Bozzio v. EMI Grp. Ltd., No. 13-15685 (9th Cir. 2016)Annotate this Case
Plaintiff, front woman of the former band Missing Persons, filed suit as a third-party beneficiary claiming that recording companies improperly treated certain sales of Missing Persons's recordings as record sales rather than revenue from licensing. Plaintiff claimed that this resulted in paying the artists a lower royalty rate than the one provided for in their recording contracts. The district court dismissed the complaint. The court concluded that the district court erred by granting plaintiff’s motion to dismiss on the ground that Missing Persons, Inc. lacked capacity to sue. The court could not affirm the district court's judgment on the ground that plaintiff waived the benefits of the Missing Persons, Inc. contract. The court agreed with plaintiff that whether she forfeited the ability to sue as a third-party beneficiary is a fact-bound inquiry ill-suited to resolution at the motion to dismiss stage. On remand, a record can be developed that will allow consideration of plaintiff’s claim that she was an intended third-party beneficiary of the agreement. Further, because amendment may not have been futile, it was error to dismiss plaintiff's complaint with prejudice. Accordingly, the court reversed and remanded.