Bubble Pony, Inc. et al v. Facepunch Studios Ltd et al
ORDER granting 109 Motion for Partial Summary Judgment(Written Opinion) Signed by Senior Judge David S. Doty on 04/14/2017. (ACB)
UNITED STATES DISTRICT COURT
DISTRICT OF MINNESOTA
Civil No. 15-601(DSD/FLN)
Bubble Pony, Inc., a Minnesota
Corporation and Patrick J. Glynn,
Facepunch Studios Ltd., Facepunch
Limited, Facepunch Group Limited,
and Garry Newman,
Brittany N. Resch, Esq., Daniel E. Gustafson, Esq., Daniel C.
Hedlund, Esq., and Michelle J. Looby, Esq. and Gustafson
Glueck PLLC, 120 South 6th Street, Suite 2600, Minneapolis, MN
55402 and Stuart M. Paynter, Esq., Jennifer Murray, Esq., Sara
Willingham, Esq., and Celeste H.G. Boyd, Esq. and The Paynter
Law Firm, PLLC, 106 South Churton Street, Suite 200,
Hillsborough, NC 27278, counsel for plaintiffs.
Todd A. Wind, Esq. and Pamela Abbate-Dattilo, Esq. and
Fredrikson & Byron, PA, 200 South 6th Street, Suite 4000,
Minneapolis, MN 55402 and Erin Jones, Esq. and Ryan Tyz, Esq.
and Tyz Law Group PC, 4 Embracadero Center, Suite 1400, San
Francisco, CA 94111, counsel for defendants.
This matter is before the court upon the motion for partial
summary judgment by plaintiffs Bubble Pony, Inc. and Patrick J.
Based on a review of the file, record, and proceedings
herein, and for the following reasons, the motion is granted.
The allegations at the center of this business dispute were
set forth in the court’s previous order on defendants’ motion to
See ECF No. 40.
Because discovery in this case is still
ongoing, the court will recite only those facts necessary to
resolve this motion.
Defendant Facepunch is an English company, majority owned by
defendant Garry Newman.
In September 2010, Newman hired Glynn as
a computer programmer for video games produced by Facepunch.
Decl. Ex. 1.
In June 2012, Glynn began work on a video game
Am. Compl. ¶ 28.
The parties dispute to what
degree Glynn was supervised and how much of his contribution was
See id. ¶¶ 28-34; Tyz Decl. Exs. 5, 6; Berry Dep. at
In June 2013, Facepunch released a limited version of RUST and
officially offered RUST for sale in August. In December, Facepunch
released RUST more widely on “Steam,” a gaming platform.
Compl. ¶¶ 33, 53.
work on RUST.1
Glynn received over $700,000 in payment for his
Tyz Decl. Ex. 12 at 2.
In May 2014, Facepunch fired Glynn purportedly due to his
unnecessarily complex coding and poor performance.
Exs. 6, 8, 10.
See Tyz Decl.
On January 22, 2015, Glynn registered the June 2013
version of RUST as a joint work with Facepunch and filed an
Plaintiff Bubble Pony, Inc. is a Minnesota corporation
formed by Glynn to receive his payments from Facepunch. Am. Compl.
application to register the August 2013 version.2
Am. Compl. ¶ 59.
Based on this copyright and his alleged original contributions,
Glynn claims that he is a joint author of RUST and that defendants
owe him an accounting of the profits made from RUST.
Id. ¶¶ 282-
On March 12, 2015, plaintiffs filed an amended complaint
alleging a variety of contract, tort, and equitable claims against
Facepunch and Newman.
On December 7, 2015, the court dismissed
most of plaintiffs’ claims except those for tortious interference
with prospective economic advantage; unjust enrichment; accounting;
and declaratory judgment of joint authorship.
acquiescence, and assignment.
Plaintiffs now move for partial
summary judgment as to those affirmative defenses.
Standard of Review
“The court shall grant summary judgment if the movant shows
that there is no genuine dispute as to any material fact and the
movant is entitled to judgment as a matter of law.”
Fed. R. Civ.
P. 56(a); see Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986).
A fact is material only when its resolution affects the outcome of
The record before the court does not indicate whether the
application has been granted.
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248
A dispute is genuine if the evidence is such that it could
cause a reasonable jury to return a verdict for either party.
id. at 252 (“The mere existence of a scintilla of evidence in
support of the plaintiff’s position will be insufficient ....”).
On a motion for summary judgment, the court views all evidence
and inferences in a light most favorable to the nonmoving party.
Id. at 255.
The nonmoving party, however, may not rest upon mere
denials or allegations in the pleadings but must set forth specific
facts sufficient to raise a genuine issue for trial.
U.S. at 324.
A party asserting that a genuine dispute exists - or
cannot exist - about a material fact must cite “particular parts of
materials in the record.”
Fed. R. Civ. P. 56(c)(1)(A).
plaintiff cannot support each essential element of a claim, the
court must grant summary judgment because a complete failure of
proof regarding an essential element necessarily renders all other
Celotex, 477 U.S. at 322-23.
Plaintiffs argue that the implied license defense is not a
cognizable defense to a joint authorship claim. Defendants respond
that an implied license is relevant to disproving that the authors
of a work intended to be joint authors.
Courts may find an implied nonexclusive license where “(1) a
person requests the creation of a work; (2) the creator makes the
particular work and delivers it to the person who requested it; and
(3) the licensor intends that the licensee-requestor copy and
distribute the work.”
Evert Software, Inc. v. Extreme Recoveries,
Inc., No. 01-1027, 2001 WL 1640116, at *3 (D. Minn. July 25, 2001)
(citing Lulirama Ltd., Inc. v. Axcess Broadcast Servs., Inc., 128
F.3d 872, 879 (5th Cir. 1997)); see also Pinkham v. Sara Lee Corp.,
983 F.2d 824, 831 (8th Cir. 1992) (“[U]nlike an exclusive license,
an authorization can be given orally or implied from conduct.”).
copyright infringement claim, I.A.E., Inc. v. Shaver, 74 F.3d 768,
775 (7th Cir. 1996), but plaintiffs have not alleged copyright
Defendants do not cite, nor can the court find, any
case where implied license has been recognized as a defense to a
joint authorship claim.
Indeed, allowing this defense would be
absurd because permission to use a copyrighted work is inherent to
Section 101 of the Copyright Act defines a
“joint work” as a “work prepared by two or more authors with the
intention that their contributions be merged into inseparable or
interdependent parts of a unitary whole.”
17 U.S.C. § 101.
Authors who create a joint work are co-owners of the copyright in
17 U.S.C. § 201(a).
Each author has “an independent
right to use or license the use of a work, subject to a duty of
accounting to the co-owners for any profits.”
Erickson v. Trinity
Theatre, Inc., 13 F.3d 1061, 1065 n.2 (7th Cir. 1994) (internal
quotation marks and citation omitted).
Further, contrary to
defendants’ claim that an implied license shows that the parties
See Sys. XIX, Inc. v. Parker, 30 F. Supp. 2d 1225,
1230 (N.D. Cal. 1998) (“Defendants correctly maintain that to
assert a claim of joint authorship over the sound recordings,
[plaintiff] must have obtained permission to use [defendant’s]
musical compositions in the sound recordings.”).
joint authors have implied permission to use copyrighted work, “a
Fishing Concepts, Inc. v. Ross, No. 4-82-560, 1985
WL 1549, at *7 (D. Minn. May 16, 1985); see also Zuill v. Shanahan,
80 F.3d 1366, 1369 (9th Cir. 1996).
Defendants next argue that an implied license defense would
eliminate any duty of accounting for profits between joint authors.
Defendants rely on Picture Music Inc. v. Bourne, Inc., 314 F. Supp.
640 (S.D.N.Y. 1970), but that case is inapposite.
constructive trust when one joint author uses a copyrighted work
Id. at 646-47.
The case does not hold, nor
does it follow, that joint authors need not account for profits
when permission is given.
The duty to account for profits could
conceivably end if one joint author transferred his ownership to
the other, but “an implied nonexclusive license ... does not
transfer ownership of the copyright.”
Shaver, 74 F.3d at 775.
a result, an implied license defense does not apply to the claims
asserted by plaintiffs.3
Joint Authorship and Accounting
Defendants next argue that acquiescence is a cognizable
defense to plaintiffs’ joint authorship and accounting claims.
Acquiescence is an affirmative defense to copyright infringement
where the defendant shows that “(1) the plaintiff knew of and
manifested acquiescence in the defendant’s infringing conduct,
actual or proposed, (2) the plaintiff intended that the defendant
rely on its conduct, and (3) the defendant reasonably relied to its
detriment on the plaintiff’s actions.”
Sony BMG Music Entm’t v.
Tenenbaum, 672 F. Supp. 2d 217, 233 (D. Mass. 2009).
infringement claim, and defendants do not cite, nor can the court
find, any case where acquiescence is a recognized defense to a
joint authorship or accounting claim.
Further, if the court were
Defendants also argue that an implied license defense is
relevant because Glynn claims he has a copyright in the game
“Cash4Kills,” which was allegedly used in the development of RUST.
But plaintiffs have not alleged any copyright infringement claim
for either RUST or Cash4Kills. Defendants cannot assert defenses
to hypothetical claims not before the court.
to hold that acquiescence is a defense to a joint authorship or
accounting claim, it would undermine the requirement that transfers
of copyright ownership be in writing.
See Pamfiloff v. Giant
(“[P]laintiffs are unable to locate a single case in which a court
allowed the doctrine of equitable estoppel to be used to circumvent
the writing requirement of [Copyright Act] Section 204(a). [A]n
assignment of copyright which is not memorialized in writing is not
effective to transfer the copyright.”).
As a result, acquiescence
is not a viable defense to the joint authorship or accounting
Intentional Interference with Prospective Economic
Defendants also contend that acquiescence is relevant to
plaintiffs’ claim of intentional interference with prospective
Again, defendants fail to cite a case where
acquiescence was similarly used.
Even if acquiescence were a
cognizable defense, however, defendants have failed to establish
that its elements have been met.
As stated above, acquiescence
requires that a plaintiff intended that the defendant rely on his
Moreover, “waiver or abandonment of copyright
occurs only if there is an intent by the copyright proprietor to
surrender rights in his work.”
Tenenbaum, 672 F. Supp. 2d at 233.
Here, defendants have only alleged, without factual support, that
Glynn failed to object when they sold an experimental version of
RUST without paying him.4
Even if true, Glynn’s failure to object
does not show intent to relinquish any rights he allegedly held in
See id. (rejecting the argument that intent can be shown
through recklessness or a version of implied consent).
the acquiescence defense also fails as a matter of law.
Finally, plaintiffs argue that defendants have not established
the affirmative defense of assignment.
Defendants respond that
Glynn assigned any interest he may have had in RUST by executing a
“Confidentiality, Non-Disclosure and Non-Use Agreement.”
The owner of a copyright can transfer his ownership interests
to another in a signed writing.
17 U.S.C. § 204(a).
writing transferring the copyright need not be detailed, it must be
clear. Papa’s-June Music, Inc. v. McLean, 921 F. Supp. 1154, 115859 (S.D.N.Y. 1996); see also Effects Assocs., Inc. v. Cohen, 908
F.2d 555, 557 (9th Cir. 1990) (“[The writing] doesn’t have to be
the Magna Charta; a one-line pro forma statement will do.”).
Whether a copyright transfer is sufficiently clear is a question of
law. Leisure Time Entm’t, Inc. v. Cal Vista, No. 94-56407, 1996 WL
115167, at *1 (9th Cir. Mar. 14, 1996).
In relevant part, the parties’ agreement states that: “Nothing
Defendants cannot rely on general characterizations of the
evidence. A party asserting that a genuine dispute exists - or
cannot exist - about a material fact must cite “particular parts of
materials in the record.” Fed. R. Civ. P. 56(c)(1)(A).
in this Agreement is intended to grant any rights to [Glynn] under
patent or copyright, nor shall this Agreement grant [Glynn] any
rights in or to the Company’s Confidential Information.” Tyz Decl.
Ex. 2 ¶ 5.
The agreement does not reference any transfer of
copyright to the defendants nor does it clearly indicate that Glynn
was relinquishing any purported copyright interest he may have had
To suggest otherwise is frivolous.
As a result, the
agreement does not meet the writing requirement of Section 204(a),
and summary judgment on the defense of assignment is warranted.5
Accordingly, based on the above, IT IS HEREBY ORDERED that
plaintiffs’ motion for partial summary judgment [ECF No. 109] is
Dated: April 14, 2017
s/David S. Doty
David S. Doty, Judge
United States District
Although discovery is still ongoing, defendants do not argue
that further discovery would strengthen any of the affirmative
defenses at issue.
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