Capitol Records, LLC v. Redigi Inc.

Filing 282

REPLY MEMORANDUM OF LAW in Support re: 270 MOTION for Attorney Fees . . Document filed by Capitol Christian Music Group, Inc., Capitol Records, LLC, Virgin Records IR Holdings, Inc.. (Mandel, Richard)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK

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CAPITOL RECORDS, LLC, CAPITOL
CHRISTIAN MUSIC GROUP, INC. and
VIRGIN RECORDS IR HOLDINGS, INC.,

)(

12 Civ. 0095 (RJS)

Plaintiffs,
-againstREDIG! INC., JOHN OSSENMACHER and
LARRY RUDOLPH a/k/a LAWRENCE S.
ROGEL,
Defendants.

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PLAINTIFFS' REPLY MEMORANDUM OF LAW IN
SUPPORT OF MOTION FOR ATTORNEYS' FEES

COWAN, LIEBOWITZ & LATMAN, P.C.
114 West 4ih Street
New York, New York 10036-6799
[phone]
Attorneys for Plaintiffs Capitol Records, LLC,
Christian Music Group, Inc. and Virgin Records IR
Holdings, Inc.

29503/003/2180543. I

Plaintiffs Capitol Records, LLC, Capitol Christian Music Group, Inc. and Virgin Records
IR Holdings, Inc. (collectively, "Plaintiffs") respectfully submit this reply memorandum in
further support of their motion for attorneys' fees under Section 505 of the Copyright Act, 17
U.S.C. § 505.
Defendant John Ossenmacher submits an opposition to Plaintiffs' attorneys' fees motion
in which he contends that Defendants advanced an objectively reasonable defense. 1 However,
Ossenmacher's response fails to address the gist of Plaintiffs' motion that Defendants engaged in
an inexcusable pattern of wasteful litigation conduct whose only purpose was to unnecessarily
increase the time and resources expended on this matter. Rather than limit themselves to the
legal issues raised by the application of the first sale doctrine in a digital context, Defendants
disingenuously sought to redefine their technology when they realized the actual facts would lead
to a result they didn't like. See Plaintiffs' Moving Brief (Docket No. 271) at 11-13. Defendants
also sought to advance numerous groundless defenses and to take pointless discovery designed
solely to delay the progress of the case. Id. at 13-14. This improper litigation conduct amply
supports imposition of an award of attorneys' fees, even assuming there was some objectively
reasonable defense buried within the avalanche of frivolous positions and harassing tactics
adopted by Defendants. See id. at 14-15 (citing cases).
Mr. Ossenmacher also insists that Defendants acted in good faith and did not commit
willful copyright infringement. However, the record does not support Mr. Ossenmacher's
argument. Indeed, while he claims to have "consulted multiple copyright experts, each of whom

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The other two defendants, ReDigi Inc. and Larry Rudolph, did not submit oppositions to
Plaintiffs' attorneys' fees motion.

29503/003/2180543.1

concluded that the ReDigi system was unique and lawful" (Ossemacher Opposition at 3), the
Court explained at the summary judgment stage that the failure to offer any evidence of such
supposed opinions undermined Defendants' claimed innocence:
Indeed, though ReDigi attempts to use its consultations with counsel as a
shield, it is telling that ReDigi declined to reveal any of the advice it
received on the subject. (See Cap. Reply 9). ReDigi's lone rebuttal to this
surfeit of evidence could only be that it "sincerely" believed in the legality of
its service. However, the Court has not found and will not create a subjective,
good faith defense to contributory liability's objective knowledge requirement,
and therefore concludes that, based on the objective facts, ReDigi was
aware of its users' infringement.
Docket No. 109 at 15-16. Likewise, Mr. Ossenmacher's claim to have had "extensive
communications" with Capitol and to have received "uniformly positive responses about the
ReDigi system" (Ossenmacher Opposition at 4) is belied by his own deposition testimony in this
case that Capitol (EMI) had refused or was too busy to meet with him to hear any pitch about the
service. See Docket No. 173 Exhibit B (Ossenmacher Dep. at 103-11 0).
While Mr. Ossenmacher claims that "Capitol has failed to present any credible evidence"
of willful infringement, the Court's summary judgment ruling already found as a matter of law
that ReDigi and its officers knew or should have known of their infringing conduct. Docket No.
109 at 15-16. The Court's opinion also held that "ReDigi's founders built a service where only
copyrighted work could be sold." Id. at 14 (emphasis in original). These findings based on the
undisputed evidence presented to the Court at the summary judgment stage compel the
conclusion that Defendants were willful infringers. See Plaintiffs' Moving Brief (Docket No.
271) at 15-18. Whatever Defendants may have subjectively believed about their conduct, a
finding of willfulness is appropriate here where the Court has already found as a matter of law
that Defendants had constructive knowledge of their infringing activities. See, ~' Knitwaves,
Inc. v. Lollytogs Ltd., 71 F.3d 996, 1010 (2d Cir. 1995) ("to show willfulness, Knitwaves was
29503/003/2180543 .I

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not required to prove Lollytogs' actual knowledge that it was infringing. Knowledge of
infringement may be constructive rather than actual"); N.A.S. Import Corp. v. Chenson
Enterprises, Inc. , 968 F.2d 250, 252 (2d Cir. 1992) (knowledge required for willfulness may be
actual or constructive); Fitzgerald Publ'g Co. v. Baylor Publ'g Co., 807 F.2d 1110, 1115 (2d Cir.
1986) (willfulness proven by actual or constructive knowledge); Tornabene Art Publ' g Co. v.
Pride Pros. Corp. , 2007 WL 2469453, at *3 (S.D.N.Y. June 4, 2007) ("[a]cting 'willfuly' means
acting with actual or constructive knowledge or ' reckless disregard of the high probability' that
one's actions constitute copyright infringement"); ASA Music Prods. V. Thomsun Elecs., 49
U.S.P.Q.2d 1545, 1552 (S.D.N.Y. 1998) (" Willfulness consists of actual or constructive
knowledge that defendants' actions constitute an infringement").

CONCLUSION
For the foregoing reasons and those set forth in Plaintiffs' moving papers, Plaintiffs'
motion for an award of attorneys' fees should be granted.
Dated: New York, New York
December }E._, 2016

Respectfully submitted,
. · JBOWITZ & JATMAN, P.C.
By:

~L-e:/

RichardS. Mandel
Jonathan Z. King

114 West 4ih Street
New York, New York 10036
[phone]
Attorneys for Plaintiffs Capitol Records, LLC,
Christian Music Group, Inc. and Virgin Records IR
Holdings, Inc.

29503/003/2180543.1

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