Daisley v. Blizzard Music Limited (US) et al

Filing 26

ORDER - Defendants' motion to transfer is GRANTED. This action is hereby transferred to the District Court for the Central District of California. The remaining motions raised in the defendants' omnibus motion are denied without prejudice to renew. Signed by Judge Howard D. McKibben on 2/22/2017. (Copies have been distributed pursuant to the NEF - DRM) [Transferred from Nevada on 2/23/2017.]

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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 DISTRICT OF NEVADA 10 11 12 13 14 15 16 ROBERT DAISLEY, ) ) Plaintiff, ) ) vs. ) ) BLIZZARD MUSIC LIMITED (US) and ) JOHN MICHAEL OSBOURNE, ) ) Defendant. ) ) _________________________________ ) 3:16-cv-00519-HDM-WGC ORDER 17 Before the court is defendant John Michael Osbourne’s 18 (“Osbourne”) motion to dismiss for lack of personal jurisdiction 19 pursuant to Federal Rule of Civil Procedure 12(b)(2), Osbourne and 20 co-defendant Blizzard Music Limited (US)’s (“Blizzard US”) motion 21 to transfer pursuant to 28 U.S.C. § 1404(a), defendants’ motion to 22 dismiss or stay the action due to binding arbitration agreement, 23 and defendants’ motion to dismiss for failure to state a claim 24 pursuant to Federal Rule of Civil Procedure 12(b)(6) and Rule 9(b) 25 (ECF No. 8). Plaintiff Robert Daisley (“Daisley”) has opposed (ECF 26 No. 14), and defendants have replied (ECF No. 16). 27 In his complaint, filed in state court on August 8, 2016 and 28 1 1 removed to this court on August 31, 2016, Daisley asserts that he 2 co-authored a number of songs with defendant Osbourne and others in 3 late 1979, 1980, and 1981. 4 songwriter agreements that assigned his copyright interest in the 5 songs to Blizzard UK. 6 UK and owned primarily by Osbourne. 7 agreements, Blizzard UK acted as the publisher and administrator 8 for Daisley’s share of the songs and was responsible for collecting 9 and distributing royalties to Daisley. In 1980 and 1981, Daisley entered into Blizzard UK is an entity incorporated in the Under the terms of the Blizzard UK was to pay 90 10 percent of all royalties received on Daisley’s behalf to Daisley, 11 retaining a ten percent fee for itself. 12 Daisley understood that administration of the copyrights 13 within the United States was done by Blizzard US, an entity created 14 and controlled by Osbourne. 15 not learn until 2014 that Blizzard US was retaining fifteen percent 16 of the royalties it received before remitting the royalties to 17 Blizzard UK for distribution to Daisley. 18 Osbourne, Blizzard US, and Blizzard UK concealed this fact so that 19 Daisley would not know of the additional deductions. 20 asserts that the songwriting agreements do not allow Blizzard US or 21 Blizzard UK to take an additional fifteen percent deduction. 22 Daisley accordingly commenced this action against Osbourne and 23 Blizzard US for fraud and an accounting. 24 Daisley resides in Australia. However, Daisley asserts that he did Daisley asserts that Daisley Osbourne resides in Los 25 Angeles, California, and England. 26 Nevada and has a post office box and bank account in Nevada, but 27 its books and records are physically located in California and its 28 administration of licenses is conducted primarily in California. Blizzard US is incorporated in 2 1 2 The court first addresses the defendants’ motion to transfer venue pursuant to 28 U.S.C. § 1404(a). 3 The court may transfer venue to any district “where it might 4 have been brought” for “the convenience of parties and witnesses, 5 in the interest of justice.” 6 party bears the burden of showing that an adequate alternative 7 forum exists. 8 n.22 (9th Cir. 2000). 9 party shows: (1) venue is proper in the transferor district court; 28 U.S.C. § 1404(a). The moving Jones v. GNC Franchising, Inc., 211 F.3d 495, 499 “Transfer is appropriate when the moving 10 (2) the transferee district court has personal jurisdiction over 11 the defendants and subject matter jurisdiction over the claims; and 12 (3) transfer will serve the convenience of the parties and 13 witnesses, and will promote the interests of justice.” 14 Himax Techs., Inc., 530 F. Supp. 2d 1121, 1123 (C.D. Cal. 2008). 15 A. 16 Pfeiffer v. Proper Venue While Blizzard US is incorporated in Nevada, the record 17 reflects that its business is conducted almost exclusively in 18 California. 19 District of California is a district where both defendants reside 20 and is therefore a proper venue for this action. 21 1391(b)(1). 22 B. 23 Osbourne also resides in California. The Central See 28 U.S.C. § Personal and Subject Matter Jurisdiction Defendant Osbourne resides in California. The federal 24 district court in California therefore has personal jurisdiction 25 over Osbourne. 26 Blizzard US is incorporated in Nevada, has a bank account in 27 Nevada, and has a P.O. Box in Nevada. 28 offices in Nevada, all of its books and records are located in 3 However, Blizzard US has no 1 California, and the business of Blizzard US is conducted primarily 2 out of California. 3 any substantial business in Nevada. 4 music publisher, and the review, negotiation, and granting of 5 license requests are done by Sharon Osbourne, on defendant 6 Osbourne’s behalf, principally from her office in Los Angeles, 7 California. 8 Blizzard US’s business is conducted primarily from Los Angeles, 9 California, which is also the location of its books and records, There is no evidence that Blizzard US conducts Specifically, Blizzard US is a (ECF No. 22 (Sharon Osbourne Decl. ¶¶4-5)). As 10 the record supports a conclusion that Blizzard US’s principal place 11 of business is in California. 12 California would have personal jurisdiction over Blizzard US. 13 defendants have conceded that California courts have jurisdiction 14 over Blizzard US. Thus, the federal district court in The 15 Finally, the parties do not dispute that the federal district 16 court in California would have jurisdiction over Daisley’s claims. 17 18 C. Convenience of the Parties and Witnesses and Interests of 19 Justice 20 The court must weigh several factors in determining whether 21 transfer is appropriate: (1) the location where the relevant 22 agreements were negotiated and executed; (2) the state that is most 23 familiar with the governing law; (3) the plaintiff’s choice of 24 forum; (4) the respective parties’ contacts with the forum; (5) the 25 contacts relating to plaintiff’s cause of action in the chosen 26 forum; (6) the differences in the cost of litigation in the two 27 forums; (7) the availability of compulsory process to compel 28 witnesses; and (8) the ease of access to sources of proof. 4 Jones, 1 211 F.3d at 498-99. 2 1. Where Relevant Agreements were Negotiated and Executed 3 It appears that the only agreements at issue in this case are 4 the songwriter agreements. 5 agreements are not relevant to this case, he does cite them in his 6 complaint and defendants rely on them in their motion to dismiss. 7 The record reflects that the agreements were executed in England. 8 (ECF No. 8-3 (Sharon Osbourne Decl. ¶5)). 9 pointing to either California or Nevada as relevant to the While Daisley argues that these 10 agreements’ negotiation and/or execution. 11 There is no evidence neutral. This factor is therefore 12 2. State Most Familiar with Governing Law 13 The parties agree that Nevada law applies to Daisley’s claims. 14 As this court is more familiar with Nevada law than a court in 15 California might be, this factor weighs against transfer. 16 3. Plaintiff’s Choice of Forum 17 Daisley argues that defendants have failed to overcome the 18 strong presumption in favor of a plaintiff’s choice of venue. 19 However, while a plaintiff’s selection of a forum is generally due 20 heavy deference, deference is reduced for foreign plaintiffs. 21 Lueck v. Sundstrand Corp., 236 F.3d 1137, 1145 (9th Cir. 2001); 22 Gemini Capital Grp., Inc. v. Yap Fishing Corp., 150 F.3d 1088, 1091 23 (9th Cir. 1998); Mujica v. Occidental Petroleum Corp., 381 F. Supp. 24 2d 1134, 1141 (C.D. Cal. 2005); see also Boston Telecomms. Grp. v. 25 Wood, 588 F.3d 1201, 1207 (9th Cir. 2009). 26 deference is not the same thing as no deference.” 27 at 1143. 28 Daisley’s choice of Nevada entitled to deference, it is not Even so, “less Daisley is not a resident of Nevada. 5 Lueck, 236 F.3d Accordingly, while 1 entitled to great deference. 2 transfer, but only slightly. This factor therefore weighs against 3 4. Parties’ Contacts with Nevada 4 Daisley does not assert any contacts with Nevada. Defendant 5 Osbourne has had some contacts with Nevada, but they appear to be 6 sporadic and infrequent and not particularly relevant to the 7 dispute in this case. 8 The party with the most Nevada contacts is defendant Blizzard US, 9 which is incorporated in Nevada, and has a Nevada bank account and 10 P.O. Box. 11 (See ECF no. 7-2 (John Osbourne Decl.)). contacts with Nevada. However, the record does not reflect any additional 12 When compared to the parties’ contacts with California – where 13 Osbourne lives and the business of Blizzard US is conducted – it is 14 apparent that the parties’ contacts with Nevada are not as 15 substantial as those with California. 16 connection to Nevada and defendants’ contacts with California, 17 including that it is the location of the books and records of the 18 business and where the review, negotiation, and granting of 19 licenses is undertaken, outweigh their contacts with Nevada, this 20 factor favors transfer. Given that Daisley has no 21 5. Parties’ Contacts Relating to Daisley’s Claims 22 Insofar as Daisley’s claims are concerned, it is unclear that 23 Nevada has any relation to them other than the fact that one of the 24 defendants is incorporated in Nevada and maintains a bank account 25 and P.O. Box in Nevada. 26 that is the basis of the complaint occurred in Nevada other than 27 the fact that one of the defendants is incorporated here. 28 there any persuasive argument that the effects of the alleged There is no allegation that the wrongdoing 6 Nor is 1 wrongdoing were felt in Nevada. 2 Nevada relating to Daisley’s claims are not substantial and the 3 actions that Daisley complains of did not take place here, this 4 factor also favors transfer. Because the parties’ contacts with 5 6. Cost of Litigation 6 No individual person involved in this litigation resides in 7 Nevada. 8 Compared to Reno, Los Angeles is an easier and more direct 9 destination for most witnesses coming from abroad. All individuals reside in either California or abroad. This means that 10 it is likely more cost-effective for litigation to take place in 11 Los Angeles. Accordingly, this factor slightly favors transfer. 12 7. Availability of Compulsory Process to Compel Witnesses 13 No non-party witnesses have been identified as residing in 14 Nevada. 15 resides in California – Sharon Osbourne. 16 not asserted or established that Sharon Osbourne would be an 17 unwilling witness whose testimony would need to be compelled. 18 other potential witnesses are outside the jurisdiction of either 19 Nevada or California. 20 transfer. Defendants have identified one non-party witness who However, defendants have All Accordingly, this factor slightly favors 21 8. Access to Sources of Proof 22 Blizzard US’s books and records are in California and England. 23 None are in Nevada. 24 in Nevada, though its relevance to these proceedings – if any – is 25 not clear. 26 discussed above, for those coming from abroad Los Angeles is an 27 easier destination to reach. 28 proof will be overall easier in California than in Nevada. However, Blizzard US does have a bank account All witnesses are in either California or abroad. As Accordingly, access to sources of 7 This 1 2 factor therefore favors transfer. 9. Additional Factors 3 4 i. Execution of Judgment Daisley argues that any successful judgment against Blizzard 5 US would be executed in Nevada, thus weighing against transfer. 6 The court finds this argument unpersuasive. 7 California may be executed in Nevada to the same degree as a 8 judgment from Nevada, with only the additional step of registering 9 the judgment with this court. A judgment from Daisley neglects to mention where a 10 judgment would be executed against defendant Osbourne, but it seems 11 most likely that it would be executed, at least in part, in 12 California. 13 foreign judgment wherever this case is tried, this factor is 14 neutral. 15 16 As Daisley would thus be required to register a ii. Personal Jurisdiction Finally, Osbourne argues that this court lacks personal 17 jurisdiction over him. 18 this issue because the action will be transferred,1 it is unlikely 19 that Daisley could establish specific jurisdiction over Osbourne. 20 In order to establish specific jurisdiction in a torts case, “the 21 defendant allegedly must have (1) committed an intentional act, (2) 22 expressly aimed at the forum state, (3) causing harm that the 23 defendant knows is likely to be suffered in the forum state.” While the court declines to directly decide 24 25 26 27 28 1 The court can transfer under § 1404(a) regardless of whether it has personal jurisdiction over the defendants. See Sinochem Int’l Co. v. Malaysia Int’l Shipping Corp., 549 U.S. 422, 425 (2007); Goldlawr, Inc. v. Heiman, 369 U.S. 463, 466-67 (1962); Stanbury Elec. Eng’g, LLC v. Energy Prod., Inc., 2016 WL 3255003, at *1 (W.D. Wash. June 13, 2016); Kawamoto v. CB Richard Ellis, Inc., 225 F. Supp. 2d 1209, 1211 (D. Haw. 2002) (“[T]his court may transfer venue under . . .§ 1404(a) . . . without regard to whether it has personal jurisdiction over” the defendant.). 8 1 Brayton Purcell LLP v. Recordon & Recordon, 606 F.3d 1124, 1128 2 (9th Cir. 2010). 3 connection to Nevada. 4 effects of defendants’ alleged actions were otherwise felt in 5 Nevada. 6 specific jurisdiction over Osbourne is tenuous. 7 the court might have general jurisdiction over Osbourne based on 8 anything other than an alter ego theory is plainly without merit. 9 Daisley’s allegations supporting the alter ego theory are largely Daisley is a resident of Australia and has no Daisley has not persuasively argued that the Accordingly, Daisley’s contention that the court has The argument that 10 conclusory and do not make a “prima facie showing of jurisdictional 11 facts to withstand the motion to dismiss.’” 12 determination of the court’s jurisdiction would therefore require 13 the parties to engage in jurisdictional discovery prior to 14 discovery on the merits of the underlying action. 15 costly and delay the resolution of this case. 16 that judicial economy therefore favors transfer to a court that 17 clearly has jurisdiction over both defendants. 18 Id. at 1127. A This would be The court concludes After considering and weighing all the relevant factors in 19 this case, the court concludes that on balance transfer to the 20 Central District of California is appropriate. 21 / 22 / 23 / 24 / 25 / 26 / 27 / 28 / 9 1 2 Conclusion In accordance with the foregoing, defendants’ motion to 3 transfer is GRANTED. 4 District Court for the Central District of California. 5 remaining motions raised in the defendants’ omnibus motion are 6 denied without prejudice to renew. This action is hereby transferred to the 7 IT IS SO ORDERED. 8 DATED: This 22nd day of February, 2017. 9 10 ____________________________ UNITED STATES DISTRICT JUDGE 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 10 The

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