Hanagami v. Epic Games, Inc.

85 F.4th 931

Kyle HANAGAMI, an individual, Plaintiff-Appellant, v. EPIC GAMES, INC., a North Carolina corporation; Does, 1 through 10, inclusive, Defendants-Appellees.

No. 22-55890

United States Court of Appeals, Ninth Circuit

Argued and Submitted August 16, 2023 Anchorage, Alaska

Filed November 1, 2023

Appeal from the United States District Court for the Central District of California, Stephen V. Wilson, District Judge, Presiding, D.C. No. 2:22-cv-02063-SVW-MRW

David L. Hecht (argued), Maxim Price, and Kathryn L. Boyd, Hecht Partners LLP, New York, New York, for Plaintiff-Appellant.

Dale Cendali (argued) and Joshua L. Simmons, Kirkland & Ellis LLP, New York, New York; Yungmoon Chang, Kirkland & Ellis LLP, Los Angeles, California; for Defendants-Appellees.

Before: Mary H. Murguia, Chief Judge, and Richard A. Paez and Jacqueline H. Nguyen, Circuit Judges.

OPINION

PAEZ, Circuit Judge:

Dance is one of the oldest forms of human expression. Recognition of dance as a form of copyrightable subject matter, however, is a far more recent development. While early versions of the Copyright Act extended statutory protection to dramatic works and musical compositions, dance long remained outside the purview of copyright law. In 1976, Congress for the first time extended explicit copyright protection to "choreographic works," bringing dance in line with the other performing arts. Nonetheless, the field of choreography copyright has remained a largely undefined area of law. Few courts have had occasion to consider the scope of copyright protections for choreographic works. This appeal presents us with that novel opportunity. We consider a choreographer's claims that Epic Games, Inc. ("Epic"), the creator of a popular videogame, infringed the copyright of a choreographic work when the company created and sold a virtual animation depicting portions of the registered choreography.

Plaintiff Kyle Hanagami ("Hanagami") is a celebrity choreographer who owns a validly registered copyright in a five-minute choreographic work. Epic is the developer of Fortnite, a video game featuring an extensive virtual world where players represent themselves using avatars. Fortnite players can customize their avatars by purchasing "emotes," which are virtual animations that players use to celebrate or dance in the game. Hanagami sued Epic, alleging the company released an emote that copies a distinct, four-count portion of his registered choreographic work.

To prevail on a claim of copyright infringement, a plaintiff must show that his original work and the allegedly infringing work are "substantially similar." At the motion to dismiss stage, the question is whether the plaintiff has plausibly alleged substantial similarity between the original work and the allegedly infringing work. The dispute in this case thus turns on how to properly apply the substantial similarity test in the context of choreographic works to determine whether Hanagami has plausibly alleged that his choreographic work and Epic's emote are substantially similar.

In moving to dismiss, Epic argued that Hanagami failed to state a claim because the allegedly copied dance steps were not protectable elements of Hanagami's work, and thus not substantially similar to Epic's emote. Hanagami argued that the dance steps in question were identical to Epic's emote and comprised the most recognized portion of his work.

The district court agreed with Epic and dismissed Hanagami's copyright claims on the ground that Hanagami failed to plausibly allege that Epic's emote was substantially similar to his registered choreography. The court concluded, as a matter of law, that Hanagami lacked protection for the individual "poses" in the choreography and that he could not claim protection over the allegedly copied portion of choreography because it was closer to an uncopyrightable "short" routine and comprised a "small component" of Hanagami's choreography. Comparing the entirety of Hanagami's registered choreography to Epic's emote, the court concluded there was no substantial similarity between the two works.

We conclude the district court erred in its application of the substantial similarity test as Hanagami plausibly alleged that his choreography and Epic's emote share substantial similarities. We thus reverse and remand for further proceedings.

I.

A.

Plaintiff Kyle Hanagami is a Los Angeles-based choreographer with a star-studded resume. His choreography has been used by numerous renowned artists, including Jennifer Lopez, Britney Spears, and Justin Bieber, and he has served on the faculty at three of the top dance studios in Los Angeles. Outside of the studio, Hanagami has partnered with globally recognized brands like Nike, Disney, Google, and Netflix. Hanagami also has a substantial presence on social media. As alleged in the Complaint, filed on March 29, 2022, Hanagami had 4.54 million YouTube subscribers (with over 857 million total video views), over 1.6 million Instagram followers, and over 1.3 million TikTok followers.

On November 11, 2017, Hanagami published a YouTube video titled "CHARLIE PUTH — How Long | Kyle Hanagami Choreography" (the "How Long Video").¹ The video contains a five-minute dance performed to the song "How Long" by singer Charlie Puth. The dance contains about 480 counts of choreography, consisting of ninety-six counts repeated by five different groups of dancers. As of May 2022, the How Long Video had garnered nearly 36 million views on YouTube.

Epic is the creator and developer of the Fortnite video game. Since its release in July 2017, Fortnite has become one of the most popular video games ever, with revenue exceeding $10 billion. Fortnite is a free-to-play game featuring an extensive virtual world where players can explore, build, and battle against each other via player-to-player combat. Fortnite also provides other entertainment options within its online platform, including virtual concerts performed by celebrity artists.

Epic generates revenue from Fortnite by maintaining an in-game marketplace for entertainment content. Within the marketplace, players use real money to purchase Fortnite's virtual currency, called "Vinderbucks" or "V-Bucks," which can be used to buy in-game customizations.² For example, players can use V-Bucks to buy clothing and accessories for their virtual avatars, which represent the players during gameplay.

Fortnite players can also purchase virtual animations, known as "emotes," for their avatars to perform. Emotes are animated movements or dances that players use in celebration of a victory or during virtual concerts. The cost of an emote varies from 200 V-Bucks to 800 V-Bucks, depending on how "rare" the emote is considered within the game.

In August 2020, Epic released Chapter 2, Season 3 of Fortnite, which included a new emote called "It's Complicated."³ Hanagami claims that the "It's Complicated" emote "contains the most recognizable portion of [his] ... [c]horeography]" from the How Long Video. The emote consists of 16 counts of movement, four of which are alleged to have been copied from Hanagami's work.⁴ Hanagami's choreography repeats the four counts in question several times throughout the How Long Video, corresponding to the song's chorus. The "It's Complicated" emote is not set to the song "How Long" and is instead accompanied by an original soundtrack without lyrics. The "It's Complicated" emote was priced at 500 V-Bucks, the equivalent of five U.S. dollars.

In February 2021, Hanagami applied for a copyright registration for his choreography in the How Long Video. The Copyright Office approved the application, and the choreography was registered as a choreographic work on February 20, 2021 (hereinafter, the "Registered Choreography"). The registration is limited to the choreography in the video, not the music or audiovisual elements.

B.

In this action, Hanagami alleges that Epic's "It's Complicated" emote infringes Hanagami's Registered Choreography. Relevant to this appeal, Hanagami brings claims for direct copyright infringement and contributory copyright infringement.⁵ Epic moved to dismiss, arguing that Hanagami failed to state a copyright claim because the allegedly copied dance steps were not protectable and the works were not substantially similar.

The district court granted Epic's motion to dismiss. Addressing Hanagami's copyright claims, the court first found that choreography is composed of "a number of individual poses" that are not protectable "when viewed in isolation." The court determined that the overall "steps" Epic allegedly copied—which the court described as "a two-second combination of eight bodily movements, set to four beats of music"—were not protectable under the Copyright Act because they were only a "small component" of Hanagami's work. Relying on guidance from the United States Copyright Office, the court reasoned that there exists a "continuum between copyrightable choreography and uncopyrightable dance." See U.S. Copyright Office, Compendium of U.S. Copyright Office Practices § 805.1 (3d ed. 2021) (Compendium) (advising that "social dance steps and simple routines" are not copyrightable).⁶ The court, having concluded that the dance steps were not protectable on their own, then concluded that Hanagami was entitled to protection "only for the way the Steps are expressed in his Registered Choreography" as a whole, "i.e., in the entire five-minute work."

The court proceeded to evaluate the similarities between the Registered Choreography as a whole and the emote. The court determined that "[t]he two works contain a series of different poses performed in different settings and by different types of performers" and that Hanagami had identified "no other similar creative elements" between them, apart from the unprotected poses. Concluding that the works were not substantially similar as a matter of law, the court dismissed Hanagami's copyright claims.

II.

We review de novo a district court's...