Case 2:09-cv-01906-MMM-JC Document 25 Filed 06/08/09 Page 1 of 14 Page ID #:339
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`UNITED STATES DISTRICT COURT
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`CENTRAL DISTRICT OF CALIFORNIA
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`CASE NO. CV 09-1906 MMM (JCx)
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`ORDER GRANTING PLAINTIFF’S
`MOTION TO REMAND AND DENYING
`PLAINTIFF’S REQUEST FOR
`ATTORNEYS’ FEES
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`)))))))))))))
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`DON JOHNSON PRODUCTIONS,
`INC.,
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` Plaintiff,
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`vs.
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`RYSHER ENTERTAINMENT, INC.,
`QUALIA CAPTIAL, LLC; and 2929
`ENTERTAINMENT, INC.,
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` Defendants.
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`On February 17, 2009, plaintiff Don Johnson Productions, Inc. (“DJP”) filed this action
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`against Rysher Entertainment, Inc., Qualia Captial, LLC, and 2929 Entertainment, Inc in Los
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`Angeles Superior Court. Defendants removed the case to federal court on March 19, 2009,
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`asserting that plaintiff’s fourth cause of action for an accounting of profits arises under the
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`Copyright Act. On April 7, 2009, DJP filed a motion to remand the action to state court.
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`Case 2:09-cv-01906-MMM-JC Document 25 Filed 06/08/09 Page 2 of 14 Page ID #:340
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`I. FACTUAL BACKGROUND
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`A.
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`Allegations in DJP’s Complaint
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`DJP is a corporation based in Los Angeles, wholly owned by actor Don Johnson.1 In
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`1994, CBS entered into an agreement with DJP to purchase 22 episodes of a television series
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`starring Johnson, which came to be known as “Nash Bridges.”2 DJP and Rysher entered into an
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`agreement (the “term agreement”) to produce and develop the series.3 Under the term agreement,
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`DJP was to receive a fifty-percent ownership interest in the series copyright if CBS agreed to
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`purchase 66 episodes of “Nash Bridges,” making the series eligible for syndication.4 In addition,
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`the term agreement granted DJP “exclusive control of interactive devices” related to the series.5
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`Rysher produced, and CBS purchased, 122 episodes of “Nash Bridges.”6 The show aired on CBS
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`from 1996 through 2001.7 2929 acquired Rysher in 2001; it sold Rysher to Qualia in 2006.8
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`DJP alleges that defendants have profited from the syndication of “Nash Bridges” since
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`1999.9 It asserts that, as co-owner of the copyright in “Nash Bridges,” it is owed 50% of
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`defendants’ profit from exploitation of the series.10 DJP further asserts that, in addition to its
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`rights as copyright co-owner, it is contractually entitled to fifty percent of Rysher’s “gross
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`1Complaint, ¶ 7.
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`2Id., ¶ 14.
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`3Id., ¶ 15.
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`4Id.
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`5Id.
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`6Id., ¶ 21.
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`7Id.
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`8Id., ¶ 24-26.
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`9Id., ¶¶ 29-30.
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`10Id., ¶ 33.
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`Case 2:09-cv-01906-MMM-JC Document 25 Filed 06/08/09 Page 3 of 14 Page ID #:341
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`receipts” from the series, as that term is defined in the term agreement.11 Finally, DJP contends
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`that defendants have frustrated its efforts to develop “interactive devices” related to “Nash
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`Bridges.”12
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`The complaint asserts claims against all defendants for breach of contract, conversion,
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`unjust enrichment, accounting of profits, and intentional interference with prospective economic
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`advantage. In their notice of removal, defendants argue that DJP’s claim for an accounting of
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`profits presents a federal question. The claim alleges:
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`“Under copyright law, a co-owner of a copyright must account to other co-owners
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`for any profits earned from licensing or use of the copyright. As a 50% owner of
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`the Nash Bridges copyright, DJP is entitled to 50% of the profits as determined by
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`Generally Accepted Accounting Principles (GAAP) earned from exploiting the
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`Series.”13
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`DJP contends that the parties’ rights in the series’ copyright are entirely based on the term
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`agreement, and the case thus does not present a federal question. It asserts that its claim for an
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`accounting is based on state law principles, and does not give rise to federal question jurisdiction.
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`In their opposition to the motion to remand, defendants identify as a further basis for
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`federal jurisdiction the fact that DJP’s unjust enrichment and conversion claims are completely
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`preempted by the Copyright Act.
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`A.
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`Legal Standard Governing Removal Jurisdiction
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`II. DISCUSSION
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`“Except as otherwise expressly provided by Act of Congress, any civil action brought in
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`a State court of which the district courts of the United States have original jurisdiction, may be
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`removed by the defendant or the defendants, to the district court of the United States for the
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`11Id., ¶ 36.
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`12Id., ¶¶ 39-40.
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`13Id., ¶ 58.
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`Case 2:09-cv-01906-MMM-JC Document 25 Filed 06/08/09 Page 4 of 14 Page ID #:342
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`district and division embracing the place where such action is pending.” 28 U.S.C. § 1441(a).
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`“If at any time before final judgment[, however,] it appears that the district court lacks subject
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`matter jurisdiction, the case shall be remanded.” 28 U.S.C. § 1447(c).
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`The Ninth Circuit “strictly construe[s] the removal statute against removal jurisdiction.”
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`Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992) (citing Boggs v. Lewis, 863 F.2d 662, 663
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`(9th Cir. 1988), and Takeda v. Northwestern Nat’l Life Ins. Co., 765 F.2d 815, 818 (9th Cir.
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`1985)). Thus, “[f]ederal jurisdiction must be rejected if there is any doubt as to the right of
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`removal in the first instance.” Id. (citing Libhard v. Santa Monica Dairy Co., 592 F.2d 1062,
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`1064 (9th Cir. 1979)). “The ‘strong presumption’ against removal jurisdiction means that the
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`defendant always has the burden of establishing that removal is proper.” Id. (citing Nishimoto
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`v. Federman-Bachrach & Assocs., 903 F.2d 709, 712 n. 3 (9th Cir. 1990), and Emrich v. Touche
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`Ross & Co., 846 F.2d 1190, 1195 (9th Cir. 1988)).
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`Removal jurisdiction can be based on diversity of citizenship or on the existence of a
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`federal question. Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987) (“Only state-court
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`actions that originally could have been filed in federal court may be removed to federal court by
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`the defendant. Absent diversity of citizenship, federal-question jurisdiction is required”); see also
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`28 U.S.C. § 1441(b); 28 U.S.C. § 1331 (the district courts “have original jurisdiction of all civil
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`actions arising under the Constitution, laws, or treaties of the United States”). Federal question
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`jurisdiction is presumed to be absent unless defendants, as the parties seeking removal, show that
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`plaintiffs have either alleged a federal claim (American Well Works Co. v. Layne & Bowler Co.,
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`241 U.S. 257, 260 (1916)), a state cause of action that requires resolution of a substantial issue
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`of federal law (Franchise Tax Bd. v. Construction Laborers Vacation Trust, 463 U.S. 1, 9 (1983);
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`Smith v. Kansas City Title & Trust Co., 255 U.S. 180, 199 (1921)), or a state cause of action that
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`Congress has transformed into an inherently federal claim by completely preempting the field
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`(Avco Corp. v. Aero Lodge No. 735, 390 U.S. 557, 560 (1968); Metropolitan Life Ins. Co. v.
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`Taylor, 481 U.S. 58, 65 (1987)).
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`Since a defendant may remove a case under § 1441(b) only if the claim could originally
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`have been filed in federal court, whether removal jurisdiction exists must be determined by
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`Case 2:09-cv-01906-MMM-JC Document 25 Filed 06/08/09 Page 5 of 14 Page ID #:343
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`reference to the “well-pleaded complaint.” Merrell Dow Pharmaceuticals, Inc. v. Thompson, 478
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`U.S. 804, 808 (1986). The well-pleaded complaint rule makes plaintiff the “master of the claim.”
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`Caterpillar, 482 U.S. at 392. Thus, where plaintiff can state claims under both federal and state
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`law, he can prevent removal by ignoring the federal claim and alleging only state law claims.
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`Rains v. Criterion Systems, Inc., 80 F.3d 339, 344 (9th Cir. 1996).
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`For federal question jurisdiction to attach,“a right or immunity created by the Constitution
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`or laws of the United States must be an element, and an essential one, of the plaintiff’s cause of
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`action.” Gully v. First Nat’l Bank in Meridian, 299 U.S. 109, 112 (1936). Only where the “right
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`to relief under state law requires resolution of a substantial question of federal law in dispute
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`between the parties” does a state law cause of action “arise under” the laws of the United States.
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`Franchise Tax Bd., 463 U.S. at 13 (1983). A claim does not present a “substantial question” of
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`federal law merely because a federal question is an “ingredient” of the cause of action. Indeed,
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`“the mere presence of a federal issue in a state cause of action does not automatically confer
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`federal question jurisdiction.” Merrell Dow, 478 U.S. at 813.
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`Likewise, it is not enough for removal purposes that a federal question may arise in
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`connection with a defense or counterclaim. “[F]ederal jurisdiction exists only when a federal
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`question is presented on the face of the plaintiff’s properly pleaded complaint.” Caterpillar, 482
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`U.S. at 392. See also Louisville & Nashville R. Co. v. Mottley, 211 U.S. 149, 152 (1908). “A
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`defense is not part of a plaintiff’s properly pleaded statement of his or her claim.” Rivet v.
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`Regions Bank of La., 522 U.S. 470, 475 (1998). See also Metropolitan Life Ins. Co., 481 U.S.
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`at 63. Thus, “a case may not be removed to federal court on the basis of a federal defense, . . .
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`even if the defense is anticipated in the plaintiff’s complaint, and even if both parties admit that
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`the defense is the only question truly at issue in the case.” Franchise Tax Bd., 463 U.S. at 14.
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`B. Whether a Cause of Action for an Accounting by a Copyright Co-Owner Gives
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`Rise to Federal Question Jurisdiction
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`“Whether a complaint asserting factually related copyright and contract claims arises under
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`the federal copyright laws for purposes of Section 1338(a) poses among the knottiest procedural
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`problems in copyright jurisprudence.” Bassett v. Mashantucket Pequot Tribe, 204 F.3d 343, 347
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`Case 2:09-cv-01906-MMM-JC Document 25 Filed 06/08/09 Page 6 of 14 Page ID #:344
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`(2d Cir. 2000) (citation and internal quotations omitted). Federal courts have exclusive
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`jurisdiction over “any civil action arising under any Act of Congress relating to . . . copyrights.”
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`28 U.S.C. § 1338(a). “At the same time, it is well established that just because a case involves
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`a copyright does not mean that federal subject matter jurisdiction exists.” Scholastic Entm’t, Inc.
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`v. Fox Entm’t Group, Inc., 336 F.3d 982, 985 (9th Cir. 2003); Vestron, Inc. v. Home Box Office,
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`Inc., 839 F.2d 1380 (9th Cir. 1988) (“Although the action clearly involves a copyright, this fact
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`alone does not satisfy federal jurisdictional requirements”); Muse v. Mellin, 212 F.Supp. 315, 316
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`(S.D.N.Y. 1962) (“[T]he word ‘copyright’ is not so compelling as to invoke federal jurisdiction
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`upon its mere mention”), aff’d, 339 F.2d 888 (2d Cir. 1964); Simon & Flynn, Inc. v. Time Inc.,
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`513 F.2d 832, 833 (2d Cir. 1975) (an “aroma of copyright” is insufficient to support the
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`conclusion that an action arises under the Copyright Act); see also Effects Assocs., Inc. v. Cohen,
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`817 F.2d 72, 73 (9th Cir.1987) (“Copyright ownership is comprised of a bundle of rights; in
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`granting a nonexclusive license[, the copyright owner] has given up only one stick from that
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`bundle – the right to sue . . . for copyright infringement. [The copyright owner] retains the right
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`to sue . . . in state court on a variety of other grounds, including breach of contract”).
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`To determine if copyright subject matter jurisdiction exists, the Ninth Circuit applies the
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`test set forth in T.B. Harms Co. v. Eliscu, 339 F.2d 823 (2d Cir.1964):
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`“[A]n action ‘arises under’ the Copyright Act if and only if the complaint is for a
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`remedy expressly granted by the Act, e.g., a suit for infringement or for the
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`statutory royalties for record reproductions, or asserts a claim requiring
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`construction of the Act . . . or, at the very least and perhaps more doubtfully,
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`presents a case where a distinctive policy of the Act requires that federal principles
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`control the disposition of the claim.” Scholastic, 336 F.3d at 986 (quoting T.B.
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`Harms, 339 F.2d at 828).
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`This test “is essentially a reiteration of the ‘well-pleaded complaint’ rule that federal jurisdiction
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`exists only when a federal question is presented on the face of a properly pleaded complaint.” Id.
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`Applying the T.B. Harms test, federal courts regularly dismiss copyright complaints that present
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`only questions of contract law. Id. (citing Dolch v. United Cal. Bank, 702 F.2d 178, 180 (9th
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`Case 2:09-cv-01906-MMM-JC Document 25 Filed 06/08/09 Page 7 of 14 Page ID #:345
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`Cir. 1983)).
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`DJP’s rights in the Nash Bridges copyright derive entirely from the term agreement; the
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`case is thus essentially a contract dispute. Defendants nonetheless argue that the accounting of
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`profits DJP seeks gives rise to federal question jurisdiction. As defendants acknowledge, the duty
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`to account imposed on co-owners of a copyright is not “a remedy expressly granted by the
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`[Copyright] Act.” T.B. Harms, 339 F.2d at 828. They contend, however, that it is an equitable
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`remedy based on federal common law and thus a source of federal question jurisdiction.14 As
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`defendants put it, “[a]n analysis of the history and creation of the duty to account among co-
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`owners of a copyright reveals that it is a matter of federal common law – created by federal
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`courts, studied by the federal Copyright Office, and addressed by Congress in the legislative
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`history of the 1976 Copyright Act.”15
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`The Ninth Circuit considered the source of the duty to account among co-owners of a
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`copyright in Oddo v. Ries, 743 F.2d 630 (9th Cir. 1984). There, the court observed that “[a]
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`co-owner of a copyright must account to other co-owners for any profits he earns from licensing
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`or use of the copyright, but the duty to account does not derive from the copyright law’s
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`proscription of infringement. Rather, it comes from equitable doctrines relating to unjust
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`enrichment and general principles of law governing the rights of co-owners.” Id. at 633 (citations
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`and internal quotation marks omitted). As a result, the court explained, “a suit to bring the
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`co-owner of a copyright to account does not fall within the district court’s jurisdiction over actions
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`arising under the copyright law.” Id. at 633 n. 5.
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`The “equitable doctrines relating to unjust enrichment and general principles of law
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`governing the rights of co-owners” that govern the accounting remedy derive from state law, not
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`federal common law. In Cambridge Literary Properties, Ltd. v. W. Goebel Porzellanfabrik
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`G.m.b.H. & Co. KG, 510 F.3d 77, 98 (1st Cir. 2007), the First Circuit, like the Ninth, expressly
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`rejected the view that the right to an accounting has its source in federal common law:
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`14Defendants’ Opposition to Plaintiff’s Motion for Remand (“Opp.”) at 2.
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`15Id. at 6.
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`Case 2:09-cv-01906-MMM-JC Document 25 Filed 06/08/09 Page 8 of 14 Page ID #:346
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`“[T]he Copyright Act, which sets forth express remedies available to copyright
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`owners against infringers, deliberately omits any comparable express or implied
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`remedy for a co-owner seeking an accounting from a joint copyright owner who has
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`profited from use of the copyright. The Act’s legislative history unambiguously
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`explains the reason for this omission: ‘[t]here is . . . no need for a specific statutory
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`provision concerning [the] rights and duties of the coowners of a work; court-made
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`law on this point is left undisturbed.’ H.R.Rep. No. 94-1676, at 121, reprinted in
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`1976 U.S.C.C.A.N. 5659, 5736. To the extent that this residual court-made law
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`involves the common-law rights of tenants in common, the primary source always
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`has been state (and not federal) law, and the Copyright Act contains no hint that
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`Congress intended to usurp the state courts’ traditional jurisdiction to adjudicate
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`these types of claims.”
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`Other courts are in agreement with Oddo and Cambridge that an action by a co-owner of a
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`copyright for an accounting does not arise under federal law. See Gaiman v. McFarlane, 360
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`F.3d 644, 652 (7th Cir. 2004) (“When co-ownership is conceded and the only issue therefore is
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`the contractual, or in the absence of contract the equitable, division of the profits from the
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`copyrighted work, there is no issue of copyright law and the suit for an accounting of profits
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`therefore arises under state rather than federal law”); Goodman v. Lee, 78 F.3d 1007, 1012 (5th
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`Cir. 1996) (“The applicability of federal law ends with th[e] determination [of copyright
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`ownership], as Goodman’s claim for an accounting is governed in all respects by state law”);
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`Community for Creative Non-Violence v. Reid, 846 F.2d 1485, 1498 (D.C. Cir. 1988) (“Joint
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`authors co-owning copyright in a work ‘are deemed to be tenants in common,’ with ‘each having
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`an independent right to use or license the copyright, subject only to a duty to account to the other
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`co-owner for any profits owned thereby,’” citing W. Patry, LATMAN’S THE COPYRIGHT LAW 116
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`(6th ed. 1986)); Brown v. Mono Records, No. CV-00-286-ST, 2000 WL 33244473, *7 (D. Or.
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`June 6, 2000) (“While protecting the rights of the owner and co-owners against all others, the
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`Copyright Act should not preempt the traditional state law jurisprudence over matters relating to
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`the ownership rights and duties that exist between co-owners”); Dead Kennedys v. Biafra, 37
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`Case 2:09-cv-01906-MMM-JC Document 25 Filed 06/08/09 Page 9 of 14 Page ID #:347
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`F.Supp.2d 1151, 1152 (N.D. Cal. 1999) (“An action for an accounting or determination of
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`ownership as between alleged co-owners is founded in state law and does not arise under the
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`copyright laws”); Iza Music Corp. v. W & K Music Corp., 995 F.Supp. 417, 418 (S.D.N.Y.
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`1998) (“Because. . . a joint author’s right to an accounting is a creature of state law rather than
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`of the Copyright Act, an action seeking an accounting alone does not satisfy any of the three
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`prongs of Judge Friendly’s test [in T.B. Harms] and therefore does not invoke the Court’s subject
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`matter jurisdiction under § 1338”).
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`Defendants invite the court to ignore this precedent, contending that Oddo’s conclusion that
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`“a suit to bring the co-owner of a copyright to account does not fall within the district court’s
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`jurisdiction over actions arising under the copyright law” is dicta.16 They assert that the
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`conclusion was not necessary to the court’s resolution of the case. In the Ninth Circuit, however,
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`an issue presented for review, addressed by the court and decided by a majority of the panel
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`“bec[o]mes law of the circuit, regardless of whether it [is] in some technical sense ‘necessary’ to
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`[the Court’s] disposition of the case.” See Barapind v. Enomoto, 400 F.3d 744, 750-51 (9th Cir.
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`2005). Moreover, the Oddo court decided that the defendant was “required to account to [the
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`plaintiff] for any profits he [ ] made from use of th[e] [jointly owned] copyrights.” Oddo, 743
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`F.2d at 633. Thus, the court necessarily had to determine the source of defendant’s obligation,
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`and its conclusion was not dicta, even under the “necessary to the disposition” standard suggested
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`by defendants.
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`Defendants also maintain that the court should reject Oddo and other cases holding that the
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`duty to account is a matter of state law as wrongly decided. In support of this position, defendants
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`argue that the early cases defining the scope of co-ownership rights in copyrights were federal
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`cases. They contend that these cases “did not apply state property law to copyright[; rather,] they
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`analogized [state law] principles in defining the scope of a federal right.”17 Defendants cite
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`Maurel v. Smith, 220 F. 195 (S.D.N.Y. 1915), Klein v. Beach, 232 F. 240 (S.D.N.Y. 1916), and
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`16Opp. at 15.
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`17Mot. at 10.
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`Case 2:09-cv-01906-MMM-JC Document 25 Filed 06/08/09 Page 10 of 14 Page ID #:348
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`Shapiro, Bernstein & Co. v. Jerry Vogel Music Co., 73 F.Supp. 165 (S.D.N.Y. 1947).
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`Defendants offer no analysis, quotations, or pin cites to support their conclusion that these cases
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`applied federal common law rather than state law. The cases refer to principles governing
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`tenancy-in-common, but nothing in any of them compels the conclusion that the courts were
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`“analogizing” to state law rather than applying it. Defendants note that, in enacting the Copyright
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`Act of 1976, Congress indicated that the statute would preserve “present law” regarding co-
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`ownership.18 Since defendants have not demonstrated that co-ownership rights prior to 1976 were
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`governed by federal law, however, the fact that the 1976 Act preserved existing law in this area
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`does not advance their position. Rather, other courts that have considered the congressional
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`decision to preserve existing law regarding co-owners have concluded that Congress intended to
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`preserve federal courts’ application of state law in this area. Siegel v. Warner Bros.
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`Entertainment Inc., 581 F.Supp.2d 1067, 1070 (C.D. Cal. 2008) (“The 1976 Copyright Act
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`embodied the basic principle under the 1909 Act that ‘authors of a joint work are co-owners of
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`the copyright.’ 17 U.S.C. § 201. The legislative history to the 1976 Act further confirmed that,
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`under this pre-existing law, ‘the rights and duties of co-owners of a work . . . was left undisturbed
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`. . . and co-owners of a copyright . . . are treated generally as tenants in common .. . subject to
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`a duty to account to other co-owners for any profits.’ H. Rep. No. 94-1476 at 120-21, 94th
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`Cong.2d Sess. (1976), U.S.Code Cong. & Admin.News 1976, pp. 5659, 5736. While the
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`interests plaintiffs have recaptured are based in copyright, it is the nature of the resulting
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`relationship between plaintiffs and defendants that gives rise to their accounting claims, a
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`relationship grounded in state common law principles of tenancy in common and the duties of a
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`trustee”).
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`Defendants finally urge that “[i]f the state courts were vested with the power to determine
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`the nature and scope of co-ownership rights and remedies, each state would have the authority to
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`apply a different rule,” frustrating the federal interest in the uniform enforcement of copyright
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`18Id. at 11.
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`Case 2:09-cv-01906-MMM-JC Document 25 Filed 06/08/09 Page 11 of 14 Page ID #:349
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`law.19 Defendants’ argument is speculative, as there is no indication that state laws governing the
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`accounting remedy differ in any significant aspect. Further, courts regularly look to state law to
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`fill gaps left by Congress in the Copyright Act. See Foad Consulting Group, Inc. v. Azzalino,
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`270 F.3d 821, 827 (9th Cir. 2001) (“In enacting the Copyright Act, Congress did not preempt the
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`field. Thus, where the Copyright Act does not address an issue, we turn to state law to resolve
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`the matter, so long as state law does not otherwise conflict with the Copyright Act” (citations
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`omitted)). More fundamentally, even if defendants’ policy and historical arguments were
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`compelling, the court would still be bound to follow Ninth Circuit precedent. Accordingly, DJP’s
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`cause of action for an accounting does not give rise to federal question jurisdiction.
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`C. Whether DJP’s Conversion and Unjust Enrichment Claims Are Completely
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`Preempted by the Copyright Act
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`17 U.S.C. § 301(a) states:
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`“On and after January 1, 1978, all legal or equitable rights that are equivalent to
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`any of the exclusive rights within the general scope of copyright as specified by
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`section 106 in works of authorship that are fixed in a tangible medium of expression
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`and come within the subject matter of copyright as specified by sections 102 and
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`103, whether created before or after that date and whether published or
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`unpublished, are governed exclusively by this title. Thereafter, no person is
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`entitled to any such right or equivalent right in any such work under the common
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`law or statutes of any State.” 17 U.S.C. § 301(a).
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`Under § 301(a), state law claims are completely preempted by federal copyright law only if they
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`concern a work fixed in a tangible medium of expression that comes within the subject matter of
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`copyright, and the state law rights asserted are equivalent to rights within the general scope of
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`copyright as defined in section 106 of the Copyright Act. See Del Madera Properties v. Rhodes
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`& Gardner, Inc., 820 F.2d 973, 977 (9th Cir. 1987), overruled on other grounds, Fogerty v.
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`Fantasy, Inc., 510 U.S. 517 (1994); KNB Enterprises v. Matthews, 78 Cal.App.4th 362, 369
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`19Id. at 14.
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`Case 2:09-cv-01906-MMM-JC Document 25 Filed 06/08/09 Page 12 of 14 Page ID #:350
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`(2000).20 To determine whether a state law claim is preempted, the court must ask two questions:
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`(1) does the property at issue fall within the subject matter of copyright; and (2) if it does, is
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`plaintiff seeking to vindicate state rights that are qualitatively different than those afforded by the
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`Copyright Act?
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`Here, there is no question that “Nash Bridges” falls within the subject matter of copyright.
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`The issue, therefore, is whether DJP seeks to vindicate a right that is equivalent to the rights
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`afforded by the Copyright Act. A right equivalent to copyright is one that is infringed by acts that
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`constitute copyright infringement. See, e.g., Balboa Ins. Co. v. Trans Global Equities, 218
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`Cal.App.3d 1327, 1339 (1990) (citing 1 M. Nimmer, NIMMER ON COPYRIGHT, § 1.01[B]).
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`Because defendants are co-owners with plaintiff of a copyright in the series, their actions cannot
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`constitute copyright infringement. See Kling v. Hallmark Cards, Inc., 225 F.3d 1030, 1034 (9th
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`2000) (“[A] co-owner of a copyright cannot be liable to another co-owner for infringement,”
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`citing Zuill v. Shanahan, 80 F.3d 1366, 1369 (9th Cir. 1996) (citing Oddo, 743 F.2d at 632-33)).
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`The Copyright Act does not grant a co-owner of copyright any rights against another co-owner.
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`Rather, as discussed above, those rights derive from state law. Thus, in asserting rights against
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`defendants, DJP is not attempting to vindicate the right to prevent infringement granted by the
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`Copyright Act, or any other right under the Act. Rather, DJP’s unjust enrichment and conversion
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`claims are based on defendants’ violation of DJP’s state law rights as a co-owner. Accordingly,
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`DJP’s unjust enrichment and conversion claims are not preempted.
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`D.
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`DJP’s Request for Attorneys’ Fees
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`DJP seeks attorneys’ fees under 28 U.S.C. § 1447(c). Section 1447(c) provides in part:
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`20See also 17 U.S.C. § 301:
`“[A]ll legal or equitable rights that are equivalent to any of the exclusive rights
`within the general scope of copyright as specified by section 106 in works of
`authorship that are fixed in a tangible medium of expression and come within the
`subject matter of copyright as specified by sections 102 and 103 . . . whether
`published or unpublished, are governed exclusively by this title. Thereafter, no
`person is entitled to any such right or equivalent right in any such work under the
`common law or statutes of any State.”
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`Case 2:09-cv-01906-MMM-JC Document 25 Filed 06/08/09 Page 13 of 14 Page ID #:351
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`“An order remanding the case may require payment of just costs and any actual expenses,
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`including attorney fees, incurred as a result of the removal.” 28 U.S.C. § 1447(c). Attorneys’
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`fees may be awarded under § 1447(c) even absent a finding that the removal was frivolous,
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`vexatious, or in bad faith. See Moore v. Permanente Medical Group, Inc., 981 F.2d 443, 446-48
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`(9th Cir. 1992). In fact, the Ninth Circuit has made clear that an award of attorneys’ fees is
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`permissible even if defendant’s removal was “fairly supportable,” but wrong as a matter of law.
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`See Balcorta v. Twentieth Century-Fox Film Corp., 208 F.3d 1102, 1106 n. 6 (9th Cir. 2000).
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`The decision to grant fees under § 1447(c) therefore rests in the sound discretion of the
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`trial court. See Toumajian v. Frailey, 135 F.3d 648, 657 (9th Cir. 1998) (“[U]pon remand for
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`lack of subject matter jurisdiction court may require payment of just costs and any actual
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`expenses, including attorney’s fees incurred as a result of the removal”); Gotro v. R&B Realty
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`Group, 69 F.3d 1485, 1487-88 (9th Cir. 1995) (recognizing that the district court has broad
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`discretion to award attorneys’ fees incurred as a result of removal under § 1447(c)); Moore, 981
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`F.2d at 447 (“Given the wide discretion provided the district court by § 1447(c), we will review
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`an award of attorney’s fees under this statute for abuse of discretion”).
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`In determining whether to award fees and costs, the court must assess the merits of
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`defendant’s removal petition. See Moore, 981 F.2d at 447; see also Balcorta, 208 F.3d at 1106,
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`n. 6 ; Gray v. New York Life Ins. Co., 906 F. Supp. 628, 634 (N.D. Ala. 1995) (“[T]he decision
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`as to whether to award fees under § 1447(c) turns primarily, if not solely, on the merit of the
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`removal”).
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`Here, the court has found that defendants’ assertion of federal question jurisdiction on the
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`basis of DJP’s request for an accounting was wrong as matter of law. Under § 1447(c), therefore,
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`the court has the discretion to award fees. The court notes, however, that DJP’s complaint alleged
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`that its right to an accounting derived not from state law, but from “copyright law” – that is, from
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`federal law.21 This is precisely the basis on which defendants removed the case. Considering that
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`defendants removed on a principle erroneously, if perhaps accidentally, asserted in DJP’s
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`21Complaint, ¶ 58.
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`Case 2:09-cv-01906-MMM-JC Document 25 Filed 06/08/09 Page 14 of 14 Page ID #:352
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`complaint, the court exercises its discretion against awarding DJP reasonable attorneys’ fees.
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`III. CONCLUSION
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`For the foregoing reasons, the court grants DJP’s motion to remand and denies its request
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`for attorneys’ fees. The clerk is directed to remand the action to state court forthwith.
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`DATED: June 8, 2009
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`
` MARGARET M. MORROW
` UNITED STATES DISTRICT JUDGE
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