Opinion
CV 22-03142-RSWL-JPRx
09-30-2022
KLAUBER BROTHERS, INC, Plaintiff, v. ANA ACCESSORIES CORPORATION, Defendant.
ORDER RE: DEFENDANT'S MOTION TO DISMISS [13]
HONORABLE RONALD S.W. LEW, Senior U.S. District Judge
Plaintiff Klauber Brothers, Inc. (“Plaintiff”) brings this Action against Defendant Ana Accessories Corporation (“Defendant”) alleging copyright infringement and vicarious and/or contributory copyright infringement. Currently before the Court is Defendant's Motion to Dismiss Plaintiff's Complaint (“Motion”) [13].
Having reviewed all papers submitted pertaining to the Motion, the Court NOW FINDS AND RULES AS FOLLOWS: the Court GRANTS in part and DENIES in part Defendant's Motion WITH LEAVE TO AMEND.
I. BACKGROUND
A. Factual Background
Plaintiff is a New York corporation that allegedly owns an original artwork design (“Subject Design”) that it fashions into lace. Compl. ¶¶ 4, 9, ECF No. 1. To protect the Subject Design, Plaintiff owns a United States Copyright Registration, Registration No. VA 180563. Id. ¶ 10. Plaintiff alleges it samples and sells the Subject Design lace to members in the fashion and apparel industries. Id. ¶ 11.
Defendant is a California corporation. Id. ¶ 5. Defendant allegedly sold infringing garments (collectively, “Garment Designs”) that bear either substantially similar or identical artwork to the Subject Design. Id. ¶ 13.
Plaintiff attached in its Complaint side-by-side photographs to show similarities between the Subject Design and the Garment Designs. Compl. ¶ 14.
Plaintiff alleges these Garment Designs infringe on Plaintiff's Subject Design. Id. ¶ 18. Plaintiff alleges Defendant discovered the Subject Design by accessing a) Plaintiff's showroom and/or design library, b) stolen Subject Design copies sold by third-party vendors, c) Plaintiff's strike-offs and samples, and d) garments manufactured and sold to the public that lawfully bear the Subject Design. Id. ¶ 17.
Plaintiff alleges that Defendant participated and directly controlled the Garment Designs' manufacturing. Id. ¶ 26.
B. Procedural Background
On May 9, 2022, Plaintiff filed its Complaint [1]. On July 1, 2022, Defendant filed the instant Motion[13]. On July 27, 2022, Plaintiff opposed [17]. Defendant did not file any reply.
Defendant mistakenly filed the instant Motion [13] as an answer instead of a motion to dismiss. The Court corrected the mistake and treated the filing as a motion to dismiss.
II. DISCUSSION
A. Legal Standard
Federal Rule of Civil Procedure 12(b)(6) allows a party to move for dismissal of one or more claims if the pleading fails to state a claim upon which relief can be granted. A complaint must contain sufficient facts, accepted as true, to state a plausible claim for relief. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quotation omitted). Dismissal is warranted for a “lack of a cognizable legal theory or the absence of sufficient facts alleged under a cognizable legal theory.” Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 1988) (citation omitted).
“In ruling on a 12(b)(6) motion, a court may generally consider only allegations contained in the pleadings, exhibits attached to the complaint, and matters properly subject to judicial notice.” Swartz v. KPMG LLP, 476 F.3d 756, 763 (9th Cir. 2007) (citation omitted). A court must presume all factual allegations to be true and draw all reasonable inferences in favor of the non-moving party. Klarfeld v. United States, 944 F.2d 583, 585 (9th Cir. 1991). The question is not whether the plaintiff will ultimately prevail, but whether the plaintiff is entitled to present evidence to support the claims. Jackson v. Birmingham Bd. of Educ., 544 U.S. 167, 184 (2005) (quoting Scheuer v. Rhodes, 416 U.S. 232, 236 (1974)). While a complaint need not contain detailed factual allegations, a plaintiff must provide more than “labels and conclusions” or “a formulaic recitation of the elements of a cause of action.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007).
B. Discussion
Defendant seeks to dismiss Plaintiff's two claims: 1) copyright infringement and 2) vicarious and/or contributory copyright infringement. See generally Def.'s Mot. to Dismiss (“Mot.”), ECF No. 13.
1. Copyright Infringement Claim
Plaintiff broadly alleged infringement by pleading Defendant had offered garments for sale under the name Style No. KL4610 (Pampered Life Sheer Socks) that are “identical to or substantially similar to the Subject Design.” Compl. ¶ 13. Given that this language does not contain sufficient facts to state a plausible claim for relief, this paragraph alone is an insufficient pleading for infringement.
To proceed with a copyright infringement claim, Plaintiff must allege (1) “ownership of a valid copyright” and (2) “copying of constituent elements of the work that are original.” Twentieth Century Fox Film Corp. v. Ent. Distrib., 429 F.3d 869, 876 (9th Cir. 2005).
a. Ownership
A complaint is acceptable if it simply alleges “present ownership by plaintiff, registration in compliance with the applicable statute and infringement by defendant.” Perfect 10, Inc. v. Cybernet Ventures, Inc., 167 F.Supp.2d 1114, 1120 (C.D. Cal. 2001). Here, Plaintiff has alleged ownership and registration in compliance with the applicable statute by pleading it owns the United States Copyright Registration for the Subject Design, Registration No. VA 180-563. Compl. ¶ 10. Therefore, Plaintiff has properly pled ownership.
b. Copying
When no direct evidence of copying is available, copying may be established by demonstrating that “the [defendant] had access to plaintiff's copyrighted work” and “the works at issue are substantially similar in their protected elements.” Cavalier v. Random House, Inc., 297 F.3d 815, 822 (9th Cir. 2002) (citation omitted). In some cases, “absent evidence of access, a ‘striking similarity' between the works may give rise to a permissible inference of copying.” Baxter v. MCA, Inc., 812 F.2d 421, 423 (9th Cir. 1987).
i. Plaintiff Insufficiently Pled Access
Proof of access requires a plaintiff to show “that the defendant had an opportunity to view or to copy plaintiff's work.” Sid & Marty Krofft TV Prods. v. McDonald's Corp., 562 F.2d 1157, 1172 (9th Cir. 1977). “Access must be more than a bare possibility and may not be inferred through speculation or conjecture.” Gaste v. Kaiserman, 863 F.2d 1061, 1066 (2d Cir. 1988). The plaintiff “must show a reasonable possibility” that defendant had access to plaintiff's work. Art Attacks Ink, Ltd. Liab. Co. v. MGA Enter. Inc., 581 F.3d 1138, 1143 (9th Cir. 2009). Thus, access may be proved by either 1) “establishing a chain of events linking plaintiff's work and defendant's access,” or 2) “showing that plaintiff's work has been widely disseminated.” Id.
Plaintiff alleges that Defendant had an opportunity to view or copy the Subject Design by having access to Plaintiff's showroom, third-party vendor's copies of the Subject Design, Plaintiff's samples, and garments manufactured and sold bearing the Subject Design's print. Compl. ¶ 17. These general opportunities neither allege that the Subject Design was widely disseminated, nor do they allege specific events linking Defendant's access to the Subject Design. Such allegations show no more than a bare possibility that Defendant had access to Plaintiff's Subject Design and therefore are insufficient to plead access. See Shame on You Prods. v. Banks, 120 F.Supp.3d 1123, 1149 (C.D. Cal. 2015) (“To satisfy its burden of pleading access, plaintiff must allege facts ‘from which a reasonable finder of fact could infer that the defendant had a reasonable opportunity to copy his or her work.'” (quoting Grubb v. KMS Patriots, L.P., 88 F.3d 1, 3 (1st Cir. 1996))).
Defendant argues that Plaintiff has not sufficiently pled that Defendant had access to Plaintiff's Subject Design because the Complaint does not specifically name Defendant as having access. Mot. at 12:5-9. However, in its Complaint, Plaintiff “alleges that Defendants . . . had access to Subject Design” and then lists the opportunities for access. Compl. ¶ 17.
ii. Plaintiff Sufficiently Pled Striking Similarity
Works are strikingly similar when the similarities between them are so great that they are highly unlikely to have been independently created. Rentmeester v. Nike, Inc., 883 F.3d 1111, 1124 (9th Cir. 2018). In assessing whether a particular work is strikingly similar, or substantially similar, the Court performs a two-part test, an extrinsic and intrinsic test. Unicolors, Inc. v. Urban Outfitters, Inc., 853 F.3d 980, 985 (9th Cir. 2017). The extrinsic test objectively compares similarities in the works' specific expressive elements. Id. The intrinsic test looks to see whether an ordinary audience would find the works' total concept and feel to be substantially similar. Id.
Courts typically only analyze the extrinsic test because the intrinsic test is usually “exclusively the province of the jury.” Funky Films, Inc. v. Time Warner Ent. Co., Ltd. P'ship, 462 F.3d 1072, 1077 (9th Cir. 2006). A plaintiff who cannot satisfy the extrinsic test loses because there must be “evidence on both the extrinsic and intrinsic tests.” Id. (quoting Kouf v. Walt Disney Pictures & Tele., 16 F.3d 1042, 1045 (9th Cir. 1994)).
Defendant argues that Plaintiff failed to establish striking similarity in the Complaint. See Mot. 12:2313:6. Defendant does not argue that the intrinsic test cannot be met. See id. at 13:21-24. Instead, it argues that the extrinsic test is not met because Plaintiff did not examine the similarities and compare the designs. See id. at 13:25-14:4. However, Plaintiff compared side by side in its Complaint images of the Subject Design and the Garment Designs and argued that the designs share identical or substantially similar elements, composition, arrangement, layout, and appearance. Compl. ¶¶ 13-15. These allegations satisfy the extrinsic test because Plaintiff compared the designs' specific expressive elements, and based off the provided images, the Court cannot at this time conclude that the garments are not strikingly similar. See L.A. Printex Indus. v. Macy's Retail Holdings, Inc., 2011 U.S. Dist. LEXIS 88733, at *16 (C.D. Cal. Aug. 9, 2011) (explaining that a jury could find striking similarity when a copyrighted work and an allegedly infringing garment compared side by side show strong similarities).
Therefore, given that the extrinsic test can be met, and the intrinsic test is exclusively the province of the jury, Plaintiff has properly alleged striking similarity. With the facts alleged, Plaintiff sufficiently pled striking similarity and “access may be inferred.” Malibu Textiles, Inc. v. Label Lane Int'l, Inc., 922 F.3d 946, 952 (9th Cir. 2019). Therefore, ownership and copying have been sufficiently pled.
Accordingly, the Court DENIES Defendant's Motion on Plaintiff's copyright infringement claim.
2. Plaintiff's Claim for Vicarious and/or Contributory Copyright Infringement
Defendant seeks to dismiss Plaintiff's contributory/vicarious copyright infringement claim on the basis that Plaintiff failed to identify third-party direct infringement. See Mot. at 15:7-14. “Secondary liability for copyright infringement does not exist in the absence of direct infringement by a third party.” A&M Records v. Napster, Inc., 239 F.3d 1004, 1013 n.2 (9th Cir. 2000). Plaintiff therefore must identify some third party before alleging Defendant's liability for vicarious and/or contributory infringement.
Plaintiff attempted to identify a third party, www.dollskills.com, in its Opposition to Defendant's Motion. See Pl.'s Opp'n to Def.'s Mot. to Dismiss (“Opp'n”) 9:18-20, ECF No. 17. This third party was not mentioned in the Complaint. See generally Compl. In determining whether to dismiss under Rule 12(b)(6), a “court may not look beyond the complaint to a plaintiff's moving papers, such as a memorandum in opposition to a defendant's motion to dismiss.” Broam v. Bogan, 320 F.3d 1023, 1026 n.2 (9th Cir. 2003) (citation omitted). While this new third party alleged in the Opposition may not be considered in whether to grant or deny the Motion, it may be considered when granting leave to amend or dismissing with prejudice. Orion Tire Corp. v. Goodyear Tire & Rubber Co., 268 F.3d 1133, 1137-38 (9th Cir. 2001).
Here, Plaintiff does not plead sufficient facts to indicate direct infringement by a third party. There is not a single third party identified in the Complaint. See generally Compl. Without establishing this preliminary requirement for a claim of contributory/vicarious copyright infringement, Plaintiff's claim fails. See Viesti Assocs. v. Pearson Educ., Inc., Civil Action No. 12-cv-02240-PAB-DW, 2013 U.S. Dist. LEXIS 113323, at *23-24 (D. Colo. Aug. 12, 2013) (“Given that no third parties are identified in the complaint, [the plaintiff]'s claim that [the defendant] had the right to control these unidentified third parties is speculative and conclusory.”).
Accordingly, the Court GRANTS Defendant's Motion on Plaintiff's contributory/vicarious copyright infringement claim.
3. Leave to Amend
Federal Rule of Civil Procedure 15(a)(2) provides that a party may amend its complaint once “as a matter of course” before a responsive pleading is served. After that, the “party may amend its pleading only with the opposing party's written consent or the court's leave. The court should freely give leave when justice so requires.” Id. Leave to amend lies “within the sound discretion of the trial court.” United States v. Webb, 655 F.2d 977, 979 (9th Cir. 1981). The Ninth Circuit has noted “on several occasions . . . that the ‘Supreme Court has instructed the lower federal courts to heed carefully the command of Rule 15(a), Fed. R. Civ. P., by freely granting leave to amend when justice so requires.'” Gabrielson v. Montgomery Ward & Co., 785 F.2d 762, 765 (9th Cir. 1986) (quoting Howey v. United States, 481 F.2d 1187, 1190 (9th Cir. 1973)).
Here, Plaintiff has not previously amended its Complaint. Plaintiff may be able to plead a specifically named third party for which Defendant could be liable for contributory/vicarious copyright infringement. Therefore, leave to amend would not be futile.
Accordingly, the Court GRANTS LEAVE TO AMEND regarding Plaintiff's contributory/vicarious copyright infringement claim.
III. CONCLUSION
Based on the foregoing, the Court DENIES in part Defendant's Motion as to Plaintiff's copyright infringement claim and GRANTS in part as to Plaintiff's contributory/vicarious copyright infringement claim WITH LEAVE TO AMEND. Plaintiff may file an amended complaint by no later than October 31, 2022.
IT IS SO ORDERED.