M.V. Music v. V.P. Records Retail Outlet, Inc.

653 F.Supp.3d 31

M.V. MUSIC et al., Plaintiffs, v. V.P. RECORDS RETAIL OUTLET, INC. et al., Defendants.

20-CV-5524 (PKC) (MMH)

United States District Court, E.D. New York

Signed January 27, 2023

Colleen Kerwick, Dombroff & Gilmore, New York, NY, Heather Cunningham, Bronx, NY, for Plaintiffs.

Daniel J. Aaron, Daniel J. Aaron, P.C., New York, NY, for Defendants VP Records, Retail Outlet, Inc., V.P. Music Group Inc., V.P. Music.

MEMORANDUM & ORDER

PAMELA K. CHEN, United States District Judge:

Plaintiffs MV Music and Clifford Ray Smith (a/k/a "Mr. Vegas") brought this lawsuit for copyright infringement, breach of contract, unjust enrichment, and unfair competition. Before this Court is Plaintiffs' motion for a preliminary injunction seeking to enjoin Defendants from using Mr. Vegas's sound, image, and likeness during this action, or alternatively, requiring Defendants to hold monies derived from Mr. Vegas's music, image, and likeness in escrow. For the reasons stated on the record at the show-cause hearing on October 27, 2022, and as supplemented herein, Plaintiffs' motion is denied.

BACKGROUND

I. Findings of Fact

Pursuant to Federal Rule of Civil Procedure 52(a)(2), the Court makes the following findings of fact in support of its denial of a preliminary injunction against Defendants.¹ Fed. R. Civ. P. 52(a)(2); see also Smith v. Everson, 266 F. App'x 58, 58 (2d Cir. 2008) ("Rule 52(a) . . . requires district courts to 'state the findings [of fact] and conclusions [of law]' when granting or refusing an interlocutory injunction.").

Plaintiff Clifford Ray Smith, professionally known as "Mr. Vegas," is a successful reggae singer from Jamaica. (Affirmation of Plaintiffs' Counsel ("Pls. Aff."), Dkt. 41-1, ¶ 2.) Plaintiff MV Music is a Florida-based limited liability company that collects royalties for Plaintiff Vegas. (Am. Compl., Dkt. 19, ¶¶ 30, 32.)

Greensleeves Records Limited ("Greensleeves") is a British record label. (Id. ¶ 39.) Since at least the 1990s, Plaintiff Vegas has had recording agreements with Greensleeves to license the master recording for some of his songs, including his Head High album, which includes the eponymous song. (Declaration of Christopher Chin in Opposition to Preliminary Injunction Motion ("Chin Decl."), Dkt. 43, ¶ 5; see also Chin Decl., Ex. B., Dkt. 43-2, at ECF² 4.)

Defendants in this case are V.P. Records Retail Outlet, Inc., V.P. Music Group Inc., and V.P. Music. (Am. Compl., Dkt. 19, ¶¶ 1, 33.) Plaintiffs allege that Greensleeves was acquired by Defendant V.P. Records Retail Outlet, Inc. in 2008. (Id. ¶ 39.) Christopher Chin is the President of V.P. Records Retail Outlet, Inc., and President of V.P. Music. (Chin Decl., Dkt. 43, at ¶¶ 2-3.) At the show-cause hearing, Defendants' counsel introduced Chin as an officer for all three Defendants. Chin also acknowledged in his affidavit that he is a managing member of Greensleeves, and of Greensleeves Publishing Limited. (Chin Decl., Dkt. 43, at ¶¶ 2-3.) Defendants did not contest in their briefing or at the show-cause hearing that Greensleeves was acquired by at least one of Defendants. Plaintiffs allege that Defendants are assignees-in-interest of Greensleeves. At this stage of the litigation, without the benefit of discovery or relevant testimony at the show-cause hearing, the Court cannot determine the exact ownership structure between Defendants and Greensleeves, or whether Defendants are assignees of Greensleeves. However, the Court finds by a preponderance of the evidence that one of the defendant corporations acquired Greensleeves.

Plaintiffs allege that since the acquisition of Greensleeves, Mr. Vegas has not received royalties from Greensleeves for the disputed works. (Pls. Aff., Dkt. 41-1, ¶ 4.) Plaintiffs further allege that Defendants infringed Plaintiffs' copyrights for five songs performed by Mr. Vegas: Heads High, Stage One, Gallis, Sucky Ducky, and Hot Wuk/Hot F*ck.³ The parties dispute whether Plaintiffs have ownership rights over some of the recordings that are the subject of this motion. (See Chin Decl., Dkt. 43, ¶¶ 5-13; see also Pls. Aff., Dkt. 41-1, ¶¶ 5-6.)

Plaintiffs applied for sound recording copyrights with the U.S. Copyright Office for Head High and Gallis on November 8, 2021, and November 9, 2021, respectively. (See Dkt. 41-3, at ECF 16-20.) The registrations for these two songs were granted on December 9, 2021, the same day that Plaintiffs filed the Amended Complaint. (Id.) Plaintiffs attached as exhibits to their motion papers several other copyright registrations that pre-date November 2020 for the sound recordings for Kill Har Wid Di No (Copyright No. SR 797-312), Bruck It Down (Soca Remix) (Copyright No. SR 768-853), Party Tun Up (Copyright No. SR 768-852), and My Jam (Copyright No. SR 768-855).⁴ Plaintiffs acknowledged at the show-cause hearing that these copyrights do not correspond to the disputed works, except that Plaintiffs asserted that Copyright No. SR 797-312, with an effective date of July 27, 2018, for Kill Har Wid Di No is the copyright for Heads High, because the songs are versions of one another. However, Defendants argue that the two songs are distinct, and Plaintiffs have not provided any contrary evidence; therefore the copyright for Kill Har Wid Di No cannot be considered the copyright for Heads High.⁵

Beyond the works at issue in this litigation, Plaintiff Vegas has an ongoing relationship with Defendant V.P. Music, with respect to 37 recordings on which Vegas appears, and for which he has received royalties. (Chin Decl., Dkt. 43-2, ¶ 16.)

II. Procedural History

On November 13, 2020, Plaintiffs filed the instant action alleging breach of contract, copyright infringement, unjust enrichment, and unfair competition. (Compl., Dkt. 1.) Defendants filed a letter motion for a pre-motion conference on August 9, 2021. (Dkt. 12.) The Court granted Defendants' request, and held a pre-motion conference on November 2, 2021. (08/30/2021 Docket Entry.) At the pre-motion conference, the Court granted Plaintiffs leave to amend the Complaint, and Defendants did not file a motion to dismiss at that time. (11/02/2021 Minute Entry.)

Plaintiffs filed their Amended Complaint on December 9, 2021. (Am. Compl., Dkt. 19.) On February 16, 2022, the Court denied Defendants' request for a premotion conference as unnecessary, and ordered the parties to brief Defendants' motion to dismiss. (2/16/2022 Docket Entry.) The parties finished briefing Defendants' motion to dismiss on April 29, 2022. (See Dkts. 31-36.)

On August 1, 2022, Plaintiffs filed the instant motion seeking a preliminary injunction to enjoin Defendants "from using [Mr. Vegas's] sound, image and likeness during the pendency of this action," or in the alternative, seeking a court order requiring Defendants "to hold money derived from Vegas['s] music[,] image[,] and likeness in escrow as a fiduciary." (Pls. Aff., Dkt. 41-1, at 5; see also Pl. Rep., Dkt. 46, at ECF 4.) The Court held a show-cause hearing on October 27, 2022. (See 10/27/2022 Minute Entry.) At the hearing, the Court denied the preliminary injunction and noted that a written decision would follow. For the reasons explained below, Plaintiffs' motion is denied in its entirety.

DISCUSSION

I. Legal Standards

"[A] preliminary injunction is 'an extraordinary remedy never awarded as of right.' " Benisek v. Lamone, — U.S. —, 138 S. Ct. 1942, 1943, 201 L.Ed.2d 398 (2018) (quoting Winter v. Natural Res. Defense Council, Inc., 555 U.S. 7, 24, 129 S.Ct. 365, 172 L.Ed.2d 249 (2008)). "A party seeking a preliminary injunction must demonstrate: (1) a likelihood of success on the merits[ ]; (2) a likelihood of irreparable injury in the absence of an injunction; (3) that the balance of hardships tips in the plaintiff's favor; and (4) that the public interest would not be disserved by the issuance of an injunction." Khan v. Addy's BBQ LLC, 419 F. Supp. 3d 538, 552 (E.D.N.Y. 2019) (quoting Benihana, Inc. v. Benihana of Tokyo, LLC, 784 F.3d 887, 895 (2d Cir. 2015)); see also Salinger v. Colting, 607 F.3d 68, 75 (2d Cir. 2010). "The purpose of such interim equitable relief is not to conclusively determine the rights of the parties, . . . but to balance the equities as the litigation moves forward." Trump v. Int'l Refugee Assistance Project, 582 U.S. 571, 137 S. Ct. 2080, 2087, 198 L.Ed.2d 643 (2017) (citations omitted); see also Am. Civil Liberties Union v. Clapper, 804 F.3d 617, 622 (2d Cir. 2015) ("A preliminary injunction is an equitable remedy and an act of discretion by the court.").

"Courts refer to preliminary injunctions as [either] prohibitory or mandatory." N. Am. Soccer League, LLC v. U.S. Soccer Fed'n, Inc., 883 F.3d 32, 36 (2d Cir. 2018). While a "[p]rohibitory injunction[ ] maintain[s] the status quo pending resolution of the case[,] [a] mandatory injunction[ ] alter[s] it." Id. at 36-37 (citation omitted). The status quo in the context of a preliminary injunction is "the last actual, peaceable uncontested status which preceded the pending controversy." Mastrio v. Sebelius, 768 F.3d 116, 120 (2d Cir. 2014) (per curiam) (internal quotation and citation omitted). A party moving for a mandatory injunction, or an injunction that "will provide the movant with substantially all the relief sought and relief that cannot be undone even if the defendant prevails at a trial on the merits" must satisfy a heightened legal standard and both: "(1) make a strong showing of irreparable harm, and (2) demonstrate a clear or substantial likelihood of success on the merits." Yang v. Kosinski, 960 F.3d 119, 127-28 (2d Cir. 2020) (internal quotation and footnotes omitted).

The Court finds that Plaintiffs are seeking a mandatory preliminary injunction because the preliminary injunction motion seeks to alter the status quo, by requesting that Defendants be prohibited from using Mr. Vegas's "sound, image[,] and likeness during the pendency of this action." (See Pls. Aff., Dkt. 41-1, at 5.) "The Court thus applies the 'heightened...