Rassamni v. Fresno Auto Spa, Inc.

365 F.Supp.3d 1039

A.J. RASSAMNI, Plaintiff,

v.FRESNO AUTO SPA, INC., dba River Park Express Car Wash, Stevan Matijevich, and Does 1 to 25, Inclusive, Defendants.

1:18-cv-00738-LJO-EPG

United States District Court, E.D. California.

Signed February 11, 2019

Amy Lovegren-Tipton, Law Office of Amy R. Lovegren-Tipton, Fresno, CA, for Plaintiff.

Ethan Brown, David Eunduck Jang, Brown Neri Smith & Khan LLP, Los Angeles, CA, for Defendants.

MEMORANDUM DECISION AND ORDER DENYING MOTION TO DISMISS

(ECF No. 22)

Lawrence J. O'Neill, UNITED STATES CHIEF DISTRICT JUDGE

I. INTRODUCTION

This case concerns Plaintiff A.J. Rassamni's claims against Defendants Fresno Auto Spa, Inc., Stevan Matijevich, and Does 1 through 25 for copyright infringement. The Court dismissed Plaintiff's complaint with leave to amend on September 25, 2018. ECF No. 17. Plaintiff filed a First Amended Complaint ("FAC") on October 12, 2018. ECF No. 18. On November 2, 2018, Defendants Fresno Auto Spa, Inc. and Matijevich (collectively "Defendants") filed a motion to dismiss the FAC. ECF No. 22. Plaintiff filed an opposition on November 16, 2018. ECF No. 24. On December 3, 2018, Defendant filed a reply. ECF No. 25. Pursuant to Local Rule 230(g), the Court determined that the motion to dismiss was suitable for decision on the papers, and the motion was deemed submitted on December 4, 2018. ECF No. 26. For the following reasons, Defendants' motion to dismiss is DENIED.

II. BACKGROUND

The following facts are drawn from Plaintiff's FAC, and are accepted as true only for the purposes of this motion to dismiss. Cousins v. Lockyer , 568 F.3d 1063, 1067 (9th Cir. 2009). Plaintiff is the owner of the Great American Car Wash in Fresno, California. ECF No. 18 ¶ 9. Defendant Matijevich is the sole shareholder of Defendant Fresno Auto Spa, Inc., a California corporation doing business as River Park Express Car Wash and located near Plaintiff's car wash. Id. ¶ 10. Plaintiff is the owner and author of a car wash brochure and inspection sheet (the "Copyrighted Material"). Id. ¶¶ 1, 9, 15. Plaintiff applied for and received copyright registration through the United States Copyright Office. Id. ¶ 16.

On or around the summer of 2017 Plaintiff became aware that Defendants had "copied verbatim, reproduced on paper, [and] distributed to their customers" the Copyrighted Material without Plaintiff's license or permission. Id. ¶¶ 17 (emphasis omitted). Defendants gained access to the Copyrighted Material circa 2014 through former employees of Plaintiff. Id. ¶ 18. Defendants began using the Copyrighted Material at some point between 2014 and 2017. Id. Specifically, Defendants copied verbatim a portion of the text contained in the Copyrighted Material and used that text in a document titled "Riverpark Car Wash." Id. ¶ 17(a)-(b). Defendants used the document in their business by providing it to customers in order to disclaim liability for damage to vehicles. Id. ¶ 17(b). Plaintiff did not license or authorize Defendants' use of the Copyrighted Material. Id. ¶ 19. Plaintiff notified Defendants of the allegedly infringing use and demanded that Defendants cease further use of the Copyrighted Material. Id. ¶ 19.

III. LEGAL STANDARD

A motion to dismiss under Rule 12(b)(6) challenges the legal sufficiency of the opposing party's pleadings. Dismissal of an action under Rule 12(b)(6) is proper where there is either a "lack of a cognizable legal theory or the absence of sufficient facts alleged under a cognizable legal theory." Balistreri v. Pacifica Police Dept. , 901 F.2d 696, 699 (9th Cir. 1990). When considering a motion to dismiss for failure to state a claim under Rule 12(b)(6), all allegations of material fact must be accepted as true and construed in the light most favorable to the pleading party. Cahill v. Liberty Mut. Ins. Co. , 80 F.3d 336, 337-38 (9th Cir. 1996). The inquiry is generally limited to the allegations made in the complaint. Lazy Y Ranch LTD v. Behrens , 546 F.3d 580, 588 (9th Cir. 2008).

Rule 8(a)(2) "requires only ‘a short and plain statement of the claim showing that the pleader is entitled to relief’ in order to ‘give the defendant fair notice of what the ... claim is and the grounds upon which it rests.’ " Bell Atl. Corp. v. Twombly , 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (quoting Conley v. Gibson , 355 U.S. 41, 47, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957) ). To overcome a Rule 12(b)(6) challenge, the complaint must allege "enough facts to state a claim to relief that is plausible on its face." Twombly , 550 U.S. at 570, 127 S.Ct. 1955. A claim is plausible on its face when "the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal , 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). A plausible claim is one which provides more than "a sheer possibility that a defendant has acted unlawfully." Id. A claim which is possible, but which is not supported by enough facts to "nudge [it] across the line from conceivable to plausible ... must be dismissed." Twombly , 550 U.S. at 570, 127 S.Ct. 1955.

A complaint facing a Rule 12(b)(6) challenge "does not need detailed factual allegations [but] a plaintiff's obligation to provide the ‘grounds’ of his ‘entitlement to relief’ requires more than labels and conclusions, and a formulaic recitation of the element of a cause of action will not do." Id. at 555, 127 S.Ct. 1955 (internal citations omitted). In essence, "a complaint ... must contain either direct or inferential allegations respecting all the material elements necessary to sustain recovery under some viable legal theory." Id. at 562, 127 S.Ct. 1955. To the extent that any defect in the pleadings can be cured by the allegation of additional facts, the plaintiff should be afforded leave to amend, unless the pleading "could not possibly be cured by the allegation of other facts. Cook, Perkiss and Liehe, Inc. v. N. Cal. Collection Serv. Inc. , 911 F.2d 242, 247 (9th Cir. 1990).

IV. ANALYSIS

The Copyright Act of 1976 provides that

the owner of copyright under this title has the exclusive rights to do and to authorize any of the following: (1) to reproduce the copyrighted work in copies or phonorecords; (2) to prepare derivative works based upon the copyrighted work; (3) to distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending.

17 U.S.C. § 106. " ‘Anyone who violates any of the exclusive rights of the copyright owner,’ that is, anyone who trespasses into his exclusive domain by using or authorizing the use of the copyrighted work ... ‘is an infringer of the copyright.’ " Sony Corp. of Am. v. Universal City Studios, Inc. , 464 U.S. 417, 433, 104 S.Ct. 774, 78 L.Ed.2d 574 (1984) (quoting 17 U.S.C. § 501(a) ).

Copyright infringement has two basic elements: "(1) ownership of a valid copyright, and (2) copying of constituent elements of the work that are original." Feist Publ'ns v. Rural Tel. Serv. Co. , 499 U.S. 340, 361, 111 S.Ct. 1282, 113 L.Ed.2d 358 (1991). "[A] certificate of copyright registration constitutes prima facie evidence of copyrightability and shifts the burden to the defendant to demonstrate why the copyright is not valid." Bibbero Sys., Inc. v. Colwell Sys., Inc. , 893 F.2d 1104, 1106 (9th Cir. 1990). In the ordinary infringement case, "the dispute centers on the second prong—whether, for example, the copying was a ‘fair use,’ or whether the materials taken were ‘original.’ " Seven Arts Filmed Entm't Ltd. v. Content Media Corp. PLC , 733 F.3d 1251, 1254 (9th Cir. 2013).

The second prong "has two distinct components: ‘copying’ and ‘unlawful appropriation.’ " Rentmeester v. Nike, Inc. , 883 F.3d 1111, 1117 (9th Cir. 2018). The first component is necessary because "if the defendant created his [work] independently, without knowledge of or exposure to the plaintiff's work, the defendant is not liable for infringement." Id. The second component reflects the concept that copyright law forbids only "illicit copying," that is, not copying merely the "ideas" or "concepts" in the plaintiff's work but copying "enough of the plaintiff's expression of those ideas or concepts to render the two works ‘substantially similar.’ " Id. (quoting Mattel, Inc. v. MGA Entm't, Inc. , 616 F.3d 904, 913-14 (9th Cir. 2010). A plaintiff may prove copying either by direct evidence or "circumstantially by showing that the defendant had access to the plaintiff's work and that the two works share similarities probative of copying." Id. The defendant may rebut such evidence by proving his or her independent creation of the material. Three Boys Music Corp. v. Bolton , 212 F.3d 477, 486 (9th Cir. 2000). Courts in the Ninth Circuit have held that a valid copyright infringement claim "must allege only the basic elements of infringement." See Basevi, Inc. v. Acorn Co. , No. CV 08–7145 AHM (JTLx), 2009 WL 764532, at *4 (C.D. Cal. Mar. 19, 2009) (collecting cases).

Copyright protects a given expression of an idea, not the idea itself. Mazer v. Stein , 347 U.S. 201, 218, 74 S.Ct. 460, 98 L.Ed. 630 (1954). Facts are not copyrightable, nor are "expressions that are standard, stock, or common to a particular subject matter or medium." Satava v. Lowry , 323 F.3d 805, 810 (9th Cir. 2003). "Where a copyrighted work is composed largely of ‘unprotectable’ elements, or elements ‘limited’ by ‘merger,’ ‘scenes a faire,’ and/or other limiting doctrines, it receives a ‘thin’ rather than a ‘broad’ scope of protection." Idema v. Dreamworks, Inc. , 162 F.Supp.2d 1129, 1178 (C.D. Cal. 2001)aff'd in relevant part , dismissed in part , 90 Fed.Appx. 496 (9th Cir. 2003), as amended on denial of reh'g (Mar. 9, 2004). When a work is entitled only to "thin" protection, "virtual identity," instead of "substantial similarity," is the appropriate standard for illicit copying. Ets-Hokin v. Skyy Spirits, Inc . ( Ets-Hokin II...