Aaberg et al v. Francesca's Collections, Inc. et al
Filing
70
MEMORANDUM OPINION & ORDER re: 47 MOTION to Dismiss The Second Amended Complaint MOTION to Strike Document No. [43 (at paras. 4 and 73)] filed by Express, LLC, O.K. Originals, Ltd., 66 MOTION to Dismiss Plaintiff s' Second Amended Complaint filed by Francesca's Collections, Inc. For the foregoing reasons, the Court GRANTS Defendants' motions to dismiss as to the state law claims (Five and Six), but DENIES Defendants' motions to dismi ss as to the Copyright and DMCA claims (One, Two, Three, and Four). The Court DENIES the OK-Express Defendants' motion to strike. This Order resolves Dkt. Nos. 47 & 66. The Court will schedule an initial pretrial conference by separate order. SO ORDERED. (Signed by Judge Alison J. Nathan on 3/27/2018) (mml)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
Sean Aaberg, et al.,
Plaintiffs,
17-CY-115 (AJN)
-vMEMORANDUM
OPINION & ORDER
Francesca's Collections, Inc., et al.,
Defendants.
ALISON J. NATHAN, District Judge:
Plaintiffs, a group of artists who create enamel pins, bring this lawsuit against certain
distributors and retailers of enamel pins they accuse of sourcing and selling "knock-offs" of the
Plaintiffs' designs. Defendants O.K. Originals, Ltd. and Express, LLC move to dismiss the
Second Amended Complaint for failure to state a cause of action under Federal Rule of Civil
Procedure 12(b)(6), and move to strike certain parts of the complaint under Rule 12(f).
Defendant Francesca's Collections, Inc. also moves to dismiss the Second Amended Complaint
under Rule 12(b)(6).
For the following reasons, the Court GRANTS both motions to dismiss as to Plaintiffs'
claims under New York state law, but DENIES both motions to dismiss as to Plaintiffs' federal
law claims. The Court DENIES the motion to strike.
I. Background
On January 6, 2017, Plaintiff-Artists Sean Aaberg, Kristina Alderette, Brianna Bulski,
Susan Ghahremani, Anita Tvancenko, Th;:iis M;:irchese, Rle;:inor Mortimer, Rric Solomon, Caitlin
Whittington, Beth Wilson, and Katharine Wilson (collectively, "Plaintiffs"), sued Defendants
1
Francesca's Collections, Inc ("Francesca's"), O.K. Originals, Ltd. ("OK), Orion Fashions, Inc.
("Orion"), and Does 1-10, under the Copyright Act, Digital Millennium Copyright Act, Lanham
Act, and under New York state law. See generally Complaint, Dkt. No. 1. Plaintiffs also alleged
mail fraud and wire fraud against OK and Orion. Id. On February 16, 2017, Plaintiffs then
amended their complaint, adding Express, LLC and La Maison Simons, Inc. ("Simons") as
defendants. See generally First Amended Complaint, Dkt. No. 25. In response, OK and Express
(collectively, "OK-Express Defendants") moved to dismiss the First Amended Complaint and to
strike certain allegations. See Dkt. Nos. 31-32. Francesca's separately moved to dismiss as well.
See Dkt. Nos. 29-30. Orion answered, Dkt. No. 36, and Simons did not respond.
In response to the motions to dismiss, Plaintiffs sought leave to amend their complaint,
Dkt. No. 37, the Court granted that motion, Dkt. No. 41, and they filed the operative Second
Amended Complaint ("SAC") on March 6, 2017. Dkt. No. 43. The SAC no longer claimed a
violation of the Lanham Act. See generally id. In response, Francesca's and the OK-Express
Defendants (collectively, for the present purpose, "Defendants") renewed their respective
motions, see Dkt. Nos. 47-51, Orion again answered, Dkt. No. 61, and Simons still did not
appeared.
The Court provides the following summary of those allegations relevant to the present
motions. In deciding the motions to dismiss, the Comi accepts the allegations as true and draws
all reasonable inferences in the Plaintiffs' favor. See LaFaro v. NY. Cardiothoracic Grp., PLLC,
570 F.3d 471, 475 (2d Cir. 2009) (quotation omitted).
Plaintiffs are all artists who operate independently to create and sell enamel pins of their
own original design. SAC ii 2. Francesca's is a retail company that sells accessories, jewelry,
and clothing through its website and a nationwide chain of approximately 620 retail locations
2
if 3. Express is a publicly-traded fashion retail company with
throughout the United States. Id.
approximately 650 stores in North America. Id. Simons is a Canadian retail company that sells
clothing, accessories, and home furnishings through retail locations and its website, shipping
products to the United States. Id. O.K. Originals mainly designs costume jewelry in New York,
which it manufactures in Asia and then imports and distributes to retailer clients in the United
States and around the world. Id.
jewelry." Id.
if 30. Orion's business consists mainly of distributing "fashion
if 31.
Plaintiffs allege that Francesca's, Express, and Simons (collectively, "Retailers") sell
enamel pins. Id.
if 4. The SAC alleges that rather than design their own or purchase or license
designs directly from artists, the Retailers instead stole Plaintiffs' designs, contracting with OK
and Orion, "both known distributors of knockoff and copycat goods," to supply them with
infringing copies of Plaintiffs' pins. Id. All of the allegedly infringing pins were sold by
Francesca's and some of them are alleged to have been sold by Express and Simons as well. Id.
irir 4-5.
All Plaintiffs except Ivancenko and Katharine Wilson have received registrations for their
pins from the U.S. Copyright Office. Id.
if 28 & Ex. A. Ivancenko and Wilson have submitted
proper deposits, applications, and applications fees for their works to the U.S. Copyright Office
and were refused registration. Id.
if 28. Notice of this action and the complaints have been served
upon the Register of Copyrights. Id.
In the interest of brevity, the Court simply notes that each Plaintiff is associated with one
or more specific pins alleged to have been infringed. See id.
ifif 36-46. Each artist sells their pins
and other products either through his or her website, through e-commerce platforms such as on
Etsy, and/or through third-party websites and retailers. Id. Each artist's name or trade name, as
3
well as his or her logo or website, is placed on the pin's packaging (and, in some cases, on the
pin itself) "via a digital and technological process involving computer software and printing
machinery" and serves to identify each artist as the author and copyright owner of the pin. Id.
Plaintiffs allege that beginning around February 2016, employees of OK and Orion
purchased pins directly from Plaintiffs to obtain samples that they could then copy, have
manufactured in Asia, and import for distribution to the Retailers. Id.
if 56.
Specifically,
Plaintiffs allege that Jennifer Perdigao, design director for OK, and Jessalyn Valvo, Orion's
creative director, purchased pins from various Plaintiffs' storefronts. Id.
iii! 57-60.
OK and Orion
then sent the original pins to their foreign manufacturers to create the allegedly infringing pins.
Id.
if 61.
When these infringing pins were later displayed by the Retailers, the information
identifying the Plaintiffs as authors and copyright owners had been removed and replaced with
new, false information. Id.
According to Plaintiffs, the Defendants began selling the infringing pins in or about
summer 2016 and Francesca's and Express were still selling at least some of them as of the filing
of the SAC. Id.
iii! 65-66.
Plaintiffs plead stories of a few of the artists notifying Francesca's
about the alleged infringement in or about August 2016. Id.
iii! 70-71
Based on these allegations, Plaintiffs contend that Defendants have committed direct and
contributory copyright infringement in violation of 17 U.S.C. §§ 106 and 501 (Copyright Act),
id.
iii! 75-88, unlawfully removed copyright management information from the pins, and
unlawfully provided false copyright management information in connection with the pins in
violation of 17 U.S.C. § 1202(b) and§ 1202(a) respectively (Digital Millennium Copyright Act,
or "DMCA"), id.
iii! 89-102, and engaged in deceptive acts and practices directed at consumers
in New York in violation of General Business Law § 349, and common law unfair competition.
4
Id. iii! 103-11. Plaintiffs seek actual damages, statutory damages, Defendants' profits, the
impounding of the infringing pins, costs and attorneys' fees, treble damages, and injunctive
relief. Id.
if 111.
II. Legal Standard
To survive a motion to dismiss under Rule 12(b)(6), the complaint must "state a claim to
relief that is plausible on its face." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). A
claim achieves "facial plausibility when the plaintiff pleads 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). Plausibility is "not akin to a 'probability
requirement,' but it asks for more than a sheer possibility that a defendant has acted unlawfully."
Id. Assessing the plausibility of a complaint is a "context-specific task that requires the
reviewing court to draw on its judicial experience and common sense." Id. at 679. To plausibly
allege a claim, the plaintiff must do more than provide "bare assertions" that "amount to nothing
more than a 'formulaic recitation of the elements"' of a claim. Id. at 681 (quoting Twombly, 550
U.S. at 555). "The Twombly plausibility standard ... does not prevent a plaintiff from pleading
facts alleged 'upon information and belief where the facts are peculiarly within the possession
and control of the defendant, or where the belief is based on factual information that makes the
inference of culpability plausible." Arista Records, LLC v. Doe 3, 604 F.3d 110, 120 (2d Cir.
2010). In reviewing a motion to dismiss, the court "may consider any written instrument
attached to the complaint, statements or documents incorporated into the complaint by
reference, ... and documents possessed by or known to the plaintiff and upon which it relied in
bringing the suit." ATS! Commc 'ns, Inc. v. Shaar Fund, Ltd., 493 F.3d 87, 98 (2d Cir. 2007).
5
III. Discussion
A. Direct Copyright Infringement Claim (First Claim for Relief)
"A properly plead[ ed] copyright infringement claim must allege 1) which specific
original works are the subject of the copyright claim, 2) that plaintiff owns the copyrights in
those works, 3) that the copyrights have been registered in accordance with the statute, and 4) by
what acts during what time the defendant infringed the copyright." Kelly v. L.L. Cool J., 145
F.R.D. 32, 36 (S.D.N.Y. 1992); accord Lefkowitz v. McGraw-Hill Global Educ. Holdings, LLC,
23 F. Supp. 3d 344, 352 (S.D.N.Y. 2014).
As a threshold matter, the OK-Express Defendants argue that Plaintiffs' pins are not
sufficiently "original" to merit copyright protection. Defendant O.K. Originals, Ltd. and
Defendant Express, LLC's Memorandum of Law in Support of Their Rule 12 Motion to Dismiss
the Second Amended Complaint ("OK Mem."), Dkt. No. 49, at 9-10. Their argument is
especially directed at two of the eleven Plaintiffs, Ivanchenko and Katherine Wilson, as the OKExpress Defendants imply that the reason both were refused registration of their pins by the
Copyright Office was for lack of originality. See id. at 9. However the OK-Express Defendants
also invite the Court to "find that the remaining Plaintiffs' pins also lack the minimum level of
creativity required for copyright protection," despite their receipt of registration certificates. Id.
at 10.
"To qualify for copyright protection, a work must be original to the author." Feist
Publ'ns, Inc. v. Rural Tel. Serv. Co., Inc., 499 U.S. 340, 345 (1991). The threshold for
originality is exceedingly low. "Original, as the term is used in copyright, means only that the
work was independently created by the author (as opposed to copied from other works), and that
is possesses at least some minimal degree of creativity." Id. at 345. "The vast majority of works
6
made the grade quite easily, as they possess some creative spark, no matter how crude, humble
or obvious it might be." Id. (internal quotation marks and citation omitted).
The OK-Express Defendants argue that Ivanchenko and K. Wilson's pins, a pastel color
strawberry and a broken heart with the words "Best Babes," respectively, are garden variety
symbols that are not original. OK Mem. at 9. Drawing all reasonable inferences in the Plaintiffs'
favor, the Court finds that both plausibly allege the originality of their pins.
Ivanchenko's Pastel Strawberry pin is slanted in orientation and light blue and pale pink
in color, which are not the colors found on strawberries in nature. SAC if 40. Wilson's Best
Babes Pin + Post may use the common symbol of a heart broken in two, but also employs a
distinctive color scheme - black and gold - and the counterintuitive nature of writing "best
babes" in cursive over a broken heart. SAC if 46. Given the low threshold needed to plausibly
allege originality, the creative elements of both pins are sufficient to avoid dismissal on these
grounds.
Moreover, while the OK-Express Defendants are correct that the existence of copyright
registration certificates for the other pins at issue is not dispositive of this threshold question of
originality, see OK Mem. at 10 (citing We Shall Overcome Found. v. Richmond Org., Inc. (TRO
Inc.), No. 16-CV-2725 (DLC), 2016 WL 6871427, at *6 (S.D.N.Y. Nov. 21, 2016)), it does
constitute primafacie evidence of the validity of the copyright. 17 U.S.C. § 410(c). Upon
reviewing the remaining pins, and drawing all reasonable inferences in Plaintiffs' favor, the
Court concludes that there is no subject pin so thoroughly devoid of a "creative spark" that the
complaint falls to plausibly allege their protection under copyright law. See SAC if 4.
The OK-Express Defendants next criticize Plaintiffs' pleading of the copyright
infringement claims as insufficiently specific under the pleadings standards of Federal Rule of
7
Civil Procedure 8(a)(2). OK Mem. at 10-12. Specifically, they argue that Plaintiffs have failed
to properly plead the fourth element of copyright infringement: "by what acts during what time
the defendant infringed the copyright." Kelly, 145 F.R.D. at 36. The OK-Express Defendants
focus on two purported failures.
First, the OK-Express Defendants criticize Plaintiffs for making allegations that "lump
together" all of the Defendants and all of the pins, without giving specific notice to each
defendant of what conduct infringes which pins. OK Mem. at 11-12, 23. They concede that
Plaintiffs do link OK and Express with certain pins, but argue that the Court should dismiss the
claims of those plaintiffs whose pins are not specifically linked to OK or Express in the
complaint. Id. at 12. Francesca's raises a similar argument, but focuses its attention on
Plaintiffs' purported failure to plead a time period for the infringement. Memorandum of Law in
Support of Defendant Francesca's Collections Inc's Motion to Dismiss Second Amended
Complaint ("Francesca's Mem.), Dkt. No. 51, at 6-7.
At this stage, Plaintiffs offer enough specificity to provide sufficient notice to OK and
Express. Rule 8(a)(2) requires "only 'a short and plain statement of the claim showing that the
pleader is entitled to relief,' in order to 'give the defendant fair notice of what. .. the claim is and
the grounds upon which it rests.'" Twombly, 550 U.S. at 555 (quoting Conley v. Gibson, 355
U.S. 41, 47 (1957)). Plaintiffs have identified 13 specific pins, and set forth their theory of how
exactly each Defendant is potentially liable for infringement, and in what timeframe. See SAC ilil
4, 5, 53-61, 64-66, 73. Moreover, Plaintiffs plead that as of the filing of the SAC, Francesca's
was still displaying images of seven pins on its website. SAC if 66. Alleging a continuing
violation has repeatedly been found to fulfill the pleading requirements for a copyright claim.
See Maverick Recording Co. v. Goldshteyn, No. 05-CV-4523 (DGT), 2006 WL 2166870, at *4
8
(E.D.N.Y. July 31, 2006) (collecting cases). It is true that Plaintiffs have only pleaded additional
details about Express and Simons with respect to certain pins, that is, the Cat Lady Pin and the
Pizza True Love and Best Babes pins respectively, and otherwise use the phrases "at a
minimum," or "at least," to cast a wider net. See, e.g., SAC ifif 5, 65. It is similarly true that there
are points at which Plaintiffs' complaint contradicts itself on time. See Francesca's Mem. at 6
(citing SAC iii! 65, 73 and noting that Plaintiffs plead both that Francesca's began selling all of
the infringing pins in or about July 2016 and that Francesca's did not begin selling the Cat Lady
Keychain until September 2016). Nonetheless, Plaintiffs have offered a limited scope of time for
the alleged infringement, and a limited number of pins that were potentially infringed. 1 To the
extent that Plaintiffs are not aware of the full scope of Defendants' activities, much of the
information exists principally within the Defendants' possession and control. See SAC iii! 52, 60.
Whatever its flaws, the SAC gives Defendants ample notice and plausibly states a claim for
infringement.
Second, the OK-Express Defendants attack the plausibility of the pleading because it fails
to account for why competing suppliers - OK and Orion- and competing retailers-Francesca's,
Express, and Simons-would have undertaken the same scheme. OK Mem. at 12. However, this
explanation is not required for Plaintiffs to plausibly state a claim for copyright infringement. At
no point do the Plaintiffs allege that OK and Orion, or Express and Francesca's, collaborated
with each other. Rather, both supplier-distributors are alleged to have independently produced
"knock-offs" for both retailers. See SAC if 63. It is not implausible that multiple Defendants
might be independently liable for the same allegedly infringing behavior.
1
To the extent Plaintiffs attempt to assert claims beyond these thirteen pins and beyond the scope of time
alleged in the SAC, these claims are dismissed. Cf Warren v. John Wiley & Sons, Inc., 952 F. Supp. 2d 610, 616-18
& n. 2 (S.D.N.Y. 2013) (finding the pleadings sufficient to place the defendant on notice, but dismissing the
complaint to the extent it asserts claims regarding unspecified photographs).
9
Accordingly, the Court denies Defendants' motion to dismiss Count 1.
B. Contributory Copyright Infringement Claim (Second Claim for Relief)
Francesca's also argues that Plaintiffs failed to adequately plead the elements of their
claim for contributory infringement. Francesca's Mem. at 3-5. "A defendant may be held liable
for contributory copyright infringement if, 'with knowledge of the infringing activity,' it
'materially contributes to the infringing conduct of another."' Arista Records LLC v. Lime Grp.
LLC, 784 F. Supp. 2d 398, 432 (S.D.N.Y. 2011) (quoting Matthew Bender & Co., Inc. v. W
Publ'g Co., 158 F.3d 693, 706 (2d Cir. 1998)) (emphasis added). "The knowledge standard is an
objective one; contributory infringement liability is imposed on persons who 'know or have
reason to know' of the direct infringement." Doe 3, 604 F.3d at 118 (emphasis in original;
citation omitted). Francesca's argues that Plaintiffs fail to allege knowledge with sufficient
specificity, noting that only four of the Plaintiffs are alleged to have notified Francesca's of the
potential infringement, and that only one of these four Plaintiffs created a pin alleged to have still
been sold by Francesca's after this notice. See Francesca's Mem. at 3-5 (citing SAC iii! 70-71,
73-74).
Francesca's assumes that Plaintiffs carry the burden of providing a pin-by-pin accounting
in order to adequately plead the knowledge element, but cite no relevant law in support of this
assumption. 2 In pleading their claims against Francesca's, Plaintiffs have alleged that the
2
In its reply brief, Francesca's cites two out-of-Circuit cases arising under the Robinson-Patman Act for
the proposition that each plaintiff must make individual allegations. See Reply Memorandum of Law in Further
Support of Defendant Francesca's Collections Inc. 's Motion to Dismiss Second Amended Complaint, Dkt. No. 64,
at 3 (citing Chawla v. Shell Oil Co., 75 F. Supp. 2d 626, 654 (S.D. Tex. 1999) and S. Gas, Inc. v. ExxonMobil Oil
Corp., 09-CV-6236, 2016 WL 816748, at *6 (D.N.J. Feb. 29, 2016)). To state a claim under Robinson-Patman Act
requires allegations that price discrimination had a prohibited effect on competition, and Plaintiffs in a "secondaryline case" must specifically plead competitive harm and cannot rely on a generalized inference. See Chawla, 75 F.
Supp. 2d at 651-53. In short, Francesca's offers no apposite citation supporting its position that Plaintiffs must
plead copyright infringement pin-by-pin under Rule 8.
10
Retailers "sourced pins from the Supplier Defendants rather than going directly to the Plaintiff
Artists because they knew the Supplier Defendants provided cheaper, knock-off goods
manufactured in Asia." SAC if 63 (emphasis added). While Plaintiffs may ultimately not find the
evidence to support this claim, the scheme they have alleged is plausibly predicated on
Francesca's actual or constructive knowledge that the pins they were sourcing from these
particular suppliers were likely infringing.
Accordingly, the Court denies Defendants' motion to dismiss Count 2.
C. Digital Millennium Copyright Act Claims (Third and Fourth Claims for Relief)
Plaintiffs' third cause of action is for alleged removal of copyright management
information under 17 U.S.C. § 1202(b), and their fourth cause of action is for the alleged
provision of false copyright management information under 17 U.S.C. § 1202(a).
The DMCA makes it unlawful to knowingly, and with the intent to "induce, enable,
facilitate, or conceal infringement," either "provide" or "distribute" (or "import for distribution")
false "copyright management information" or "CMI." 17 U.S.C. § 1202(a). Thus, to state a
claim under this subsection, § 1202(a), Plaintiffs must allege that the defendant both knew that
the CMI was false, and provided or distributed the false CMI with the intent to induce, enable,
facilitate, or conceal infringement. See Ward v. Nat'l Geographic Soc'y, 208 F. Supp. 2d 429,
449 (S.D.N.Y. 2002).
The DMCA also prohibits doing any of the following "without the authority of the
copyright owner or the law" and with knowledge or reasonable grounds to know that it will
"induce, enable, facilitate, or conceal" infringement:
(1) intentionally remove or alter any copyright management information,
(2) distribute or import for distribution copyright management information knowing that
the copyright management information has been removed or altered without authority of
the copyright owner or the law, or
11
(3) distribute ... works, copies of works, or phonorecords, knowing that copyright
management information has been removed or altered without authority of the copyright
owner or the law.
17 u.s.c. § 1202(b).
Accordingly, to state a valid claim under subsection 1202(b), a plaintiff must allege 1) the
existence of CMI on the products at issue; 2) removal and/or alteration of that information; and
3) that the removal and/or alteration was done intentionally. BanxCorp v. Costco Wholesale
Corp., 723 F. Supp. 2d 596, 609 (S.D.N.Y. 2010) (collecting cases).
As relevant here, the statutory definition of CMI includes: 1) "[t]he name of, and other
identifying information about, the author of a work,"§ 1202(c)(2); 2) "[t]he name of, and other
identifying information about, the copyright owner of the work, including the information set
forth in a notice of copyright,"§ 1202(c)(3); and 3) "[i]dentifying numbers or symbols referring
to such information or links to such information."§ 1202(c)(7).
The OK-Express Defendants argue that Plaintiffs fail to state a claim under either
subsection of the statute for three separate reasons. First, they assert that virtually none of the
pins contains "copyright management information" or CMI, as statutorily defined by 17 U.S.C. §
1202(c). OK Mem. at 13-14. Second, they argue that because none of the alleged infringing
conduct occurred in the digital sphere, and, rather, all occurred in the physical sphere, Plaintiffs
cannot adequately plead a DMCA claim. Id. at 15-16. Third, the OK-Express Defendants
contend that Plaintiffs have failed to state a viable cause of action because they do not plausibly
allege that OK or Express "removed or altered" any CMI from Plaintiffs' own products or
packaging, instead alleging that they made new and separate pins and packaging without the
CMI. Id. at 17. Finally, Francesca's asserts a separate, fourth basis for dismissal. The Court
addresses these arguments in tum.
12
First, the OK-Express Defendants assert that virtually none of the pins contains
"copyright management information" as statutorily defined by 17 U.S.C. § 1202(c).
Specifically, OK-Express Defendants note that only two pins allegedly contain the Plaintiff's
name (Plaintiffs Alderette and Ghahremani) and argue that trade names, logos, website
addresses, or social media handles do not meet the statutory definition of CMI. See OK Mem. at
14 (citing SAC iii! 36-46). OK-Express Defendants insist that the conjunctive word "and"
connecting "the name of' to "other identifying information about" in the text of statute means
that the name of the author or copyright owner is still required in order to qualify as CMI, and
"other identifying information" may supplement the name, but does not suffice in its absence. Id.
at 14-15.
Plaintiffs respond that not only is OK-Express Defendants' interpretation of§ 1202(c)(2)
and (c)(3) incorrect as a matter of law, but also that logos, website addresses, and social media
handles qualify under subsection (c)(7) as "[i]dentifying numbers or symbols ... or links to such
information." Plaintiff Artists' Consolidated Memorandum of Law in Opposition to the Motions
of (1) Defendants O.K. Originals, Ltd. and Express, LLC, and (2) Defendant Francesca's
Collections, Inc. to Dismiss the Second Amended Complaint ("Opp."), Dkt. No. 60, at 18-19.
Plaintiffs have the better argument. The OK-Express Defendants offer no legal support
for their narrow view of§ 1202(c). Plaintiffs plead that each pin has some combination of a
trade or brand name, a logo, and a website address. See SAC iii! 36-46. Collectively, this
information is sufficient to identify the copyright owning Plaintiff. See GC2 Inc. v. Int 'l Game
Tech. PLC, 255 F. Supp. 3d 812, 822 (N.D. Ill. 2017) ("[T]rademark information (such as a
trademark logo] may constitute CMI if it is used to signal authorship of a copyrighted work. .. ");
Fischer v. Forrest, No. 14-CV-1304 (PAE), 2018 WL 948758, at *12 (S.D.N.Y. Feb. 16, 2018)
13
(finding that CMI "need not exactly match the name of the copyright owner"). The OK-Express
Defendants read too much into the use of the conjunctive "and" in § 1202( c)(2) & ( c)(3 ).
Numerous courts have taken a broad view of what constitutes CMI. See, e.g., Williams v.
Cavalli, No. 14-CV-6659, 2015 WL 1247065, at *2 (C.D. Cal. Feb. 12, 2015) (finding
pseudonymous signatures are CMI); AardwolfIndus., LLC v. Abaco Machs. USA, Inc., No. 16CV-1968, 2016 WL 9275401, at *4 (C.D. Cal. Nov. 21, 2016) (finding a collective logo,
copyright symbol, and design mark sufficient CMI); Goldstein v. Metro. Reg'! Info. Sys., Inc.,
No. 15-CV-2400, 2016 WL 4257457, at *8 (D. Md. Aug. 11, 2016) (finding that a mark
consisting of a copyright symbol and website address meets the definition of CMI in §
1202(c)(3)). "[T]he point of CMI is to inform the public that something is copyrighted and to
prevent infringement." Pers. Keepsakes, Inc. v. Personalizationmall.com, No. 11-CV-5177, 2012
WL 414803, at *6 (N.D. Ill. Feb. 8, 2012). This broader view is confirmed by the Senate Report
on the DMCA, which defines CMI to include "such items as the title of the work, the author, the
copyright owner, and in some instances, the writer, performer and director." See S. Rep. No.
105-190, at 16 (1998). The OK-Express Defendants offer no contrary case law and the Court
finds that the information included with the pins qualifies as CMI under either§ 1202(c)(3) or§
1202(c)(7).
The OK-Express Defendants' second and third arguments are closely related to each
other. Essentially, both arguments focus on whether the DMCA is meant to reach conduct like
that alleged here - namely, where defendants take the physical product and packaging of
plaintiffs and reproduce them without the original CMI.
The parties' arguments reflect a split among the courts to have considered this question.
The OK-Express Defendants rely heavily on Textile Secrets, Int'!, Inc. v. Ya-Ya Brand, which
14
held that§ 1202 was not "intended to apply to circumstances that have no relation to the Internet,
electronic commerce, automated copyright protections or management systems, public registers,
or other technological measures or processes as contemplated by the DMCA as a whole." 524 F.
Supp. 2d 1184, 1201 (C.D. Cal. 2007). However, this narrow understanding is likely the
minority position now, as myriad other courts tasked with considering the proper scope of the
DMCA have not limited it in this way. See, e.g., Assoc. Press v. All Headline News Corp., 608 F.
Supp. 2d 454, 462 (S.D.N.Y. 2009); Murphy v. Millennium Radio Grp. LLC, 650 F.3d 295, 30005 (3d Cir. 2011); InterplanArchitect, Inc. v. CL. Thomas, Inc., No. 08-CV-3181, 2009 WL
6443117, at *5 (S.D. Tex. Nov. 13, 2009); Fox v. Hildebrand, 2009 WL 1977996, at *2-3 (C.D.
Cal. 2009); Levey.film, Inc. v. Fox Sports Interactive Media, LLC, 999 F. Supp. 2d 1098, 1101
(N.D. Ill. 2014); Agence France Presse v. Morel, 769 F. Supp. 2d 295, 306 (S.D.N.Y. 2011);
Williams, 2015 WL 1247065, at *3; Logan Developers, Inc. v. Heritage Bldgs., Inc., No. 12-CV323, 2013 WL 5460757, at *9 (E.D.N.C. Sept. 30, 2013). Rather, those courts have reasoned
that there is no reason "to resort to legislative history to cloud a statutory text," when a "statute's
language is clear." Assoc. Press, 608 F. Supp. 2d at 461-62 (quotation omitted). The text of§§
1202(a) or (b) does not include the words "internet," "e-commerce," "technological,"
"automated," "process," or "system," or any other word or phrase that would suggest that the
removal or alteration of CMI, or provision of false CMI, must be accomplished in a specific way.
A similar divide may be developing between those courts that conclude that the DMCA
requires a showing that the CMI was removed from the plaintiff's work itself, see Faulkner
Press, LLCv. Class Notes, LLC, 756 F. Supp. 2d 1352, 1359-60 (N.D. Fla. 2010) (dismissing a
DMCA claim at summary judgment because information was "allegedly copied into a different
form and then incorporated into the note packages" instead of being removed or altered "from
15
the copyrighted works"), and those which have allowed a claim to proceed with allegations that
CMI was recreated anew. See Assoc. Press, 608 F. Supp. 2d at 457-58, 462 (finding DMCA
sufficiently alleged where defendant re-wrote or copied plaintiffs news stories and published
them on a separate news service).
The Court need not decide this question at this early juncture, because even if the Court
were to adopt the narrower view of the DMCA, and require Plaintiffs to have both plausibly
alleged that the CMI was removed or altered through a technological process and that the CMI
was removed or altered from Plaintiffs' actual products, and not just left off of a new creation,
dismissal would still not be warranted. Plaintiffs are silent on exactly how the Defendants
allegedly removed the CMI. Plaintiffs plead only that "O.K. Originals and Orion sent the
Original Pins to their foreign manufacturers," and that "when the Infringing Products returned
from the foreign manufacturers ... the Plaintiff Artists' copyright management information had
been completely removed." SAC if 61. While "[i]t is impossible to ascertain at this stage of the
litigation ... when and how the removal was accomplished," on a motion to dismiss, "Rule 8 does
not require certainty; it requires plausibility." Greg Young Publ'g, Inc. v. CafePress, Inc., No.
15-CV-6013, 2016 WL 6106752, at *4 (C.D. Cal. Jan. 25, 2016). On a motion to dismiss, the
Court must draw all reasonable inferences in Plaintiffs' favor. LaFaro, 570 F.3d at 475. While
no images of the allegedly infringing packaging have been provided to the Court, it is reasonable
to infer based on Plaintiffs' allegations that these foreign manufacturers may have used a
technological process to replicate the pins and packaging without Plaintiffs' CMI, rather than
creating the products entirely anew based merely on "inspiration" from the samples.
Consequently, drawing this inference in Plaintiffs' favor, under either party's proposed legal
standard, the Court finds that the SAC plausibly alleges a violation of§ 1202. The Court's
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conclusion at this stage in the litigation carries no prejudice for Defendants to make a similar
legal argument following discovery should the evidence ultimately demonstrate otherwise.
Finally, Francesca's argues that Plaintiffs' fail to adequately state their DMCA claim
because they do not allege that Francesca's knew about the CMI infonnation on the pins, nor that
it knew the distributors had removed or altered the CMI from the Plaintiffs' pins. Francesca's
Mem. at 5. The Second Circuit has stated that courts should be lenient in allowing scienter
issues to survive motions to dismiss. Jn re DDAVP Direct Purchaser Antitrust Litig., 585 F.3d
677, 693 (2d Cir. 2009). Here, the SAC alleges that certain Plaintiffs contacted Francesca's with
complaints of infringement, and that Francesca's continued to sell infringing products
nonetheless. See SAC iii! 70-71, 73 (alleging that Ghahremani sent a cease-and-desist letter to
Francesca's and communicated with Francesca's on social media and that Alderette, B. Wilson,
and K. Wilson also notified Francesca's of their infringement claims). Similar allegations were
sufficient to establish the knowledge element of the DMCA claims in other cases. See, e.g.,
Fischer v. Forrest, No. 14-CV-1304 (PAE), 2015 WL 195822, at *9 (S.D.N.Y. Jan. 13, 2015)
(finding plausible inference of intentionality given that defendant continued conduct after
receiving cease-and-desist letter); Agence France, 769 F. Supp. 2d at 306 (finding sufficient
allegations that defendants continue to distribute infringing photos despite plaintiffs instruction
to change the photo credit); Goldstein, 2016 WL 4257457, at *8 (finding that scienter may be
pleaded generally and that defendant's continued behavior despite actual knowledge sufficed).
The allegations of knowledge here are sufficient to survive a motion to dismiss as well.
Accordingly, for the reasons stated above, the Court finds that Plaintiffs adequately state
a claim under both§ 1202(a) and§ 1202(b).
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D. New York Law Claims (Fifth and Sixth Claims for Relief)
Plaintiffs' fifth claim for relief alleges that Defendants engaged in deceptive acts and
practices in violation of New York's General Business Law§ 349. To state a claim under GBL
§ 349, a plaintiff must demonstrate that "(1) the defendant's deceptive acts were directed at
consumers, (2) the acts are misleading in a material way, and (3) the plaintiff has been injured as
a result." Maurizio v. Goldsmith, 230 F.3d 518, 521 (2d Cir. 2000). Defendants argue that
Plaintiffs' claim is preempted by the Copyright Act, which exclusively governs claims that seek
"to vindicate legal or equitable rights that are equivalent to one of the bundle of exclusive rights
already protected by copyright law," with respect to works protected by the Act. See OK Mem.
at 18 (quoting Briarpatch Ltd., L.P. v. Phoenix Pictures, Inc., 373 F.3d 296, 305 (2d Cir. 2004)).
Plaintiffs argue that their claim under § 349 is not preempted because as a "passing off' claim,
its focus is on the deceptive effect on consumers, and so is qualitatively different than what is
protected by the Copyright Act. See Opp. at 26-27. Plaintiffs are correct that if the nature of the
rights asserted under GBL § 349 is that of consumer deception, the claim may not be preempted.
We Shall Overcome Found., 2016 WL 6871427, at *10. However, ifthat is the nature of
Plaintiffs' claim, they have not adequately stated it.
It is well settled that for a corporate competitor to establish a prima facie case for
deceptive trade practices under§ 349, "the gravamen of the complaint must be consumer injury
or harm to the public interest." Gucci Am., Inc. v. Duty Free Apparel, Ltd., 277 F. Supp. 2d 269,
273 (S.D.N.Y. 2003) (quotations omitted). "Courts routinely reject ... attempts to fashion
Section 349 ... claims from garden variety disputes between competitors" where the gravamen
of the complaint is harm to another business. Winner Int'! v. Kryptonite Corp., No. 95-CV-247
(KMW), 1996 WL 84476, at *3 (S.D.N.Y. Feb. 27, 1996). Here, Plaintiffs allege in a conclusory
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manner that consumers are "discerning and well-informed about the pins and their creators" and
"are likely to be confused as to the origin of these goods, and are likely to mistakenly believe
that Plaintiff Artists are somehow affiliated with or associated with these goods when in fact they
are not." SAC iii! 48, 68. Plaintiffs offer no examples of any consumers who were confused.
Rather, what Plaintiffs truly allege would be properly called "reverse passing off' under
the Lanham Act, an element of which is that "the origin of the work was falsely designated by
the defendant." See Nat 'l Lighting Co. v. Bridge Metal Indus., LLC, 601 F. Supp. 2d 556, 564
(S.D.N.Y. 2009). Plaintiffs dropped their false designation claim under the Lanham Act when
amending their complaint in response to Defendants' first motions to dismiss for good reason:
The crux of Plaintiffs' complaint is that the Retailers altered the packaging to sell it under their
own name, not that of Plaintiffs. See SAC if 109 (alleging Defendants to have "deceive[ d]
customers into believing that Defendants were the authors of the pin designs"). Ultimately, the
claim fails to adequately allege consumer confusion.
Plaintiffs' sixth cause of action is for unfair competition under New York state common
law. Plaintiffs fail to adequate state this claim for the same reasons their claim under GBL § 349
falls - namely, the claim is either preempted or inadequately pled. An unfair competition claim
may avoid preemption if predicated on a theory of"passing off' or "reverse passing off." WNET
v. Aereo, Inc., 871 F. Supp. 2d 281, 288 (S.D.N.Y. 2012) (Nathan, J.). However, the standards
for false designation of origin claims under the Lanham Act and unfair competition claims under
New York law are virtually the same. Kregos v. Assoc. Press, 795 F. Supp. 1325, 1336
(S.D.N.Y. 1992). As discussed above, Plaintiffs do not adequately allege false designation
because they do not adequately support claims of consumer confusion. The "mere reproduction"
of Plaintiffs' designs could support an unfair competition claim for false designation of
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ownership, id. at 1337, but their failure to adequately allege that the public is likely to be
confused is determinative.
Accordingly, the Court grants Defendants' motions to dismiss Plaintiffs' state law claims.
E. Motion to Strike
OK-Express Defendants also move to strike as impertinent and scandalous portions of the
complaint that allege that OK is a "known distributor[] of knockoff and copyright goods" and a
"known infringer" respectively. OK Mem. at 21 (citing SAC iii! 4, 73). They argue that the
allegations "unnecessarily reflect upon OK's alleged moral character" and would be inadmissible
at trial. Id.
Under Rule 12(f) of the Federal Rules of Civil Procedure, "[t]he court may strike from a
pleading ... any redundant, immaterial, impertinent, or scandalous matter." However, it is clear
in the Second Circuit that motions to strike are generally disfavored. "[C]ourts should not
tamper with the pleadings unless there is a strong reason for so doing." Lipsky v. Commonwealth
United Corp., 551 F.2d 887, 893 (2d Cir. 1976). It is well settled that courts should deny
motions to strike material from the pleadings "unless it can be shown that no evidence in support
of the allegation would be admissible." Id. Given these parameters, "[t]o prevail on a motion to
strike, the defendant must show that: (1) no evidence in support of the allegations would be
admissible; (2) the allegations have no bearing on the relevant issues; and (3) permitting the
allegations to stand would result in prejudice to the movant." Hargett v. Metro. Transit Auth.,
552 F. Supp. 2d 393, 404 (S.D.N.Y. 2008) (quotations omitted).
Plaintiffs correctly respond that the allegations bear directly on the scienter elements of
Plaintiffs' contributory infringement and DMCA claims. Opp. at 30. While a bare allegation of
bad character might be inadmissible, the Court cannot say at this juncture that Plaintiffs would be
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unable to generate evidence to support this claim, such as evidence of OK's reputation within the
industry or evidence of prior infringements. Accordingly, and in light of the high standard that
governs motions to strike portions of the pleadings, the Court denies the OK-Express
Defendants' motion. Cf Finch v. Xavier Univ., No. 07-CV-987, 2008 WL 11351334 (S.D. Ohio
Mar. 20, 2008) (denying a motion to strike an allegation that a man was "known for his sexist
views" in Title IX case); Nelson v. Banks, No. 15-CV-605, 2016 WL 5496406, at *11-12 (E.D.
Ark. Sept. 28, 2016) (denying motion to strike allegation that man was "known racist" in
employment discrimination case).
IV. Conclusion
For the foregoing reasons, the Court GRANTS Defendants' motions to dismiss as to the
state law claims (Five and Six), but DENIES Defendants' motions to dismiss as to the Copyright
and DMCA claims (One, Two, Three, and Four). The Court DENIES the OK-Express
Defendants' motion to strike.
This Order resolves Dkt. Nos. 47 & 66. The Court will schedule an initial pretrial
conference by separate order.
SO ORDERED.
Dated: March ~ ,., 2018
New York, New York
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