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| Brief Supporting E!'s Motion To Dismiss |
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IN THE UNITED STATES DISTRICT COURT Civil Action No. 03-D-2334 (PAC)
KAREN DUDNIKOV and Pro Se Plaintiffs, v.
E! ENTERTAINMENT TELEVISION, INC., Defendant DEFENDANT'S BRIEF IN SUPPORT OF MOTION TO DISMISS |
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Pursuant to D.C. Colo. L.Civ. r.7.1, Defendant E! Entertainment Television, Inc. ("E!"), submits this combined brief in support of Defendant's Motion to Dismiss. Based on the following points and authorities, defendant requests that this Court dismiss Plaintiffs' Complaint pursuant to Fed.R.Civ. P. 12(b)(6). I. INTRODUCTION Plaintiffs' Complaint is premised upon their contention that the "first Sale Doctrine" shields them from claims of copyright infringement in connection with the auction of a copyrighted E! DVD on eBay. However, the DVD they attempted to auction was not subject to a first sale. It was distributed without charge to members of the Academy of Television Arts and Sciences ("ATAS") and the National Academy of Television Arts and Sciences ("NATAS") solely for promotional purposes in connection with the Emmy awards. As the copyright owner, E! expressly reserved all rights including any rights of distribution. It specifically prohibited any further distribution or sale. Because Plaintiffs cannot claim valid ownership of the DVD, they cannot invoke the first sale doctrine, and their claims fail as a matter of law. II. STATEMENT OF UNIDSPUTED FACTS 1. E! makes and distributes DVDS of broadcast television and provides these DVDs to members of ATAS/NATAS for purposes of Emmy Consideration.1 (See Plaintiffs' COMPLAINT OF TORTIOUS BUSINESS INTERFERENCE, OUTRAGEOUS CONDUCT, NEGLIGENT MISREPRESENTATION, AND FRAUDULENT MISREPRESENTATION UNDER COLORADO LAW AND PERJURY UNDER 17 U.S.C. § 512 ("Complaint"), ¶5.) 2. E! owns the copyrights to these DVDs and has taken measures to protect these copyrights. 2 (See id. ¶¶14-15. A copy of the copyrighted DVD, including the reservation of copyright and prohibition of resale, is attached as Exhibit A.) 3. Plaintiffs acquired an E! DVD containing two shows: E! True Hollywood Story: Jaws; and the Michael Essany Show. They listed this DVD for sale on eBay, an internet auction site. 3 (See id. ¶¶ 3,12,16,18.) 4. The DVD Plaintiffs sought to auction was distributed to members of ATAS/NATAS solely for purposes of Emmy consideration as specified on the cover of the DVD. 5. As the copyright holder, E! reserved all rights with respect to the DVD and expressly prohibited any distribution or sale as indicated on the DVD. 6. E! submitted an affidavit to eBay pursuant to 15 U.S.C. §512, informing eBay that E! owned the copyright to the DVD at issue in this litigation, and requested that eBay terminate the auction of this DVD, which it did. 4 (See id., ¶¶17, 51.) This action is the basis for all of Plaintiffs' claims in this lawsuit. III. ARGUMENT A. Standard for Dismissal under Fed.R.Civ.P.12(b)(6) Dismissal of Plaintiffs' Complaint is appropriate if, assuming the facts alleged in Plaintiffs' Complaint to be true, the Complaint fails "to state a claim upon which relief can be granted." Fed. R.Civ.P. 12(b)(6). "The purpose of a motion under 12 (b)(6) is to test for the formal sufficiency of the statement of the claim for relief." Johnson v. N.T.I., a Div. Of Colorado Springs Circuits, 898 F. Supp. 762, 766 (D.Colo. 1995). See also Issa V. Comp USA, 354 F. 3d 1174, 1177 (10th Cir. 2003). Under these standards, Plaintiffs' Complaint fails to state a claim upon which relief may be granted and should be dismissed. B. Plaintiffs are Not Entitled to the Declaratory Relief Sought In Their Complaint Plaintiffs seek a declaration that their selling of E!'s DVD was proper - and that E!'s efforts to terminate this sale were improper - based solely on the "first sale" doctrine and the "fair use" doctrine. As detailed below, neither of these doctrines shield Plaintiffs' conduct nor provide a basis for Plaintiffs' claims. 1. The First Sale Doctrine Does Not Protect Plaintiffs Because They Are Unlawfully in Possession of Copyrighted Materials. Plaintiffs can take no refuge from copyright violations in the first sale doctrine. First and foremost, "[t}he alleged infringer bears the burden of tracing the chain of title to prove that the first sale doctrine applies," meaning Plaintiffs have the burden of showing proper title to the DVD in question. Too, Inc. v Kohl's Department Stores, Inc., 2002 WL 31409852, *3 (S.D. Ohio 2002) (finding that where the defendant's acts of selling copyrighted materials were not authorized by the copyright holder, the first sale doctrine was not triggered). The first sale doctrine is codified at 17 U.S.C. § 109, which expressly removes first sale protection from "any person who as acquired possession of the copy…by rental, lease, loan, or otherwise, without acquiring ownership of it." 17 U.S.C.A §109 (d). In other words, "[t]he person reselling the copy…must be owner of such copy and not merely in possession of it," meaning someone who with permissive use of a motion picture from a copyright owner has no right to transfer the motion picture to someone else. 18 A.Jr.2d, Copyright and Literacy Property, § 98. See also U.S. V. Gallo, 599 F. Supp. 241, 247 (W.D.N.Y. 1984) ("But this doctrine only applies to copies lawfully obtained."). Accordingly, "[t]he first sale doctrine under Section 109(a), however, is concerned only with those forms of disposition which involve a sale or other transfer of ownership," Parfums Givenchy, Inc., v. C&C Beauty Sales, Inc., 832 F.Supp. 1378, 1389 (C.D. Calif. 1993), and the doctrine does not apply when the first disposition of copyrighted material is restricted from subsequent sales by licenses or similar restrictions. See Adobe Systems, Inc. v. One Stop Micro, Inc., 84 F. 2d 1086, 1089 (N.V. Calif 2000); Microsoft Corporation v. Software Wholesale Club, Inc., 129 F. Supp. 2d 995, 1007 (S.D. Tex. 2000) ("However, a party that licenses its products rather than selling them may avoid the application of the first sale doctrine."); Microsoft Corporation v. Harmony Computers Electronics, Inc., 846 F. Supp. 208, 213 (E.D.N.Y. 1994)("Entering a license agreement is not a 'sale' for purposes of the first sale doctrine."). More specifically, the first sale doctrine does not apply where motion pictures are provided to parties by copyright owners who reserve rights to subsequent sale or distribution of the motion pictures. See U.S. v. Wise, 550 F 2d 1180, 1191 (9th Cir. 1977); U.S. v Drebin, 557 F. 2d 1316, 1326 (9th Cir. 1977)(finding that while proprietors of copyrighted motion picture films transferred limited distribution and exhibition rights for a limited time, and generally prohibited the copy or sale of the film, the first sale doctrine did not apply); Video Pipeline, Inc., V. Buena Vista Home Entertainment, 192 F. Supp. 2d 321, 333 (D.N.J. 2002) (finding that first sale doctrine did not apply to video clips of copyrighted motion pictures where a license to use such video clips was limited to previews and compilations to be exhibited at video stores). This is because "[t]he mere failure to expressly reserve title to the films does not require finding that the films were sold, where the general tenor of the entire agreement is inconsistent with such a conclusion." Wise, 550 F. 2d at 1191. Plaintiffs concede that E! transferred the DVD in question to discrete individuals, with E! reserving all rights, including the right of distribution under 17 U.S.C. § 106. This is specified on the DVD along with the restriction that "[d]istribution or sale [of the DVD] is expressly prohibited."5 (A copy of the DVD is included with this motion. Where, as in this instance, a document or thing is referred to in Plaintiffs' Complaint and is central to Plaintiffs' claims the court may consider it in resolving a Rule 12 (b)(6) motion. See, e.g., Prager v. LaFever, 180 f. 3d 1185, 1188-1189 (10th Cir. 1999).) 2. The Copyrighted Material at Issue is Not Encompassed Within The Fair Use Doctrine. As Plaintiffs concede, the fair use doctrine applies to trademark claims. See Complaint at 11-12, ¶¶ 42-50. However, Plaintiffs' infringement upon E!'s copyright in the DVD, not E!'s trademark, was the basis for E!'s efforts to terminate Plaintiffs' sale of the DVD and the fair use doctrine has no application to E!'s efforts to protect its copyright. As detailed above, Plaintiffs have no defense to their unauthorized sale of copyrighted material, and the fair use doctrine does not provide Plaintiffs with such a defense. In any event, "[a] fair use, although not specifically defined by the statute, is one made 'for purposes such as criticism, comment, news reporting, teaching…, scholarship, or research…It is an affirmative defense for which the alleged infringer bears the burden of proof."' Video Peipeline, Inc. v. Buena Vista Home Entertainment, Inc., 342 F. 3d 191, 197 (3rd Cir. 2003)(citation omitted). An attempt to commercially sell the entire content of copyrighted motion pictures does not fall into any of these fair uses and Plaintiffs will not be able to meet their burden of establishing entitlement to this doctrine. See id. (rejecting fair use argument in case brought by video clip complier against owner of copyrights in motion pictures seeking declaration that complier's commercial use of owner's movies on the internet was not copyright infringement). C. Plaintiffs Have Failed To State A Claim For Tortious Interference To support a claim of tortious interference with a contract, Colorado law requires that Plaintiffs please "an existing valid contract," and "damage to the plaintiffs." R-G Denver, Ltd. V. First City Holdings of Colorado, 789 F. 2d 1469, 1774 (10th Cir. 1986)(emphasis added). Contracts relating to the auction of motion pictures in violation of copyrights are not valid contracts, and Plaintiffs cannot have been damaged by the loss of a sale of something that was never theirs. Accordingly, Plaintffs' claim for tortious interference with a contract should be dismissed. D. Plaintiffs Have Failed to State A Claim For Negligent or Fraudulent Misrepresentation To support a claim of fraud or negligent misrepresentation, Colorado law requires that Plaintiffs plead the negligent or intentional communication of false information. High Country Movin', v. U.S. West Direct Co., 839 P. 2d 469, 471 (Colo. App. 1992); Nielson v. Scott, 53 P.3d 777,779-80 (Colo. Appl 2002). Plaintiffs' only support for these claims is E!'s communication of its copyright to eBay. As detailed above, this communication was entirely truthful and accurate and cannot comprise the basis of a fraud or negligent misrepresentation claim. Accordingly, these claims should be dismissed. E. Plaintiffs Have Failed To State A Claim For Outrageous Conduct The tort of outrageous conduct requires "conduct so outrageous in character and so extreme in degree as to go beyond all possible bounds of decency and to be regarded as atrocious and utterly intolerable in a civilized community." Coors Brewing Co., v. Floyd, 978 P. 2d 663, 666 (Colo. 1999) (citation omitted).6 ("Before permitting a plaintiff to present a claim for outrageous conduct to the jury, a trial court must initially rule on the threshold issue of whether the plaintiffs allegations of outrageous conduct are sufficiently outrageous as a matter of law." (Coors Brewing Co., 973 P.2d at 665.) Taking proper actions to prevent the unlawful sale of copyrighted materials simply cannot amount to this quantum of atrocious conduct. Yet, this is exactly what E! undisputedly did and, accordingly, Plaintiffs outrageous conduct should be dismissed. Taking proper actions to prevent the unlawful sale of copyrighted materials simply cannot amount to this quantum of atrocious conduct. Yet, this is exactly what E! undisputedly did and, accordingly, Plaintiffs outrageous conduct should be dismissed. IV. CONCLUSION Based on the foregoing, E! respectfully requests that this Court enter an order dismissing each of Plaintiffs' claims in this lawsuit, with prejudice. Respectfully submitted this 29th day of Mach, 2004. |