Ark Promotions, Inc. v. Justin.TV, Inc.

904 F.Supp.2d 541

ARK PROMOTIONS, INC., Plaintiff,

v.JUSTIN.TV, INC., Youtube LLC, and Youtube, Inc., Defendants.

No. 3:12–cv–131–RJC–DCK.

United States District Court,

W.D. North Carolina,

Charlotte Division.

Oct. 17, 2012.

John C. Nipp, Summa, Allan & Additon, P.A., Charlotte, NC, for Plaintiff.

Jonathan E. Buchan, Jr., Helms, Mulliss & Wicker, PLLC, Corby C. Anderson, Marisa B. Nye, McGuireWoods, LLP, Charlotte, NC, Brian Michael Willen, Wilson Sonsini Goodrich & Rosati, New York, NY, Rodrick J. Enns, Enns & Archer, LLP, Winston–Salem, NC, for Defendants.

ORDER

ROBERT J. CONRAD, JR., Chief Judge.

THIS MATTER comes before the Court on Defendants' Partial Motion to Dismiss, (Doc. No. 16), Plaintiff's Response, (Doc. No. 20), and the Magistrate Judge's Memorandum and Recommendation (“M & R”), (Doc. No. 22), recommending that the Motion be granted. The parties were advised that objections to the M & R were to be filed by September 17, 2012. The time for filing objections has since passed and no objections were filed by either party in this matter. For the reasons stated below, the Court GRANTS Defendants' motion to dismiss counts one (1), two (2) and seven (7) of Plaintiff's Complaint.

I. STANDARD OF REVIEW

The Federal Magistrate Act provides that “a district court shall make a de novo determination of those portions of the report or specific proposed findings recommendations to which objection is made.” 28 U.S.C. § 636(b)(1); Camby v. Davis, 718 F.2d 198, 200 (4th Cir.1983). In the absence of a timely filed objection, a district court need not conduct a de novo review, but instead must “only satisfy itself that there is no clear error on the face of the record in order to accept the recommendation.” Diamond v. Colonial Life & Acc. Ins. Co., 416 F.3d 310, 315 (4th Cir.2005) (quoting Fed.R.Civ.P. 72 advisory committee's note).

II. DISCUSSION

The Magistrate Judge issued an M & R on August 29, 2012. (Doc. No 22). Plaintiff has not filed any objection to the Magistrate Judge's thorough examination and dismissal of certain of Plaintiff's claims. This Court finds no clear error with the Magistrate Judge's recommendation and concludes that the findings of fact are supported by the record and the conclusions of law are consistent with and supported by relevant case law. Accordingly, this Court hereby accepts the Magistrate Judge's M & R and adopts it as the final decision of the Court for all purposes relating to this case.

III. CONCLUSION

IT IS, THEREFORE, ORDERED that:

1. The Magistrate Judge's M & R, (Doc No. 20) is ADOPTED; and

2. Defendants' Partial Motion to Dismiss is GRANTED.

MEMORANDUM AND RECOMMENDATION

DAVID C. KEESLER, United States Magistrate Judge.

THIS MATTER IS BEFORE THE COURT on “Defendants' Joint Motion To Dismiss” (Document No. 16). This matter has been referred to the undersigned Magistrate Judge pursuant to 28 U.S.C. § 636(b), and is now ripe for disposition. Having carefully considered the motion, the record, and the applicable authority, the undersigned will respectfully recommend that the motion be granted.

I. PROCEDURAL BACKGROUND

Ark Promotions, Inc. (“Plaintiff” or “Ark”) filed its “Complaint” in this Court on February 27, 2012, against YouTube, LLC, YouTube, Inc. (collectively “YouTube”) and Justin.tv, Inc. (“Justin.tv”) (all together “Defendants”). (Document No. 1). Plaintiff's claims arise from Defendants' alleged unauthorized reception and re-transmission of Plaintiff's copyrighted pay-per-view live broadcast of a boxing match between Evander Holyfield and Sherman Williams on January 22, 2011. Id.

On April 20, 2012, Defendants filed their “... Joint Motion To Dismiss” (Document No. 16) and “Memorandum Of Law In Support Of Defendants' Joint Motion To Dismiss” (Document No. 17). On May 7, 2012, “Plaintiff's Opposition To Defendants' Joint Motion To Dismiss” (Document No. 20) was filed. Defendants' “Reply In Support Of Defendants' Joint Motion To Dismiss” (Document No. 21) was timely filed on May 17, 2012. As such, the pending motion is now ripe for review, and for a recommendation for disposition to the presiding district judge.

II. STANDARD OF REVIEW

A motion to dismiss pursuant to Fed.R.Civ.P. 12(b)(6) tests the “legal sufficiency of the complaint” but “does not resolve contests surrounding the facts, the merits of a claim, or the applicability of defenses.” Republican Party of N.C. v. Martin, 980 F.2d 943, 952 (4th Cir.1992); Eastern Shore Markets, Inc v. J.D. Assoc. Ltd. Partnership, 213 F.3d 175, 180 (4th Cir.2000). A complaint attacked by a Rule 12(b)(6) motion to dismiss will survive if it contains “enough facts to state a claim to relief that is plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 1960, 173 L.Ed.2d 868 (2009), quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007); see also, Robinson v. American Honda Motor Co., Inc., 551 F.3d 218, 222 (4th Cir.2009). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 129 S.Ct. at 1949. “Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.” Id.

The Supreme Court has also opined that

Federal Rule of Civil Procedure 8(a)(2) requires only “a short and plain statement of the claim showing that the pleader is entitled to relief.” Specific facts are not necessary; the statement need only “ ‘give the defendant fair notice of what the ... claim is and the grounds upon which it rests.’ ” In addition, when ruling on a defendant's motion to dismiss, a judge must accept as true all of the factual allegations contained in the complaint.

Erickson v. Pardus, 551 U.S. 89, 93–94, 127 S.Ct. 2197, 167 L.Ed.2d 1081 (2007) (citations omitted).

“Although for the purposes of this motion to dismiss we must take all the factual allegations in the complaint as true, we are not bound to accept as true a legal conclusion couched as a factual 2 allegation.” Papasan v. Allain, 478 U.S. 265, 286, 106 S.Ct. 2932, 92 L.Ed.2d 209 (1986). The court “should view the complaint in the light most favorable to the plaintiff.” Mylan Labs., Inc. v. Matkari, 7 F.3d 1130, 1134 (4th Cir.1993).

III. DISCUSSION

Viewing the Complaint in the light most favorable to Plaintiff supports the following summary of pertinent facts. Plaintiff was the promoter of a boxing match between Holyfield and Williams on January 22, 2011, at the Greenbrier Resort in White Sulphur Springs, West Virginia. (Document No. 1, p. 3). As such, Plaintiff sold tickets to watch the boxing match in person and licensed the rights to certain entities to distribute the live television broadcast, via cable television and satellite broadcast to residential and commercial viewers on a pay-per-view basis. Id. Prior to the boxing match, Plaintiff made a significant investment in advertising and promoting the boxing match, paying the fighters, and producing the live television broadcast (“Live Broadcast”). Id. Plaintiff expected to recoup its investment through pay-per-view sales. Id. Plaintiff is the lawful owner of the Live Broadcast and registered its copyright in the Live Broadcast with the United States Copyright Office. (Document No. 1, p. 4).

According to the Complaint, unauthorized live video streams of the Live Broadcast were retransmitted to www. justin. tv by users who had access to the broadcast signal transmitted by an authorized cable or satellite provider. (Document No. 1, p. 5). The unauthorized live video streams were transmitted over the www. justin. tv website simultaneously with the authorized transmission of the Live Broadcast. Id. Plaintiff asserts that prior to the boxing match, and during the boxing match, it alerted Justin.tv to the fact that its users planned to, and did in fact, transmit the Live Broadcast through the www. justin. tv website. (Document No. 1, pp. 4–5). Plaintiff further asserts that Justin.tv took no action to stop the unauthorized reception and transmission, and as a result at least thousands of people viewed the Live Broadcast without proper payment to Plaintiff. Id.

The Complaint also provides that on or about January 22–23, 2011, YouTube received, transmitted, published, reproduced, distributed and/or displayed the Live Broadcast on its www. youtube. com website. (Document No. 1, p. 6). Consequently, Plaintiff contends that at least thousands of people were able to view the Live Broadcast on YouTube's website without proper payment to Plaintiff. Id.

Based on the foregoing, Plaintiff's Complaint asserts nine causes of action. (Document No. 1). “Defendants' Joint Motion To Dismiss” seeks dismissal of Plaintiff's first, second, and seventh causes of action in the Complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). (Document No. 16). The first cause of action alleges unauthorized reception of cable service in violation of 47 U.S.C. § 553; the second cause of action alleges unauthorized publication or use of communications in violation of 47 U.S.C. § 605; and the seventh cause of action alleges inducement of copyright infringement. (Document No. 1, pp. 7–8, 11–12). The other six causes of action assert additional claims of copyright infringement. (Document No. 1, 9–14).

Defendants contend that the first, second and seventh claims should be dismissed because: (1) the Cable Communications Policy Act (“Communications Act”) does not apply to the conduct alleged by Plaintiff; (2) even if the Communications Act were applicable here, the claims under that statute would be barred by Section 230(c) of the Communications Decency Act (“CDA”), 47 U.S.C. § 230; and (3) the claim for inducement lacks “any factual allegations suggesting that Defendants took any ‘affirmative steps' intended to encourage copyright infringement by their users.” (Document No. 17, pp. 2–3).

A. First and Second Causes Of Action

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