General Motors LLC et al v. Dorman Products, Incorporated et al

Filing 48

ORDER Denying Plaintiffs' 32 Motion to Dismiss Counterclaim. Signed by District Judge Victoria A. Roberts. (LVer)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
GENERAL MOTORS LLC, et al.,
Plaintiffs/Counterclaim Defendants,

Case No. 15-12917
Honorable Victoria A. Roberts

v.
DORMAN PRODUCTS, INC., et al.,
Defendants/Counterclaim Plaintiffs.
____________________________________/
ORDER DENYING PLAINTIFFS’ MOTION TO DISMISS COUNTERCLAIM [Doc. 32]
Plaintiffs/Counterclaim Defendants (“GM”) filed a Motion to Dismiss Counterclaim
for Failure to State a Claim. [Doc. 32]. It is fully briefed. GM says that
Defendants/Counterclaim Plaintiffs (“Dorman”) fail to state a claim for copyright misuse.
GM’s primary argument is that the Sixth Circuit has not yet recognized such claims. GM
also says that if such a claim is to be part of this case at all, it should only be allowed as
an affirmative defense. Finally, GM says that Dorman’s allegations fail to meet IqbalTwombly pleading requirements either as an affirmative defense or counterclaim.
Dorman’s copyright misuse counterclaim is based on the premise that GM
requires vehicle owners who seek repairs from independent mechanics, rather than GM
and its licensed dealers or mechanics, to buy a second licensed copy of software when
repairing a module on their vehicles, even though the customer – by virtue of vehicle
ownership – already owns a copy of the software installed on the vehicle’s control
modules. Dorman says GM bars vehicle owners from accessing their own copies of
software to: (1) eliminate vehicle aftermarket businesses such as Dorman and
businesses to whom it sells less expensive parts; (2) create a monopoly for GM; and
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(3) drive up costs to consumers. Dorman alleges that GM refuses to enter into a
licensing arrangement with it. As a result, GM limits access only to authorized GM
mechanics and never gives it to aftermarket parts suppliers. Dorman says this practice
violates 17 U.S.C. § 109(a).
While it is true that the Sixth Circuit has yet to rule on copyright misuse as a
viable counterclaim, various district courts in the Sixth Circuit have allowed declaratory
judgment actions such as Dorman’s counterclaim to proceed. See Malibu Media v.
Doe, No. 13-11432, 2014 WL 2616902, at *6 (E.D. Mich. June 12, 2014); Midwest
Tape, LL v. Recorded Books, LLC, No. 09-2176, 2010 WL 1258101, at *1 (N.D. Ohio
Mar. 26, 2010); McGuire v. Regents of Univ. of Mich., No. 99-1231, 2000 WL 1459435,
at *6 (S.D. Ohio Sept. 21, 2000).
Based on the law developing in this Circuit as well as cases outside of the Sixth
Circuit, see, e.g., Amaretto Ranch Breedables, LLC v. Ozimals, Inc., 790 F. Supp. 2d
1024, 1034 (N.D. Cal. 2011) (collecting cases) (denying defendant’s motion to dismiss
copyright misuse claim, and holding that “an affirmative claim of copyright misuse is
appropriate in this case”), the Court allows Dorman’s copyright misuse counterclaim to
proceed. In so doing, the Court finds that the counterclaim meets the Iqbal-Twombly
pleading standards. See Ashcroft v. Iqbal, 556 U.S. 662 (2009); Bell Atl. Corp. v.
Twombly, 550 U.S. 544 (2007).
GM’s Motion to Dismiss Counterclaim is DENIED.
IT IS ORDERED.
S/Victoria A. Roberts
Victoria A. Roberts
United States District Judge
Dated: March 20, 2018

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