J & J Sports Productions, Inc. v. Garcia et al
Filing
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MEMORANDUM AND ORDER: IT IS HEREBY ORDERED that the motion of defendants Antonio Garcia, Brenda Garcia, and Agencia Garcia, Inc. to dismiss the amended complaint (Doc. 12) is denied. IT IS FURTHER ORDERED that the motions of defendants Antonio Garcia, Brenda Garcia, and Agencia Garcia, Inc. to dismiss the original complaint (Doc. 6) and to strike (Doc. 8) are denied as moot. Signed by Magistrate Judge David D. Noce on 6/13/2014. (KMS)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
EASTERN DIVISION
J & J SPORTS PRODUCTIONS, INC.,
Plaintiff,
v.
ANTONIO GARCIA, BRENDA GARCIA,
and AGENCIA GARCIA, INC.,
Defendants.
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No. 4:13 CV 2416 DDN
MEMORANDUM AND ORDER
This action is before the court on the motion of defendants Antonio Garcia, Brenda
Garcia, and Agencia Garcia, Inc. to dismiss the original complaint for lack of subject matter
jurisdiction and for failure to state a claim (Doc. 6), to strike from the original complaint
plaintiff's prayer for relief (Doc. 8), and to dismiss the first amended complaint for failure to
state a claim (Doc. 12). The parties have consented to the exercise of plenary authority by the
undersigned United States Magistrate Judge pursuant to 28 U.S.C. § 636(c). (Doc. 21.) The
court heard oral argument on March 7, 2014.
I. BACKGROUND
On November 27, 2014, plaintiff J & J Sports Production Inc. commenced this action
against defendants Antonio Garcia, Brenda Garcia, and Agencia Garcia, Inc. (Doc. 1.) On
January 7, 2014, plaintiff amended its complaint. (Doc. 11.)
According to plaintiff’s first amended complaint, the following occurred. Plaintiff is a
California corporation with its principal place of business in California. (Id. at ¶ 5.) Defendants
Antonio Garcia, Brenda Garcia, and Agencia Garcia, Inc., a Missouri corporation, own, operate,
and supervise a business under the name La Tejana in Bridgeton, Missouri. (Id. at ¶¶ 6-8.)
Plaintiff obtained the exclusive nationwide television distribution rights to what it
describes in the amended complaint as the "Program." The "Program" is comprised of the
telecast of the “Good v. Evil: Angel Cotto v. Antonio Margarito WBA Super World Light
Middleweight Championship Fight Program” and all undercard fights and commentary in the
television broadcast which took place on December 3, 2011, in New York City, New York. (Id.
at ¶ 10.)
After it obtained the distribution rights to the Program, plaintiff entered into
sublicensing agreements with various entities and granted them the right to publicly exhibit the
Program to their patrons. (Id. at ¶ 11.) Plaintiff incurred substantial expenses marketing,
advertising, promoting, administering, and transmitting the Program. (Id. at ¶ 12.) Aware of the
unauthorized nature of their conduct, "Defendants and/or their agents, servants, workmen or
employees" published and distributed the Program at the time of its transmission at La Tejana for
the purpose of commercial advantage or financial gain. (Id. at ¶ 13.)
In Count I and Count II, plaintiff alleges violations of the Federal Communications Act
under 47 U.S.C. §§ 553 and 605. (Id. at ¶¶ 9-22.) In Count III, plaintiff alleges conversion
under Missouri state law. (Id. at ¶¶ 23-26.) Plaintiff seeks compensatory damages, statutory
damages, punitive damages, attorney’s fees, and costs. (Id. at 5-6.)
II. MOTION TO DISMISS FIRST AMENDED COMPLAINT
Defendants move to dismiss the first amended complaint for failure to state a claim,
arguing that the fact allegations in the complaint are insufficient to provide notice of the basis of
the claims under the Federal Communications Act. Defendants further argue that plaintiff fails
to state a claim for individual liability under the Federal Communications Act. Defendants also
argue that plaintiff failed to state a claim of conversion, contending that plaintiff does not allege
that they deprived possession and that the tort of conversion does not apply to intangible
property such as the program. (Doc. 13.)
Plaintiff responds that its pleading adequately states a factual basis for its claims and for
individual liability under the Federal Communications Act.
It also responds that whether
conversion applies to property such as the program has not been decided by Missouri law.
(Docs. 24, 25.)
III. MOTION TO DISMISS STANDARD
A motion to dismiss a complaint for failure to state a claim, under Fed. R. Civ. P.
12(b)(6), challenges the legal sufficiency of the complaint.
See Carton v. General Motor
Acceptance Corp., 611 F.3d 451, 454 (8th Cir. 2010); Young v. City of St. Charles, 244 F.3d
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623, 627 (8th Cir. 2001). To survive a Rule 12(b)(6) motion to dismiss, the complaint must
include “enough facts to state a claim to relief that is plausible on its face.” Bell Atlantic Corp.
v. Twombly, 550 U.S. 544, 570 (2007). To meet the plausibility standard, the complaint must
contain “more than labels and conclusions.” Id. at 555. Rather, the complaint must contain
“factual content that allows the court to draw the reasonable inference that the defendant is liable
for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
IV. DISCUSSION
Defendants move to dismiss, arguing that: (1) the fact allegations in the complaint are
insufficient to provide notice of the basis of the claims under the Federal Communications Act;
(2) plaintiff fails to state a claim for individual liability under the Federal Communications Act;
and (3) plaintiff fails to state a claim of conversion.
A. Sufficiency of Notice
Defendants argue that they have insufficient notice regarding Counts I and II due to
plaintiff’s failure to identify any agents, servants, workmen, or employees, the audience for the
illegally published program, and the nature of the commercial advantage or financial gain. The
court recognizes a split among district courts for complaints pled in a manner similar to the
instant amended complaint. Courts dismissing such complaints take issue with the liberal use of
“and/or”1 and the lack of specific factual allegations. See Joe Hand Promotions, Inc. v. Creative
Entm't, LLC, 2013 WL 5651803, *3 (M.D. Fla. 2013); Joe Hand Promotions, Inc. v. Maryland
Food & Entm't, LLC, 2012 WL 5879127, *3 (D. Md. 2012). Courts denying motions to dismiss
find that the complaints include detail sufficient to notify the defendants of the claims against
them. See Joe Hand Promotions, Inc. v. Hubbard, 2013 WL 2319354, *3 (E.D. Mo. 2013); Joe
Hand Promotions, Inc. v. Crossroads Rest. & Lounge, Inc., 2013 WL 1787573, *2-3 (E.D. Mo.
2013).
1
"And/or" is ordinarily understood as expressing both the disjunctive and conjunctive. Bryan
Garner, Garner's Modern American Usage, 45 (Oxford U. Press 2003); http://www.merriamwebster.com/dictionary/and/or (viewed on June 13, 2014).
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Twombly and Iqbal instruct federal courts to disregard conclusory statements, assume the
truth of the remaining fact allegations, and determine whether such allegations entitle plaintiff to
relief. Braden v. Wal-Mart Stores, Inc., 588 F.3d 585, 594 (8th Cir. 2009).
Counts I and II allege violations of 47 U.S.C. §§ 553 and 605. 47 U.S.C. § 553 states,
“No person shall intercept or receive or assist in intercepting or receiving any communications
service offered over a cable system, unless specifically authorized to do so by a cable operator or
as may otherwise be specifically authorized by law.” 47 U.S.C. § 605 states, “[N]o person
receiving, assisting in receiving, transmitting, or assisting in transmitting, any interstate or
foreign communication by wire or radio shall divulge or publish the existence, contents,
substance, purport, effect, or meaning thereof, except through authorized channels of
transmission or reception.”
At base, plaintiff’s amended complaint alleges that plaintiff had the exclusive authority to
permit the publication of the Program on December 3, 2011, and that defendants and their agent,
servants, workmen, or employees published the Program without authorization at the time of its
transmission at La Tejana in Bridgeton, Missouri, for financial gain, or alternatively that
defendants or their agents, servants, workmen, or employees did so. (Doc. 11 at ¶¶ 10-13.) The
court concludes that the failure to identify the particular agents, the audience, or the nature of
financial gain does not render legally insufficient the notice provided by plaintiff’s complaint.
B. Individual Liability
Defendants move to dismiss the Federal Communications Act claims against the
individual defendants, arguing that plaintiff has failed to plead that the actions of the individual
defendants and the actions of the corporate defendant are indistinguishable. They cite Joe Hand
Promotions, Inc. v. Sharp, 885 F. Supp. 2d 953 (D. Minn. 2012), which held that to sustain a
claim of individual liability for corporate misconduct under the Federal Communications Act, a
plaintiff must demonstrate no distinction between the conduct of the corporation and the
individuals. In Comcast of Illinois X v. Multi-Vision Electronics, Inc., 491 F.3d 938 (8th Cir.
2007), the Court of Appeals upheld the district court’s determination that the individual and
corporate entity were jointly and severally liable for a single course of conduct because the
record indicated no distinction between the conduct of the individual and corporate entity. Id. at
940, 947 ("Abboud was Multivision's only corporate officer and its sole owner, however. His
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deposition testimony demonstrates that he knew of the uses and features of the cable boxes
Multivision sold, was intimately familiar with how cable services function, and was involved in
setting company policy. Because the record shows no distinction between Abboud's actions and
Multivision's, the district court did not err in making Abboud personally liable for the
judgment").
In the case at bar, plaintiff does not plead that the individual defendants are liable for
corporate conduct other than their own.
Regarding each claim, plaintiff alleges that all
"Defendants and/or" their agents, etc., acted as alleged. There is no allegation that any defendant
or less than all of the defendants acted in a way different from how any other defendant or
defendants acted. Rather, plaintiff alleges that the individual defendants are directly liable for
their own conduct which was also the conduct of the corporate defendant.
Accordingly, because plaintiff does not allege that the individual defendants are
vicariously liable for the corporate defendant’s conduct, defendants’ argument is without merit.
C. Conversion
Defendants argue that plaintiff fails to state a claim for Missouri common law
conversion, contending that such a cause of action does not apply to intangible property such as
the exclusive right to broadcast a program.2 Plaintiff responds that the issue remains an open
issue under Missouri law
“Where neither the legislature nor the highest court in a state has addressed an issue, the
federal court must determine what the highest state court would probably hold were it called
upon to decide the issue.” Hazen v. Pasley, 768 F.2d 226, 228 (8th Cir. 1985); cf. Joe Hand
Promotions, Inc. v. Hubbard, 2013 WL 2319354, *3 (E.D. Mo. 2013); Joe Hand Promotions, Inc.
v. Crossroads Rest. & Lounge, Inc., 2013 WL 1787573, *2 (E.D. Mo. 2013).
Under Missouri law, “[c]onversion requires an intentional exercise of dominion or
control over property that so seriously interferes with the owner's right of control that the
interferer may justly be required to pay the owner the full value of the property.” Kingfisher
Hospitality, Inc. v. Behmani, 335 S.W.3d 486, 498 (Mo. Ct. App. 2011). “The law of conversion
is concerned with possession, not title.” Lacks v. R. Rowland & Co., Inc., 718 S.W.2d 513, 517
2
Tangible property is defined as property that has physical form and characteristics. Black's
Law Dictionary (9th ed. 2009). Intangible property lacks a physical existence. Id.
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(Mo. Ct. App. 1986).
The traditional limitation that conversion applied solely to tangible
personal property has eroded. Schaefer v. Spence, 813 S.W.2d 92, 96 (Mo. Ct. App. 1991).
Specifically, Missouri law allows conversion for intangible rights merged with a document,
including negotiable instruments and engineering plans. Moore Equip. Co. v. Callen Const. Co.,
Inc., 299 S.W.3d 678, 682 (Mo. Ct. App. 2009); Colton, McMichael, Lester, Auman, Visnovske,
Inc. v. Mueller, 896 S.W.2d 741, 743 (Mo. Ct. App. 1995); Chem. Workers Basic Union, Local
No. 1744 v. Arnold Sav. Bank, 411 S.W.2d 159, 163 (Mo. 1966).
Here, plaintiff alleges conversion of its exclusive broadcasting rights rather than tangible
property or intangible rights merged with a document. The sole Missouri case recognizing
conversion for purely intangible property summarily upheld a trial verdict for the conversion of a
trade name with no discussion of the law of conversion.
Schnucks Twenty-Five, Inc. v.
Bettendorf, 595 S.W.2d 279, 284-85 (Mo. Ct. App. 1979). In every other instance, Missouri
courts have rejected such claims. See Emerick v. Mut. Ben. Life Ins. Co., 756 S.W.2d 513, 52324 (Mo. 1988) (leasehold interest and debt); Schaefer v. Spence, 813 S.W.2d 92, 97 (Mo. Ct.
App. 1991) (spice blend formula); Breece v. Jett, 556 S.W.2d 696, 710 (Mo. Ct. App. 1977)
(debt); Norman Schuman Interiors, Inc. v. Sacks, 479 S.W.2d 200, 203 (Mo. Ct. App. 1972)
(interior decorating services). The court concludes that Missouri courts have not extended the
doctrine of conversion to purely intangible rights.
This court has previously recognized that no Supreme Court or Missouri Court of
Appeals case opinion has directly considered whether a conversion claim will lie "for the
pirating of a broadcast signal." Joe Hand Promotions, Inc. v. Hubbard, 2013 WL 2319354, *3.
For that reason, the court decided not to dismiss the action at the pleading stage. Id. This court
agrees that this is the correct procedure, because several issues remain unresolved. The case may
involve the mixed factual and legal question of whether an electronic, digital signal has sufficient
physical characteristics to support a cause of action for state common law conversion, which is
indicated by the language of plaintiff's amended complaint. (Doc. 11, at ¶ 24 ("Defendants
tortuously obtained possession of the Program and wrongfully converted it").
Accordingly, the court denies the motion to dismiss at the pleading stage plaintiff’s claim
of conversion.
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V. CONCLUSION
For the reasons stated above,
IT IS HEREBY ORDERED that the motion of defendants Antonio Garcia, Brenda
Garcia, and Agencia Garcia, Inc. to dismiss the amended complaint (Doc. 12) is denied.
IT IS FURTHER ORDERED that the motions of defendants Antonio Garcia, Brenda
Garcia, and Agencia Garcia, Inc. to dismiss the original complaint (Doc. 6) and to strike (Doc. 8)
are denied as moot.
/S/ David D. Noce
k
UNITED STATES MAGISTRATE JUDGE
Signed on June 13, 2014.
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