Consider this in the light of the very well known case of Suntrust v. Houghton-Mifflin (3d Cir. 2001), which has a similar case pattern. In it, the court allowed a retelling of Margaret Mitchell's "Gone with the Wind" from a slave's perspective. Deeming "The Wind Done Gone" a parody novel, the Third Circuit reinforced the Fair Use Doctrine. Here's a summary: http://www.rcfp.org/newsitems/index.php?i=3121
Given this, how can the District Court's ruling feel right?