Malibu Media, LLC v. Doe 1, No. 8:2012cv01198 - Document 31 (D. Md. 2012)
Court Description: MEMORANDUM OPINION. Signed by Chief Judge Deborah K. Chasanow on 12/21/12. (sat, Chambers)
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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MARYLAND : MALIBU MEDIA, LLC : v. : Civil Action No. DKC 12-1198 : DOE 1 : MEMORANDUM OPINION Presently pending and ready for resolution is a motion to dismiss counterclaim filed by Plaintiff Malibu Media, LLC. No. 29). (ECF The relevant issues have been briefed and the court now rules pursuant to Local Rule 105.6, no hearing being deemed necessary. For the reasons that follow, the motion will be granted. I. Background Plaintiff commenced this action on April 19, 2012, asserting copyright infringement against sixteen Doe defendants alleged to have downloaded and/or uploaded a pornographic film via a file-sharing protocol called BitTorrent. with its complaint, Plaintiff filed a motion Concomitantly for expedited discovery, seeking to serve subpoenas on the Internet Service Providers Protocol ( ISPs ) addresses identities. associated ( IP with addresses ) the in subscribers order to Internet learn their That motion was granted the following day. Soon thereafter, the court issued an order sua sponte severing the defendants and dismissing all except Doe 1. With respect to that defendant, the court directed that all documents containing his or her identifying information be filed under seal. After learning the identity of Doe 1 from the ISP, Plaintiff filed, under seal, an amended complaint naming the defendant. Doe 1 responded by filing a sealed answer and counterclaim. At the direction of the court, the parties publicly filed redacted versions of these pleadings. In the redacted answer, Doe 1 raises numerous affirmative defenses, including the doctrine of misuse of copyright ; that Defendant s use of the work in question, if it occurred at all, was a legally protected fair use ; and that Plaintiff s claims are barred by the doctrine of implied license. at 5). The sophisticated cost, counterclaim business low-quality [protection] ; recites model works making that that the that consists barely works (ECF No. 25, Plaintiff of producing qualify available has for via a low- copyright a torrent protocol, where they are sure to be accessed and shared by other users ; accessing John Doe its hiring an works ; investigator then defendants, immediately identify the account holders. to Doe 1, Plaintiff fil[ing] was to log suits seeking IP against subpoena (ECF No. 25 ¶¶ 9-11). formed 2 solely for the addresses numerous power to According purposes of creating copyright defendants for registrations financial and gain. suing (Id. at thousands of 13). The ¶ counterclaim purports to assert a cause of action for misuse of copyright, seeking damages and/or appropriate attorneys fees and costs (id. at ¶ 25), as well as declaratory relief (id. at 11). to Defendant further seeks a declaratory judgment, pursuant 28 U.S.C. Plaintiff s [§] works 2201, is a that fair any use alleged under access copyright . . law, . of that Plaintiff s works [are] subject to an implied license, and that Defendant did not infringe any of Plaintiff s purportedly protected works. (Id. at ¶¶ 32, 37, 41). On October 19, Plaintiff filed a motion to dismiss the counterclaim 12(b)(6). pursuant to (ECF No. 29). Federal Rule of Civil Procedure Defendant has opposed that motion (ECF No. 30), and Plaintiff did not file a reply. II. Standard of Review A motion pursuant to Federal Rule of Civil 12(b)(6) tests the sufficiency of the complaint. Procedure Presley v. City of Charlottesville, 464 F.3d 480, 483 (4th Cir. 2006). A complaint need only satisfy the standard of Rule 8(a), which requires a short and plain statement of the claim showing that the pleader is entitled to relief. Fed.R.Civ.P. 8(a)(2). Rule 8(a)(2) still requires a showing, rather than a blanket assertion, of entitlement to relief. 3 Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 n. 3 (2007). That showing must consist of more than a formulaic recitation of the elements of a cause of action or naked assertion [s] devoid of further factual enhancement. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (internal citations omitted). At this stage, the court must consider all well-pleaded allegations in a complaint as true, Albright v. Oliver, 510 U.S. 266, 268 (1994), and must construe all factual allegations in the light most favorable to the plaintiff, see Harrison v. Westinghouse Savannah River Co., 176 F.3d 776, 783 (4th Cir. 1999) (citing Mylan Labs., Inc. v. Matkari, 7 F.3d 1130, 1134 (4th Cir. 1993)). The court unsupported legal allegations. need not, however, accept Revene v. Charles Cnty. Comm rs, 882 F.2d 870, 873 (4th Cir. 1979). Nor must it agree with legal conclusions couched as factual allegations, Iqbal, 556 U.S. at 678, or conclusory factual allegations devoid of any reference to actual events, United Black Firefighters v. Hirst, 604 F.2d 844, 847 (4th Cir. 1979); see also Francis v. Giacomelli, 588 F.3d 186, 193 (4th Cir. 2009). [W]here the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged, but it show[n] . . . that the pleader is entitled to relief. 556 U.S. at 679 (quoting Fed.R.Civ.P. 8(a)(2)). has not Iqbal, Thus, [d]etermining whether a complaint states a plausible claim for 4 relief will . . . be a context-specific task that requires the reviewing court to draw on its judicial experience and common sense. Id. III. Analysis Plaintiff initially argues that Defendant s counterclaim for misuse of copyright must be dismissed because [m]isuse of copyright is counterclaim. an affirmative defense (ECF No. 29, at 2). and not a claim or Defendant contends that prior decisions have squarely rejected that argument. (ECF No. 30, at 1). While there is a split of authority on the question of whether a declaratory judgment action for misuse of copyright is cognizable, see Nielson Co. (US), LLC v. Truck Ads, LLC, No. 08 C 6446, 2011 WL 221838, at *7 (N.D.Ill. Jan. 24, 2011) (collecting cases), courts have generally agreed that copyright misuse does not support a claim for damages. Breedables v. Ozimals, Inc., 790 F.Supp.2d Amaretto Ranch 1024, 1034 n. 7 (N.D.Cal. 2012) (quoting Adobe Systems Incorp. v. Norwood, No. C 10-03564, 2011 WL 845923, at *4 (N.D.Cal. Mar. 8, 2011)); see also Lava Records, LLC v. Amurao, 354 Fed.Appx. 461, 463 (2nd Cir. 2009); Adobe Systems Inc. v. Kornrumpf, 780 F.Supp.2d 988, 992 (N.D.Cal. 2011); Ticketmaster L.L.C. v. RMG Technologies, Inc., 536 F.Supp.2d 1191, 1198 (C.D.Cal. 2008); Metro-GoldwynMayer Studios, Inc. v. Grokster, Ltd., 269 F.Supp.2d 1213, 1225 5 (C.D.Cal. 2003). Indeed, the cases cited by Defendant are not to the contrary. See Apple Inc. v. Psystar Corp., N. C 08-03251 WHA, 2009 WL 303046, at *2 (N.D.Cal. Feb. 6, 2009) ( This [court] is unconvinced . . . that misuse may never be asserted as a counterclaim for declaratory relief ); Open Source Yoga Unity v. Choudhury, No. C 03-3182 PJH, 2005 WL 756558, at *8 (N.D.Cal. Apr. 1, 2005) (permitting the plaintiff to assert a declaratory relief action for misuse of copyright because the declaratory relief plaintiff is in fact likely to be accused of copyright infringement ). Thus, assuming without deciding that a cause of action for misuse of copyright may be maintained under certain declaratory circumstances, judgment. the only Accordingly, available Defendant s remedy is request a for damages in relation to misuse of copyright cannot be sustained. What remains, then, declaratory relief, affirmative defenses. which The are Defendant s counterclaims essentially parallel his Declaratory Judgment Act or for her provides that [i]n a cases of actual controversy within its jurisdiction . . . any court of the United States . . . may declare the rights and other legal relations of any interested party seeking such declaration, whether or not further relief is sought. U.S.C. § 2201(a) (emphasis added). The Fourth Circuit 28 has further explained that a federal court may properly exercise jurisdiction in such cases where three criteria are met: (1) 6 the complaint alleges an actual controversy between the parties of sufficient immediacy and reality to warrant issuance of a declaratory basis for judgment; the (2) the jurisdiction court over the possesses parties an independent (e.g., federal question or diversity jurisdiction); and (3) the court does not abuse its discretion in its exercise of jurisdiction. Volvo Constr. Equip. N. Am., Inc. v. CLM Equip. Co., Inc., 386 F.3d 581, 592 (4th Cir. 2004) (citing 28 U.S.C. § 2201; Cont l Cas. Co. v. Fuscardo, 35 F.3d 963, 965 (4th Cir. 1994)). The first jurisdiction and appear second requirements to met be here. for The the exercise of only question is whether the court should exercise its discretion to consider the counterclaims. In the declaratory judgment context, the normal principle that federal courts should adjudicate claims within their jurisdiction yields to considerations of practicality and wise judicial administration. New Wellington Fin. Corp. v. Flagship Resort Dev. Corp., 416 F.3d 290, 296 (4th Cir. 2005) (quoting Wilton v. Seven Falls Co., 515 U.S. 277, 287 (1995)). Accordingly, the court may, in the exercise of its broad discretion, S.C. Dept. of Health & Envtl. Control v. Commerce & Indus. Ins. Co., 372 F.3d 245, 260 (4th Cir. 2004), decline to exercise its jurisdiction and dismiss the action, Volvo Constr. Equip., 386 F.3d at 594. A court must be cautious, however, as it should only decline to exercise jurisdiction where there is a 7 good reason to do so. Id. In particular, a court should normally entertain a declaratory action where the relief sought (i) will serve a useful purpose in clarifying and settling the legal relations in issue, and (ii) will terminate and afford relief from the uncertainty, insecurity, and controversy giving rise to the proceeding. Fuscardo, 35 F.3d at 965 (quoting Nautilus Ins. Co. v. Winchester Homes, Inc., 15 F.3d 371, 375 (4th Cir. 1994)). [C]onsiderations of federalism, efficiency, [and] comity are also significant. Aetna Cas. & Sur. Co. v. Ind-Com Elec. Co., 139 F.3d 419, 423 (4th Cir. 1998). Doe 1 offers no explanation as to how the counterclaims would clarify the parties obligations. Defendant asserts, in conclusory fashion, that a simple review of the answer and counterclaims demonstrates that there is little overlap between the defenses and counterclaims (ECF No. 30, at 5), but presents no further consolidated analysis and, pleading indeed, is of the distinction between the defenses and counterclaims. Courts have typically declaratory consider there review substantive to that simple no declined reflects a counterclaims for relief that are duplicative of affirmative defenses. See Penn Mutual Life Ins. Co. v. Berck, No. DKC 09-0578, 2010 WL 3294305, at *3 (D.Md. Aug. 20, 2010) ( This type of double pleading is not the purpose of a declaratory judgment ); Penn Mutual Life Ins. Co. v. Greatbanc Trust Company, No. 09 C 6129, 2010 WL 8 2928054, at *5 (N.D.Ill. July 21, 2010) ( counterclaims that mimic affirmative counterclaims declaratory defenses that relief ); are mirror Zytax, no the Inc. less duplicative plaintiff s v. Green [than] request Plains for Renewable Energy, Inc., No. H-09-2582, 2010 WL 2219179, at *8 (S.D.Tex. May 28, 2010) (dismissing declaratory counterclaim duplicative of affirmative defense); United States v. Zanfei, 353 F.Supp.2d 962, 965 (N.D.Ill. 2005) (noting that it is well settled that courts may dismiss duplicative counterclaims); see also Fed.R.Civ.P. 8(c) ( If a party mistakenly designates a defense as a counterclaim, or a counterclaim as a defense, the court must, if justice requires, treat the pleading as though it were correctly designated, and may impose terms for doing so ). Defendant urges that a declaration in his or her favor would eliminate uncertainty for the thousands of people who are likely to be named in future lawsuits by the Plaintiff. No. 30, at 3). (ECF The Declaratory Judgment Act, however, is not intended to provide a forum for establishing the legal relations between declaratory defendants and all the world ; rather, it only permits courts to clarify or settle the legal relations of the parties insecurity, or and to provide controversy relief giving from rise to the the uncertainty, proceeding. Metro-Goldwyn-Mayer Studios, 269 F.Supp.2d at 1226. Thus, a declaratory judgment in Defendant s favor would not eliminate 9 uncertainty for the thousands of people who are likely to be named in asserts. future lawsuits by the Plaintiff, as Defendant (ECF No. 30, at 3). At base, Defendant seeks a declaration of noninfringement under a number of different theories. While he or she appears to seek, once and for all, a judgment that will stem the rising tide of litigation from Malibu Media and similarly-situated plaintiffs, this lawsuit does not provide a vehicle for doing so. Rather, the instant case is concerned with adjudicating the rights of these particular parties. IV. Conclusion For the foregoing reasons, Plaintiff s motion to dismiss counterclaim will be granted. A separate order will follow. ________/s/_________________ DEBORAH K. CHASANOW United States District Judge 10
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