Ticketmaster LLC v. RMG Technologies Inc et al, No. 2:2007cv02534 - Document 91 (C.D. Cal. 2008)
Court Description: ORDER Granting Motion to Dismiss by Judge Audrey B. Collins, For the reasons set forth above, Ticketmasters motion to dismiss is GRANTED. RMGs First and Third Counterclaims are hereby DISMISSED, with leave to amend. RMGs Second Counterclaim is DISMISSED WITH PREJUDICE, as is RMGs Fourth Counterclaim, to the extent it is based on copyright misuse. RMG shall have 30 days from the date of this order in which to file any further amended counterclaims. IT IS SO ORDERED (es)
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Ticketmaster LLC v. RMG Technologies Inc et al Case 2:07-cv-02534-ABC-JC Doc. 91 Document 91 Filed 03/10/2008 Page 1 of 16 1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 CENTRAL DISTRICT OF CALIFORNIA 10 TICKETMASTER L.L.C., 11 12 Plaintiff, v. 13 RMG TECHNOLOGIES, INC., et al., 14 15 Defendants. _______________________________ 16 RMG TECHNOLOGIES, INC., 17 18 Counterclaim-Plaintiff, v. 19 TICKETMASTER L.L.C., et al., 20 Counterclaim-Defendants. _______________________________ ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) CASE NO.: CV 07-2534 ABC (JCx) ORDER GRANTING MOTION TO DISMISS 21 22 Currently pending before the Court is a Motion to Dismiss 23 Counterclaims 1 Through 4, filed December 21, 2007 by Plaintiff/ 24 Counterdefendant Ticketmaster L.L.C. and Counterdefendant 25 IAC/Interactivecorp (collectively, “Ticketmaster”). 26 Counterclaimant RMG Technologies, Inc. (“RMG”) filed its opposition to 27 the motion on January 28, 2008. 28 February 11, 2008. Defendant/ Ticketmaster’s reply was filed On March 7, 2008, the Court found this Motion Dockets.Justia.com Case 2:07-cv-02534-ABC-JC Document 91 Filed 03/10/2008 Page 2 of 16 1 appropriate for submission without oral argument and vacated the 2 hearing set for March 10, 2008. 3 7-15. 4 the case file, the Court hereby GRANTS the Motion. See Fed. R. Civ. P. 78(b); Local Rule Having considered the materials submitted by the parties and 5 BACKGROUND 6 RMG alleges that Ticketmaster is in the business of “selling 7 tickets to individual sports and live entertainment events on behalf 8 of its clients, who are venues, promoters, entertainers and sports 9 franchises.” (RMG’s First Amended Counterclaims (“FACC”), at ¶ 8.) 10 Ticketmaster sells these tickets to the public “at prices set by its 11 clients” (referred to as the “face value” of the tickets), plus 12 “convenience charges and other charges . . . . tantamount to 13 Ticketmaster’s commission on each sale.” 14 what Ticketmaster provides to its clients are “primary ticket 15 distribution services,” through which professional sports teams, 16 musicians, theaters, etc., make tickets available to members of the 17 general public who wish to attend their events. 18 Ticketmaster is alleged to be the exclusive provider of “primary 19 ticket distribution services” or “primary-ticketing services” for 26 20 of 30 NBA teams, 31 of 32 NFL teams, 26 of 30 NHL teams, and the “vast 21 majority of major venues and professional sports franchises.” 22 ¶¶ 8, 10.) 23 in the retail ticketing industry,” although that monopoly is 24 apparently threatened by recent developments in this industry. 25 ¶¶ 11-12.) (FACC ¶¶ 9, 15(2).) Thus (FACC ¶¶ 8-10.) (FACC Further, Ticketmaster is alleged to maintain a “monopoly (FACC 26 In response to these threats to its monopoly in the “retail 27 ticketing industry,” Ticketmaster has allegedly “developed a scheme to 28 obtain a monopoly in the ticket resale market.” 2 (FACC ¶ 14.) The Case 2:07-cv-02534-ABC-JC Document 91 Filed 03/10/2008 Page 3 of 16 1 exact parameters of the “ticket resale market” are unclear, but it 2 appears that this alleged market includes at least those transactions 3 in which people who have already purchased tickets in the primary 4 ticket market choose to resell those tickets to other purchasers. 5 (FACC ¶ 15(2).) 6 transactions through the “TicketExchange” and “TeamExchange” sections 7 of its website. 8 at prices above “face value” through the “Auction” section of its 9 website (FACC ¶ 15(3)), but it is not clear whether those tickets have Ticketmaster apparently facilitates these resale (Id.) Ticketmaster is also alleged to sell tickets 10 previously been sold and are then resold through the Auction site, or 11 are simply sold for the first time at prices above face value. 12 As part of this plan to monopolize the ticket resale market, 13 Ticketmaster has allegedly created “Terms of Use” for its website that 14 are designed to reduce competition in that market. 15 These “Terms of Use,” which all Ticketmaster users must agree to abide 16 by in order to use the Ticketmaster website, purportedly: 17 prohibit users from using the website for commercial purposes; (2) 18 prohibit users from utilizing “automated devices, spiders, robots or 19 bots” to access the website; (3) prohibit users from “viewing more 20 than 1,000 web pages from the site in any twenty four (24) hour 21 period”; and (4) contain a liquidated damages clause requiring anyone 22 who exceeds this 1,000 page limit in 24 hours to pay damages of $10.00 23 per page for each page over 1,000. 24 Terms of Use serve to reduce the number of tickets that “ticket resale 25 brokers” can purchase, while having no effect on the “average ticket 26 buyer.” 27 “ticket resale broker” are not expressly defined in the FACC, RMG 28 appears to use these terms to refer to individuals or businesses that (FACC ¶ 17.) (Id.) (FACC ¶ 16.) (1) According to RMG, these While the terms “broker,” “ticket broker,” and 3 Case 2:07-cv-02534-ABC-JC Document 91 Filed 03/10/2008 Page 4 of 16 1 purchase tickets in bulk from sources like Ticketmaster with the 2 intent of reselling them to the general public. 3 reduce the number of tickets that brokers can buy “by severely 4 reducing the amount of times that a broker can access Ticketmaster’s 5 website in order to purchase their inventory of tickets.” 6 The Terms of Use (Id.) RMG further alleges that in about 2004, it developed “a software 7 application called a Ticket Broker Acquisition Tool” or “TBAT.” (FACC 8 ¶ 7.) 9 variety of ticket selling websites, including, but not limited to TBAT is used by Ticket Brokers “in purchasing tickets from a 10 ticketmaster.com, tickets.com, evenue.net and other websites, so that 11 tickets can be resold on the ticket resale market.” 12 itself a Ticket Broker, and does not buy or sell tickets; “TBAT, as 13 well as its support products, are the only goods and services which 14 RMG creates, markets, licenses, sells, or supports.” 15 (Id.) RMG is not (Id.) Although the FACC is not explicit on this point, it appears, even 16 from RMG’s allegations, that TBAT is one of the “automated devices, 17 spiders, robots or bots” that Ticketmaster’s Terms of Use prohibit. 18 (FACC ¶ 16.) 19 which filed suit against RMG on April 17, 2007, claiming that the use 20 of TBAT violates Ticketmaster’s Terms of Use, infringes its 21 copyrights, runs afoul of several federal statutes, and gives rise to 22 a number of state law contract and fraud claims. 23 after a hearing, this Court granted Ticketmaster’s motion for a 24 preliminary injunction, and enjoined RMG from “(1) Creating, 25 trafficking in, facilitating the use of or using computer programs or 26 other automatic devices to circumvent the technological copy 27 protection systems in Ticketmaster’s website; (2) Using information 28 gained from access of Ticketmaster’s website to create computer Certainly this is the position taken by Ticketmaster, 4 On October 16, 2007, Case 2:07-cv-02534-ABC-JC Document 91 Filed 03/10/2008 Page 5 of 16 1 programs to circumvent Ticketmaster’s copy protection and website 2 regulation systems; (3) Copying or facilitating the copying of 3 portions of Ticketmaster’s website in excess of any license 4 Ticketmaster has granted; (4) Purchasing or facilitating the purchase 5 of tickets from Ticketmaster’s website for the commercial purpose of 6 reselling them; and (5) Otherwise accessing and using Ticketmaster’s 7 website in excess of the license granted by the Terms of Use posted 8 thereon.” 9 After the injunction issued, RMG filed its answer and 10 counterclaim on October 29, 2007; the FACC was later filed on December 11 3, 2007. 12 “attempted monopolization” under Section 2 of the Sherman Act; (2) 13 “misuse of copyright”; (3) violation of the California Unfair 14 Competition Law, Cal. Bus. & Prof. Code § 17200, et seq.; (4) 15 declaratory relief; (5) violation of the Computer Fraud and Abuse Act, 16 18 U.S.C. § 1030; and (6) violation of California Penal Code § 502. 17 Ticketmaster now moves to dismiss the first three of these claims in 18 their entirety, and the declaratory relief claim in part. 19 claims Ticketmaster currently does not move to dismiss, it has 20 indicated it intends to seek summary adjudication at the appropriate 21 stage of the case. RMG has asserted six counterclaims in its FACC: 22 23 (1) As to those LEGAL STANDARD A Rule 12(b)(6) motion tests the legal sufficiency of the claims 24 asserted in a complaint. Fed. R. Civ. P. 12(b)(6). Rule 12(b)(6) 25 must be read in conjunction with Rule 8(a), which requires a “short 26 and plain statement of the claim showing that the pleader is entitled 27 to relief.” 28 Miller, Federal Practice and Procedure: Civil § 1356. Fed. R. Civ. P. 8(a)(2); 5A Charles A. Wright & Arthur R. 5 A Rule 12(b)(6) Case 2:07-cv-02534-ABC-JC Document 91 Filed 03/10/2008 Page 6 of 16 1 dismissal is proper only where there is either a “lack of a cognizable 2 legal theory” or “the absence of sufficient facts alleged under a 3 cognizable legal theory.” 4 F.2d 696, 699 (9th Cir. 1988). 5 complaint “does not need detailed factual allegations,” but the 6 “[f]actual allegations must be enough to raise a right to relief above 7 the speculative level.” 8 1964-65 (2007). Balistreri v. Pacifica Police Dept., 901 To survive a Rule 12(b)(6) motion, a Bell Atl. Corp. v. Twombly, 127 S. Ct. 1955, 9 The Court must accept as true all material allegations in the 10 complaint, as well as reasonable inferences to be drawn from them. 11 Pareto v. F.D.I.C., 139 F.3d 696, 699 (9th Cir. 1998). 12 the complaint must be read in the light most favorable to plaintiff. 13 Id. 14 inferences, unwarranted deductions of fact, or conclusory legal 15 allegations cast in the form of factual allegations. 16 Mining Council v. Watt, 643 F.2d 618, 624 (9th Cir. 1981). 17 18 19 Furthermore, However, the Court need not accept as true any unreasonable Id.; Western DISCUSSION I. Attempted Monopolization of the Secondary Market Ticketmaster attacks RMG’s attempted monopolization claim on 20 numerous grounds, starting with the argument that RMG has failed to 21 allege a “relevant product market.” 22 operative definition of the relevant product market at issue in order 23 to analyze a number of Ticketmaster’s other arguments, that is the 24 first question that should be addressed. 25 Ikon Office Solution, 513 F.3d 1038, 1044 (9th Cir. 2008) (“The first 26 question we must address is whether Newcal’s antitrust claims allege 27 any legally cognizable ‘relevant market.’”); Big Bear Lodging Ass’n v. 28 Snow Summit, Inc., 182 F.3d 1096, 1104 (9th Cir. 1999) (affirming 6 As it is necessary to have an See Newcal Indus., Inc. v. Case 2:07-cv-02534-ABC-JC Document 91 Filed 03/10/2008 Page 7 of 16 1 dismissal of attempted monopolization claim based in part on failure 2 to “sufficiently identify the markets affected by Defendants’ alleged 3 antitrust violations,” because “[m]onopolization claims can only be 4 evaluated with reference to properly defined geographic and product 5 markets”); Forsyth v. Humana, Inc., 114 F.3d 1467, 1477 (9th Cir. 6 1997) (holding that resolution of both actual monopolization and 7 attempted monopolization claims “is dependent upon a definition of the 8 relevant market”). 9 RMG argues, first, that the “relevant market” question is 10 typically a fact issue, not suited for disposition on a motion to 11 dismiss. 12 market is generally a fact question, however, a complaint which fails 13 even to identify the relevant market at issue is vulnerable to a 14 motion to dismiss. 15 1063 (9th Cir. 2001); Big Bear Lodging, 182 F.3d at 1104. 16 “a complaint may be dismissed under Rule 12(b)(6) if the complaint’s 17 ‘relevant market’ definition is facially unsustainable.” 18 Indus., 513 F.3d at 1045; Tanaka, 252 F.3d at 1063 (affirming 19 dismissal of case on grounds that “markets” identified in first 20 amended complaint were not “appropriately defined for antitrust 21 purposes, even at this stage of the litigation”). 22 While it may be true that the validity of a properly alleged Tanaka v. University of So. Cal., 252 F.3d 1059, Likewise, Newcal RMG does go on to argue that it properly alleged a relevant 23 market, assuming that question can be reached at this stage of the 24 case. 25 the Court must, of course, look to those allegations themselves, and 26 not to RMG’s characterization of the allegations in its opposition 27 brief. 28 Court cannot agree with RMG that any relevant market has been properly In order to determine whether RMG’s allegations are sufficient, Having reviewed the allegations in the FACC, however, the 7 Case 2:07-cv-02534-ABC-JC 1 Document 91 Filed 03/10/2008 Page 8 of 16 identified. 2 “Antitrust law requires allegation of both a product market and a 3 geographic market.” Newcal Indus., 513 F.3d at 1045 n.4. 4 geographic market includes the area of “effective competition,” or 5 that area “where buyers can turn for alternative sources of supply.” 6 Tanaka, 252 F.3d at 1063 (internal quotations omitted). 7 market includes that “pool of goods or services that enjoy reasonable 8 interchangeability of use and cross-elasticity of demand.” 9 “the market must encompass the product at issue as well as all 10 economic substitutes for the product.” 11 1045. 12 are part of the same market.” 13 Co., 51 F.3d 1421, 1435 (9th Cir. 1995). 14 The The product Id. Thus, Newcal Indus., 513 F.3d at “If consumers view the products as substitutes, the products Rebel Oil Co. v. Atlantic Richfield The allegations of the FACC are hopelessly muddled as to what 15 product market (or markets) are at issue here. Certain allegations 16 pertain to “ticket distribution services,” while others pertain to 17 tickets themselves, and both distribution services and tickets are 18 further sometimes divided into sales in the “primary” and “secondary” 19 markets. 20 for “primary ticket distribution services,” the market for “secondary 21 ticket distribution services,” the market for “ticket distribution 22 services” for any and all tickets, the market for tickets that have 23 never been sold before, the market for tickets that have been sold 24 before, the market for tickets regardless of whether or not they have 25 been sold before . . . and so on. 26 markets might ultimately turn out to be valid or not, it is currently 27 impossible to tell from the FACC which one(s) RMG may be trying to 28 base its case on. Thus any number of markets might be intended: the market Whether any of these product 8 Case 2:07-cv-02534-ABC-JC 1 Document 91 Filed 03/10/2008 Page 9 of 16 It does not suffice to refer to the “retail ticket sales market” 2 or the “ticket resale market,” as RMG does in the FACC, because either 3 of those terms could encompass both tickets and ticket distribution 4 services -- and the Court has no difficulty whatsoever in finding, as 5 a matter of law, that ticket distribution services and tickets do not 6 belong in the same market. 7 to what happens in the other market, but in no sense whatsoever are 8 “ticket distribution services” a viable substitute for tickets 9 themselves. What happens in one market may be relevant There is no “interchangeability of use” or “cross- 10 elasticity of demand” between tickets and ticket distribution 11 services. 12 find that the opportunity to sell tickets on TeamExchange is a 13 reasonable substitute for a ticket to the game. 14 whether tickets to a Clippers game would be an acceptable substitute 15 for Lakers tickets might have to wait until summary judgment, but the 16 suggestion in the FACC that tickets and ticket distribution services 17 are part of the same market, implying that a contract for distribution 18 services would be an acceptable substitute for tickets to any 19 basketball game (or other event), is simply “facially unsustainable.” 20 RMG does not appear to have appreciated the implications of this Someone who wants to attend a Lakers game is not going to The question of 21 distinction when drafting the FACC; its allegations blur the line 22 between tickets and ticket distribution services. 23 alleged to have a monopoly in the “retail ticketing industry” (FACC ¶ 24 11), but apparently not because it has a monopoly on retail tickets; 25 rather, RMG alleges that Ticketmaster’s “market share for primary 26 ticket distribution services purchased by major venues” is “somewhere 27 28 9 Ticketmaster is Case 2:07-cv-02534-ABC-JC Document 91 Filed 03/10/2008 Page 10 of 16 1 between 60% and 90%.”1 2 share for primary ticket distribution services is why it allegedly has 3 a monopoly in the retail ticket market, then is Ticketmaster 4 purportedly trying to achieve a monopoly in the ticket resale market 5 by increasing its market share for secondary ticket distribution 6 services? 7 TicketExchange and TeamExchange services, which appear to offer 8 secondary ticket distribution services to fans who already have 9 tickets but cannot use them (see, e.g., FACC ¶ 15(2)), and also (FACC ¶ 10). So if Ticketmaster’s market Perhaps -- RMG refers repeatedly to Ticketmaster’s 10 alleges that Ticketmaster is attempting to purchase software companies 11 that “create software for the purpose of reselling tickets” (FACC ¶ 12 23(3)). 13 selection of tickets on the resale market.” 14 it is the allegations that control, RMG does claim in its brief that 15 the products at issue are “tickets which have already been sold at 16 retail” (Opp’n at 4), not services that enable people who already have 17 some of those tickets to resell them.2 18 include allegations regarding multiple markets in its pleading, if 19 necessary to explain what occurred, but if RMG intends to pursue an On the other hand, the FACC refers to the “supply and (FACC ¶ 24). And, while It is not that RMG cannot 20 1 21 22 23 24 25 26 27 28 Ticketmaster is not alleged to be a “producer” of tickets; in other words, RMG does not claim that Ticketmaster itself owns venues or organizes events to which tickets could be sold. Thus Ticketmaster does not appear to have any ability to increase the total number of valid tickets extant at any given time. 2 How tickets sold on the Auction site fit into this market is not clear. RMG argues that the sale of tickets on Ticketmaster’s Auction site is part of Ticketmaster’s plan to monopolize the market for “tickets which have already been sold at retail,” but the allegations regarding the Auction site do not explain whether those tickets have previously been sold at retail. Perhaps RMG really means to define the market as including not just “tickets that have previously been sold at retail,” but all tickets ever sold at amounts above face value? 10 Case 2:07-cv-02534-ABC-JC Document 91 Filed 03/10/2008 Page 11 of 16 1 antitrust claim, it has to be clear about the market in which the 2 alleged antitrust violation occurred, and be consistent about how the 3 various parties at issue are involved in that market. 4 As noted, RMG tries to clarify in its opposition brief that what 5 it meant to plead is that the products at issue in the relevant market 6 for its antitrust claim are “tickets which have already been sold at 7 retail” (Opp’n at 4), and that the appropriate geographic market is 8 “the United States” (Opp’n at 5). 9 focus its claims, then it needs to amend its pleading to conform the If that is truly how RMG wants to 10 allegations to that theory of the case. However, RMG should be aware 11 that defining the market in this way will undoubtedly give rise to 12 numerous problems in the future, with both the “product” definition 13 and the “geographic” definition of this market. 14 resale ticket in the country really a substitute for every other such 15 ticket? 16 ticket to see “Disney on Ice: Princess Wishes” in Miami? 17 year-old Hannah Montana fan in Seattle (and her parents) find that 18 tickets to see Marilyn Manson perform in Philadelphia are an 19 acceptable substitute? 20 addressed on a motion to dismiss, but the Court is reasonably certain 21 it can expect argument over whether these tickets all “enjoy 22 reasonable interchangeability of use and cross-elasticity of demand,” 23 within one area of “effective competition.”3 Is any and every Will the average Raiders fan in Oakland be satisfied with a Will the 12- This may or may not be something that can be 24 25 26 27 28 3 Another potential problem with this geographic definition is suggested by the allegation in the FACC that “less than a dozen states in the U.S. even have anti-ticket reselling laws on their books.” (FACC ¶ 13.) So in as many as 11 states, or over 20% of the geographic market proposed by RMG, the “ticket resale market” may exist, if at all, only in violation of state law. Surely RMG does not (continued...) 11 Case 2:07-cv-02534-ABC-JC 1 Document 91 Filed 03/10/2008 Page 12 of 16 Further, as overbroad as this definition appears in some 2 respects, it seems too narrow in others. Why are retail and resale 3 tickets not acceptable economic substitutes for each other? 4 is reasonably sure that the aforementioned hypothetical Hannah Montana 5 fan would not care whether her ticket was purchased through 6 Ticketmaster in the “retail” market or from a ticket broker in the 7 “resale” market (although her parents might), as long as she is able 8 to attend the concert. 9 judgment rather than a Rule 12(b)(6) motion, but RMG would be well- The Court Again, this might be a question for summary 10 advised to consider these likely problems in deciding whether and how 11 to amend its antitrust claim. 12 Ticketmaster also argues that RMG has failed to allege facts 13 showing a “dangerous probability” that Ticketmaster will be successful 14 in its alleged plan to monopolize the “ticket resale market.” 15 to allege “a dangerous probability of success of achieving monopoly 16 power in a particular market” is grounds for dismissal of a claim for 17 attempted monopolization. 18 Without a clearer idea of the boundaries of the market at issue, 19 however, it is difficult to analyze whether anyone may have any 20 probability of forming a successful monopoly in that market. 21 even assuming that the “ticket resale market” had been adequately 22 defined, RMG’s allegations regarding Ticketmaster’s ability to 23 monopolize that market appear insufficient. 24 by any means, to simply recite the elements of a cause of action, see 25 Twombly, 127 S. Ct. at 1965, parties who choose to recite the elements Failure Big Bear Lodging, 182 F.3d at 1104. However, While it is not enough, 26 27 28 3 (...continued) really intend to argue that the Sherman Act protects RMG’s right to participate in an illegal market. 12 Case 2:07-cv-02534-ABC-JC Document 91 Filed 03/10/2008 Page 13 of 16 1 of a cause of action as a starting point for further factual 2 allegations should at least recite those elements correctly. 3 contrast, RMG has alleged that there is “a dangerous possibility that 4 Ticketmaster and IAC will succeed in their attempt to monopolize the 5 ticket resale market.” 6 nothing more than a typographical error, but it does cast doubt on 7 whether RMG has even attempted to allege facts that would support the 8 correct standard. 9 RMG’s allegations fail appear well-taken; and while there is no need (FACC ¶ 23 (emphasis added).) By This may be Further, many of Ticketmaster’s arguments as to why 10 to examine those arguments in detail unless RMG manages to identify a 11 proper market, RMG should consider Ticketmaster’s arguments on this 12 issue if it chooses to amend its counterclaims. 13 Finally, Ticketmaster notes in a footnote in its motion that RMG 14 lacks “antitrust standing” to assert its attempted monopolization 15 claim. 16 this argument was relegated to a footnote, but in light of the fact 17 that the question of antitrust standing, like many other issues raised 18 by Ticketmaster, will be affected by the definition of the “relevant 19 market” eventually adopted by RMG, there is little sense in examining 20 the question in detail at this time. 21 potential markets that may be at issue here, whatever combination of 22 tickets or ticket distribution services may be involved, the Court 23 anticipates that RMG’s antitrust standing will be subject to 24 challenge. 25 participant in any market in which Ticketmaster is involved, whether 26 for tickets or ticket distribution services. 27 RMG’s alleged injury flows from any unlawful conduct, or is the type 28 of injury that the antitrust laws were intended to prevent. (Motion at 8 n.4.) The Court is somewhat puzzled as to why However, under any of the It is difficult to see how RMG would be considered a 13 Nor is it obvious that Glen Case 2:07-cv-02534-ABC-JC Document 91 Filed 03/10/2008 Page 14 of 16 1 Holly Entertainment Inc. v. Tektronix Inc., 352 F.3d 367, 371-72 (9th 2 Cir. 2003) (listing elements of “antitrust injury,” the most important 3 factor in determining “antitrust standing”); American Ad Mgmt., Inc. 4 v. General Tel. Co., 190 F.3d 1051, 1055 (9th Cir. 1999) (same). 5 Court therefore expects that should RMG choose to amend its attempted 6 monopolization claim, and should Ticketmaster thereafter again move to 7 dismiss, the parties will fully brief the question of standing, unless 8 RMG presents dramatically different allegations in the future. 9 II. 10 The Misuse of Copyright Ticketmaster argues that “copyright misuse” is an affirmative 11 defense to a claim for copyright infringement, and does not support an 12 independent claim for damages. 13 Clear Logic, Inc., 424 F.3d 1079, 1090 (9th Cir. 2005) (affirming 14 district court’s refusal to “extend[] the doctrine of copyright misuse 15 beyond ‘its logical place as a defense to a claim of copyright 16 infringement’”); Practice Mgmt. Info. Corp. v. American Medical Ass’n, 17 121 F.3d 516, 520 (9th Cir. 1997) (adopting rule that “misuse is a 18 defense to copyright infringement”); Metro-Goldwyn-Mayer Studios Inc. 19 v. Grokster, Ltd., 269 F. Supp.2d 1213, 1225 (C.D. Cal. 2003) (noting 20 that, as even defendant conceded, “copyright misuse cannot found a 21 claim for damages”). 22 hereby GRANTED as to RMG’s Second Counterclaim, for “Misuse of 23 Copyright.” 24 claim was pled, but on the fact that no such claim can ever be pled, 25 the dismissal of this claim is WITH PREJUDICE, as no possible 26 amendment could save it. 27 28 The Court agrees. Altera Corp. v. Accordingly, Ticketmaster’s motion to dismiss is And as this holding is not based on the way in which this Further, to the extent that RMG’s Fourth Counterclaim, for Declaratory Relief, is based on copyright misuse, that claim too is 14 Case 2:07-cv-02534-ABC-JC Document 91 Filed 03/10/2008 Page 15 of 16 1 hereby DISMISSED WITH PREJUDICE. 2 misuse as an affirmative defense, and whatever benefit the theory of 3 copyright misuse may afford RMG can be fully realized in this context. 4 There may be cases in which asserting such a cause of action for 5 copyright misuse would be proper, such as when no claim for copyright 6 infringement has been asserted to which the defense of misuse could be 7 raised. 8 (N.D. Cal. Apr. 1, 2005). 9 identified no reason why allowing it to seek declaratory relief on a 10 claim for copyright misuse in addition to litigating its affirmative 11 defense of copyright misuse might “serve the purposes of declaratory 12 relief, such as clarifying and settling the legal relations of the 13 parties, or affording a declaratory plaintiff relief from the 14 ‘uncertainty, insecurity, and controversy giving rise to the 15 proceeding.’” 16 (quoting Bilbrey v. Brown, 738 F.2d 1462, 1470 (9th Cir. 1984)). 17 the contrary, the presence of a declaratory relief claim for copyright 18 misuse here would be duplicative, and a needless waste of judicial 19 resources. 20 III. California Unfair Competition Law 21 RMG can and has asserted copyright See Open Source Yoga Unity v. Choudhury, 2005 WL 756558, *8 This is not such a case, however. RMG has Metro-Goldwyn-Mayer Studios, 269 F. Supp. 2d at 1226 On Id. Ticketmaster argues that RMG’s counterclaim for state law unfair 22 competition should be dismissed because California law does not 23 recognize antitrust claims based on unilateral conduct. 24 this argument somewhat in its response, arguing only that section 25 17200 claims can be based on violations of the federal Sherman Act, 26 and, since it has pled a viable Sherman Act claim, its 17200 claim 27 should therefore also survive. 28 found that RMG has in fact not pled a viable Sherman Act claim, there RMG avoids Under this logic, since the Court has 15 Case 2:07-cv-02534-ABC-JC Document 91 Filed 03/10/2008 Page 16 of 16 1 is nothing left on which to predicate the 17200 claim. 2 that claim is also hereby DISMISSED, without prejudice. 3 4 Accordingly, CONCLUSION For the reasons set forth above, Ticketmaster’s motion to dismiss 5 is GRANTED. RMG’s First and Third Counterclaims are hereby DISMISSED, 6 with leave to amend. 7 PREJUDICE, as is RMG’s Fourth Counterclaim, to the extent it is based 8 on copyright misuse. 9 order in which to file any further amended counterclaims. RMG’s Second Counterclaim is DISMISSED WITH RMG shall have 30 days from the date of this 10 11 IT IS SO ORDERED. 12 13 DATED: March 10, 2008 14 15 ________________________________ AUDREY B. COLLINS UNITED STATES DISTRICT JUDGE 16 17 18 19 20 21 22 23 24 25 26 27 28 16
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