Ferrarini v. Irgit

MARIA SOLANGE FERRARINI, Plaintiff, v. IPEK IRGIT, et al., Defendants.

19 Civ. 0096 (LGS)

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK

January 9, 2020

OPINION AND ORDER

LORNA G. SCHOFIELD, District Judge:

Plaintiff Maria Solange Ferrarini brings this action against Defendants Ipek Irgit and Kiini, LLC (collectively, the "Defendants"), alleging copyright infringement, 17 U.S.C. § 501; a violation of California's Unfair Competition law, California Business and Professions Code § 17200, et seq.; conversion and/or civil theft under California and New York common law; and intentional interference with prospective economic advantage. Defendants move to dismiss the Amended Complaint (the "Complaint") under Federal Rule of Civil Procedure 12(b)(6). For the following reasons, the motion is denied as to the copyright infringement claim, and granted as to the state law claims.

I. BACKGROUND

The following facts relevant to Defendants' motion are taken from the Complaint and supporting exhibits, and are accepted as true for purposes of this motion. See Hu v. City of New York, 927 F.3d 81, 88 (2d Cir. 2019) ("In deciding a Rule 12(b)(6) motion, the court may consider only the facts alleged in the pleadings, documents attached as exhibits or incorporated by reference in the pleadings[,] and matters of which judicial notice may be taken.") (internal quotation marks omitted).

Plaintiff is an artisan living in Trancoso, Brazil. In 1998, Plaintiff created a design for hand knitted, colorful crochet bikinis and, since then, has sold these bikinis directly to the public. In 2012, Defendant Irgit purchased one of Plaintiff's bikinis. In 2013, Defendant Irgit founded Kiini, LLC and, in 2014, Defendants began manufacturing and selling bikinis using Plaintiff's design. In December 2014, Defendant Irgit registered Plaintiff's bikini design with the United States Copyright Office. The copyright listed Defendant Irgit as the author, and asserted January 30, 2013, as the date of first publication. Defendant Irgit subsequently assigned the copyright to Kiini, LLC. Defendants advertised and promoted the bikini through the Kiini, LLC website, and through numerous interviews in fashion and swimwear publications around the world. In these promotional interviews, Defendants falsely portrayed Defendant Irgit as the creator of the bikini design.

In 2015, Defendant Irgit sued Victoria's Secret for infringing Defendant Irgit's purported bikini design. During that lawsuit, Victoria's Secret subpoenaed individuals in Kiini, LLC's manufacturing and production chain, including Sally Wu. In 2012, Defendant Irgit had emailed Ms. Wu to inquire about potential production of Plaintiff's bikini design, and had attached images of Plaintiff's bikini to the email. The images revealed Plaintiff's actual signature and phone number on the waistline of the bikini bottom. In an attempt to obstruct Ms. Wu's cooperation with the subpoena, Defendant Irgit instructed Ms. Wu not to reveal the bikini was a duplication of Plaintiff's design, and offered to take Ms. Wu and three of her friends on a trip anywhere in the world if Kiini, LLC won its lawsuit against Victoria's Secret. Ms. Wu never received a copy of the subpoena, and Defendants secured a settlement with Victoria's Secret.

In early 2018, Defendant Irgit sued two smaller swimsuit manufacturers. The CEO of one of companies was able to locate Plaintiff in Trancoso, Brazil. Plaintiff subsequently soughtcounsel and brought this lawsuit. After Plaintiff secured a United States copyright registration, Plaintiff amended the complaint on April 17, 2019, to include a copyright infringement claim.

II. STANDARD

To survive a motion to dismiss under Rule 12(b)(6), "a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). "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." Id. (citing Twombly, 550 U.S. at 556). It is not enough for a plaintiff to allege facts that are consistent with liability; the complaint must "nudge[]" claims "across the line from conceivable to plausible." Twombly, 550 U.S. at 570. "To survive dismissal, the plaintiff must provide the grounds upon which his claim rests through factual allegations sufficient to raise a right to relief above the speculative level." Lanier v. Bats Exch., Inc., 838 F.3d 139, 150 (2d Cir. 2016). On a Rule 12(b)(6) motion, "all factual allegations in the complaint are accepted as true and all inferences are drawn in the plaintiff's favor." Apotex Inc. v. Acorda Therapeutics, Inc., 823 F.3d 51, 59 (2d Cir. 2016).

III. DISCUSSION

A. The Copyright Claim is Not Barred by the Statute of Limitations

Defendants argue that the Complaint's copyright claim is time barred. "Although the statute of limitations is ordinarily an affirmative defense that must be raised in the answer, a statute of limitations defense may be decided on a Rule 12(b)(6) motion if the defense appears on the face of the complaint." Thea v. Kleinhandler, 807 F.3d 492, 501 (2d Cir. 2015); accord Wei Su v. Sotheby's, Inc., No. 17 Civ. 4577, 2019 WL 4917609, at *2 (S.D.N.Y. Oct. 4, 2019).

The threshold question for this analysis is the type of claim brought -- ownership or infringement -- because the type of claim determines how the statute of limitations is applied. If the claim is one of ownership, the copyright claim must be brought "within three years after the claim accrued." 17 U.S.C. § 507(b)); see Wilson v. Dynatone Publ'g Co., 892 F.3d 112, 118 (2d Cir. 2018). "[A]n infringement action may be commenced within three years of any infringing act, regardless of any prior acts of infringement; . . . the three-year limitations period . . . bar[s] only recovery for infringing acts occurring outside the three-year period." Kwan v. Schlein, 634 F.3d 224, 228 (2d Cir. 2011). Where "the ownership claim is time-barred, and ownership is the dispositive issue, any attendant infringement claims must fail." Id. at 230.

Here, Defendants are correct that Plaintiff brings an ownership claim. However, because it is not apparent on the face of the Complaint that the claim accrued more than three years before Plaintiff brought this action, the copyright infringement claim is not dismissed.

1. The Complaint Asserts an Ownership Claim

The Complaint asserts an ownership claim because it "cannot be decided without adjudication of a genuine dispute as to the plaintiff's ownership of the copyright." Id. at 226; accord Narrative Ark Entm't LLC v. Archie Comic Publications, Inc., No. 16 Civ. 6109, 2019 WL 4142362, at *4 (S.D.N.Y. Aug. 29, 2019).

Here, the gravamen of the Complaint is ownership and not infringement. For example, the Complaint alleges that Defendant Irgit "plotted to claim the design as her own" (Dkt. No. 66 at ¶ 4); Defendant Irgit "founded a company to sell her stolen design" (Dkt. No. 66 at ¶ 5); "[i]n an attempt to conceal the true authorship of the bikini design . . . [Defendant] Irgit registered [Plaintiff's] design with the United States Copyright Office" (Dkt. No. 66 at ¶ 6); Defendant Irgit "falsely claim[ed]" she was the design author (Dkt. No. 66 at ¶ 7); and Defendant Irgit"continues to falsely claim she made [the bikini] with her grandmother when she was 10 or 11." (Dkt. No. 66 at ¶ 25). These types of allegations are consistent with a dispute over ownership. See Kwan, 634 F.3d at 229 (observing that infringement -- rather than ownership -- claims "involve the nature, extent or scope, of copying"); Archie Comic Publications, Inc., 2019 WL 4142362, at *5 (finding that similar factual allegations, "along with . . . competing claims of ownership, place the parties' disputed ownership of the registered works at the heart of this case").

Moreover, the Complaint alleges that both Plaintiff and Defendants have registered the bikini design with the United States Copyright Office. As Defendants do not concede that Plaintiff owns the copyright, any finding of infringement must be predicated on a finding of ownership of the copyright in question. This is sufficient to find that Plaintiff's claim is one for ownership, not infringement. See Cole v. Blackwell Fuller Music Publ'g, LLC, No. 16 Civ. 7014, 2018 WL 4680989, at *5 (S.D.N.Y. Sept. 28, 2018) ("Since Defendants do not concede that Plaintiff is owner of [the disputed] copyrights . . . the relevant statute of limitations inquiry relates to the claim of ownership."); Ortiz v. Guitian Bros. Music Inc., No. 07 Civ. 3897, 2008 WL 4449314, at *3 (S.D.N.Y. Sept. 29, 2008) ("Where, as here, a plaintiff's copyright ownership is not conceded (and, in fact, the defendant holds a prior copyright registration certificate for the disputed work), copyright ownership, and not infringement, is the gravamen of the plaintiff's claim to which the statute of limitations is applied.").

2. The Claim is Not Time Barred

The copyright claim is timely because nothing on the face of the Complaint shows that the claim was brought more than "three years after the claim accrued." See 17 U.S.C. § 507(b). "A copyright ownership claim accrues only once, when a reasonably diligent plaintiff wouldhave been put on inquiry as to the existence of a right." Dynatone Publ'g Co., 892 F.3d at 118 (quotation marks omitted). "Although an alleged author is aware of his claim to ownership of the work from the moment of its creation, the author does not need to bring suit until there has been an express repudiation of that claim." Gary Friedrich Enterprises, LLC v. Marvel Characters, Inc., 716 F.3d 302, 316 (2d Cir. 2013) (quotation marks and citation omitted). "This Court has identified at least three types of events that can put a potential plaintiff on notice and thereby trigger the...