Opinion
1:20-cv-01872
07-01-2021
CITY OF MAPLE HEIGHTS, OHIO, Plaintiff, v. NETFLIX, INC. & HULU, LLC, Defendant.
CERTIFICATION ORDER
JAMES S. GWIN, UNITED STATES DISTRICT COURT JUDGE:
Under Ohio Supreme Court Rule of Practice 9.01, this Court certifies two questions of Ohio law to the Ohio Supreme Court. This Court provides the following information:
I. Name of the Case
City of Maple Heights, Ohio v. Netflix, Inc. and Hulu, LLC, No. 1:20-cv-01872 (N.D. Ohio).
II. Defendants' Motion to Dismiss and Plaintiff's Responses
Plaintiff City of Maple Heights, Ohio sues Defendants Netflix, Inc. and Hulu, LLC for allegedly providing video services in Ohio-including in Maple Heights-without video service authorizations in violation of the Fair Competition in Cable Operations Act.
Ohio Rev. Code §§ 1332.21, et seq.
Maple Heights asks the Court to declare that Netflix and Hulu are video service providers under Ohio law and, therefore, Netflix and Hulu must pay video service provider fees to Maple Heights and other Ohio municipalities.
On October 19, 2021, Netflix and Hulu separately filed motions to dismiss Maple Heights's Complaint. In these motions to dismiss, Netflix and Hulu argue, inter alia, that they do not provide video service under Ohio law because: (1) they do not offer video programming comparable to broadcast television under O.R.C. § 1332.21(I); (2) they offer their content over the public Internet, which they claim is exempt under O.R.C. § 1332.21(J); and (3) they do not own, operate, or use video service networks in public rights-of-way under O.R.C. § 1332.21(J).
Plaintiff Maple Heights disagrees on each of these points and argues that Netflix and Hulu are subject to the requirements of O.R.C. §§ 1332.21, et seq. Plaintiff contends, inter alia: (1) Netflix and Hulu offer the same types of televisions shows, movies, and other video content as broadcast television and, therefore, provide video programming under O.R.C. § 1332.21(I); (2) Netflix and Hulu do not offer their video programming over the public Internet and, even if they did, Netflix and Hulu's video programming is not offered as “part of and via a service that enables users to access content, information, electronic mail, or other services offered over the public internet," as required by O.R.C. § 1332.21(J); and (3) they are video service providers under O.R.C. §§ 1332.21, et seq. even if Netflix and Hulu do not own, operate, or use video service networks.
In its motion to dismiss, Hulu also argues that Maple Heights is an improper party to bring this suit. To support this standing argument, Hulu points to O.R.C. § 1332.24(C), which gives the Director of Commerce authority to seek injunctions against the unauthorized provision of video services, enter into written assurances of voluntary compliance, or assess civil penalties pursuant to an administrative adjudication. According to Hulu, the Ohio legislature granted the Director of Commerce, not municipalities, the power to bring actions against persons who provide unauthorized video services.
In response, Maple Heights argues it has standing to bring this suit. First, Maple Heights points to O.R.C. § 1332.33, which gives municipalities and townships a private right of action to sue video service providers who underpay their franchise fees based on the results of an audit. Second, Maple Heights asserts that even if this suit falls outside the scope of O.R.C. § 1332.33, the Court should infer that the Ohio legislature intended municipalities and townships to bring enforcement actions against video service providers that provide video service without the Director of Commerce's authorization.
See Cort v. Ash, 422 U.S. 66 (1975); see also Anderson v. Smith, 196 Ohio App.3d 540, 544 (Ohio Ct. App. 2011).
III. Questions of Law to be Answered
1. Whether Netflix and Hulu are video service providers under Ohio law.
See Ohio Rev. Code § 1332.21(M).
2. Whether Maple Heights can sue Netflix and Hulu to enforce Ohio's video service provider provisions.
See Ohio Rev. Code §§ 1332.24, 1332.33(D); Cort v. Ash, 422 U.S. 66 (1975).
IV. Name of Each Party
• Plaintiff City of Maple Heights, Ohio
• Defendant Netflix, Inc.
• Defendant Hulu, LLC
V. Names, Addresses, and Telephone Numbers of Counsel for Each Party
Plaintiff City of Maple Heights, Ohio is represented by:
Mark A. DiCello (Ohio Bar No. 0063924) Justin J. Hawal (Ohio Bar No. 0092294)
DICELLO LEVITT GUTZLER LLC
7556 Mentor Avenue Mentor, Ohio 44060 Tel: 440-953-8888 madicello@dicellolevitt.com jhawal@dicellolevitt.com
Adam J. Levitt Mark S. Hamill Brittany Hartwig
DICELLO LEVITT GUTZLER LLC
Ten North Dearborn Street, Sixth Floor
Chicago, Illinois 60602
Tel: 312-314-7900
alevitt@dicellolevitt.com mhamill@dicellolevitt.com bhartwig@dicellolevitt.com
Austin Tighe Michael Angelovich Chad E. Ihrig
NIX PATTERSON, LLP
3600 North Capital of Texas Highway
Building B, Suite 350
Austin, Texas 78746
Tel: 512-328-5333
atighe@nixlaw.com mangelovich@nixlaw.com
Peter Schneider
SCHNEIDER WALLACE COTTRELL KONECKY, LLP
3700 Buffalo Speedway, Ste. 1100 Houston, Texas 77098 Tel: 713-338-2560 pschneider@schneiderwallace.com
Todd M. Schneider Jason H. Kim
SCHNEIDER WALLACE COTTRELL KONECKY, LLP
2000 Powell Street, Suite 1400 Emeryville, California 94608 Tel: 415-421-7100 tschneider@schneiderwallace.com jkim@schneiderwallace.com
Defendant Netflix, Inc. is represented by:
Amanda Martinsek (Ohio Bar No. 0058567) Gregory C. Djordjevic (Ohio Bar No. 0095943)
ULMER & BERNE LLP
1660 West 2nd Street, Suite 1100
Cleveland, Ohio 44113-1448
Tel.: 216-583-7000 / Fax: 216-583-7001
amartinsek@ulmer.com gdjordjevic@ulmer.com
Jean A. Pawlow
LATHAM & WATKINS LLP
555 Eleventh Street, NW, Suite 1000
Washington, D.C. 20004-1304
Tel.: 202-637-2200 / Fax: 202-637-2201
jean.pawlow@lw.com
Mary Rose Alexander Robert C. Collins III
LATHAM & WATKINS LLP
330 North Wabash Ave., Suite 2800
Chicago, IL 60611
Tel.: 312-876-7700 / Fax: 312-993-9767
mary.rose.alexander@lw.com robert.collins@lw.com
Defendant Hulu, LLC is represented by:
Kerri L. Keller (Ohio Bar No. 0075075)
BROUSE McDOWELL
388 S. Main St., Suite 500 Akron, OH 44311-4407 Telephone: (330) 535-5711 Facsimile: (330) 253-8601 kkeller@brouse.com
Victor Jih Elizabeth R. Gavin Eric T. Kohan
WILSON SONSINI GOODRICH & ROSATI
Professional Corporation 633 West Fifth Street, Suite 1550 Los Angeles, CA 90071-1650 Telephone: (323) 210-2900 Facsimile: (866) 974-7329
vjih@wsgr.com bgavin@wsgr.com ekohan@wsgr.com
VI. Designation of One of the Parties as the Moving Party
None of the parties moved for certification. Because these issues are raised in Defendants' motions to dismiss, the Court designates Defendants Netflix and Hulu as the moving parties.
Ohio S.Ct. Prac. R. 9.02(E).
VII. Conclusion
The Court CERTIFIES the above questions of law to the Ohio Supreme Court. In accordance with Rule 9.03(A), the Clerk of the United States District Court for the Northern District of Ohio is instructed to serve copies of this certification upon all parties or their counsel and file this certification order under the seal of this Court with the Clerk of the Ohio Supreme Court.
IT IS SO ORDERED.