Pablo Star Ltd. v. The Welsh Government et al

Filing 53

OPINION AND ORDER: re: 22 MOTION to Dismiss filed by Gracenote, Miami Herald Media Co., E.W. Scripps, Co., The Welsh Government, Pittsburgh Post-Gazette, Richmond Times Dispatch, 16 MOTION for Preliminary Injunction filed by Pablo Star Ltd., 25 LETTER MOTION for Extension of Time to File Response/Reply as to 16 MOTION for Preliminary Injunction hold in abeyance or stay pending disposition of motion to dismiss (Dkt. No. 22) addressed to Judge J. Paul Oetken from Ri filed by Gracenote, Miami Herald Media Co., E.W. Scripps, Co., The Welsh Government, Pittsburgh Post-Gazette, Richmond Times Dispatch, 38 MOTION to Dismiss filed by Journal Medi a Group, Inc., Tribune Content Agency, LLC, Treasure Coast Newspapers, Visit Wales, Miami Herald Media Co., E.W. Scripps, Co., The Welsh Government, Pittsburgh Post-Gazette, Richmond Times Dispatch. For the foregoing reasons, Defendan ts' motion to dismiss is GRANTED in part and DENIED in part. All claims against the Welsh Government are dismissed for improper service and improper venue. All claims against Publisher Defendants the Miami Herald Media Co., the Richmond Times Di spatch, Treasure Coast Newspapers, E.W. Scripps, Co., Journal Media Group, and the Pittsburgh Post-Gazette are dismissed for lack of personal jurisdiction. Defendants' motion to dismiss the claims of Plaintiff Pablo Star Ltd. for lack of standin g is denied without prejudice. Plaintiffs' motion for a preliminary injunction is DENIED. As a result, Defendants' motion to stay is DENIED as moot. Plaintiffs shall, within 10 days of the date of this order, advise the Court in writing why the claims against Defendants Travel Squire and Colorado News Feed should not be dismissed for failure to prosecute. The sole remaining defendant, Tribune Content Agency, shall file an answer to the First Amended Complaint within 21 days of the date of this Order. The Clerk of Court is directed to close the motions at docket numbers 16, 22, 25, and 38. SO ORDERED. (Signed by Judge J. Paul Oetken on 3/16/2016) (ama)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
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:
PABLO STAR LTD., et al.,
:
Plaintiffs, :
:
:
-v:
THE WELSH GOVERNMENT, et al.,
:
Defendants. :
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15-CV-1167 (JPO)
OPINION AND ORDER

J. PAUL OETKEN, District Judge:
In this case, the Welsh Government, a political subdivision of the United Kingdom, and
various media companies are accused of using two photographs depicting the poet Dylan
Thomas without authorization and in violation of the Copyright Act. Plaintiffs, owners of the
copyrights in these photos, are Pablo Star Ltd. and Pablo Star Media Ltd. (“Plaintiffs”)—two
related companies that are “organized and registered under the laws of Ireland and the United
Kingdom.” (Dkt. No. 26 ¶ 1). The operative Complaint in this matter was filed on May 11,
2015. (Dkt. No. 26.) On June 1, 2015, a motion to dismiss was filed by Defendants the Welsh
Government and Visit Wales (“the Welsh Government”), the Tribune Content Agency, LLC, the
Pittsburgh Post-Gazette, E.W. Scripps, Co., the Journal Media Group, Inc., Treasure Coast
Newspapers, the Richmond Times Dispatch, and the Miami Herald Media Co. (the “Publisher
Defendants”) (collectively, “Defendants”). (Dkt. No. 39.)
Defendants move to dismiss on multiple grounds, including: (1) insufficient service of
process under Federal Rule of Civil Procedure 12(b)(5); (2) improper venue under Rule 12(b)(3);
(3) lack of personal jurisdiction over the Publisher Defendants under Rule 12(b)(2); and (4) lack
of subject-matter jurisdiction under Rule 12(b)(1) because the Welsh Government is immune
from suit under the Foreign Sovereign Immunities Act (“FSIA”), see 28 U.S.C. § 1604.

Because the Welsh Government was not properly served under the FSIA, venue is improper, and
the Court lacks personal jurisdiction over all but one of the Publisher Defendants, the motion is,
with certain limited exceptions, granted.
I.

Background 1
Dylan Thomas, a Welsh-born poet who lived from 1914 to 1953, is best known for his

troubled and chaotic personal life and for penning the poem “Do not go gentle into that good
night.” See Dylan Thomas, The Poetry Foundation, http://www.poetryfoundation.org/bio/dylanthomas (last viewed March 1, 2016). Plaintiffs, related media companies “organized and
registered under the laws of Ireland and the United Kingdom,” own copyrights in two
photographs depicting Thomas: “Just Married Dylan Thomas” and “Dylan and Caitlin at Penard”
(“the Photos”). (Dkt. No. 26 ¶¶ 1-4.)
Plaintiffs allege that the Welsh Government operates “Visit Wales” as “an administrative
division or business enterprise to encourage tourism and otherwise publicize and promote Wales
as a tourist destination.” (Id. ¶ 15.) As a part of its effort to promote tourism in Wales, the
Welsh Government, “acting through Visit Wales,” has “published, displayed, distributed, and
otherwise used copies of [the Photos] in advertisements, publications, and other promotional
materials directed at and specifically targeted towards the United States generally and New York
residents in particular.” (Id. ¶¶ 14-16.) Specifically, Visit Wales operates a website that is
accessible in the United States and which has displayed the Photos without authorization. (Id.
¶ 26; Dkt. No. 26-12.) Visit Wales also created a downloadable map and guide depicting a
“Dylan Thomas Walking Tour of Greenwich Village, New York” that included one of the
Photos. (Dkt. Nos. 26-1, 26-2.)
All facts in this Section of the Opinion are, unless otherwise noted, drawn from the First
Amended Complaint. (Dkt. No. 26.)
1

2

Moreover, Plaintiffs allege that the “Welsh Government provided unauthorized copies of
[the Photos] to the [] Publisher Defendants, either directly or by making copies of the [P]hotos
available on its various websites.” (Dkt. No. 17 at 1.) In turn, the Publisher Defendants
“published and displayed [the Photos] on their respective websites and/or print publications.”
(Dkt. No. 26 ¶ 87.)
The First Amended Complaint asserts claims for copyright infringement against all
Defendants, as well as claims for contributory and vicarious infringement against the Welsh
Government. (Id. ¶¶ 107-129.)
II.

Discussion
Defendants move to dismiss on several bases, including insufficient service of process,

improper venue, lack of personal jurisdiction, and lack of subject-matter jurisdiction. (Dkt. No.
39.) As to subject-matter jurisdiction, the Welsh Government argues that it is immune from suit
under the FSIA, which provides the “sole basis for obtaining jurisdiction over a foreign state in
the courts of this country.” Rogers v. Petroleo Brasilero, S.A., 673 F.3d 131, 136 (2d Cir. 2012)
(quoting Argentine Republic v. Amerada Hess Shipping Corp., 488 U.S. 428, 443 (1989)).
Under the FSIA, “a foreign state [is] immune from the jurisdiction of the courts of the United
States and of the States except as provided” by certain statutory exceptions. 28 U.S.C. § 1604.
The parties do not dispute that the Welsh Government is a “political subdivision” of the United
Kingdom and thus that jurisdiction over it can be obtained only in accordance with the
requirements of the FSIA. Rather, they contest the applicability of three statutory exceptions to
the general rule of foreign sovereign immunity: the commercial activity exception, 28 U.S.C.
§ 1605(a)(2); the expropriation exception, 28 U.S.C. § 1605(a)(3); and the noncommercial tort
exception, 28 U.S.C. § 1605(a)(5).

3

Determining whether this Court possesses subject-matter jurisdiction over the Welsh
Government would require it to reach difficult questions at the frontiers of both copyright law
and the law of foreign sovereign immunity. 2 Because the claims against the Welsh Government
in this case must be dismissed on independent grounds, the Court declines to reach the issue of
immunity under the FSIA. See Magi XXI, Inc. v. Stato della Città del Vaticano, 714 F.3d 714,
720 n.6 (2d Cir. 2013) (“We need not consider whether this Court lacks subject-matter
jurisdiction by virtue of the Vatican State having immunity under the Foreign Sovereign
Immunities Act because in appropriate circumstances, . . . a court may dismiss for lack of
personal jurisdiction without first establishing subject-matter jurisdiction.”) (citation and internal
quotation marks omitted).
Although “jurisdictional questions ordinarily must precede merits determinations in
dispositional order . . . . [subject-matter] [j]urisdiction is vital only if the court proposes to issue a
judgment on the merits.” Sinochem Int’t Co. v. Malasya Int’l Shipping Corp., 549 U.S. 422, 431
(2007) (citation omitted). In turn, “a federal court has leeway to choose among threshold
grounds for denying audience to a case on the merits” in the interests of judicial restraint and
judicial economy. Id. For example, when “the alleged defect in subject-matter jurisdiction
raises a difficult and novel question, the court does not abuse its discretion by turning directly to
personal jurisdiction.” Ruhrgas AG v. Marathon Oil Co., 526 U.S. 574, 588 (1999). So too,
courts may decide a “challenge to venue before addressing the challenge to subject-matter
jurisdiction” in the interests of adjudicative efficiency. Brodt v. Cty of Hartford, 10 F. Supp. 3d
198, 200 (D.D.C. 2014). See Magi XXI, 714 F.2d at 720 n.6. Prudential concerns, including the

Those questions include whether, and under what circumstances, a foreign corporation can
subject a foreign state to suit in the United States for instances of online copyright infringement
on the grounds that the infringing content is accessible in the United States via the internet.
2

4

interests of judicial restraint and economy, caution against venturing into the subject-matter
jurisdiction terrain in this case when it can be resolved on more familiar territory. Defendants’
arguments for dismissal based on improper service, lack of personal jurisdiction, and improper
venue are discussed in turn.
A.

Service of Process

“The FSIA provides the sole means for effecting service of process on a foreign state.”
Harrison v. Republic of Sudan, 802 F.3d 399, 403 (2d Cir. 2015). See 28 U.S.C. § 1608(a). The
statute prescribes four methods of service. “Plaintiffs must attempt service by the first method,
or determine that it is unavailable, before attempting subsequent methods in the order in which
they are laid out.” Harrison, 802 F.3d at 403. The methods of service offered in the statute are:
(1) by delivery of a copy of the summons and complaint in accordance
with any special arrangement for service . . .
(2) if no special arrangement exists, by delivery of a copy of the summons
and complaint in accordance with an applicable international
convention on serve of judicial documents . . .
(3) if service cannot be made under paragraphs (1) or (2), by sending a
copy of the summons and complaint and a notice of suit . . . by any
form of mail required a signed receipt, to be addressed and dispatched
by the clerk of the court to the head of the ministry of foreign affairs of
the foreign state . . .
(4) if service cannot be made within 30 days under paragraph (3), by
sending two copies of the summons and complaint . . . to the Secretary
of State in Washington . . . and the Secretary shall transmit one copy
of the papers through diplomatic channels to the foreign state . . . .
28 U.S.C. § 1608(a). “[S]trict adherence to the terms of [§] 1608(a) is required.” Transaero,
Inc. v. La Fuerza Aerea Boliviana, 30 F.3d 148, 154 (D.C. Cir. 1994). The plaintiff carries the
burden of demonstrating that service on the defendant was proper. See Zhang v. Baidu.com Inc.,
932 F. Supp. 2d 561, 564 (S.D.N.Y. 2013); Lewis & Kennedy, Inc. v. Permanent Mission of the
Republic of Botswana to the United Nations, No. 05-CV-2591, 2005 WL 1621342, at *2
(S.D.N.Y. July 12, 2005) (collecting cases).

5

Plaintiffs contend that they served the Welsh Government in accordance with a “special
arrangement for service,” the first method under the statute, and then—“out of an abundance of
caution”—also served the government under the third method by effecting service on the head of
the Ministry of Foreign Affairs of the United Kingdom. 28 USC §§ 1608(a)(1)-(3). (Dkt. No.
45 at 5-6.)
Plaintiffs’ attempt to effect service according to the strictures of § 1608(a)(3) is
irrelevant. Service by this method is proper only “if service cannot be made under” either the
first or second methods prescribed by the statute. 28 U.S.C. § 1608(a)(3). Thus, before
attempting service under § 1608(a)(3), Plaintiffs needed to exhaust § 1608(a)(2) service, which
mandates compliance with the Hague Convention on the Service Abroad of Judicial and
Extrajudicial Documents in Civil or Commercial Matters. (Dkt. No. 39 at 6.) The United
Kingdom, of which the Welsh Government is a political subdivision, is a state party to the Hague
Service Convention. See Caytas v. Maruszak, No. 06-CV-985, 2009 WL 666768, at *1
(S.D.N.Y. Mar. 6, 2009). Plaintiffs do not, however, contend that service could not be made
under § 1608(a)(1), nor do Plaintiffs explain their failure to comply with, or attempt compliance
with, the requirements of § 1608(a)(2). Therefore, even if service was effected under
§ 1608(a)(3), Plaintiffs’ failure to exhaust service under § 1608(a)(2) renders the attempted
§ 1608(a)(3) service improper.
The question, then, is whether Plaintiffs effected service “in accordance with any special
arrangement for service” under § 1608(a)(1). Plaintiffs contend that “arrangements for service
were made prior to suit with counsel for the Welsh Government.” (Dkt. No. 45 at 5.) In support,
Plaintiffs submit an email exchange between counsel for the Welsh Government and Plaintiffs’
counsel, in which Plaintiffs contend that “the Welsh Government instructed Plaintiffs to effect
service according to the requirements of the 1947 UK Crown Proceedings Act.” (Dkt. No. 47-1;
6

Dkt. No. 45 at 5.) In the email exchange, Plaintiffs’ counsel asks “if [opposing counsel] [is]
authorized to accept service on behalf of [his] client and if [he would] be willing to do so
electronically.” (Dkt. No. 7-1 at 3.) In response, the Welsh Government’s counsel states: “We
are not authorized to accept service. Proceedings should be served upon the Welsh Ministers,
addressed to the Director of Legal Services, Mr[.] Jeffrey Godfrey. This is in line with the
provisions of the Crown Proceedings Act 1947.” The best reading of this exchange is that
counsel for the Welsh Government directed Plaintiffs’ counsel to comply with the rules of
service under the laws of the United Kingdom, not that counsel for the parties came to an
agreement as to a special arrangement for service. Indeed, because the Welsh Government’s
counsel disclaimed that it was authorized to accept service, the most natural construction of this
communication is neither that counsel had power to agree to a special arrangement on his client’s
behalf, nor that he did so.
Courts require a more definite manifestation of agreement when determining that a
special arrangement has been made, such as a contract provision specifying a method of service
in the event of suit. See Matter of Arbitration Between Space Systems/Loral, Inc. v. Yuzhnoye
Design Office, 164 F. Supp. 2d 397, 402-403 (S.D.N.Y. 2001) (collecting cases); Matter of
Arbitration Between Trans Chemical Ltd. and China Nat. Mach. Import and Export Corp., 978
F. Supp. 266, 298-299 (S.D. Tex. 1997); Copelco Capital, Inc. v. General Consul of Bolivia, 940
F. Supp. 93, 95 (S.D.N.Y. 1996). Here, the record does not support the conclusion that there was
a special arrangement for service between the parties. See Angellino v. Royal House Al-Saud,
No. 10-519, 2011 WL 9933485, at *2 (D.D.C. Apr. 29, 2011) (holding that the record evidence
did not demonstrate the existence of a special arrangement for service), rev’d on other grounds
sub nom. Angellino v. Royal Family Al-Saud, 688 F.3d 771, 776-777 (D.C. Cir. 2012); see also

7

Smith v. Gnassingbe, No. 07-4167, 2009 WL 3300037, at *2 (D. Minn. Oct. 13, 2009) (finding
that the existence of a special arrangement was not supported by the record).
Because service in “strict adherence to the terms of [§] 1608(a) is required” and Plaintiffs
did not effect service in accordance with the statute, Plaintiffs’ claims against the Welsh
Government are dismissed for improper service.
B.

Personal Jurisdiction over the Publisher Defendants

Defendants also argue that the Court lacks personal jurisdiction over Publisher
Defendants the Miami Herald Media Co., the Richmond Times Dispatch, Treasure Coast
Newspapers, E.W. Scripps, Co., Journal Media Group, and the Pittsburgh Post-Gazette. 3
“A plaintiff bears the burden of demonstrating personal jurisdiction over a person or
entity against whom it seeks to bring suit.” Penguin Grp. (USA) Inc. v. Am. Buddha, 609 F.3d
30, 34 (2d Cir. 2010) (citing In re Magnetic Audiotape Antirust Litig., 334 F.3d 204, 206 (2d Cir.
2003). To survive a motion to dismiss for lack of personal jurisdiction, a plaintiff must make a
prima facie showing of personal jurisdiction over all defendants. Cortlandt Street Recovery
Corp. v. Deutsche Bank AG, London Branch, No. 14-CV-01568, 2015 WL 5091170, at *2
(S.D.N.Y. Aug. 28, 2015) (Oetken, J.) (quoting MacDermid, Inc. v. Deiter, 702 F.3d 725, 727
(2d Cir. 2012)). A prima facie case for personal jurisdiction involves three elements: “(1) proper
service of process upon the defendant; (2) a statutory basis for personal jurisdiction; and (3)
accordance with constitutional due process principles.” Reich v. Lopez, 38 F. Supp. 3d 436, 454
(S.D.N.Y. 2014) (Oetken, J.) (citations and internal quotation marks omitted).

Because the Complaint contains no specific allegations related to the Pittsburgh Post-Gazette,
Plaintiffs have failed to make a prima facie showing that this Court has personal jurisdiction over
it. Accordingly, the motion to dismiss for lack of personal jurisdiction as to the Pittsburgh PostGazette is granted. (See Dkt. No. 39 at 14 n.15.)
3

8

Plaintiffs can make such a showing through the submission of affidavits and supporting
materials that contain “an averment of facts that, if credited, would suffice to establish
jurisdiction over the defendant.” Cortlandt, 2015 WL 5091170, at *2 (quoting S.N. Eng. Tel. Co.
v. Glob. NAPS, Inc., 624 F.3d 123, 138 (2d Cir. 2010)). “[A]ll factual doubts or disputes are to
be resolved in the plaintiff's favor.” Jonas v. Estate of Leven, 116 F. Supp. 3d 314, 323
(S.D.N.Y. 2015). However, the Court need not accept as true allegations controverted by the
defendant’s affidavits, MacDermid, 702 F.3d at 727, nor need it accept “a legal conclusion
couched as a factual allegation.” Cortlandt, 2015 WL 5091170, at *2 (quoting Jazini v. Nissan
Motor Co., 148 F.3d 181, 185 (2d Cir. 1998)). See Allojet PLC v. Vantage Associates, No. 04CV-5223, 2005 WL 612848, at *3 (S.D.N.Y. Mar. 15, 2005) (Where a defendant “rebuts a
plaintiff’s unsupported allegations with direct, highly specific, testimonial evidence regarding a
fact essential to jurisdiction—and the plaintiff does not counter that evidence—the allegation
may be deemed refuted.”) (citation, alterations and internal quotation marks omitted).
Courts may exercise either specific or general jurisdiction over a defendant. Daimler AG
v. Bauman, 134 S. Ct. 746, 754 (2014). “General jurisdiction renders a defendant amendable to
suit on all claims.” Cortlandt, 2015 WL 5091170, at *2 (citations omitted). Specific jurisdiction
subjects a defendant to suit only on claims that “arise from conduct related to the forum.” Id. In
diversity cases, “the breadth of a federal court’s personal jurisdiction is determined by the law of
the state in which the district court is located.” Reich, 38 F. Supp. 3d at 454 (quoting Thomas v.
Ashcroft, 470 F.3d 491, 495 (2d Cir. 2006) (alterations omitted)). “In litigation arising under
federal statutes that do not contain their own jurisdictional provisions, such as the Copyright Act
under which suit is brought in the case at bar, federal courts are to apply the personal jurisdiction
rules of the forum state.” Penguin Grp., 609 F.3d at 35. Thus, to determine whether it has
personal jurisdiction, the Court looks to the laws of the State of New York. The Court then
9

considers whether the exercise of personal jurisdiction is consistent with due process. See
Daimler, 134 S. Ct. at 751.
1.

General Jurisdiction

Under New York law, “a foreign corporation is subject to general personal jurisdiction in
New York if it is ‘doing business’ in the state.” Wiwa v. Royal Dutch Petroleum Co., 226 F. 3d
88, 95 (2d Cir. 2000) (citation omitted). A corporation is “doing business” in New York when it
conducts business in the state “not occasionally or casually, but with a fair measure of
permanence and continuity.” Id. (citation omitted). Plaintiffs who make a showing of such
sustained business activity satisfy the requirements of New York law. Cortlandt, 2015 WL
5091170, at *3.
However, to establish general jurisdiction, a plaintiff must also satisfy the requirements
of the Due Process Clause. Daimler, 134 S. Ct. at 751. As this Court and others have noted, “it
is uncertain if New York’s ‘doing business’ jurisdiction remains viable in light of Daimler.”
Cortlandt, 2015 WL 5091170, at *3 (citing Reich, 38 F. Supp. 3d at 454-55 (collecting cases));
see also Sonera Holding B.V. v. Cukorova Holding A.S., 750 F.3d 221, 224 n.2 (2d Cir. 2014);
SPV OSUS Ltd. v. UBS AG, No. 14-CV-9744, 2015 WL 4394955, at *4 (S.D.N.Y. 2015)
(Rakoff, J.). “[G]eneral jurisdiction extends beyond an entity’s state of incorporation and
principal place of business only in the exceptional case where its contacts with another forum are
so substantial as to render it ‘at home’ in that state.” Sonera Holding, 750 F.3d at 223. After
Daimler, there are “very limited circumstances” in which a corporation’s contacts with a state
are sufficient to satisfy this test. Cortlandt, 2015 WL 5091170, at *3 (noting that a cabined
conception of general jurisdiction “protect[s] the liberty interests of defendants [and] provid[es]
them with ‘fair warning’”).

10

Plaintiffs have not alleged facts that, if true, would be sufficient to confer general
jurisdiction over the Defendants. The Complaint does not allege that any of the Publisher
Defendants are incorporated in, or have a principal place of business in, New York. (See Dkt.
No. 26 ¶¶ 36-87.) Nor have Plaintiffs alleged contacts with New York so substantial that this is
the “‘exceptional case’ in which a corporation is ‘essentially at home’ in a foreign forum.” 4 SPV
OSUS, 2015 WL 4394955, at *4 (citing Daimler, 134 S. Ct. at 761 n.19).
2.

Specific Jurisdiction

“Specific jurisdiction requires a connection between the forum and the underlying
controversy, most often ‘activity or an occurrence that takes place in the forum State and is
therefore subject to the State’s regulation.’” Cortlandt, 2015 WL 5091170, at *5 (quoting
Goodyear Dunlop Tires Operations, S.A. v. Brown, 131 S. Ct. 2846, 2851 (2011)). Plaintiffs
contend that the Publisher Defendants are subject to specific jurisdiction under subsection (a)(3)
of New York’s long-arm statute, N.Y. C.P.L.R. (“CPLR”) § 302. 5
CPLR § 302(a)(3) permits a court to exercise personal jurisdiction in cases where a nondomiciliary “commits a tortious act [outside] the state causing injury to person or property within
the state,” but only where the party “(i) regularly does or solicits business, or engages in any
other persistent course of conduct, or derives substantial revenue from goods used or consumed
or services rendered, in the state, or (ii) expects or should reasonably expect the act to have
consequences in the state and derives substantial revenue from interstate or international
commerce.” CPLR § 302(a)(3).
Moreover, Plaintiffs have waived any argument rooted in general jurisdiction by failing to
advance such a theory in their papers.
4

In their Opposition, Plaintiffs also cite language from a separate provision of New York’s longarm statute, CPLR § 302(a)(1), but neither provide a theory as to this provision’s applicability
nor cite facts that could support such a theory. (See Dkt. No. 45 at 21-22.) Absent such
assertions, Plaintiffs have offered no basis on which to conclude that CPLR § 302(a)(1) applies.
5

11

Defendants do not contest that the acts of copyright infringement alleged would
constitute “tortious acts” performed by the Publisher Defendants outside New York. See Royalty
Network Inc. v. Dischant.com, LLC, 638 F. Supp. 2d 410, 423 (S.D.N.Y. 2009). (Dkt. No. 39 at
21-22.) Rather, the parties dispute whether that tort “caus[ed] injury to person or property within
the state,” CLPR § 302(a)(3), and whether the requirements of §§ 302(a)(3)(i) or 302(a)(3)(ii)
have been met.
Defendants argue that “no injury was caused to a person within New York” because
Plaintiffs “are admittedly foreign companies and not New York copyright owners.” (Dkt. No. 39
at 22.) To be sure, Plaintiffs have “levied allegations of a form of infringement that works an
injury that is virtually impossible to localize—the uploading and making available of
copyrighted materials, free of charge, to anyone with an Internet connection.” Troma Entm’t,
Inc. v. Centennial Pictures Inc., 729 F.3d 215, 220 (2d Cir. 2013). Despite this difficulty,
Plaintiffs are not relieved of “the obligation . . . to allege facts demonstrating a non-speculative
and direct New York-based injury to its intellectual property rights.” Id. at 220. It is now
established that “[a] New York copyright owner alleging infringement sustains an in-state injury
pursuant to CPLR [§] 302(a)(3)(ii) when its [copyrighted work] is uploaded without permission
onto the Internet for public access.” Penguin Grp., 640 F.3d at 500 (quoting Penguin Grp.
(USA) Inc. v. Am. Buddah, 946 N.E.2d 159, 163 (N.Y. 2011) (emphasis added)). But Plaintiffs
are companies “organized and registered under the laws of Ireland the United Kingdom,” (Dkt.
No. 26 ¶ 1), and they do not allege that they “reside” in New York, even if they conduct some
business here. (See Dkt. No. 46). The question is whether, in a copyright infringement case, a
copyright owner who neither resides in New York nor has its principal place of business in New
York, may assert that New York is the situs of injury for purposes of determining long-arm
jurisdiction under CPLR § 302(a)(3).
12

There is considerable authority for the proposition that “[t]he torts of copyright and
trademark infringement cause injury in the state where the allegedly infringed intellectual
property is held.” McGraw-Hill Co. v. Ingenium Tech. Corp., 375 F. Supp. 2d 252, 256
(S.D.N.Y. 2005); see Capitol Records, LLC v. VideoEgg, Inc., 611 F. Supp. 2d 349, 363
(S.D.N.Y. 2009); Design Tex Grp., Inc. v. U.S. Vinyl Mfg. Corp., No. 04-CV-5002, 2005 WL
357125, at *1 (S.D.N.Y. Feb. 14, 2005); see also 3-12 Melville B. Nimmer and David Nimmer,
Nimmer on Copyright § 12.01 (2015) (“Nimmer”) (“Because a copyright is an intangible,
incorporeal right, it has no situs apart from the domicile of the proprietor.”); cf. Lewis v. Madej,
No. 15-CV-2676, 2015 WL 6442255, at *4 (S.D.N.Y. Oct. 23, 2015) (collecting cases standing
for the proposition that “the tort of trademark infringement causes injury in the state where the
allegedly infringed intellectual property is held.”). Plaintiffs contend that a “copyright owner
[also] suffers a cognizable injury in the market where the infringement occurred in the form of
lost potential sales.” (Dkt. No. 45 at 12.) If follows, they argue, that the “injury [in this case]
occurred in . . . New York specifically due to lost or threatened business” as Plaintiffs were
“deprived [of] the potential opportunity to license and publish their copyrighted photos here.”
(Dkt. No. 45 at 13.)
Plaintiffs’ argument fails for two reasons. First, as a general matter, when a defendant is
accused of posting copyrighted material on a website accessible to anyone with an internet
connection, Plaintiffs’ theory of “market harm” would define the “market” as anywhere that the
internet is accessible. Online copyright infringement would thus always cause injury in New
York, no matter how thin a plaintiff’s connection to the forum. Such a rule is not consonant with
a plaintiff’s obligation under New York law to “allege facts demonstrating a non-speculative and
direct New York-based injury to its intellectual property.” Troma, 729 F.3d at 220. Moreover,

13

the New York Court of Appeals has itself cast doubt on the viability of a market-based approach
to locating injury in the context of online infringement:
In cases of this nature, identifying the situs of injury is not as simple as
turning to “the place where plaintiff lost business,” because there is no
singular location that fits that description. . . . As a result, although it may
make sense in traditional commercial tort cases to equate a plaintiff’s
injury with the place where its business is lost or threatened, it is illogical
to extend that concept to online copyright infringement cases where the
place of uploading is inconsequential and it is difficult, if not impossible,
to correlate lost sales to a particular geographic area.
Penguin Grp., 946 N.E.2d at 164 (citation omitted). Second, on the facts of this case, even if the
Court were to try to identify a single location where this alleged injury is felt, that location would
not be New York. The most concrete “lost potential sales” identified by Plaintiffs are the fees
that the Publisher Defendants would have paid Plaintiffs for the right to use the Photos—not
foregone sales to New York consumers who merely viewed the Photos online. To the extent that
this harm causes injury in any single place—a dubious proposition—the location of that injury is
not New York.
For these reasons, a copyright owner that neither resides in New York nor has its
principal place of business in New York may not assert that New York is the situs of injury in an
online copyright infringement case where, as here, the basis for locating the injury in New York
is simply that New Yorkers can access the infringing content online. Because Plaintiffs have not
alleged that a tort “caus[ed] injury to person or property within the state” under CLPR
§ 302(a)(3), this Court does not have personal jurisdiction over the Miami Herald Media Co.,
Richmond Times Dispatch, Treasure Coast Newspapers, E.W. Scripps, Co., or the Journal Media
Group, Inc. 6 Accordingly, the motion to dismiss for lack of personal jurisdiction is granted as to

Because the Court determines it does not have personal jurisdiction over these defendants
pursuant to New York’s long-arm statute, it need not decide whether the assertion of jurisdiction
would otherwise comport with due process. See Best Van Lines, Inc. v. Walker, 490 F.3d 239,
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these defendants. But because the Tribune Content Agency has not joined in the motion to
dismiss for lack of personal jurisdiction, claims against it are not dismissed.
C.

Venue

Defendants also move pursuant to Rule 12(b)(3) to dismiss claims against the Welsh
Government for improper venue. See Fed. R. Civ. P. 12(b)(3). As relevant here, a civil action
against a foreign state may be brought:
(1) in any judicial district in which a substantial part of the events or
omissions giving rise to the claim occurred, or a substantial part of
property that is the subject of the action is situated . . . .
(3) in any judicial district in which the agency or instrumentality is
licensed to do business or is doing business, if the action is brought
against an agency or instrumentality of a foreign state as defined in
section 1603(b) of this title; or
(4) in the United States District Court for the District of Columbia if the
action is brought against a foreign state or political subdivision thereof.
28 U.S.C. § 1391(f). Plaintiffs claim that venue is proper under both §§ 1391(f)(1) and
1391(f)(3). “[I]n deciding a motion to dismiss for improper venue, the ‘court may examine facts
outside the complaint to determine whether venue is proper. The Court must draw all reasonable
inferences and resolve all factual conflicts in favor of plaintiff.’” Concesionaria DHM, S.A. v.
Int’l Fin. Corp., 307 F. Supp. 2d 553, 555 (S.D.N.Y. 2004) (quoting E.P.A. ex rel. McKeown v.
Port Authority, 162 F. Supp. 2d 173, 183 (S.D.N.Y. 2001)).
First, Plaintiffs argue that venue is proper because a “substantial part of the events or
omissions giving rise to the claim occurred” in this judicial district. (Dkt. No. 45 at 20-21.) As
the Second Circuit has noted, the court must “take seriously the adjective ‘substantial.’” Gulf
Ins. Co. v. Glasbrenner, 417 F.3d 353, 357 (2d Cir. 2005) (interpreting the identical provision of

242 (2d Cir. 2007) (a court conducts the due process analysis “if, but only if,” it has concluded
that jurisdiction is appropriate under New York law.)
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28 U.S.C. § 1391(b)(2)); see Comm’ns Import Export S.A. v. Republic of the Congo, No. 11-CV6176, 2012 WL 1468486, at *2 (S.D.N.Y. Apr. 27, 2012) (applying Gulf in the context of 28
U.S.C. § 1391(f)). “That means for venue to be proper, significant events or omissions material
to the plaintiff’s claim must have occurred in the district in question, even if other material
events occurred elsewhere.” Gulf, 417 F.3d at 357 (emphasis in original).
Conclusory statements aside, Plaintiffs have not alleged that any of the specific conduct
at issue occurred in this district, let alone a “substantial part” of it. Neither Plaintiffs nor the
Welsh Government reside in the United States. The only concrete infringing materials that
Plaintiffs can identify are materials that were available online. (See Dkt. Nos. 26-1, 26-2, 26-4,
26-12.) But the fact that an infringing material is accessible via the internet in a jurisdiction is
hardly sufficient to conclude that this infringement occurred in this district for the purposes of
venue. Indeed, all of the Welsh Government’s relevant conduct—including the creation and
maintenance of the websites at issue—appears to have occurred abroad. 7 On this basis, the
Court cannot conclude that a substantial part of the events giving rise to this claim occurred in
New York.

Although no such allegation is contained the First Amended Complaint, Plaintiffs argue that
“visitwales.com was created and is maintained on servers here in the United States.” (Dkt. No.
45 at 18.) The Holt declaration offered by Defendants avers that the “computer servers for the
Welsh Government, including those used for its tourism promotion activities,” such as
visitwales.com, “are created and maintained in the United Kingdom.” (Dkt. No. 49 ¶ 6.) So too,
“the content of the site has always been created and maintained on servers located in the United
Kingdom.” (Id.). In support, Defendants submit a copy of a “domain search” for visitwales.com
which lists the “Registrant Contact” and “Admin Contact” as the Welsh Government. (Dkt. No.
39-5.) Plaintiffs’ response, which is based entirely on the “domain search” document submitted
by Defendants, is that it actually establishes that the servers for visitwales.com are located in the
United States, in large part because a Delaware company is listed as the “Tech Contact.” (Id.)
Even assuming, as Plaintiffs do, that the location of servers is relevant to determining whether
the Welsh Government performed an act in the United States, there is no basis on which to
conclude that the servers for visitwales.com are maintained in this country, let alone in this
judicial district.

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Plaintiffs also contend that venue is proper under § 1391(f)(3), which provides for venue
“in any judicial district in which the agency or instrumentality [of a foreign state] is licensed to
do business or is doing business.” 28 U.S.C. § 1391(f). In turn, Plaintiffs argue that the Welsh
Government is an “agency or instrumentality” of the United Kingdom by virtue of being a
“political subdivision” of the United Kingdom. Plaintiffs rely on 28 U.S.C. § 1603(b), which
defines an “agency or instrumentality of a foreign state” as, in part, “an organ of a foreign state
or political subdivision thereof.” 28 U.S.C. § 1603(b). But this provision means that an “agency
or instrumentality” may be either the organ of a foreign state or the organ of a political
subdivision—not that a political subdivision is, itself, an agency or instrumentality. Indeed,
Plaintiffs’ reading is foreclosed by the plain text of the statute. See Gates v. Victor Fine Foods,
54 F.3d 1457, 1461-1462 (9th Cir. 1995). For example, the very next clause of § 1603(b)
clarifies that an “agency or instrumentality” includes “an organ . . . a majority of whose shares or
other ownership interest is owned by a foreign state or political subdivision thereof.” Under
Plaintiffs’ construction, this second mention of “or political subdivision” would be entirely
redundant. 8

Although Plaintiffs do not cite Visit Wales as a basis for venue, and thus have waived any such
argument, Plaintiffs separately seek to assert claims against Visit Wales as an “agency or
instrumentality” of the Welsh Government. (Dkt. No. 45 at 6.) Under the FSIA, an “agency or
instrumentality of a foreign state” means, as relevant here, any entity that (1) “is a separate legal
person, corporate or otherwise” and (2) “is an organ of a foreign state or political subdivision
thereof.” 28 U.S.C. § 1603(b). Whether a foreign entity is a “separate legal person” under the
statute depends on “whether the core functions of the foreign entity are predominantly
governmental or commercial.” Garb v. Republic of Poland, 440 F.3d 579, 593-594 (2d Cir.
2006).
Defendants argue that Visit Wales “is not a proper defendant” because it “is not a
separate legal entity” but rather “a trade name used by the Welsh Government.” (Dkt. No. 39-15
¶ 6.) Defendants have also submitted a declaration from Rob Holt, the Deputy Director of
Tourism Development in the Department for Economy, Science and Transport in the Welsh
Government, in which he avers that Visit Wales “is not a separate legal entity” but “merely the
name of the administrative division of the Welsh Government charged with carrying out the
Government’s policy to promote tourism to Wales.” (Dkt. No. 49 ¶ 4.) Finally, Plaintiffs
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Because venue in this judicial district is improper under § 1391(f), the motion to dismiss
claims against the Welsh Government for improper venue is granted.
D.

Remaining Issues

Having dismissed claims against the Welsh Government and all the other Publisher
Defendants, only the Tribune Content Agency remains as a defendant in this matter.

As a

result, two lingering issues must be addressed.
First, Defendants charge that Pablo Star Ltd. lacks standing to pursue any copyright
claims against Defendants because it “assigned ownership of the copyrights at issue to Pablo
Media” and “only retained the right to sue for past copyright infringement against certain
specific parties (the names of which are redacted).” (Dkt. No. 39 at 23.) Defendants concede
that one of the two Plaintiffs—either Pablo Star Ltd. or Pablo Star Media—has standing, and
thus that this case may proceed irrespective of the Court’s determination on the subject of Pablo
Star Ltd.’s standing. Further discovery and briefing on the subject of Pablo Star Ltd.’s standing
to pursue its claims is necessary for the Court to resolve this question. The motion to dismiss for
lack of standing is, therefore, denied without prejudice to renewal of this argument following
discovery.
Second, Plaintiffs have also moved for a preliminary injunction against Defendants that
would enjoin them from “continuing to publish, display, distribute, and otherwise use Plaintiff’s
copyrighted photographs” and would “order the impoundment (or quarantine) of any materials in

concede that Visit Wales is part of the Department for Economy, Science and Transport. (Dkt.
No. 45 at 6.) The Court concludes that the “core function” of Visit Wales—namely, tourism
promotion—is “predominantly governmental” and not “commercial.” See Garb, 440 F.3d at
594-597. It follows that Visit Wales is not a separate legal person and thus not an “agency or
instrumentality” under the FSIA and that the proper defendant in this case is the Welsh
Government itself. Even were venue and service of process proper, this conclusion would lead
the Court to dismiss all claims against Visit Wales.
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Defendants’ possession . . . that include copies of the subject photos.” (Dkt. No. 17 at 1.) The
“cardinal principle that the district court is ‘powerless to proceed’ in the absence of personal
jurisdiction applies with no less force when the court is presented with a motion for a preliminary
injunction.” Khatib v. Alliance Bankshares Corp., 846 F. Supp. 2d 18, 24 (D.D.C. 2012) (citing
Emp’rs Reinsurance Corp. v. Bryant, 299 U.S. 374, 382 (1937)). Therefore, the only question is
whether a preliminary injunction against the Tribune Content Agency is appropriate.
A preliminary injunction in a copyright case may issue “upon a finding of (a) irreparable
harm and (b) either (1) likelihood of success on the merits or (2) sufficiently serious questions
going to the merits to make them a fair ground for litigation and a balance of hardships tipping
decidedly toward the party requesting the preliminary relief.” Salinger v. Colting, 607 F.3d 68,
75 (2d Cir. 2010). “[C]ourts must not simply presume irreparable harm.” Id. at 82 (citing eBay,
Inc. v. MercExchange, L.L.C., 547 U.S. 388, 393 (2006)). Rather, “plaintiffs must show that, on
the facts of their case, the failure to issue an injunction would actually cause irreparable harm.”
Id. In this case, Plaintiffs have failed to make such a showing. The submissions contain no
evidence of a connection between concrete harm that Plaintiffs have or might suffer and the
Tribune Content Agency’s alleged infringing use. Esbin & Alter v. Sabharwal, Globus, & Lin,
LLP, 403 F. App’x 591, 593 (2d Cir. 2010). Moreover, Plaintiffs have not alleged, let alone
submitted evidence to show, that the Tribune Content Agency continues to use the Photos. Getty
Images (US), Inc. v. Microsoft Corp., 61 F. Supp. 3d 296, 300 (S.D.N.Y. 2014). As a result,
Plaintiffs “cannot demonstrate that it will suffer any irreparable harm if an injunction is not
issued.” Id. For this reason, the motion for a preliminary injunction is denied.
III.

Conclusion
For the foregoing reasons, Defendants’ motion to dismiss is GRANTED in part and

DENIED in part. All claims against the Welsh Government are dismissed for improper service
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and improper venue. All claims against Publisher Defendants the Miami Herald Media Co., the
Richmond Times Dispatch, Treasure Coast Newspapers, E.W. Scripps, Co., Journal Media
Group, and the Pittsburgh Post-Gazette are dismissed for lack of personal jurisdiction.
Defendants’ motion to dismiss the claims of Plaintiff Pablo Star Ltd. for lack of standing is
denied without prejudice.
Plaintiffs’ motion for a preliminary injunction is DENIED. As a result, Defendants’
motion to stay is DENIED as moot.
Plaintiffs shall, within 10 days of the date of this order, advise the Court in writing why
the claims against Defendants Travel Squire and Colorado News Feed should not be dismissed
for failure to prosecute.
The sole remaining defendant, Tribune Content Agency, shall file an answer to the First
Amended Complaint within 21 days of the date of this Order.
The Clerk of Court is directed to close the motions at docket numbers 16, 22, 25, and 38.

SO ORDERED.
Dated: March 16, 2016
New York, New York
____________________________________
J. PAUL OETKEN
United States District Judge

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