesus.	23. Defendants deny the allegations contained in paragraph 23 of the Complaint.
24. From FIP’s announcement of new copyright restrictions, substantial confusion existed among the followers and students of A Course in Miracles as to FIP’s intentions with respect to enforcement of the new restrictions.	24. Defendants are without knowledge or information sufficient to form a belief as to the truth of the allegations contained in paragraph 24 of the Complaint.
25. Upon information and belief, in November 1993, FIP registered a trademark/service mark for A Course in Miracles as well as a trademark for the initials ACIM in a further attempt to unreasonably and wrongfully restrict independent works and teachings.	25. Defendants admit that on or about November 30, 1993, FIP registered a service mark for "A Course in Miracles" and also admit that on or about December 2, 1997, FIP registered the initials "ACIM". Defendants deny the remaining allegations contained in paragraph 25 of the Complaint.
26. In 1995, FIP entered into a contract with defendant Penguin with respect to certain publication and distribution rights for A Course in Miracles.	26. Defendants admit that FIP entered into a contract with defendant Penguin Putnam, Inc. (formerly Penguin Books U.S.A., Inc.), which contract, in its entirety, speaks for itself. To the extent the allegations of paragraph 26 of the Complaint misstate or mischaracterize the content, substance or import of said document, or cite to the same out of context or in a misleading fashion, they are denied.
27. In March 1999, FIP transferred the copyright to FACIM. FACIM had, prior to the transfer, been primarily engaged in teaching and publication activities involving FACIM’s particular interpretation and application of A Course in Miracles.	27. Defendants admit that in or about September 23, 1998, FIP transferred the copyright to FACIM and that FACIM is and has been primarily engaged in teaching and publication activities involving "A Course in Miracles". Defendants deny the remaining allegations contained in paragraph 27 of the Complaint.
28. Also, Dr. Kenneth Wapnick, the President of FACIM, authored a certain book entitled Absence From Felicity that includes text that was scribed by Dr. Helen Schucman and is believed by Circle of Atonement to be divine revelation containing the words of Jesus. This text is not included in A Course in Miracles.	28. Defendants are without knowledge or information sufficient to form a belief as to the truth of the allegations contained in paragraph 28 of the Complaint.
29. In addition, Schucman also scribed two other works, Psychotherapy and The Song of Prayer, which are believed to be divine revelation and the words of Jesus. In addition, Schucman also scribed in the same manner a portion of The Gifts of God which contains the words of Jesus as divine revelation (collectively referred to as Other Works).	29. Defendants admit that Dr. Helen Schucman is the author of "Psychotherapy", "The Song of Prayer", and "The Gifts of God". Defendants are without knowledge or information sufficient to form a belief as to the truth of the allegations concerning the beliefs of unidentified persons referred to in paragraph 29 of the Complaint. Defendants deny the remaining allegations contained in paragraph 29 of the Complaint.
30. Robert Perry, a principal of Circle of Atonement, began studying A Course in Miracles in 1981.	30. Defendants are without knowledge or information sufficient to form a belief as to the truth of the allegations contained in paragraph 30 of the Complaint.
31. In January 1986, he began teaching and writing about A Course in Miracles and it soon became his life work.	31. Defendants are without knowledge or information sufficient to form a belief as to the truth of the allegations contained in paragraph 31 of the Complaint.
32. Allen Watson, another principal of Circle of Atonement, began publishing in April 1988 a newsletter entitled Miracle Thoughts, containing writings and commentary on A Course in Miracles.	32. Defendants are without knowledge or information sufficient to form a belief as to the truth of the allegations contained in paragraph 32 of the Complaint.
33. At that time, Watson wrote to FIP explaining his intended use of A Course in Miracles as a basis for the newsletter. In response, FIP sent a letter of acknowledging use without any restrictions, requesting only that sources be attributed. There was no restriction on use of the title, or the amount of material quoted.	33. The allegations contained in the first two sentences of paragraph 33 of the Complaint attempt to characterize documents, which, in their entirety, speak for themselves, if they exist. To the extent the allegations misstate or mischaracterize the content, substance or import of said documents or cite to the same out of context or in a misleading fashion, they are denied, Defendants deny the remaining allegations contained in paragraph 33 of the Complaint.
34. In 1990, Perry received written agreement from FIP to use about 10,000 words from A Course in Miracles in his book The Elder Brother: Jesus In a Course in Miracles. He also began work on other publications and in 1991, began work on a booklet series. With respect to these subsequent publications, FIP acknowledged and agreed to his use by simply advising Mr. Perry to use the same agreement he already had from The Elder Brother.	34. The allegations contained in the first sentence of paragraph 34 of the Complaint attempt to characterize a document, which, in its entirety, speaks for itself. To the extent said allegations misstate or mischaracterize the content, substance or import of said document or cite to the same Out of Context or in a misleading fashion, they are denied. Defendants are without knowledge or information sufficient to form a belief as to the truth of the allegations contained in the second and third sentences of paragraph 34 of the Complaint concerning other publications Mr. Perry began working on in or around 1991. Defendants deny the remaining allegations contained in paragraph 34 of the Complaint.
35. In March 1993, Circle of Atonement was incorporated to continue to pursue Mr. Perry’s activities with respect to teaching and publication of works based on A Course in Miracles. Mr. Watson joined Circle of Atonement shortly thereafter.	35. Defendants are without knowledge or information sufficient to form a belief as to the truth of the allegations contained in paragraph 35 of the Complaint.
36. Thereafter, Circle of Atonement continued to teach and publish booklets and other publications based on A Course in Miracles according to the earlier written agreement from FIP, and based on oral and implied agreement for use from the President of FIP, Judith Skutch Whitson.	36. Defendants are without knowledge or information sufficient to form a belief as to the truth of the allegations contained in paragraph 36 of the Complaint concerning the activities of the Circle of Atonement. Defendants deny the remaining allegations contained in paragraph 36 of the Complaint.
37. Beginning in 1995, Circle of Atonement and FIP began a series of negotiations with respect to FIP’s efforts to enforce new copyright restrictions. Through its President, FIP represented that Circle of Atonement was grandfathered in so that it could continue its publication and teaching efforts, even if FIP sought to enforce more stringent restrictions on others. The negotiations, which continued until March 1999 were primarily intended to assist FIP in developing a fair use policy so that authors and teachers, such as Circle of Atonement, could continue to publish and distribute independent scholarly works regarding A Course in Miracles.	37. Defendants admit that from time to time Mr. Perry and FIP engaged in certain discussions concerning Mr. Perry's requests to quote from the Work.Defendants deny the remaining allegations contained in paragraph 37 of the Complaint.
38. Circle of Atonement continued its publication activities with the express or implied agreement and acknowledgement of FIP, and relied upon such in devoting all of its resources and energies to its continuing efforts to understand, interpret and teach A Course in Miracles.	38. Defendants are without knowledge or information sufficient to form a belief as to the truth of the allegations contained in paragraph 38 of the Complaint concerning the efforts, activities or beliefs of the Circle of Atonement. Defendants deny the remaining allegations contained in paragraph 38 of the Complaint.
39. In early 1998, Robert Perry, in a work written for Circle of Atonement, submitted an extensive, several hundred page scholarly work pertaining to A Course in Miracles to a literary agent for publication consideration (the Perry Manuscript). At that time, Circle of Atonement was advised that it should seek agreement for use of A Course in Miracles and Absence of Felicity in the Perry Manuscript. In that regard, Circle of Atonement requested such from the President of FIP.	39. Defendants admit that Robert Perry requested permission from FIP to quote from the Work in a manuscript presented to FIP in or around 1998. Defendants are without knowledge or information sufficient to form a belief as to the truth of the remaining allegations contained in paragraph 39 of the Complaint.
40. From that time forward until the assignment of the copyright to FACIM, Circle of Atonement reasonably believed that agreement would be reached. Nevertheless, Circle of Atonement was subsequently made aware that the review of the manuscript had been delegated to Ken Wapnick, the president of FACIM. Mr. Wapnick teaches a different interpretation of A Course in Miracles than that of Circle of Atonement.	40. Defendants are without knowledge or information sufficient to form a belief as to the expectations or beliefs of the Circle of Atonement as alleged in the first sentence of paragraph 40 of the Complaint. Defendants admit that Dr. Kenneth Wapnick is the President of FACIM and that he teaches differently than Messrs. Perry and Watson. Defendants deny the remaining allegations contained in paragraph 40 of the Complaint.
41. After further delays in which Circle of Atonement was advised that the review was not complete, transfer of the copyright was made to Wapnick’s FACIM.	41. Defendants admit that FIP assigned the copyright in the Work to FACIM. Defendants deny the remaining allegations contained in paragraph 41 of the Complaint.
42. Immediately thereafter, Circle of Atonement was advised, some 14 months after the request, denying, without explanation, use of any portion of A Course in Miracles or Absence From Felicity. A copy of the letter of denial is attached as Exhibit A.	42. The allegations contained in the first sentence of paragraph 42 of the Complaint attempt to characterize a document, which, in its entirety, speaks for itself. To the extent said allegations misstate or mischaracterize the content, substance or import of said document or cite to the same out of context or in a misleading fashion, they are denied.
43. In July 1999, Circle of Atonement was served with a cease and desist letter from FACIM with respect to numerous publications. A copy of the letter is attached as Exhibit B. The publications identified in Exhibits A & B are collectively referred to as the Challenged Publications.	43. The allegations contained in the first sentence of paragraph 43 of the Complaint attempt to characterize a document, which, in its entirety, speaks for itself. To the extent said allegations misstate or mischaracterize the content, substance or import of said document or Cite to the same out of context or in a misleading fashion, they are denied.
44. Following receipt of this demand letter, Circle of Atonement sought to address with FACIM the fair use of A Course in Miracles, (see attached Exhibit C), but FACIM refuses to address the issue. (See attached Exhibit D).	44. The allegations contained in paragraph 44 of the Complaint attempt to characterize documents, which, in their entirety, speak for themselves. To the extent said allegations misstate or mischaracterize the content, substance or import of said documents or cite to the same out of context or in a misleading fashion, they are denied.
45. Each of the Challenged Publications contains original, creative literary works authored by Allen Watson and/or Robert Perry as principals of Circle of Atonement. The Challenged Publications were written for Circle of Atonement’s benefit and use, and any rights therein have been assigned to Circle of Atonement by the authors.	45. Defendants deny the allegations contained in the first sentence of paragraph 45 of the Complaint. Defendants are without knowledge or information sufficient to form a belief as to the truth of the allegations contained in the second sentence of paragraph 45 of the Complaint.
46. Upon information and belief, the efforts being undertaken by FACIM are not for any legitimate copyright protection, but are an effort to stifle free speech and free exercise of religion under the guise of the Copyright Act of 1909 to prevent independent scholarly works that comment upon A Course in Miracles, or the Other Works, especially those which set forth a different interpretation from the interpretation or opinions held by Dr. Wapnick.	46. Defendants deny the allegations contained in paragraph 46 of the Complaint.
47. The Defendants actions are damaging to the Circle of Atonement because such efforts prevent Circle of Atonement from fulfilling its function, in that its entire focus since its inception (and Mr. Perry’s and Mr. Watson’s work for over a decade) is the teaching and interpretation of A Course in Miracles.	47. Defendants deny the allegations contained in paragraph 47 of the Complaint.
48. Plaintiff realleges paragraphs 1-47 above.	48. Counterclaim Plaintiffs are further entitled to recover from Circle the damages, including attorneys' fees, they have sustained and will sustain, and any gains, profits, and advantages obtained by Circle as a result of Circle's acts of infringement as alleged above. At present, the amount of such damages, revenues, gains, profits, and advantages cannot be fully ascertained.
49. Each of the Challenged Publications, including the booklet Series, Perry manuscript, Current Workbook Lesson Commentaries, Workbook Companion, Manual Study Series and Electronic Text Class is for the purpose of criticism, comment, teaching, scholarship and/or research based on divine revelation from the words of Jesus found in A Course in Miracles, Absence From Felicity, Psychotherapy and/or The Song of Prayer.	49. By reason of Circle's infringement, in the alternative, Counterclaim Plaintiffs seek statutory damages in the sum of Twenty Thousand Dollars ($20,000.00) per infringing work as provided in 17 U.S.C. §504(c)(1).
50. Each of the Challenged Publications is for a religious, non- commercial, non-profit educational purpose, primarily or wholly for the public benefit.	50. Defendants are without knowledge or information sufficient to form a belief as to the truth of the allegations of contained in paragraph 50 of the Complaint concerning whether the Challenged Publications are for religious, non-commercial, or non-profit educational purposes. Defendants deny the remaining allegations contained in paragraph 50 of the Complaint.
51. The claimed copyrighted work, A Course in Miracles, is a religious work, factual or informational in nature, considered in the nature of scripture, and is believed by Circle of Atonement to be the words of Jesus	51. Defendants are without knowledge or information sufficient to form a belief as to the truth of the allegations contained in paragraph 51 of the Complaint concerning how the Work is considered or with respect to the beliefs of the Circle of Atonement. Defendants admit that "A Course in Miracles" is a copyrighted work. Defendants deny the remaining allegations contained in paragraph 51 of the Complaint.
52. The Other Works are religious works, factual or informational in nature, containing certain text that was scribed by Dr Schucman that Circle of Atonement believes is divine revelation containing the words of Jesus, and which are not published in A Course in Miracles.	52. Defendants are without knowledge or information sufficient to form a belief as to the truth of the allegations contained in paragraph 52 of the Complaint concerning the beliefs of the Circle of Atonement. Defendants deny the remaining allegations contained in paragraph 52 of the Complaint.
53. The Challenged Publications use the words A Course in Miracles and use only that portion of A Course in Miracles, and the Other Works as necessary to effectively comment about, expound and interpret these works.	53. Defendants deny the allegations contained in paragraph 53 of the Complaint.
54. The Challenged Publications do not replace the primary works, nor are they intended to do so. In fact, Circle of Atonement’s catalogue expressly describes A Course in Miracles, Absence of Felicity, Psychotherapy The Gifts of God and The Song of Prayer and encourages their purchase. None of the challenged works express any suggestion that they are intended to substitute for the Defendant’s works.	54. Defendants are without knowledge or information sufficient to form a belief as to the truth of the allegations contained in paragraph 54 of the Complaint concerning the views of the Circle of Atonement. Defendants admit that one or more of the Circle of Atonement's catalogues list "A Course in Miracles", "Absence from Felicity", "Psychotherapy", "Song of Prayer", and "The Gifts of God". Defendants deny the remaining allegations contained in paragraph 54 of the Complaint.
55. The Challenged Publications add new and independent creative thought intended to add to society’s understanding and knowledge of A Course in Miracles and the Other Works and are thus transformative in nature.	55. Defendants are without knowledge or information sufficient to form a belief as to the truth of the allegations contained in paragraph 55 of the Complaint.
56. The challenged publications have increased, or will increase, the market for, and value of, the claimed copyrighted works.	56. Defendants deny the allegations contained in paragraph 56 of the Complaint
57. The Challenged Publications fall within the protection of fair use of the claimed copyrighted works and service trademark. Defendants have committed a misuse of their claimed copyrighted works and trademark/service mark pursuant to the Copyright Act and the Lanham Act by claiming a right to refuse reasonable use and by demanding that plaintiff cease and desist from distribution of the Challenged Publications.	57. Defendants deny the allegations contained in paragraph 57 of the Complaint.
58. Defendants, under the color of the Copyright Act and Lanham Act, have attempted to use federal law to stifle First Amendment, free exercise of religion rights in order to deter religious works that are considered by FACIM to diverge from its interpretation and teachings based on A Course in Miracles.	58. Defendants deny the allegations contained in paragraph 58 of the Complaint.
59. Plaintiff is entitled to the declaration of this Court that the Challenged Publications fall within the protections of fair use and do not violate defendants claimed copyright and trademark/service mark.	59. Defendants deny the allegations contained in paragraph 59 of the Complaint.
60. Plaintiff realleges paragraphs 1-59 as set forth above.	60. Defendants repeat their responses to paragraphs 1-59 of this Answer as if set forth here.
61. A Course in Miracles, including the phrase A Course in Miracles, is divine revelation containing the words of Jesus in the nature of scripture. Defendants are estopped from claiming otherwise based on their public pronouncements and actions.	61. Defendants deny the allegations contained in paragraph 61 of the Complaint.
62. The registration of the trademark/service mark misrepresents the source and creates confusion because the source is the book itself believed to contain divine revelation, and not particular teachings by FIP or FACIM.	62. Defendants deny the allegations contained in paragraph 62 of the Complaint.
63. Because the source of A Course in Miracles is a divine being and is devoid of any human creativity, it cannot be copyrighted or trademarked and the copyright registration and service trademark of A course in Miracles is invalid and the copyright and trademark/service mark should be voided and cancelled.	63. Defendants deny the allegations contained in paragraph 63 of the Complaint.
64. Upon information and belief, Defendants, or predecessors, have distributed hundreds or thousands of copies of A Course in Miracles to the public prior to registration of a claimed copyright.	64. Defendants deny the allegations contained in paragraph 64 of the Complaint.
65. In the alternative, even if the copyright is valid, the nature of A Course in Miracles as a religious work, Defendants or their predecessor’s copyright policies (or lack thereof), Defendant’s routine granting of permission when requests were received to use A Course in Miracles, and Defendants failure, upon information and belief, to enforce even the most egregious violations of the claimed copyright or trademark/service mark for over 15 years have caused A Course in Miracles to enter the public domain and use of A Course in Miracles should no longer be subject to copyright and trademark protection.	65. Defendants deny the allegations contained in paragraph 65 of the Complaint.
66. In the alternative, as a result of defendants purposeful encouragement of independent writings and teachings about A Course in Miracles, and use of the phrase A Course in Miracles and its acronym, due in whole or in part to a lax or non-existent copyright policy, which independent works caused A Course in Miracles to increase in reputation and popularity, Defendants are now estopped from claiming enforceability of the copyright and trademark/service mark.	66. Defendants deny the allegations contained in paragraph 66 of the Complaint.
67. In reliance upon the Defendants’ actions as set forth above, Plaintiff developed and implemented its programs of study of the Course and invested substantial time, energy and funds in producing the Challenged Publications, such that it would be inequitable to now require Defendants to abandon its activities and publications.	67. Defendants deny the allegations contained in paragraph 67 of the Complaint.
68. Plaintiff realleges paragraphs 1-66 as set forth above.	68. Defendants repeat their responses to paragraphs 1-67 of this Answer as if set forth here.
69. From the inception of Mr. Perry and Circle of Atonement’s authoring and publication activities in the late 1980’s which interpret, teach and quote A Course in Miracles liberally and with frequent use of the words A Course in Miracles, defendants have given implied or express permission to Perry and then Circle of Atonement to publish and distribute such works.	69. Defendants deny the allegations contained in paragraph 69 of the Complaint.
70. Express agreement for use was reached in 1990 for use of A Course in Miracles in The Elder Brother.	70. Defendants admit that FIP granted Robert Perry permission to quote one thousand words from the Work for use only in his work entitled 'The Elder Brother: Jesus and A Course in Miracles," as set forth in a document, which, in its entirety, speaks for itself. To the extent the allegations of paragraph 70 of the Complaint misstate or mischaracterize the content, substance, or import of said document, or cite to the same out of context or in a misleading fashion, they are denied. Defendants deny the remaining allegations contained in paragraph 70 of the Complaint.
71. Express agreement for use was reached in 1991 to publish and distribute the continuing series of booklets or pamphlets (the Series) that are now part of the Challenged Publications.	71. Defendants deny the allegations contained in paragraph 71 of the Complaint.
72. Although the initial term of the agreed use was for five years, thereafter Plaintiff continued to publish and distribute the Series and the other Challenged Publications and to liberally use the phrase A Course in Miracles with the acknowledgement, agreement and/or approval of the President of FIP.	72. Defendants deny the allegations contained in paragraph 72 of the Complaint.
73. During this time, Plaintiff and Defendant continued a dialogue with respect to FIP developing a comprehensive fair use policy.	73. Defendants deny the allegations contained in paragraph 73 of the Complaint.
74. FIP, through its President, informed Plaintiff that it was grandfathered and was not subject to the new copyright policies FIP had developed or was developing.	74. Defendants deny the allegations contained in paragraph 74 of the Complaint
75. Plaintiff frequently sent copies of each of its bound publications to at least the President of FIP.	75. Defendants admit that Mr. Perry has, on occasion, sent copies of his writings to FIP. Defendants deny the remaining allegations contained in paragraph of the Complaint.
76. In good faith reasonable reliance on the express and implied agreement of FIP, Plaintiff continued its publication, distribution and teaching activities, and otherwise expended substantial resources in time and money to develop a teaching center and written works based on comment, interpretation, and teaching of A Course in Miracles. The booklet series alone already consists of 23 publications with each booklet containing not less than 40 pages and the longest of over 350 pages.	76. Defendants are without knowledge or information sufficient to form a belief as to the truth of the allegations contained in the second sentence of paragraph 76 of the Complaint concerning the "booklet series". Defendants deny the remaining allegations contained in paragraph 76 of the Complaint.
77. Based on the above allegations, Defendants have breached their agreements and have taken a position contrary to their earlier representations, and are otherwise estopped from seeking enforcement of the copyright and service trademark in a manner that differs in any substantial degree from the prior approvals and agreement with Circle of Atonement to publish and distribute its works, and to use the words A Course in Miracles or its acronym ACIM.	77. Defendants deny the allegations contained in paragraph 77 of the Complaint.
78. Plaintiff realleges paragraphs 1-76 as set forth above	78. Defendants repeat their responses to paragraphs 1-77 of this Answer as if set forth here.
79. On or about November 1993, FIP sought for the first time to register A Course in Miracles and its acronym as a trademark/service mark.	79. Defendants admit that on or about November 30, 1993, FIP filed a federal registration for the trademark "A Course in Miracles" and that on December 2, 1997, FlP registered the letters "ACIM". Defendants deny the remaining allegations contained in paragraph 79 of the Complaint.
80. By virtue of FACIM’s cease and desist demand, Defendants apparently seek to preclude Circle of Atonement’s use of the words A Course in Miracles and the acronym ACIM.	80. Defendants admit that they seek to prevent infringements of their registered trademarks. Defendants deny the remaining allegations contained in paragraph 80 of the Complaint.
81. The trademark was issued based on misinformation and should be cancelled.	81. Defendants deny the allegations contained in paragraph 81 of the Complaint.
82. The words A Course in Miracles are part of the divine revelation or word of Jesus from a divine being as scribed by Dr. Schucman and the words are not capable of trademark protection.	82. Defendants deny the allegations contained in paragraph 82 of the Complaint
83. The words A Course in Miracles are a book title and are not capable of trademark protection.	83. Defendants admit that the Work is entitled "A Course in Miracles." Defendants deny the remaining allegations contained in paragraph 83 of the Complaint.
84. The meaning ascribed to the phrase A Course in Miracles is related to a book title.	84. Defendants deny the allegations contained in paragraph 84 of the Complaint.
85. There is no confusion of the name because in fact, the meaning ascribed to the phrase refers to a book title, which cannot receive trademark protection, and not to any particular teachings of FIP or FACIM except with reference to the book itself.	85. Defendants deny the allegations contained in paragraph 85 of the Complaint.
86. The Defendants, having allowed the public to freely use the concept and phrase for 20 years, and are estopped from now contending that the phrase can be protected by trademark.	86. Defendants deny the allegations contained in paragraph 86 of the Complaint.
87. Moreover, Plaintiff has published some 23 booklets with reference to the phrase A Course in Miracles, as well as numerous other publications, with the express or implied agreement of FIP, and has reasonably relied on that permission in expending time and resources in further teaching and publication efforts commenting upon, and interpreting A Course in Miracles.	87. Defendants are without knowledge or information sufficient to form a belief as to the truth of the allegations contained in paragraph 87 of the Complaint concerning the extent of the Circle of Atonement's publishing efforts and library. Defendants deny the remaining allegations contained in paragraph 87 of the Complaint.
	88. All allegations not expressly admitted herein are denied.