Osama Ahmed Fahmy v. Live Nation Entertainment, Inc.
Filing
25
MINUTES OF DEFENDANTS MOTION TO DISMISS FOR FAILURE TO STATE A CLAIM OR, IN THE ALTERNATIVE, STAY PROCEEDINGS (Dkt. No. 15, filed April 16, 2015 Motion Hearing held before Judge Christina A. Snyder: In accordance with the foregoing, defendants mot ion to dismiss is GRANTED IN PART insofar as it seeks to dismiss plaintiffs direct infringement claim, and otherwise DENIED. Any First Amended Complaint attempting to address the pleading deficiencies identified herein must be filed no later than Ju ly 8, 2015. If plaintiff does not file a First Amended Complaint by that date, the Court will dismiss the direct infringement claim with prejudice. Defendants motion to stay is DENIED without prejudice to its being renewed after the pleadings are closed. Court Reporter: Khowoonsun Chong. (pj)
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Case No.
2:15-cv-01158-CAS (PJWx)
Title
OSAMA AHMED FAHMY v. LIVE NATION ENTERTAINMENT,
INC., ET AL.
Present: The Honorable
Date
‘O’
June 8, 2015
CHRISTINA A. SNYDER
Catherine Jeang
Deputy Clerk
Khowoonsun Chong
Court Reporter / Recorder
N/A
Tape No.
Attorneys Present for Plaintiffs:
Attorneys Present for Defendants:
Jonathan Gottfried
Susan Gutierrez
Alexander Kaplan
Proceedings:
I.
DEFENDANT’S MOTION TO DISMISS FOR FAILURE TO
STATE A CLAIM OR, IN THE ALTERNATIVE, STAY
PROCEEDINGS (Dkt. No. 15, filed April 16, 2015)
INTRODUCTION
Plaintiff Osama Ahmed Fahmy filed this action on February 18, 2015, against Live
Nation Entertainment, Inc. (“defendant” or “Live Nation”) and Does 1 through 10. The
gravamen of the complaint is that defendant has infringed plaintiff’s public performance
rights in a copyrighted musical composition entitled Khosara, Khosara by sponsoring
and promoting concerts at which rapper Jay-Z performed the song Big Pimpin’, which
contains an unauthorized sample of Khosara, Khosara. Plaintiff alleges claims for (1)
direct copyright infringement, (2) contributory copyright infringement, and (3) vicarious
copyright infringement. See generally Compl.
On April 16, 2015, defendant filed a motion to dismiss the complaint for failure to
state a claim or, in the alternative, to stay the action pending resolution of a related case
also involving the alleged infringement of Khosara, Khosara by Big Pimpin’. Dkt. No.
15. Plaintiff filed an opposition on May 11, 2015. Dkt. No. 21. Defendant filed a reply
on May 26, 2015. Dkt. No. 22. On June 8, 2015, the Court held a hearing on the matter,
at which counsel for both parties appeared and argued. Having considered the parties’
arguments, and for the reasons stated below and in open court, the Court grants in parts
and denies in part the motion to dismiss, and denies the motion to stay without prejudice
to its being renewed after the pleadings have closed and the timeline of the related case is
more certain.
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Case No.
2:15-cv-01158-CAS (PJWx)
Title
OSAMA AHMED FAHMY v. LIVE NATION ENTERTAINMENT,
INC., ET AL.
II.
Date
‘O’
June 8, 2015
BACKGROUND
A.
Allegations of the Complaint
For purposes of the motion to dismiss, the Court assumes the truth of the
allegations of the complaint, summarized as follows. Plaintiff is the nephew and heir of
the late Baligh Hamdy (“Hamdy”), an Egyptian music composer. Compl. ¶ 3. In 1957,
Hamdy authored an original musical composition entitled Khosara, Khosara. Id. ¶ 7. In
1960, a copyright in Hamdy’s name for Khosara, Khosara was registered under Egyptian
law. Id. ¶ 10. Hamdy retained full copyright ownership of the Khosara, Khosara
composition until his death in 1993, when that ownership passed to his three siblings. Id.
¶¶ 11–12. Since December 2002, plaintiff and other Hamdy heirs have owned the
copyright. Id. ¶ 12. Plaintiff “holds a general power of attorney to act on behalf of” the
other co-owners. Id. Although the Khosara, Khosara copyright has been licensed over
the years, plaintiff alleges that his copyright ownership “is valid and subsisting, and has
been in full force and effect at all times material to this action.” Id. ¶ 14.
In 1999, music producer Timothy Mosley, also known as Timbaland (“Mosley”),
came into possession of a recording of Khosara, Khosara. Id. ¶ 17. Shortly thereafter,
Mosley and popular rapper Shawn Carter, also known as Jay-Z (“Jay-Z”) created and
recorded the rap song entitled Big Pimpin’, which incorporates a significant portion of
Khosara, Khosara as its recurring “hook.” Id. ¶¶ 18–19. Big Pimpin’ was first released
in December 1999, and has subsequently appeared on other Jay-Z albums and
collaborations. Id. ¶ 21. Plaintiff contends that the song “is an unauthorized derivative
work that infringes upon the Khosara, Khosara copyright.” Id. ¶ 20.
Defendant Live Nation is one of the largest sponsors, producers, and promoters of
live musical concerts in the world. Id. ¶ 22. It owns, operates, has exclusive booking
rights for, or has an equity interest in over a hundred performance venues. Id. In April
2008, defendant entered into an agreement with Jay-Z and affiliated entities, pursuant to
which defendant agreed to “sponsor, promote, facilitate, and/or finance Jay-Z’s live
concerts and tours for the next ten years.” Id. ¶ 23. Since entering into this agreement,
defendant “has sponsored and promoted Jay-Z and his tours and performances, sold JayZ concert tickets and merchandise, and assisted in organizing and producing Jay-Z tours
and concerts.” Id. ¶ 24.
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date
‘O’
Case No.
2:15-cv-01158-CAS (PJWx)
June 8, 2015
Title
OSAMA AHMED FAHMY v. LIVE NATION ENTERTAINMENT,
INC., ET AL.
Jay-Z has “performed Big Pimpin’, or a variation thereof, at every single one of his
concerts from 2008 to the present.” Id. ¶ 27. Additionally, Big Pimpin’ “has been
mentioned regularly in concert reviews as one of the songs Jay-Z had performed,” and in
“concert previews as one of the songs Jay-Z was expected to perform.” Id. ¶ 29.
According to plaintiff, “the hope and expectation that Jay-Z would perform Big Pimpin’
drew a significant percentage of attendees to the concerts, thereby increasing
[defendant’s] profit.” Id. ¶ 62. Plaintiff asserts that these public performances infringe
his copyright in Khosara, Khosara. Id. ¶ 36.
Defendant owned or had exclusive booking rights at one or more of the venues at
which Jay-Z performed Big Pimpin’. Id. ¶ 28. Plaintiff alleges that defendant “has
profited substantially from Jay-Z’s performances of Big Pimpin’, including, but not
limited to, profits from ticket sales, merchandise, parking, concessions, and other revenue
streams.” Id. ¶ 31. Plaintiff also alleges that defendant at all relevant times “knew that
Big Pimpin’ infringed upon the Khosara, Khosara copyright,” and “had an expectation
that Jay-Z would perform Big Pimpin’ ” at his concerts, but nevertheless “continued to
sponsor, promote, and facilitate Jay-Z’s performances of the infringing work.” Id. ¶¶ 32,
40. Plaintiff contends that defendant “provided substantial and integral assistance to the
public performances of Big Pimpin’, including but not limited to ticketing and
promotional services,” and never attempted to “stop or mitigate Jay-Z’s infringement,”
but rather “enabled, induced, caused, and/or contributed” to that infringement. Id. ¶¶
49–51. Finally, plaintiff alleges that defendant “had certain rights to supervise and/or
control the planning, promotion and/or execution of Jay-Z’s concert performances,” and
“participated extensively in” the same. Id. ¶¶ 59–60.
B.
The Related Jay-Z Action
On August 31, 2007, plaintiff Fahmy filed suit against Jay-Z, Mosley, and a host of
other defendants not including Live Nation. That action, which also involves alleged
infringement of Khosara, Khosara by Big Pimpin’ and related works, is styled Fahmy v.
Jay-Z, et al., No. 2:07-cv-05715-CAS-PJWx (C.D. Cal. filed Aug. 31, 2007). That case,
hereinafter referred to as the “Jay-Z Action,” is currently set for trial on October 13,
2015.
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Case No.
2:15-cv-01158-CAS (PJWx)
Title
OSAMA AHMED FAHMY v. LIVE NATION ENTERTAINMENT,
INC., ET AL.
III.
Date
‘O’
June 8, 2015
MOTION TO DISMISS FOR FAILURE TO STATE A CLAIM
A.
Legal Standard
A motion pursuant to Federal Rule of Civil Procedure 12(b)(6) tests the legal
sufficiency of the claims asserted in a complaint. Under this Rule, a district court
properly dismisses a claim if “there is a ‘lack of a cognizable legal theory or the absence
of sufficient facts alleged under a cognizable legal theory.’ ” Conservation Force v.
Salazar, 646 F.3d 1240, 1242 (9th Cir. 2011) (quoting Balisteri v. Pacifica Police Dep’t,
901 F.2d 696, 699 (9th Cir. 1988)). “While a complaint attacked by a Rule 12(b)(6)
motion to dismiss does not need detailed factual allegations, a plaintiff’s obligation to
provide the ‘grounds’ of his ‘entitlement to relief’ requires more than labels and
conclusions, and a formulaic recitation of the elements of a cause of action will not do.”
Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007). “[F]actual allegations must
be enough to raise a right to relief above the speculative level.” Id.
In considering a motion pursuant to Rule 12(b)(6), a court must accept as true all
material allegations in the complaint, as well as all reasonable inferences to be drawn
from them. Pareto v. FDIC, 139 F.3d 696, 699 (9th Cir. 1998). The complaint must be
read in the light most favorable to the nonmoving party. Sprewell v. Golden State
Warriors, 266 F.3d 979, 988 (9th Cir. 2001). However, “a court considering a motion to
dismiss can choose to begin by identifying pleadings that, because they are no more than
conclusions, are not entitled to the assumption of truth. While legal conclusions can
provide the framework of a complaint, they must be supported by factual allegations.”
Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009); see Moss v. United States Secret Service,
572 F.3d 962, 969 (9th Cir. 2009) (“[F]or a complaint to survive a motion to dismiss, the
non-conclusory ‘factual content,’ and reasonable inferences from that content, must be
plausibly suggestive of a claim entitling the plaintiff to relief.”). Ultimately,
“[d]etermining whether a complaint states a plausible claim for relief will . . . be a
context-specific task that requires the reviewing court to draw on its judicial experience
and common sense.” Iqbal, 556 U.S. at 679.
Unless a court converts a Rule 12(b)(6) motion into a motion for summary
judgment, a court cannot consider material outside of the complaint (e.g., facts presented
in briefs, affidavits, or discovery materials). In re American Cont’l Corp./Lincoln Sav. &
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date
‘O’
Case No.
2:15-cv-01158-CAS (PJWx)
June 8, 2015
Title
OSAMA AHMED FAHMY v. LIVE NATION ENTERTAINMENT,
INC., ET AL.
Loan Sec. Litig., 102 F.3d 1524, 1537 (9th Cir. 1996), rev’d on other grounds sub nom
Lexecon, Inc. v. Milberg Weiss Bershad Hynes & Lerach, 523 U.S. 26 (1998). A court
may, however, consider exhibits submitted with or alleged in the complaint and matters
that may be judicially noticed pursuant to Federal Rule of Evidence 201. Lee v. City of
Los Angeles, 250 F.3d 668, 689 (9th Cir. 2001); In re Silicon Graphics Inc. Sec. Litig.,
183 F.3d 970, 986 (9th Cir. 1999).
As a general rule, leave to amend a complaint which has been dismissed should be
freely granted. Fed. R. Civ. P. 15(a). However, leave to amend may be denied when “the
court determines that the allegation of other facts consistent with the challenged pleading
could not possibly cure the deficiency.” Schreiber Distrib. Co. v. Serv-Well Furniture
Co., 806 F.2d 1393, 1401 (9th Cir. 1986).
B.
Analysis
To state a claim for copyright infringement, a plaintiff must allege “(1) ownership
of a valid copyright; and (2) that the defendant violated the copyright owner’s exclusive
rights under the Copyright Act.” Ellison v. Robertson, 357 F.3d 1072, 1076 (9th Cir.
2004) (citing 17 U.S.C. § 501(a)); see also Range Road Music, Inc. v. East Coast Foods,
Inc., 668 F.3d 1148, 1153 (9th Cir. 2012) (describing a prima facie case as consisting of
(1) valid copyright ownership and (2) copying of original elements of the work). The
Ninth Circuit “recognize[s] three doctrine of copyright liability: direct copyright
infringement, contributory copyright infringement, and vicarious copyright
infringement.” Ellison, 357 F.2d at 1076. As the Supreme Court has recognized, “the
lines between direct infringement, contributory infringement, and vicarious liability are
not clearly drawn.” Sony Corp. of Am. v. Universal City Studios, Inc., 464 U.S. 417, 435
n.17 (1984) (internal quotation marks and citations omitted). Plaintiff alleges, and
defendant moves to dismiss, a claim under each theory of liability.
1.
Direct Copyright Infringement
To state a claim for direct copyright infringement, a plaintiff must allege (1) “that
he owns the copyright” and (2) “that the defendant himself violated one or more of the
plaintiff’s exclusive rights under the Copyright Act.” Ellison, 357 F.3d at 1076.
Defendant does not contest plaintiff’s allegations of copyright ownership. But defendant
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date
‘O’
Case No.
2:15-cv-01158-CAS (PJWx)
June 8, 2015
Title
OSAMA AHMED FAHMY v. LIVE NATION ENTERTAINMENT,
INC., ET AL.
argues that because defendant’s alleged infringement is based solely on Jay-Z’s
performances of Big Pimpin’, plaintiff has not alleged that defendant itself violated
plaintiff’s exclusive rights under the Copyright Act. See Dkt. No. 15-1 (Memo. Supp.
Mot.) at 5–7. In opposition, plaintiff argues that defendant may be held directly liable as
a sponsor and promoter of the performances, and as a proprietor of one or more of the
venues at which Big Pimpin’ was performed. See Dkt. No. 21 (Opp’n) at 5–8.
The Supreme Court has stated in dicta that “[t]he entrepreneur who sponsors . . .
[an infringing] public performance for profit is also an infringer—direct or contributory.”
Twentieth Century Music Corp. v. Aiken, 422 U.S. 151, 157 (1975); see also Range Road
Music, 668 F.3d at 1153 (quoting this portion of Aiken, but only considering a theory of
vicarious liability with regard to public performances at the defendants’ restaurant and
bar). Citing this dictum, district courts on which plaintiff relies have found that the
proprietor of an establishment where infringing live and recorded musical performances
take place can be held liable. These courts have neglected to specify whether such
liability is direct, contributory, or vicarious, or have stated that the liability could be
“either” direct or contributory. See Broad. Music, Inc. v. Crawford, No. 1:12-cv-01903JLT, 2014 WL 1285660, at *4–6 (E.D. Cal. Mar. 28, 2014) (holding pub operator liable
for unauthorized playing of songs on jukebox, without stating whether the liability was
direct or indirect); Broad. Music, Inc. v. It’s Amore Corp., No. 3:08-cv-570, 2009 WL
1886038, at *5 (M.D. Pa. June 30, 2009) (holding that proprietors of a restaurant where
infringing live performances took place were “liable for the infringement that occurred at
the restaurant”); Blendingwell Music, Inc. v. Moor-Law, Inc., 612 F. Supp. 474, 478, 481
(D. Del. 1985) (concluding that there “can be no issue as to [the defendant’s] liability as a
direct or contributory infringer” where the owner of a bar hired live bands and operated
jukeboxes that played infringing music).
But in a thoroughly researched opinion, another district court has stated: “In cases
involving live performances by musicians or disc jockeys . . . the only bases for liability
of the nightclub owner are vicarious and contributory liability, because the owner is not
performing the work.” Polygram Int’l Publ’g, Inc. v. Nevada/TIG, Inc., 855 F. Supp.
1314, 1322 (D. Mass. 1994). Noting that the “leading cases on third-party liability . . .
were careful to find an actual infringement by the alleged direct infringer,” the Polygram
court contrasted live performances at music venues with “direct liability cases—for
instance, those involving jukeboxes and radios,” in which “a lounge owner who runs his
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date
‘O’
Case No.
2:15-cv-01158-CAS (PJWx)
June 8, 2015
Title
OSAMA AHMED FAHMY v. LIVE NATION ENTERTAINMENT,
INC., ET AL.
own establishment can be held directly liable for playing music without authorization
because the owner himself is ‘performing’ the music as that term is defined in the
Copyright Act.” Id. at 1321 (citing 17 U.S.C. § 101).1
The Court finds persuasive Polygram’s reasoning that a music venue proprietor
may only be held secondarily liable for the infringement of an artist it hires, and finds
that reasoning equally applicable where the defendant is alleged to be a venue proprietor
and concert promoter. It makes sense for such a defendant to be held secondarily liable
for the infringing performance of a musical artist it sponsors, as contributory or vicarious
infringement is separate from and dependent on direct infringement. See Gershwin
Publ’g Corp. v. Columbia Artists Mgmt., Inc., 443 F.2d 1159, 1163 (2d Cir. 1971)
(holding concert promoter contributorily and vicariously liable for the “actions of the
primary infringers,” musical performers); Danjaq, S.A. v. MGM/UA Commc’ns Co., 773
F. Supp. 194, 201 (C.D. Cal. 1991) (“Contributory infringement . . . plainly does not lie
without primary infringement.”). It makes substantially less sense to hold the concert
promoter directly liable along with the artist, where there would be no infringement
without the artist’s performance. See Ellison, 357 F.3d at 1076 (explaining that direct
infringement requires a showing “that the defendant himself violated one or more of the
plaintiff’s exclusive rights” (emphasis added)); New World Music Co. v. Tampa Bay
Downs, Inc., No. 8:07-CV-398, 2009 WL 35184, at *4 (M.D. Fla. Jan. 6, 2009) (“Where
a copyright infringement case involves live performances by musicians or disc jockeys,
the owner of the establishment may be subject to vicarious liability . . . . However,
secondary liability cannot be imposed without first establishing direct infringement by
the performer.”). Because imposing direct liability under these circumstances would
collapse the distinction between primary and secondary liability, the Court concludes that
plaintiff’s direct infringement claim must fail.
1
Under the Copyright Act, “to ‘perform’ a work means to recite, render, play,
dance, or act it, either directly or by any means of any device or process.” 17 U.S.C.
§ 101. Thus, a club that plays music for its customers over a radio, jukebox, or similar
“device”—unlike a proprietor who hires live musicians—appears to “play” and
“perform” music within the meaning of the Copyright Act.
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date
‘O’
Case No.
2:15-cv-01158-CAS (PJWx)
June 8, 2015
Title
OSAMA AHMED FAHMY v. LIVE NATION ENTERTAINMENT,
INC., ET AL.
Of the three district court cases plaintiff cites that suggest that a music venue
proprietor or similar defendant can be a direct infringer, only two involved live
performances (as opposed to sound recordings), and none separately analyzed direct
infringement. Additionally, one of the cases involving a live performance reasoned that
the proprietor was liable for infringement of the bands it hired “under the normal agency
rule of respondeat superior,” Blendingwell Music, 612 F. Supp. at 481—but the Ninth
Circuit has stated that “[v]icarious copyright liability” (not direct liability) “is an
‘outgrowth’ of respondeat superior,” A&M Records v. Napster, Inc., 239 F.3d 1004,
1022 (9th Cir. 2001) (quoting Fonovisa, Inc. v. Cherry Auction, Inc., 76 F.3d 259, 262
(9th Cir. 1996)). And tellingly, the seminal Gershwin case analyzed a concert promoter’s
contributory and vicarious liability, but did not suggest that a promoter could be held
liable as a direct infringer, and implied that the promoter was not a “primary infringer.”
443 F.3d at 1162–63. For these reasons, the Court concludes that the complaint does not
contain sufficient allegations to sustain a direct infringement claim, and dismisses that
claim with leave to amend.
2.
Contributory Copyright Infringement
“ ‘One who, [1] with knowledge of the infringing activity, [2] induces, causes or
materially contributes to the infringing conduct of another may be liable as a contributory
[copyright] infringer.’ ” Ellison, 357 F.3d at 1076 (emphasis and brackets in original)
(quoting Gershwin, 443 F.2d at 1162). Defendant argues that plaintiff has not
sufficiently alleged either element.
a.
Knowledge of Infringing Activity
In the Ninth Circuit, “the knowledge requirement for contributory copyright
infringement . . . include[s] both those with actual knowledge and those who have reason
to know of direct infringement.” Ellison, 357 F.3d at 1076 (emphasis in original) (citing
Napster, 239 F.3d at 1013). “Willful blindness of specific facts” is also sufficient to
“establish knowledge for contributory liability.” Luvdarts, LLC v. AT&T Mobility,
LLC, 710 F.3d 1068, 1073 (9th Cir. 2013). However, “more than a generalized
knowledge by the [defendant] of the possibility of infringement” is required. Id. at 1072.
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date
‘O’
Case No.
2:15-cv-01158-CAS (PJWx)
June 8, 2015
Title
OSAMA AHMED FAHMY v. LIVE NATION ENTERTAINMENT,
INC., ET AL.
Plaintiff supports the knowledge element of this claim with the allegation that
defendant “knew that Big Pimpin’ infringed upon the Khosara, Khosara copyright, but
nevertheless continued to sponsor, promote, and facilitate Jay-Z’s performances of the
infringing work.” Compl. ¶ 32. Although defendant argues that the Court should
disregard the allegation as a mere conclusion, additional facts alleged in the complaint or
judicially noticeable, as well as reasonable inferences that can be drawn therefrom,
support plaintiff’s claim of knowledge. Plaintiff alleges that defendant (1) is a large
concert sponsor, producer, and promoter and (2) entered into an agreement with Jay-Z to
“sponsor, promote, facilitate, and/or finance Jay-Z’s live concerts and tours” for a tenyear period, Compl. ¶¶ 22–23. The Court also takes judicial notice of the fact that the
Jay-Z Action was filed in 2007, before defendant signed its deal with Jay-Z.2 Viewing
the complaint in the light most favorable to plaintiff, it is reasonable to infer that
defendant—a sophisticated business entity that entered into a multi-year deal with an
internationally known artist and has since been heavily involved in promoting and
facilitating Jay-Z’s tours—would have been put on notice of the alleged infringement.
Because of this reasonable inference and plaintiff’s direct allegation of knowledge,
dismissing this claim on the ground that defendant did not know about the alleged
infringement would be premature.
The most on-point case defendant cites in opposition is Pryor v. Warner/Chappell
Music, Inc., No. 13-cv-04344-RSWL, 2014 WL 2812309 (C.D. Cal. June 20, 2014). In
that case, a company called “Caesar’s Music” registered the composition to a song titled
Bumpin’ Bus Stop, misattributing its authorship, and later entered into a sampling
agreement with “TB Music” to sample and create derivative works based on that song.
Id. at *2. The plaintiffs (including Bumpin’ Bus Stop’s true composer) alleged that TB
Music gave unauthorized permission to other defendants “to use, exploit, and distribute a
sample of the composition” by releasing a different record, Get Down, that sampled
Bumpin’ Bus Stop. Id. The court held allegations that TB Music “knew or had reason to
2
See Fed. R. Evid. 201; United States ex rel. Robinson Rancheria Citizens Council
v. Borneo, Inc., 971 F.2d 244, 248 (9th Cir. 1992) (explaining that a court may take
judicial notice “of proceedings in other courts . . . if those proceedings have a direct
relation to matters at issue”). The Court does not, however, presume the truth of the
allegations in that related case.
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date
‘O’
Case No.
2:15-cv-01158-CAS (PJWx)
June 8, 2015
Title
OSAMA AHMED FAHMY v. LIVE NATION ENTERTAINMENT,
INC., ET AL.
know of the infringement upon initial release of the recording” insufficient to plead
knowledge of infringement, because plaintiffs could not allege “how” TB Music—as
opposed to a co-defendant—knew or had reason to know that” Get Down included an
unauthorized sample of Bumpin’ Bus Stop. Id. at *8. Pryor is distinguishable, however,
because it involved no alleged or judicially noticeable facts from which the Court could
infer that TB Music had a reason to know that the accused song included an unauthorized
sample—especially because the copyright registration misattributed the earlier
composition’s authorship. Here, there is no indication that the authorship of Khosara,
Khosara had been obscured, and it is plausible that plaintiff could prove that the Jay-Z
Action put defendant on constructive notice of the alleged infringement.
Faulkner v. National Geographic Society, 211 F. Supp. 2d 450 (S.D.N.Y. 2002),
which defendant cites for the proposition that constructive knowledge cannot be inferred
from the filing of the Jay-Z Action, does not persuade the Court that dismissal of the
contributory knowledge claim is appropriate at this stage of the litigation. In that case,
photographers and writers whose work had been published in National Geographic
magazines argued that several defendants had infringed their intellectual property rights
by republishing their work in a digital collection of National Geographic content called
“The Complete National Geographic.” Id. at 454. One defendant, Kodak—a
manufacturer and developer of photographic equipment—had entered into a deal
whereby it placed advertising messages in the digital collection, and the plaintiffs sought
to hold Kodak contributorily liable for that involvement. Id. at 455, 473–74. Noting that
Kodak, through its advertising and promotion, may have materially contributed to the
infringement, the court nonetheless granted summary judgment because there was no
evidence Kodak knew of the infringing activity. Id. at 475. The court rejected plaintiffs’
argument that Kodak was put on notice when copyright infringement claims were first
brought against parties other than Kodak, reasoning:
While it is clear Kodak has had actual knowledge of adverse
claims since 1997, it is not apparent that Kodak should have
known from the existence of these claims that The Complete
National Geographic products infringed plaintiffs' copyrights.
As this opinion makes clear, to the extent plaintiffs'
infringement claims have not been dismissed, disputed issues of
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UNITED STATES DISTRICT COURT
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Case No.
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June 8, 2015
Title
OSAMA AHMED FAHMY v. LIVE NATION ENTERTAINMENT,
INC., ET AL.
fact remain regarding whether or not plaintiffs created their
photographs and texts as works for hire for NGS. Because the
work-for-hire issue requires resolution by a trier of fact, it is
difficult to conclude that Kodak should have known simply
from the fact of these lawsuits that plaintiffs owned the
copyrights at issue. Plaintiffs' argument merely begs the
question to be answered by the lawsuit.
The situation here is different from that found in the counterfeit
music or software context, where courts have been willing to
impute knowledge to defendants who have received
cease-and-desist letters and other warnings. In the piracy
context, there usually are clear indicators that an accused
product is infringing, such as packaging and unusually low
prices. Here, the question of infringement turns on complex
analysis of contractual arrangements going back twenty years
and more. In other words, plaintiffs' allegations of infringement
are anything but readily verifiable, making Kodak's lack of
knowledge regarding true copyright ownership objectively
reasonable.
Id. at 474–75 (footnotes omitted). The court also noted that Kodak “made a reasonable
inquiry regarding the intellectual property rights of contributors and received satisfactory
assurances,” further undermining the constructive knowledge argument. Id. at 475.
Unlike the present motion—where the Court must take plaintiff’s allegations as
true—Faulkner was decided on a motion for summary judgment, with a full evidentiary
record. Id. at 454–55. The Faulkner court did not hold that a copyright infringement
lawsuit against other persons can never put a defendant on constructive notice of
infringement; rather, it found there was insufficient evidence in one case from which to
find that one defendant knew of infringement. Here, there is no evidentiary record, and
the Court cannot say with certainty that discovery will not produce other “indicators that
[the] accused [song] [was] infringing.” Id. at 475. Additionally, unlike in Faulkner, there
is no indication that defendant “made a reasonable inquiry regarding . . . intellectual
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date
‘O’
Case No.
2:15-cv-01158-CAS (PJWx)
June 8, 2015
Title
OSAMA AHMED FAHMY v. LIVE NATION ENTERTAINMENT,
INC., ET AL.
property rights . . . and received satisfactory assurances.” Id. Finally, on a Rule 12(b)(6)
motion, the Court cannot gauge—as the Faulkner court could on a broader motion for
summary judgment—the complexity and merits of the direct infringement issues on
which defendant’s contributory liability may hinge. Accordingly, the Court does not find
defendant’s arguments concerning lack of knowledge to justify dismissal of the
contributory infringement claim at the pleading stage.
b.
Material Contribution to Infringement
“Material contribution turns on whether the activity in question ‘substantially
assists’ direct infringement.” Louis Vuitton Malletier, S.A. v. Akanoc Solutions, Inc.,
658 F.3d 936, 943 (9th Cir. 2011) (citation omitted). “Put differently, liability exists if
the defendant engages in ‘personal conduct that encourages or assists the infringement.’ ”
Napster, 239 F.3d at 1019 (quoting Matthew Bender & Co. v. West Publ’g Co., 158 F.3d
693, 706 (2d Cir. 1998)).
Plaintiff argues that this element is adequately pleaded through allegations that
defendant “provided substantial and integral assistance to the public performance of Big
Pimpin’, including but not limited to ticketing and promotional services,” and also
“owned and/or had exclusive booking rights at one or more of the venues at which Jay-Z
performed Big Pimpin’.” Compl. ¶¶ 49, 31. Defendant, on the other hand, argues that
plaintiff’s allegations are insufficient because they really pertain to defendant’s
promotion of Jay-Z concerts as a whole, not specific promotion of Big Pimpin’. At least
at this stage of the litigation, the Court agrees with plaintiff.
Faulkner, upon which defendant relies, notes that “[a]dvertising or otherwise
promoting an infringing product or service may be sufficient to satisfy the material
contribution prong” of a contributory infringement claim. 211 F. Supp. 2d at 473–74.
Other courts agree. See Columbia Pictures Indus., Inc. v. Redd Home, Inc., 749 F.2d
154, 161 (3d Cir. 1984) (holding defendant liable as a contributory infringer where it
conducted “all of the advertising and promotion work” for a retail video store that
publicly displayed copyrighted movies); Rogers v. Koons, 751 F. Supp. 474, 481
(S.D.N.Y. 1990) (reasoning that an art gallery that advertised and displayed infringing
sculptures “materially contributed to [the sculptor’s] infringing conduct”). Plaintiff has
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date
‘O’
Case No.
2:15-cv-01158-CAS (PJWx)
June 8, 2015
Title
OSAMA AHMED FAHMY v. LIVE NATION ENTERTAINMENT,
INC., ET AL.
alleged that defendant was extensively involved in advertising and promoting Jay-Z’s
concerts, that defendant operated or owned at least some of the venues at which Jay-Z
performed, and that at each concert, Jay-Z played Big Pimpin’, which was a substantial
draw for concert-goers. Accordingly, it would be “premature to say that plaintiff[] cannot
satisfy the material contribution prong.” Faulkner, 211 F. Supp. 2d at 474.
Although defendant argues that the claim must be dismissed because this
promotion and sponsorship was not directed at “Jay-Z’s public performance of Big
Pimpin’ specifically,” Memo. Supp. Mot. at 10–11, defendant cites no case that actually
stands for this proposition. And as the Supreme Court has recognized, cases in which a
dance hall or similar business owner retains musical artists to play music to paying
customers are classic examples of contributory infringement, even though in many of
those cases those proprietors did not promote any specific infringing song or control the
song selection played.3 In sum, the Court concludes that plaintiff has sufficiently alleged
a claim for contributory copyright infringement, and that defendant’s arguments for
dismissal of the claim are better suited for a motion for summary judgment. Accordingly,
the motion to dismiss this claim is denied.
3.
Vicarious Copyright Infringement
“A defendant is vicariously liable for copyright infringement if he (1) “enjoys a
direct financial benefit from another’s infringing activity” and (2) “ ‘has the right and
ability to supervise’ the infringing activity.” Ellison, 357 F.3d at 1076 (emphasis
omitted) (quoting Napster, 239 F.3d at 1022 (quoting Gershwin, 443 F.2d at 1162)). In
Range Road Music, for example, the Ninth Circuit held that a complaint stated a claim
3
See Sony, 464 U.S. at 437 & n.18 (citing the “dance hall cases” as examples of
“contributory” infringement); Aiken, 422 U.S. at 157 (stating in dicta that an
“entrepreneur who sponsors . . . for profit” a performance by “[a]n orchestra or individual
instrumentalist or singer” may be a “contributory” infringer); Buck v. Jewell-La Salle
Realty Co., 283 U.S. 191, 198 (1931) (“[K]nowledge of the particular selection to be
played or received is immaterial. One who hires an orchestra for a public performance
for profit is not relieved from a charge of infringement merely because he does not select
the particular program to be played.”).
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date
‘O’
Case No.
2:15-cv-01158-CAS (PJWx)
June 8, 2015
Title
OSAMA AHMED FAHMY v. LIVE NATION ENTERTAINMENT,
INC., ET AL.
for vicarious liability by alleging that “copyrighted musical compositions were publicly
performed at the [defendants’ restaurant and bar], and plead[ing] specific facts to raise a
plausible inference that [defendants] exercised control over and financially benefitted
from the performance venue.” Id. at 1152–53. Vicarious liability may be imposed “even
if the defendant initially lacks knowledge of the infringement.” Metro-Goldwyn-Mayer
Studios, Inc. v. Grokster, Ltd., 545 U.S. 913, 930 n.9 (2005).
a.
Financial Benefit
“Financial benefit exists where the availability of infringing material acts as a
‘draw’ for customers.” Napster, 239 F.3d at 1023 (quoting Fonovisa, 76 F.3d at 263–64).
“There is no requirement that the draw be ‘substantial’ ” or “quantifi[able].” Ellison, 357
F.3d at 1079.
Plaintiff sufficiently pleads this element by alleging that defendant “has profited
substantially from Jay-Z’s performance of Big Pimpin’ ” from sources including “ticket
sales, merchandise, parking, concessions, and other revenue streams,” and that “the hope
and expectation that Jay-Z would perform Big Pimpin’ drew a significant percentage of
attendees to the concerts, thereby increasing [defendant’s] profit.” Compl. ¶¶ 31, 62.
These allegations plausibly suggest that Big Pimpin’ was a “draw” for those who
attended Jay-Z concerts, and that defendant profited from the infringing performances.
Defendant resists this conclusion by arguing that plaintiff has not pleaded specific
facts to support the inference that defendant’s “profit from Jay-Z concerts goes up or
down depending on whether or not Jay-Z performs Big Pimpin’.” Memo. Supp. Mot. at
15. But plaintiff alleges that Jay-Z has performed Big Pimpin’ “at every single one of his
concerts from 2008 to the present.” Compl. ¶ 27. This makes it difficult indeed for
plaintiff to allege that profits are higher at concerts where Jay-Z performs Big Pimpin’.
Moreover, plaintiff’s allegation that the hope that Big Pimpin’ would be played “drew a
significant percentage to the concerts, thereby increasing [defendant’s] profit,” leads to
the reasonable inference that the performances and associated goods would have been
less profitable if Jay-Z had not performed Big Pimpin’—the precise contention defendant
contends is lacking.
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date
‘O’
Case No.
2:15-cv-01158-CAS (PJWx)
June 8, 2015
Title
OSAMA AHMED FAHMY v. LIVE NATION ENTERTAINMENT,
INC., ET AL.
Defendant cites no on-point authority for its argument that plaintiff must allege
more granular facts detailing the financial benefit from performances of Big Pimpin’
specifically.4 Such a requirement would conflict with the “legion” cases “hold[ing] the
dance hall proprietor liable for the infringement of copyright resulting from the
performance of a musical composition by a band or orchestra whose activities provide the
proprietor with a source of customers and enhanced income,” without indicating that a
plaintiff must prove what the defendant’s income would have been if the same band or
orchestra did not play the infringing compositions. See Shapiro, Bernstein & Co. v. H.L.
Green Co., 316 F.2d 304, 307 (2d Cir. 1963) (collecting cases); see also In re Aimster
Copyright Litig., 334 F.3d 643, 654 (7th Cir. 2003) (explaining that the “canonical
illustration” of vicarious infringement “is the owner of a dance hall who hires dance
bands that sometimes play copyrighted music without authorization”). Indeed, “[i]n
cases involving the performance of music”—which defendant avoids citing—“courts
have sometimes relied on an inferred, overall benefit that a performance of music confers
on an establishment, rather than attempting to discern the ‘direct’ benefit.” See
Polygram, 855 F. Supp. at 1330–32; Realsongs v. Gulf Broad. Corp., 824 F. Supp. 89, 92
(M.D. La. 1993) (rejecting an argument that radio station could not be held liable for
infringing songs played by third-parties who paid flat fees for air time; reasoning that the
stations “still have a direct financial interest in the infringing activity if the station is a
for-profit enterprise and defendants benefit from its operation”); see also 3 Melville B.
Nimmer & David Nimmer, Nimmer on Copyright § 12:04[A][2] (Matthew Bender, Rev.
Ed. 2015) (noting that courts including the Ninth Circuit have understood the “direct
financial interest” element as “encompass[ing] a possible, indirect benefit” (citing
Napster, 239 F.3d at 1022–23)).5
4
A leading treatise points out that the Ninth Circuit has found a financial benefit
where “the actual receipts to defendant were generalized, rather than traceable directly to
the infringement.” 3 Melville B. Nimmer & David Nimmer, Nimmer on Copyright §
12:04[A][2] (Matthew Bender, Rev. Ed. 2015) (citing Fonovisa,76 F.3d at 262–63).
5
Despite relying in its own motion largely on cases that do not even involve
musical compositions, defendant attempts to distinguish “restaurant and ‘dance hall’
cases” on the ground that there, “the entire performance(s) constituted recordings or
covers of unlicensed, copyrighted works,” whereas here, Jay-Z performed without
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Case No.
2:15-cv-01158-CAS (PJWx)
Title
OSAMA AHMED FAHMY v. LIVE NATION ENTERTAINMENT,
INC., ET AL.
b.
Date
‘O’
June 8, 2015
Supervision or Control
The complaint also sufficiently alleges defendant’s right to supervise or control the
allegedly infringing activity. This element is satisfied where the defendant has “both a
legal right to stop or limit the directly infringing conduct, as well as the practical ability
to do so.’ ” Range Road Music, 668 F.3d at 1155 (quoting Perfect 10, Inc. v.
Amazon.com, Inc., 487 F.3d 701, 730 (9th Cir. 2007)).
First, plaintiff alleges that defendant “owned and/or had exclusive booking rights
at one or more of the venues at which Jay-Z publicly performed Big Pimpin’,” Compl.
¶ 28, making defendant a proprietor of at least one venue at which the alleged
infringement took place. Courts have found allegations that a defendant “exercised
control over . . . the performance venue” sufficient to allege this element of a vicarious
infringement claim. Range Road Music, 668 F.3d at 1153 (emphasis added); see
Polygram, 855 F. Supp. at 1328 (“[D]efendants are found to have ‘control’ over a
performance if they ‘either actively operate or supervise the operation of the place
wherein the performances occur, or control the content of the infringing program.’ ”
(emphasis in original) (quoting H.R. Rep. No. 94-1476, at 159–60 (1976))).
Second, plaintiff alleges that defendant had “rights to supervise and/or control the
planning, promotion and/or execution of Jay-Z’s concert performances,” and indeed
“participated extensively in the planning, promotion, and/or execution of Jay-Z’s concert
performances.” Compl. ¶¶ 59–60. Plaintiff also contends that defendant never
“attempt[ed] to stop or mitigate Jay-Z’s infringement of Khosara, Khosara,” id. ¶ 50,
implying that defendant had some ability to do so. These allegations also support the
authorization portions of Khosara, Khosara within his own musical composition. Reply
at 12. Although it is true that plaintiff “cites no authority supporting a finding of direct
financial interest in these circumstances,” id., defendant cites no contrary authority,
either. And it is not clear why, for purposes of the financial benefit element, there should
be a distinction between (1) an artist performing one or more copyrighted compositions
without authorization in a multi-song performance—where liability has been consistently
found—and (2) an artist performing a song that prominently copies from a copyrighted
composition in a multi-song performance.
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date
‘O’
Case No.
2:15-cv-01158-CAS (PJWx)
June 8, 2015
Title
OSAMA AHMED FAHMY v. LIVE NATION ENTERTAINMENT,
INC., ET AL.
control element of plaintiff’s vicarious infringement claim. See Fonovisa, 76 F.3d at 263
(recognizing that “promoting” and “creating an audience for” a direct infringer can
support an inference that the defendants “were in a position to police the direct
infringers” and satisfy the control element of a contributory infringement claim).
To the extent defendant argues that it cannot be held vicariously liable because
there is no allegation that it selected or controlled the songs Jay-Z would play at concerts,
that argument lacks merit. Nearly a century ago, the Supreme Court held that “[o]ne who
hires an orchestra for a public performance for profit is not relieved from a charge of
infringement merely because he does not select the particular program to be played.”
Buck v. Jewell-La Salle Realty Co., 283 U.S. 191, 198 (1931). Numerous courts and
commentators writing before and after this pronouncement have concurred. See, e.g.,
H.L. Green Co., 316 F.2d at 307 (holding that a dance hall or similar proprietor is liable
“whether or not the proprietor has knowledge of the compositions to be played or any
control over their selection”); Dreamland Ball Room v. Shapiro, Bernstein & Co., 36
F.2d 354, 355 (7th Cir. 1929) (affirming judgment against dance hall operators that had
no control over “the musical selections to be rendered during an evening’s engagement”
and “did not know that any musical selection played by the orchestra was copyrighted”);
Broad. Music, Inc. v. CDZ, Inc., 724 F. Supp. 2d 9320 (C.D. Ill. 2010) (collecting cases
rejecting the argument that defendants “cannot be held vicariously liable for copyright
infringement where they exercised no control or supervision over their hired bands”); 3
Nimmer on Copyright § 12:04[A][2] (“[T]he proprietor of a dance hall is liable for
infringing performances of the orchestra, even if the orchestra is hired as an independent
contractor and exclusively determines the music to be played.”). As the First Circuit has
explained, the reason defendant’s argument has been rejected is that sponsors of musical
events “could otherwise reap the benefits of countless violations by orchestras . . . by
merely claiming ignorance that any violation would take place.” Famous Music Corp. v.
Bay State Harness Horse Racing & Breeding Ass’n, Inc., 554 F.2d 1213, 1215 (1st Cir.
1977).
Because plaintiff sufficiently alleges both elements of a vicarious infringement
claim, defendant’s motion to dismiss this claim is denied.
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Case No.
2:15-cv-01158-CAS (PJWx)
Title
OSAMA AHMED FAHMY v. LIVE NATION ENTERTAINMENT,
INC., ET AL.
IV.
Date
‘O’
June 8, 2015
MOTION TO STAY
Because two of plaintiff’s claims are adequately pleaded, the Court turns to
defendant’s alternative argument for a stay pending resolution of the Jay-Z Action.
A.
Legal Standard
A district court has discretionary power to stay proceedings. See Landis v. N. Am.
Co., 299 U.S. 248, 254 (1936). The court “may, with propriety, find it is efficient for its
own docket and the fairest course for the parties to enter a stay of an action before it,
pending resolution of independent proceedings which bear upon the case.” Leyva v.
Certified Grocers of Cal. Ltd., 593 F.2d 857, 863 (9th Cir. 1979). However, case
management concerns alone are not necessarily a sufficient ground to stay proceedings.
See Dependable Highway Express v. Navigators Ins. Co., 498 F.3d 1059, 1066 (9th Cir.
2007). Among the interests to be weighed in deciding whether to stay a pending
proceeding are (1) “the possible damage which may result from the granting of a stay,”
(2) “the hardship or inequity which a party may suffer in being required to go forward,”
and (3) “the orderly course of justice measured in terms of the simplifying or
complicating of issues, proof, and questions of law which could be expected to result
from a stay.” Lockyer v. Mirant Corp., 398 F.3d 1098, 1110 (9th Cir. 2005). “ ‘[I]f there
is even a fair possibility that the stay . . . will work damage to someone else,’ the stay
may be inappropriate absent a showing by the moving party of ‘hardship or inequity.’ ”
Dependable Highway Express, 498 F.3d at 1066 (quoting Landis, 299 U.S. at 255).
However, “being required to defend a suit, without more, does not constitute a ‘clear case
of hardship or inequity.’ ” Lockyer, 398 F.3d at 1112.
Generally, “[a] stay should not be granted unless it appears likely that the other
proceedings will be concluded within a reasonable time in relation to the urgency of the
claims presented to the court.” Leyva, 593 F.2d at 864. “The proponent of a stay bears
the burden of establishing its need.” Clinton v. Jones, 520 U.S. 681, 706 (1997).
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Case No.
2:15-cv-01158-CAS (PJWx)
Title
OSAMA AHMED FAHMY v. LIVE NATION ENTERTAINMENT,
INC., ET AL.
B.
Date
‘O’
June 8, 2015
Analysis
Defendant first argues that no damage will result from granting a stay because the
Jay-Z Action has been pending for over seven years, and thus plaintiff “could not
credibly claim any prejudice from a delay of a few months in the present case proceeding
to discovery.” Memo. Supp. Mot. at 17. Defendant argues that it, on the other hand,
would be unfairly prejudiced by having to spend time and money litigating a secondary
infringement action that could be disposed of on collateral estoppel grounds if the alleged
direct infringer (Jay-Z) is not found liable. Id. at 18; see Napster, 239 F.3d at 1013 n.2
(“Secondary liability for copyright infringement does not exist in the absence of direct
infringement by a third party.”). For the same reason of possible collateral estoppel,
defendant argues that a stay would promote efficiency and “further the orderly course of
justice.” Id. at 18–19.
Plaintiff responds that defendant’s argument that a stay of “a few months” would
do no harm is flawed because it assumes that the Jay-Z Action will actually proceed to
trial in October 2015 and will not settle after trial or be appealed. Opp’n at 18–19.
Plaintiff asserts that: (1) the Jay-Z Action may settle, creating no binding judgment as to
direct infringement; (2) if the case is appealed, it could take years for the appeal to be
heard, and longer if the case is remanded for further proceedings; and (3) the related case
may not be dispositive of the instant action because, for example, even if Jay-Z is found
to have directly infringed Khosara, Khosara, Live Nation may still contest secondary
liability on other grounds. Id. at 18–19. Plaintiff additionally argues that a stay would
harm him by compromising his “ ‘interest in having [his] case resolved quickly,’ ” id. at
20 (quoting ESG Capital Partners LP v. Stratos, 22 F. Supp. 3d 1042, 1046 (C.D. Cal.
2014)), and could result in the loss of evidence if witnesses die or leave the Los Angeles
area. Plaintiff also denies that defendant’s litigation burden would be onerous over the
next few months, and argues that judicial efficiency favors proceeding with the instant
litigation. Id. at 21.
The Court finds defendant’s arguments more persuasive. Although the outcome of
the Jay-Z Action will not necessarily be dispositive of this case, that outcome will
certainly inform this case. As to plaintiff’s argument that an appeal in the Jay-Z Action
could lengthen the stay, defendant correctly points out that “a final judgment retains its
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date
‘O’
Case No.
2:15-cv-01158-CAS (PJWx)
June 8, 2015
Title
OSAMA AHMED FAHMY v. LIVE NATION ENTERTAINMENT,
INC., ET AL.
collateral estoppel effect, if any, while pending appeal.” Collins v. D.R. Horton, Inc.,
505 F.3d 874, 882–83 (9th Cir. 2007) (explaining that the Ninth Circuit has “held that the
benefits of giving a judgment preclusive effect pending appeal outweigh any risks of a
later reversal of that judgment,” in part because the risk can be mitigated through staying
the second action or filing a “protective appeal” in the second action). Moreover,
plaintiff’s concerns about losing witnesses during its pendency are entirely speculative.
Still, while there may be reason to grant a stay pending the Jay-Z Action’s resolution, the
Court declines to do so at this time because (1) plaintiff may file an amended complaint
and (2) there is a chance that the Jay-Z Action will not proceed to trial as scheduled,
which could inform the length of a potential stay and the propriety of granting one.
Therefore, the motion is denied without prejudice to its being renewed after the pleadings
are closed and the Court has a more concrete sense of whether trial in the related action
will proceed in October.
V.
CONCLUSION
In accordance with the foregoing, defendant’s motion to dismiss is GRANTED IN
PART insofar as it seeks to dismiss plaintiff’s direct infringement claim, and otherwise
DENIED. Any First Amended Complaint attempting to address the pleading
deficiencies identified herein must be filed no later than July 8, 2015. If plaintiff does
not file a First Amended Complaint by that date, the Court will dismiss the direct
infringement claim with prejudice. Defendant’s motion to stay is DENIED without
prejudice to its being renewed after the pleadings are closed.
IT IS SO ORDERED.
00
Initials of Preparer
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