Nike, Inc. v. Lombardi et al, No. 3:2010cv00389 - Document 45 (D. Or. 2010)
Court Description: OPINION AND ORDER: Defendant CMG's motion to dismiss 29 is denied. Signed on 11/16/10 by Magistrate Judge Dennis J. Hubel. (kb)
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Nike, Inc. v. Lombardi et al Doc. 45 1 2 3 4 5 6 7 8 9 IN THE UNITED STATES DISTRICT COURT 10 FOR THE DISTRICT OF OREGON 11 PORTLAND DIVISION 12 13 14 15 16 17 18 NIKE, INC., an Oregon corporation, ) ) ) Plaintiff, ) ) v. ) ) VINCE LOMBARDI, JR., an ) individual; SUSAN LOMBARDI, an) individual; and CMG WORLDWIDE,) INC., an Indiana corporation, ) ) Defendants. ) ) No. CV-10-389-HU OPINION & ORDER 19 20 21 22 Jon P. Stride David M. Weiler TONKON TORP LLP 1600 Pioneer Tower 888 SW Fifth Avenue Portland, Oregon 97204-2099 23 Attorneys for Plaintiff 24 Jan K. Kitchel SCHWABE, WILLIAMSON & WYATT, P.C. Pacwest Center 1211 SW Fifth Avenue, Suite 1900 Portland, Oregon 97204 25 26 27 28 Attorney for Defendants Vince Lombardi, Jr. & Susan Lombardi / / / 1 - OPINION & ORDER Dockets.Justia.com 1 2 Bradley Schrock SCHROCK LAW OFFICE, P.C. 500 SW Hall Boulevard Beaverton, Oregon 97005 3 4 5 Theodore J. Minch SOVICH MINCH, LLP 10099 Chesapeake Drive, Suite 100 McCordsville, Indiana 46055 6 7 Attorneys for Defendant CMG Worldwide, Inc. HUBEL, Magistrate Judge: 8 9 Plaintiff Nike, Inc. brings this action against defendants Vince Lombardi, Jr., Susan Lombardi, and CMG Worldwide, Inc. The 10 action against the individual defendants is brought against them as 11 fifty percent owners of the intellectual property of the late Vince 12 Lombardi. 13 All parties have consented to entry of final judgment by a 14 Magistrate Judge in accordance with Federal Rule of Civil Procedure 15 73 and 28 U.S.C. ยง 636(c). 16 action for failure to join an indispensable party. 17 motion. 18 Defendant CMG moves to dismiss the I deny the BACKGROUND 19 The background, based on the facts as alleged in the 20 Complaint, is fully set out in the August 11, 2010 Opinion & Order 21 denying CMG's motion to dismiss for lack of personal jurisdiction 22 and alternative motion to transfer. 23 referenced in the discussion below. 24 Any additional facts are STANDARDS 25 Defendants move to dismiss for failure to 26 indispensable party under Federal Rule of Procedure 19. 27 Civ. 28 determine whether a party should or must be joined. P. 12(b)(7). 2 - OPINION & ORDER Rule 19 requires a two-step join an Fed. R. analysis to Takeda v. 1 Northwestern Nat'l Life Ins. Co., 765 F.2d 815, 819 (9th Cir. 2 1985). 3 the party is necessary or required. 4 5 6 7 8 9 Under Rule 19(a), the court must first determine whether Id. A party is necessary if (A) in that person's absence, the court cannot accord complete relief among existing parties; or (B) that person claims an interest relating to the subject of the action and is so situated that disposing of the action in the person's absence may (i) as a practical matter impair or impede the person's ability to protect the interest; or (ii) leave an existing party subject to a substantial risk of incurring double, multiple, or otherwise inconsistent obligations because of the interest. Fed. R. Civ. P. 19(a)(1). 10 The "complete relief" inquiry concerns only the relief as 11 between the existing parties, not between an existing party and the 12 absent party whose joinder is sought. 13 Chehalis Indian Reservation v. Lujan, 928 F.2d 1496, 1501 n.3 (9th 14 Cir. 1991). And, the "appropriate focus" in determining the 15 necessity a 16 ramifications of joinder versus nonjoinder." Puyallup Indian Tribe 17 v. Port of Tacoma, 717 F.2d 1251, 1255 (9th Cir. 1983) (internal 18 quotation omitted). of party under Rule 19(a) Confederated Tribes of is on the "practical 19 If the party is necessary, but its joinder will destroy 20 jurisdiction, then the court must consider whether "in equity and 21 good conscience" the action should proceed without his joinder. 22 Takeda, 765 F.2d at 819; see also EEOC v. Peabody W. Coal Co., 400 23 F.3d 774, 779 (9th Cir. 2005) (noting that whether a party is 24 indispensable to an action involves "three successive inquiries" 25 with the first determining whether the absent party is "required," 26 the second determining the feasibility of joinder, and the third, 27 if the absent party is required and cannot feasibly be joined, 28 determining whether "in equity and good conscience," the action 3 - OPINION & ORDER 1 should proceed among the existing parties or should be dismissed). 2 Four factors are relevant to the indispensable inquiry: 3 (1) the extent to which a judgment rendered in the person's absence might prejudice that person or the existing parties; (2) the extent to which any prejudice could be lessened or avoided by: (A) protective provisions in the judgment; (B) shaping the relief; or (C) other measures; (3) whether a judgment rendered in the person's absence would be adequate; and (4) whether the plaintiff would have an adequate remedy if the action is dismissed for nonjoinder. 4 5 6 7 8 Fed. R. Civ. P. 19(b). Only if the court determines that the 9 action must be dismissed is the party deemed indispensable. 10 McLaughlin v. International Ass'n of Machinists and Aerospace 11 Workers, 847 F.2d 620, 621 (9th Cir. 1988). 12 DISCUSSION 13 CMG argues that plaintiff's long time advertising agency, 14 Wieden + Kennedy (WK) is a necessary/required party which may not 15 be joined without destroying this Court's diversity jurisdiction 16 and thus, WK is an indispensable party and this action must be 17 dismissed. 18 facts not included in the Complaint. 19 emails 20 Thomashow, other employees of plaintiff, and CMG employee Mark 21 Roesler. 22 In support of the motion, CMG written by WK employees, relies on additional The evidence consists of plaintiff's employee Mark The emails show that WK was working on an ad, called the 23 "Voyeur," which, in concept, was going to use what WK thought was 24 a speech given by Vince Lombardi. 25 plaintiff inquiring if the license to the speech had been obtained, 26 indicating that WK was going to also contact NFL films in an 27 attempt to locate the original speech, and inquiring if Thomashow 28 would inquire whether it would be possible to get permission to do 4 - OPINION & ORDER There are emails from WK to 1 2 a voiceover if WK did not like how the original speech sounded. Other emails sought clarification that a $150,000 licensing 3 had been paid. July 2008 emails suggest that there was some 4 confusion by Thomashow who thought that WK already had a copy of 5 the speech, and expressing frustration that he had not been told 6 that a voiceover request was possible. Several emails in July 2008 7 sought to clarify what WK already had in terms of an audio of the 8 speech. 9 stated that WK had not actually heard the speech, but had read it In late July 2008, Thomashow emailed CMG's Roesler and 10 in a book by Vince Lombardi, Jr. Thomashow expressed interest in 11 obtaining a sound recording of the speech and asked Roesler if he 12 knew of any "cache" of Lombardi speeches. 13 A couple of other emails in late July 2008 indicated that the 14 original speech could not be found, but that pursuing "Vince Jr" to 15 re-record "for the same cost as the original" should be pursued. 16 But, a WK employee then indicated that WK would prefer that before 17 moving forward, WK wanted to first award the job, talk with the 18 director, and "have a final treatment" including voiceover talent. 19 The next emails are dated in January and February 2009, when 20 WK asked Thomashow about the financial liability of the $150,000 21 payment if the speech was not used. 22 had had no communication about the speech since July 29, 2008, and 23 that CMG had already paid the Lombardis. 24 been told there was a chance the speech would not be used. 25 separate email to someone at Nike, as well as to the person at WK, 26 Thomashow stated that the $150,000 was paid for the rights based on 27 misinformation from WK as to what they wanted and what existed. 28 Thomashow indicated that he He stated he had never In a In February 2009, Thomashow learned from another Nike employee 5 - OPINION & ORDER 1 that it was likely the speech would not be used in the ad. 2 Nike employee indicated that they would still pay for it, but it 3 was likely it would not be used. 4 explaining that the speech was not going to be used because it 5 ended up not being right for the concept. 6 was disappointed that WK never told him not using the speech was a 7 possibility and that WK did not ask Thomashow to build in a "kill 8 fee" if the speech was not used. 9 pay back the $150,000. 10 11 The Thomashow then wrote to Roesler He told Roesler that he Thomashow then asked Roesler to Finally, there are several emails from June and July 2009, regarding finishing the filming of the video. 12 CMG argues that the emails show that WK was responsible for 13 the origination, design, production, release, and placement of the 14 ad campaign that was to use the Lombardi intellectual property or 15 the Lombardi speech. 16 responsible for locating the audio of the Lombardi Speech, or in 17 the alternative, that WK was planning on using a voiceover should 18 WK be unable to locate the actual audio or the audio was not of 19 sufficient 20 responsibility 21 intellectual property. 22 CMG CMG asserts that the emails show that WK was quality. was contends According to that secure based to the on CMG, rights WK's plaintiff's to primary the role sole Lombardi in the 23 circumstances underlying this action, WK is a required party which 24 should be joined, and further, that WK is indispensable to this 25 action. Generally, CMG argues that by failing to add WK, plaintiff 26 has sought to exclude from the court's, and ultimately the jury's, 27 consideration the detailed facts and circumstances associated with 28 the negligence and contributory liability of WK acting on behalf of 6 - OPINION & ORDER 1 plaintiff in regard to the speech. 2 I. 3 Rule 19(a) - Necessary or Required Party The first inquiry of a Rule 19 joinder analysis is whether the 4 party to be added is necessary or required. 5 party is necessary or required if, "in that person's absence, the 6 court cannot accord complete relief among existing parties." 7 R. Civ. P. 19(a)(1)(A). 8 9 As stated above, a Fed. CMG argues that complete relief cannot be afforded to either it or the Lombardis if WK is not joined. Specifically, CMG argues 10 that WK "holds the key to CMG's absolute defense of the one and 11 only cause asserted against CMG, fraud[.]" 12 9. 13 responsible for the planning and design of the advertising campaign 14 in which the speech was to be used; (2) the payment for the rights 15 to use the Lombardi intellectual property was to be attributed to 16 WK's budget; (3) the existence of the speech notwithstanding, WK 17 was prepared to use a voiceover as 18 Lombardi himself; (4) WK negligently failed to confirm that the 19 Lombardi Speech did not exist in audio form, nor did it seek to 20 confirm the availability as WK should have because the industry 21 standard of practice requires the advertising agency to do so; and 22 (5) WK did not communicate that the speech may not be used in the 23 campaign 24 negotiate a "kill fee" in such a circumstance. CMG bases in its any argument form, on depriving the Deft CMG's Mem. at p. following: (1) WK was opposed to the voice of plaintiff of the chance to 25 As I understand CMG's argument, it anticipates defending the 26 fraud claim asserted against it by plaintiff by arguing that (1) 27 given 28 misrepresentation about the existence of the voice recording was the facts 7 - OPINION & ORDER regarding WK's involvement, CMG's alleged 1 not material to plaintiff, or (2) plaintiff's reliance on the 2 misrepresentation was not reasonable, or (3) in the end, plaintiff 3 suffered no damages caused by CMG's alleged misrepresentation about 4 the existence of the recording because the recording was not used 5 by WK based on a creative decision. 6 made a party, it will be prejudiced and unable to obtain full 7 relief. 8 9 Notably, CMG fails prejudice in WK's absence. to CMG contends that if WK is not explain why it will suffer such I agree with plaintiff that if CMG is 10 able to cast blame on WK, plaintiff will recover nothing in this 11 lawsuit and CMG will be provided complete relief in the form of a 12 verdict in its favor on the only claim against it. 13 prevents CMG from making its argument at trial. 14 WK witnesses and offer evidence in support of its theory of the 15 case. 16 empty chair, an opportunity most defense attorneys would relish. 17 And, alternatively, if CMG fails to convince the jury that WK is at 18 fault, plaintiff will be awarded damages accordingly, whether WK is 19 a party or not. 20 accorded full relief. 21 Nothing CMG may subpoena As I explained at oral argument, CMG gets to point to the In either event, the existing parties will be In a recent case, Judge Stewart came to the same conclusion. 22 In Hurley v. Horizon Project, Inc., No. CV-08-1365-ST, 2009 WL 23 5511205 (D. Or. Dec. 3, 2009), adopted by Judge Redden (D. Or. Jan. 24 15, 2010), Judge Stewart rejected an argument similar to the one 25 made by CMG here. 26 contended that complete relief under Rule 19 could not be afforded 27 in the absence of the State of Oregon as a party because the State 28 was liable for some or all of the plaintiff's injuries. Id. at *7. As she noted, the county defendants in the case 8 - OPINION & ORDER 1 The county defendants, she noted, believed they would be "left 2 holding the bag" without the State's presence. 3 defendants argued that their concerns over their ability to "pin 4 blame on the State" were valid considerations in the "complete 5 relief" analysis and compelled a finding that the State was a 6 necessary party. Id. The county Id. 7 Judge Stewart rejected the argument, explaining first that 8 joinder of a joint tortfeasor with "the usual 'joint-and-several' 9 liability" is regulated by Rule 20, governing permissive joinder. 10 Id. 11 under FRCP 19[.]" 12 defendants could be afforded complete relief: 13 Id. Then, she explained that the county The county defendants remain free to contend that Hurley's injuries were caused by the State's actions. They may subpoena state witnesses and offer evidence in support of their arguments. Because the State will not be present to defend itself, it is difficult to understand how its absence will prejudice the county defendants. 14 15 16 17 "[A] joint tortfeasor is not a necessary party to a lawsuit Id. at *8. 18 The same is true here for CMG. Given that CMG can call WK 19 employees as witnesses and can submit the email evidence at trial, 20 CMG, like the county defendants in Hurley, is "free to contend that 21 [the plaintiff's] injuries were caused by [WK's] actions." 22 not a necessary or required party under Rule 19(a)(1). 23 II. WK is Rule 19(b) 24 Hurley and other cases indicate that if the party sought to be 25 joined is not necessary/required, then the Court does not proceed 26 to the Rule 19(b) analysis. 27 Port of Astoria, No. CV-09-847-JE, 2010 WL 143821, at *5 (D. Or. 28 Jan. 5, 2010) (when party was not necessary under Rule 19(a), court 9 - OPINION & ORDER Id. at *10; e.g., LNG Dev. Co., LLC v. 1 does not reach question of whether the party is indispensable under 2 Rule 19(b)). 3 CONCLUSION 4 Defendant CMG's motion to dismiss [29] is denied. 5 IT IS SO ORDERED. 6 Dated this 16th day of November, 2010. 7 8 /s/ Dennis J. Hubel 9 Dennis James Hubel United States Magistrate Judge 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 10 - OPINION & ORDER
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