DFSB Kollective Co., Ltd. et al v. John Does 1 through 10

Filing 31

ORDER TO SHOW CAUSE RE: 28 . Response due by 6/4/2012. Signed by Judge Nathanael M. Cousins on 5/21/12. (nclc1, COURT STAFF) (Filed on 5/21/2012)

1
2
3
4
5
6
7
8
9

UNITED STATES DISTRICT COURT

10

NORTHERN DISTRICT OF CALIFORNIA

11

SAN FRANCISCO DIVISION

12
13

DFSB KOLLECTIVE CO., LTD. and
others,

ORDER TO SHOW CAUSE
Plaintiffs,

14
15
16
17

Case No. 11-cv-01051 CW (NC)

Re: Dkt. Nos. 28, 29
v.
BING YANG, INDRAWATI YANG, and
others,
Defendants.

18
19

In this action for copyright infringement, plaintiffs move for the entry of default judgment

20

under Federal Rule of Civil Procedure 55(b)(2) against defendants Bing Yang and Indrawati

21

Yang. Plaintiffs request an award of $315,000 in statutory damages against Bing Yang, an award

22

of $900,000 in statutory damages against Indrawati Yang, interest under 28 U.S.C. § 1961(a), and

23

a permanent injunction barring defendants from further infringing plaintiffs’ copyrights. The

24

motion was referred to this Court by District Judge Wilken. Dkt. No. 29. As the allegations in

25

the complaint and motion for default judgment do not establish that this Court has personal

26

jurisdiction over Bing Yang and Indrawati Yang, who are residents of Vietnam and Indonesia

27

respectively, this action may not be instituted in this district under 28 U.S.C. § 1441(a) (providing

28

that “[c]ivil actions, suits, or proceedings arising under any Act of Congress relating to copyrights
Case No. 11-cv-01051 CW (NC)
ORDER TO SHOW CAUSE

1

or exclusive rights in mask works or designs may be instituted in the district in which the

2

defendant or his agent resides or may be found.”). Accordingly, plaintiffs are ORDERED TO

3

SHOW CAUSE by June 4, 2012, why this Court should not recommend to the District Court that

4

this action be dismissed for lack of personal jurisdiction and improper venue.
I. BACKGROUND

5

Plaintiff DFSB Kollective Co. Ltd. is a corporation that acquired the rights to promote and

6
7

protect the musical-recording copyrights owned by plaintiffs Nega Network, Jungle

8

Entertainment, Foundation Records, Woolim Entertainment, Aftermoon Music Entertainment,

9

Inc., Paragon Music Corp., Roxta Music, and Spot/Monky Global. Am. Comp. ¶¶ 1, 7, Dkt. No.

10

16. All of the plaintiffs are Korean corporations. Id. ¶ 2. The copyrights owned by plaintiffs

11

were issued by the United States Copyright Office and cover various Korean pop songs and their

12

corresponding album artwork. Id. ¶¶ 7, 16.
Plaintiffs claim that defendants Bing Yang and Indrawati Yang post on their websites

13
14

links to material available on third-party websites that allegedly infringes plaintiffs’ copyrights.

15

Id. ¶ 3. The websites on which defendants post infringing material are “often hosted on servers

16

located outside of the United States.” Id. ¶ 24. Defendants allegedly profit from this activity by

17

displaying advertisings next to the infringing material. Id. ¶ 3. Plaintiffs claim that these

18

activities constitute willful copyright infringement, contributory copyright infringement, and

19

inducement of copyright infringement under the Copyright Act, 17 U.S.C. §§ 101-810. Id. ¶ 4.

20

In the operative complaint, plaintiffs allege that the Court has personal jurisdiction over

21

defendants because (1) defendants or their agents “are doing business in this district”; and (2) a

22

“substantial part of the wrongful acts” committed by defendants “has occurred in interstate

23

commerce in the State of California and Northern District of California.” Id. ¶ 6. Plaintiffs also

24

state conclusorily that venue in this district is proper under 28 U.S.C. § 1391(b) and 28 U.S.C. §

25

1400(a).

26

//

27
28
Case No. 11-cv-01051 CW (NC)
ORDER TO SHOW CAUSE

2

II. LEGAL STANDARD

1
2

“[D]efault judgments are generally disfavored. Whenever it is reasonably possible, cases

3

should be decided upon their merits.” Pena v. Seguros La Comercial, S.A., 770 F.2d 811, 814

4

(9th Cir. 1985). After the clerk enters a defendant’s default, a court must take “the well-pleaded

5

factual allegations” in the complaint “as true.” DIRECTV, Inc. v. Hoa Huynh, 503 F.3d 847, 854

6

(9th Cir. 2007). However, the “defendant is not held to admit facts that are not well-pleaded or to

7

admit conclusions of law.” Id.

8
9

In determining whether to enter a default judgment, a court “may dismiss an action sua
sponte for lack of personal jurisdiction,” because a “judgment entered without personal

10

jurisdiction over the parties is void.” In re Tuli, 172 F.3d 707, 712 (9th Cir. 1999) (citations

11

omitted). A court, however, must provide to a plaintiff the opportunity to assert facts to establish

12

that the exercise of personal jurisdiction over a nonresident defendant is proper before dismissing

13

an action for lack of personal jurisdiction. Id.
III. DISCUSSION

14
15

Based on the allegations in the complaint and the motion for default judgment, the Court

16

lacks personal jurisdiction over defendants; consequently, this action cannot be brought in this

17

district under 28 U.S.C. § 1400(a).

18

In determining whether the exercise of personal jurisdiction over a nonresident defendant

19

is proper, a district court must apply the law of the state in which it sits when there is no

20

applicable federal statute governing personal jurisdiction. Panavision Int’l, L.P. v. Toeppen, 141

21

F.3d 1316, 1320 (9th Cir. 1998). District courts in California may exercise personal jurisdiction

22

over a nonresident defendant to the extent permitted by the Due Process Clause of the

23

Constitution. CAL. CODE CIV. P. § 410.10. The Due Process Clause requires that the defendant

24

have “certain minimum contacts” with the forum “such that the maintenance of the suit does not

25

offend traditional notions of fair play and substantial justice.” Int’l Shoe Co. v. State of

26

Washington, 326 U.S. 310, 316 (1945) (citations and internal quotation marks omitted). The

27

party seeking to invoke jurisdiction has the burden of establishing that jurisdiction exists. Flynt

28

Distrib. Co. v. Harvey, 734 F.2d 1389, 1392 (9th Cir. 1984). “[L]itigation against an alien
Case No. 11-cv-01051 CW (NC)
ORDER TO SHOW CAUSE

3

1

defendant requires a higher jurisdictional barrier than litigation against a citizen from a sister

2

state.” Rano v. Sipa Press, Inc., 987 F.2d 580, 588 (9th Cir. 1993) (citation omitted). Personal

3

jurisdiction may be founded on either general jurisdiction or specific jurisdiction.
Here, plaintiffs bear the burden of establishing a prima facie case supporting personal

4
5

jurisdiction, but they have not met that burden. Id. at 587 (noting that a plaintiff bringing a

6

copyright infringement claim “bears the burden of establishing a prima facie case supporting in

7

personam jurisdiction”). Plaintiffs do not specify whether personal jurisdiction over defendants is

8

founded on general or specific jurisdiction. Indeed, plaintiffs’ only allegations with respect to

9

personal jurisdiction are that (1) defendants or their agents “are doing business in this district”;

10

and (2) a “substantial part of the wrongful acts” committed by defendants “has occurred in

11

interstate commerce in the State of California and Northern District of California.” Am. Compl. ¶

12

6. These conclusory allegations are insufficient to support this Court’s exercise of general or

13

specific personal jurisdiction over defendants, as they do not show that defendants, who reside in

14

Vietnam and Indonesia, have any contacts with this district. See Rano, 987 F.2d at 588 (affirming

15

dismissal of copyright infringement claim against an alien defendant because there was no

16

evidence that the defendant invoked the benefits or protections of the forum’s laws).
When a plaintiff brings a claim for willful copyright infringement arising out of conduct

17
18

on the internet, the plaintiff must satisfy the requirements of the Calder effects test in order to

19

establish that the exercise of specific personal jurisdiction over a nonresident defendant is proper.

20

Brayton Purcell LLP v. Recordon & Recordon, 361 F. Supp. 2d 1135, 1140 (N.D. Cal. 2005)

21

(citation omitted); Calder v. Jones, 465 U.S. 783, (1984). The Calder effects test requires the

22

plaintiff to show that (1) the defendant committed an intentional act, (2) that was expressly aimed

23

at the forum, and (3) that caused harm, the brunt of which is suffered and which the defendant

24

knows is likely to be suffered in the forum. Id. Here, the allegations in the operative complaint

25

fail to establish the last two of these elements, because they do not show that defendants’ acts

26

were expressly aimed at the Northern District of California or that defendants caused harm that

27

they knew was likely to be suffered in the Northern District of California.

28

//
Case No. 11-cv-01051 CW (NC)
ORDER TO SHOW CAUSE

4

1

Furthermore, plaintiffs have failed to establish that venue is proper in this district. In

2

actions for copyright infringement, venue is governed by 28 U.S.C. § 1400(a), which provides

3

that such actions “may be instituted in the district in which the defendant or his agent resides or

4

may be found.” 28 U.S.C. § 1400(a). The Ninth Circuit has interpreted § 1400(a) to mean that

5

venue “is proper in any judicial district in which the defendant would be amenable to personal

6

jurisdiction if the district were a separate state.” Columbia Pictures Television v. Krypton Broad.

7

of Birmingham, Inc., 106 F.3d 284, 289 (9th Cir. 1997) (overruled on other grounds). Because

8

defendants are not amenable to personal jurisdiction in this district, as discussed above, venue

9

also is improper.
IV. CONCLUSION

10
11

On or before June 4, 2012, plaintiffs must show cause, in writing, why this Court should

12

not recommend to the District Court that this action be dismissed for lack of personal jurisdiction

13

and improper venue.

14

IT IS SO ORDERED.

15
16

Date: May 21, 2012

17

_____________________
Nathanael M. Cousins
United States Magistrate Judge

18
19
20
21
22
23
24
25
26
27
28
Case No. 11-cv-01051 CW (NC)
ORDER TO SHOW CAUSE

5