Rawls v. Paradise Artists, Inc.
Filing
101
MEMORANDUM OPINION OF THE COURT. Signed by Magistrate Judge Barbara D. Holmes on 3/27/2020. (DOCKET TEXT SUMMARY ONLY-ATTORNEYS MUST OPEN THE PDF AND READ THE ORDER.)(mg)
IN THE UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF TENNESSEE
NASHVILLE DIVISION
NINA RAWLS
v.
PARADISE ARTISTS, INC. and
THE ORCHARD ENTERPRISES, INC.
)
)
)
)
)
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No. 3:18-0417
Judge Holmes
MEMORANDUM OPINION AND ORDER
Currently pending before the Court is Defendants’ motion to dismiss (Docket Entry
(“DE”) 83), to which Plaintiff has filed a response. (DE 86.) Defendants have also filed a reply to
Plaintiff’s response. (DE 88.) Also pending is Plaintiff’s related motion requesting that the Court
take judicial notice of a copyright registration (DE 87), to which Defendants have filed a
response. (DE 89.) This action is before the Magistrate Judge for all further proceedings pursuant
to the consent of the parties and referral of the District Judge in accordance with 28 U.S.C.
§ 636(c). (DE 97.)
For the reasons that follow, Defendants’ motion to dismiss (DE 83) is GRANTED IN
PART and Plaintiff’s motion for judicial notice (DE 87) is DENIED AS MOOT. As a result, this
action is DISMISSED WITHOUT PREJUDICE.
I. STATEMENT OF THE CASE
Plaintiff Nina Rawls (“Plaintiff” or “Ms. Rawls”) is the widow of recording artist Lou
Rawls (“Mr. Rawls”). 1 Plaintiff, as the sole trustee of the Lou and Nina Rawls Trust (“Trust”),
1
These facts are drawn from Plaintiff’s third amended complaint. (DE 78.) For reasons
delineated in the Court’s previous order, the title “third amended complaint” is actually a
has asserted multiple claims against Defendants Paradise Artists, Inc. (“Paradise Artists”) and
The Orchard Enterprises NY, Inc. (“Orchard”) (collectively referred to as “Defendants”) for the
unauthorized use of three works: (1) Seasons 4 U, an album recorded by Mr. Rawls in 1998;
(2) Rawls Sings Sinatra, an album recorded by Mr. Rawls in 2003; and (3) a collection of
photographs taken by photographer Bonnie Schiffman in 2003 in connection with the Rawls
Sings Sinatra album (“the 2003 photographs”).
The Seasons 4 U album was released by Rawls and Brokaw Records (“Rawls and
Brokaw”), a company co-owned by Mr. Rawls and his manager. Counsel for Plaintiff obtained
copyright registration for the Seasons 4 U album in Plaintiff’s name on July 24, 2018, almost
three months after the instant lawsuit was commenced, the certificate of which is attached to the
third amended complaint. (DE 78 at 17-19.)2 Later, on November 5, 2018, counsel for Plaintiff
registered the copyright for Seasons 4 U in the name of the Trust.
Mr. Rawls registered the copyright for the Rawls Sings Sinatra album in 2003. Counsel
for Plaintiff obtained copyright registration for this album in the name of the Trust on
November 1, 2018, approximately six months after the commencement of the instant lawsuit.
Copyright registration for the 2003 photographs was completed and issued to Mr. Rawls
on June 10, 2004.
misnomer. (DE 77 at 1, n.1.) However, because the operative pleading is labeled as the “third
amended complaint” (see DE 78) and the parties continue to reference the document as such, the
Court will similarly do so.
2
Plaintiff alleges in the third amended complaint that Mr. Rawls “obtained a copyright
registration in the [Seasons 4 U] album” in 1998 (DE 78 at ¶ 9), but admits in her response that
the copyright was not registered until after commencement of the instant lawsuit. (DE 86 at 6.)
As noted by Defendants, Plaintiff’s allegations have been less than consistent throughout the
course of this litigation.
2
The agreement governing the Trust (“Trust agreement”) was executed by Mr. Rawls and
Plaintiff on March 10, 2005. That same day, Mr. Rawls and Plaintiff executed a “Grant and
Assignment” that assigned all of their “separate and community property” to the Trust. 3 The
Trust agreement contains an intellectual property rights provision that states in relevant part:
[T]he Trustors hereby declare that they hereby transfer to the Trust all of the
Trustors’ right, title and interest in and to either Trustor’s name, sobriquet, voice,
signature, photograph, actual or simulated likeness, image and other personal
identification, any and all trademarks, trade names, trade dress, service marks and
other personal identifiers, all applications and registrations thereof and all
goodwill symbolized thereby, all rights of publicity, all copyrights, copyright
registrations and rights to renew, extend, cause reversion of or to terminate any
grant of such copyright, and all rights arising under or out of any of the
foregoing[.]
On May 31, 2005, Paradise Artists entered into a “Music Service Agreement” with
Orchard to distribute sound recordings to various digital musical platforms. Pursuant to this
agreement, the Seasons 4 U album was distributed to 96 digital platforms while Rawls Sings
Sinatra was distributed to 95 digital platforms.
On January 5, 2006, one day before his death, Mr. Rawls executed his Last Will and
Testament, which directed in relevant part that “all of the rest, residue and remainder of my
estate” is bequeathed to “the then acting Trustee or Trustees” of the Trust. 4 On January 9, 2006,
Plaintiff executed a “Notice of Acceptance of Trusteeship” that memorialized her status as the
successor sole trustee of the Trust.
In February of 2018, Plaintiff discovered that the Seasons 4 U and Rawls Sings Sinatra
albums were available on numerous digital musical platforms, including iTunes and Spotify. The
3
A copy of this agreement is attached to the third amended complaint. (DE 78 at 20-22.)
4
A copy of the will is also attached to the third amended complaint. (DE 78 at 32-47.)
3
Rawls Sings Sinatra album was advertised using one of the 2003 photographs. Paradise Artists
and Orchard were responsible for distribution of these albums to the various digital platforms.
Plaintiff asserts four claims against Paradise Artists: (1) copyright infringement for
unauthorized licensing of both albums to Orchard for digital distribution; (2) copyright
infringement for unauthorized use of the 2003 photographs; (3) violation of section 43(a) of the
Lanham Act, 15 U.S.C. § 1125(a)(1)(A), for unauthorized use of Mr. Rawls’ name in connection
with the unauthorized licensing of both albums; and (4) violation of Tennessee’s right of
publicity, Tenn. Code Ann. § 47-25-1103, for unauthorized use of Mr. Rawls’ name and
photographs in connection with the unauthorized licensing of both albums.
Plaintiff asserts five claims against Orchard: (1) copyright infringement for unauthorized
digital distribution of Seasons 4 U; (2) copyright infringement for unauthorized digital
distribution of Rawls Sings Sinatra; (3) copyright infringement for unauthorized use of the 2003
photographs; (4) violation of section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a)(1)(A), for
unauthorized use of Mr. Rawls’ name in connection with the unauthorized distribution of both
albums; and (5) violation of Tennessee’s right of publicity, Tenn. Code Ann. § 47-25-1103, for
unauthorized distribution of both albums.
Based on these claims, Plaintiff seeks preliminary and permanent injunctions prohibiting
Defendants from further infringement of Plaintiff’s intellectual property rights, actual damages
pursuant to 17 U.S.C. § 504(b), or, alternatively, statutory damages pursuant to 17 U.S.C.
§ 504(c), as well as costs and attorney’s fees pursuant to 17 U.S.C. § 505.
Defendants seek dismissal on various grounds, including under Rule 12(b)(1) for lack of
standing and Rule 12(b)(6) for failure to state a claim. Plaintiff opposes Defendants’ motion to
dismiss.
4
II. STANDARD OF REVIEW
A. Dismissal for Lack of Subject Matter Jurisdiction
A motion that alleges lack of standing under Rule 12(b)(1) is properly characterized as a
motion seeking dismissal for lack of subject matter jurisdiction. Hosp. Auth. of Metro. Gov’t of
Nashville v. Momenta Pharm, Inc., 353 F. Supp. 3d 678, 686-87 (M.D. Tenn. 2018). Such a
motion can attack the claim of jurisdiction on its face, or, alternatively, attack the factual basis
for jurisdiction. DLX, Inc. v. Kentucky, 381 F.3d 511, 516 (6th Cir. 2004). A motion representing
a facial attack challenges only “the sufficiency of the pleadings” and is treated akin to a
Rule 12(b)(6) motion, thus requiring the court to accept as true all allegations made by the
plaintiff. Glob. Tech., Inc. v. Yubei (XinXiang) Power Steering Sys. Co., 807 F.3d 806, 810 (6th
Cir. 2015) (internal citation omitted).
B. Dismissal for Failure to State a Claim
To survive a motion to dismiss under Rule 12(b)(6), the complaint need only contain “a
short and plain statement of the claim showing that the pleader is entitled to relief.” Carrier
Corp. v. Outokumpu Oyj, 673 F.3d 430, 444 (6th Cir. 2012) (quoting Fed. R. Civ. P. 8(a)(2)).
When reviewing a motion to dismiss pursuant to Fed. R. Civ. P. 12(b)(6), the court must
“construe the complaint in the light most favorable to the plaintiff[] [and] accept all well-pleaded
factual allegations as true[.]” Matthew N. Fulton, D.D.S., P.C. v. Enclarity, Inc., 907 F.3d 948,
951-52 (6th Cir. 2018) (quoting Hill v. Snyder, 878 F.3d 193, 203 (6th Cir. 2017)).
Matters outside of the pleadings are generally not considered when ruling on a
Rule 12(b)(6) motion to dismiss. Rondigo, L.L.C. v. Twp. of Richmond, 641 F.3d 673, 680 (6th
Cir. 2011) (citation omitted). However, the court may consider “exhibits attached [to the
complaint], public records, items appearing in the record of the case and exhibits attached to
5
defendant’s motion to dismiss so long as they are referred to in the complaint and are central to
the claims contained therein,” without converting the motion to dismiss into a motion for
summary judgment. Id. at 680-81 (citing Bassett v. Nat’l Collegiate Athletic Ass’n, 528 F.3d 426,
430 (6th Cir. 2008)).
While generally prohibited from considering matters outside the pleadings in ruling on a
motion to dismiss, the court may consider materials that are “appropriate for the taking
of judicial notice” under Rule 201 of the Federal Rule of Evidence. In re Unumprovident Corp.
Sec. Litig., 396 F. Supp. 2d 858, 875 (E.D. Tenn. 2005) (citing Bovee v. Coopers & Lybrand
C.P.A., 272 F.3d 356, 360-61 (6th Cir. 2001)). Rule 201 permits the Court to take judicial notice
of facts that are “not subject to reasonable dispute” because they are either (1) “generally known
within the trial court’s territorial jurisdiction” or (2) “can be accurately and readily determined
by sources whose accuracy cannot reasonably be questioned.” Fed. R. Evid. 201(b). The Court
may take such action on its own, but “must take judicial notice if a party requests it and the court
is supplied with the necessary information.” Fed. R. Evid. 201(c).
III. ANALYSIS
Because standing represents a “threshold question” in any federal case, Am. Telecom Co.
v. Republic of Lebanon, 501 F.3d 534, 537 (6th Cir. 2007), the Court must initially determine
whether Plaintiff has standing to sue. The Copyright Act provides that the “legal or beneficial”
owner of an exclusive right is entitled to “institute an action for any infringement of that
particular right committed while he or she is the owner of it.” 17 U.S.C. § 501(b). To have
standing under this provision, the party bringing suit “must have some ownership rights over at
least part of the exclusive right for which he wishes to sue.” Warner/Chappell Music, Inc. v. Blue
Moon Ventures, No. 3:10-cv-1160, 2011 WL 662691, at *3 (M.D. Tenn. Feb. 14, 2011).
6
Plaintiff, as the party invoking federal jurisdiction, bears the burden of establishing standing.
Loren v. Blue Cross & Blue Shield of Mich., 505 F.3d 598, 607 (6th Cir. 2007) (citing Lujan v.
Defenders of Wildlife, 504 U.S. 555, 561 (1992)).
Defendants contend that Plaintiff has failed to allege sufficient facts to establish standing.
Defendants argue that Plaintiff cannot proceed with any claims related to the Rawls Sings Sinatra
album since the associated copyright was not registered to the Trust until November 1, 2018,
several months after the initial complaint was filed. As noted by Plaintiff, however, section
411(a) does not require that the party bringing the infringement claim be the same individual or
entity that registered the work. See Huthwaite, Inc. v. Sunrise Assisted Living, Inc., 261 F. Supp.
2d 502, 508-09 (E.D. Va. 2003) (“[T]he plaintiff in court obviously need not be the same party
who initially registered the subject work.”) (internal citation omitted). See also Tang v. Hwang,
799 F. Supp. 499, 503-04 (E.D. Pa. 1992) (“There is no requirement under [17 U.S.C. § 411(a)]
that the only person who may bring an action is the person who applies for the copyright
registration. The law merely provides that there must be registration of the copyright claim,
pursuant to the Copyright Act, before an action may be instituted.”). Defendants cite no authority
to the contrary. Because Plaintiff alleges that Rawls Sings Sinatra was registered in 2003 and the
rights thereof were later transferred to her, she has standing to sue for copyright infringement.
The same reasoning applies to the 2003 photographs. The third amended complaint
alleges that these photographs were registered on June 10, 2004 and subsequently became the
property of the Trust in March of 2005.5 Plaintiff was not required to register the photographs in
5
The 2003 photographs are the subject of Plaintiff’s motion for judicial notice (see
DE 87), which, for the reasons outlined in this memorandum opinion, is denied as moot. For
purposes of the instant motion to dismiss, however, the Court assumes registration was
completed on June 10, 2004.
7
the name of the Trust prior to commencing the instant lawsuit, therefore she has standing to
pursue claims for copyright infringement as to those works. For these reasons, Defendants’
standing arguments as to these two works fail.
Defendants do not clearly delineate whether they seek to dismiss Plaintiffs infringement
claims related to the Seasons 4 U album for lack of standing or failure to state a claim.
References to that work are interspersed throughout Defendants’ arguments for dismissal on both
these grounds. To the extent that Defendants assert Plaintiff’s lack of standing to pursue
infringement claims as to the Seasons 4 U album, that argument appears to be based on
Plaintiff’s failure to demonstrate that she obtained copyright registration for Seasons 4 U in
1998. Defendants argue that, because Plaintiff provides only registration numbers for Seasons 4
U that were issued after the commencement of this action, her complaint fails to comply with
17 U.S.C. § 411(a)’s requirement that “preregistration or registration” of the copyright be made
prior to bringing any lawsuit for infringement of the copyright. Although (perhaps) framed as a
standing question, compliance with section 411 is not a jurisdictional requirement.
Reed
Elsevier, Inc. v. Muchnick, 559 U.S. 154, 166-67 (2010) (concluding that the copyright
registration requirement of section 411(a) is a pleading requirement, not a jurisdictional one).6
The proper analysis is whether Plaintiff has adequately stated a claim for relief, specifically
whether the pleadings sufficiently demonstrate prefiling compliance with section 411(a).
Plaintiff acknowledges the Supreme Court’s recent decision in Fourth Estate Pub. Benefit
Corp. v. Wall-Street.com, LLC, which holds that registration for purposes of 17 U.S.C. § 411(a)
has been made “not when an application for registration is filed, but when the Register has
6
Nothing in the Supreme Court’s decision in the Fourth Estate case discussed in more
detail below changes its earlier decision in Reed Elsevier that section 411 compliance is not a
jurisdictional prerequisite.
8
registered
a
copyright
after
examining
a
properly
filed
application.”
___ U.S.
___, 139 S. Ct. 881, 892, 203 L. Ed. 2d 147 (2019). Plaintiff concedes that she did not obtain
copyright registration of Seasons 4 U until after commencement of the lawsuit but notes that
numerous courts have held that submission of an amended complaint after registration is
completed alleviates any pleading deficiencies. However, each of the cases cited by Plaintiff
predates the Fourth Estate decision, which, contrary to Plaintiff’s argument otherwise, impacts
the Court’s analysis given that numerous cases decided after Fourth Estate hold that an amended
complaint cannot fix the defect caused by a claimant’s failure to obtain copyright registration
prior to filing suit. See, e.g., UAB “Planner 5D” v. Facebook, Inc., No. 19-cv-03132-WHO,
2019 WL 6219223, at *7 (N.D. Cal. Nov. 21, 2019) (“A plaintiff cannot cure its failure to meet
the preconditions set forth in 17 U.S.C. § 411(a) by amending its pending complaint.”); XclusiveLee, Inc. v. Hadid, No. 19-CV-520-PKCCLP, 2019 WL 3281013, at *4 (E.D.N.Y. July 18, 2019)
(declining to grant claimant leave to amend complaint involving copyright that had not yet been
registered); Izmo, Inc. v. Roadster, Inc., No. 18-CV-06092-NC, 2019 WL 2359228, at *2 (N.D.
Cal. June 4, 2019) (denying Plaintiff’s attempt to amend complaint to cure its failure to register
copyright before suing);7 Mai Larsen Designs v. Want2Scrap, LLC, No. SA-17-CV-1084-ESC,
2019 WL 2343019, at *6 (W.D. Tex. June 3, 2019) (“To adopt [plaintiff’s] reasoning the Court
would have to hold that Fourth Estate allows a plaintiff to file a lawsuit before copyright
registrations have been awarded and to amend the pleadings after registration is obtained, so long
as the effective date (i.e., the date of application) predates the filing of the lawsuit. The Court
7
Like Plaintiff in this matter, the claimant in Izmo cited the court’s decision in Zito v.
Steeplechase Films, Inc., 267 F. Supp. 2d 1022 (N.D. Cal. 2003), to argue that the filing of an
amended complaint after registration was complete satisfied section 411(a), which prompted the
Izmo court to question whether Zito “remains good law in light of the Supreme Court’s”
Fourth Estate decision. Izmo, 2019 WL 2359228, at *2 (N.D. Cal. June 4, 2019).
9
cannot square this argument with the holding of Fourth Estate.”); Malibu Media, LLC v. Doe,
No. 18-CV-10956 (JMF), 2019 WL 1454317, at *2 (S.D.N.Y. Apr. 2, 2019) (“Plaintiff’s
argument would make a meaningless formality out of Fourth Estate’s requirement that an
application be approved prior to filing suit. Were it correct, a plaintiff could file suit at any time,
notwithstanding Section 411(a)’s precondition, and simply update the complaint when
registration finally occurred.”) Indeed, the Court agrees with the reasoning of these decisions and
finds that Plaintiff’s post-complaint registration of Seasons 4 U fails to comply with 17 U.S.C.
§ 411(a).
What must the Court then do upon finding that only two of the three works at issue in this
lawsuit satisfy section 411(a)’s registration requirement? In Fourth Estate, the Supreme Court
concluded that the registration requirement is “akin to an administrative exhaustion.” Fourth
Estate, 139 S. Ct. at 887. See also Reed Elsevier, supra at 165-66 (comparing section 411(a) to
“Title VII’s requirement that sex-discrimination claimants timely file a discrimination charge
with the EEOC”). In other areas of law, failure to exhaust administrative remedies generally
results in dismissal without prejudice. See, e.g., Bell v. Konteh, 450 F.3d 651, 654 (6th Cir. 2006)
(holding that claims brought under Prison Litigation Reform Act that did not meet administrative
exhaustion requirement should be dismissed without prejudice); Ravencraft v. UNUM Life Ins.
Co. of Am., 212 F.3d 341, 344 (6th Cir. 2000) (dismissal without prejudice appropriate when
dismissing an ERISA action solely for failure to exhaust administrative remedies); Thomas v.
Grinder & Haizlip Const., 547 F. Supp. 2d 825, 829 (W.D. Tenn. 2007) (“Dismissal without
prejudice is generally the appropriate remedy for a Title VII claim filed prematurely before
administrative remedies are exhausted.”) (internal citation omitted). This is consistent with the
post-Fourth Estate cases from other districts cited above, all of which except one resulted in
10
dismissal without prejudice of copyright infringement claims brought before registration was
completed. 8
The body of law that has emerged in the wake of Fourth Estate strongly suggests that
allowing the claims related to Seasons 4 U to proceed, despite successful registration of the
associated copyright following commencement of this action, would “undermine the objectives
animating” the Fourth Estate holding. Izmo, 2019 WL 2359228, at *2. Although there is some
appeal to dismissing only the Seasons 4 U claims and allowing the remaining infringement
claims to proceed, the Court does not find a tenable outcome in dismissal of the Seasons 4 U
claims without prejudice and not of the claims for the other two works. See id. (“The fact that
[plaintiff] properly ‘commenced’ this lawsuit as to some of its copyrights does not excuse its
failure to comply with § 411(a) as to its other copyrights.”) (emphasis in original). 9
8
The court in Xclusive-Lee, Inc. v. Hadid did not explicitly dismiss the subject plaintiff’s
copyright claims with prejudice, but instead “declined to grant Plaintiff leave to amend the
complaint to allege registration should its copyright application be approved in the future.” 2019
WL 3281013, at *4. This is distinct from the instant matter, in which Plaintiff achieved
registration after filing her initial complaint but before filing the first amended complaint.
Further, the court in Xclusive-Lee appeared to contemplate that the plaintiff in that case might
file a new action after being formally granted a registered copyright. Id., n.8
9
The Court acknowledges its statements in a previous, non-dispositive order on
Plaintiff’s motion to amend suggesting that the interests of judicial economy would be best
served by simply allowing Plaintiff to amend her complaint to comply with section 411(a)
following successful registration of the Seasons 4 U copyright. (DE 77 at 7-9). As a purely
practical outcome, that may well still be supportable. However, in this instance at least
practicalities yield to the law. And it is not clear that all the holdings relied upon in resolution of
the motion to amend remain good law, at least as they pertain to the registration requirement, and
particularly considering the substantial body of law that has developed following Fourth Estate
(and following resolution of the motion to amend). Further, and more importantly, in ruling on
the motion to amend, the Court expressly noted that it was not deciding Defendants’ argument
that Plaintiff’s amendment was futile because of continuing defects in copyright registration.
(Id. at 6.) To have resolved that issue would have required an analysis under Rule 12(b)(6). Rose
v. Hartford Underwriters Ins. Co., 203 F.3d 417, 421 (6th Cir. 2000) (“[A] proposed amendment
is futile only if it could not withstand a Rule 12(b)(6) motion to dismiss.”). The Court declined to
undertake that analysis for the reasons stated in the order. (DE 77 at 6-7.) Thus, there was no
11
The Court recognizes the procedural quandary implicated by this result. Outright
dismissal of the third amended complaint without prejudice will likely result in a newly filed
lawsuit, which will then require the parties to retrace their steps of almost two years only to
arrive at essentially the same place. The idea of such procedural hoop jumping certainly offends
the Court’s sense of judicial economy. However, a partial dismissal of only the infringement
claims related to Seasons 4 U might also result in Plaintiff simply refiling an action based solely
on infringement related to Seasons 4 U, at which point there would be two federal lawsuits
involving the same parties and the same underlying set of facts, and no savings of judicial or
other resources there either. On balance, dismissal of all Plaintiff’s infringement claims without
prejudice represents the best measured resolution.
For all these reasons, the Court therefore opts for compliance with Fourth Estate, and
because Plaintiff initiated this action without satisfying 17 U.S.C. § 411(a) as to all subject
works, concludes the action cannot proceed. Dismissal of the third amended complaint without
prejudice is the appropriate outcome. See Hallstrom v. Tillamook Cty., 493 U.S. 20, 31 (1989)
(“[I]n the long run, experience teaches that strict adherence to the procedural requirements
specified by the legislature is the best guarantee of evenhanded administration of the law.”). See
also Blue Book Servs., Inc. v. Farm Journal, Inc., No. 18-cv-07155, 2020 WL 419405, at *6
(N.D. Ill. Jan. 27, 2020) (“This Court will not disregard the procedural requirements specified by
the legislature; failure to comply with § 411(a) requires dismissal of this case, albeit without
prejudice[.]”).
decision on the issues raised in the instant motion to dismiss. Now the Court has fully considered
whether the third amended complaint can survive dismissal under Rule 12(b)(6) and concludes
that under controlling and applicable law it cannot.
12
IV. CONCLUSION
For the foregoing reasons, Defendants’ motion to dismiss (DE 83) is GRANTED IN
PART and the instant action is DISMISSED WITHOUT PREJUDICE.10
It is SO ORDERED.
__________________________
BARBARA D. HOLMES
United States Magistrate Judge
10
Because this action is dismissed based on Plaintiff’s failure to comply with prefiling
registration requirement of section 411, the Court need not address the remaining arguments in
Defendants’ motion.
13
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