Case 8:20-cv-01344-MCS-DFM Document 361 Filed 01/30/23 Page 1 of 9 Page ID #:19432
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`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`CARROLL SHELBY LICENSING,
`INC. et al.,
`
`
`Plaintiffs,
`
`
`
`Case No. 8:20-cv-01344-MCS-DFM
`
`ORDER RE: MOTION TO CERTIFY
`ORDER FOR INTERLOCUTORY
`APPEAL (ECF NO. 357)
`
`
`DENICE SHAKARIAN HALICKI et
`al.,
`
`v.
`
`
`
`Defendants.
`
`
`AND RELATED COUNTERCLAIMS.
`
`
`Denice Shakarian Halicki, Eleanor Licensing, LLC, and Gone in 60 Seconds
`
`Motorsports, LLC (collectively, “Halicki Parties”) move for an order certifying an
`interlocutory appeal of the Court’s November 29, 2022 order resolving the parties’
`second round of motions for summary judgment (“MSJ Order,” ECF No. 350). (Mot.,
`ECF No. 357.) Carroll Shelby Licensing, Inc. and Carroll Hall Shelby Trust
`(collectively, “Shelby Parties”) filed a brief opposing the motion, (Opp’n, ECF No.
`359), and Classic Recreations, LLC, Jason Engel, and Tony Engel (collectively, “CR
`Parties”) joined the Shelby Parties’ opposition, (Joinder, ECF No. 358). The Court has
`considered the motion without a reply brief and without a hearing. (See Order Re:
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`Further Proceedings 2, ECF No. 354 (citing Fed. R. Civ. P. 78(b) and C.D. Cal. R. 7-
`15).)
`BACKGROUND
`I.
`The Court has recited the factual background of this case on several occasions
`
`and need not repeat it at length here. In short, this litigation arises after the ostensible
`settlement of litigation between the Halicki Parties and Shelby Parties and related
`entities over intellectual property interests in vehicles designated Eleanor that appear in
`the Gone in 60 Seconds film franchise. A decade after the settlement, the Halicki Parties
`demanded that the CR Parties stop selling vehicles created under license from the
`Shelby Parties that purportedly infringed the Halicki Parties’ rights in Eleanor. The
`Shelby Parties claim that the Halicki Parties’ conduct breaches the settlement
`agreement, and the Halicki Parties claim that the Shelby Parties and CR Parties infringe
`the Eleanor copyright and that the Shelby Parties’ conduct breaches the settlement
`agreement.
`
`Upon a second round of summary judgment motions, the Court considered
`whether Eleanor is a character subject to copyright protection independent from the
`films in which it appears. (MSJ Order 5–24.) The Court concluded that “Eleanor is not
`entitled to standalone copyright protection as a matter of law” and dismissed several of
`the Halicki Parties’ claims on this basis. (Id. at 23.) The Halicki Parties seek leave to
`file an interlocutory appeal to resolve three issues:
`(1) Whether the District Court correctly interpreted the
`Halicki Films, DC Comics, and Daniels test regarding
`copyrightability of a character by requiring under
`prong 2 of that test an analysis of the character
`“whenever
`it appears” and a comparison
`for
`consistency based on every instance a character
`appears in media.
`(2) Whether the District Court correctly interpreted the
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`Halicki Films, DC Comics, and Daniels test regarding
`copyrightability
`of
`a
`character by
`denying
`copyrightability to a character based on its repeated
`appearance in one work, regardless of how sufficiently
`delineated the character appears in that work.
`(3) Whether the District Court correctly interpreted the
`Halicki Films, DC Comics, and Daniels test regarding
`copyrightability of a character by determining that an
`otherwise
`copyrightable
`character
`becomes
`uncopyrightable if a new iteration of the same character
`has traits and attributes varied with prior iterations.
`
`(Mot. 1.)
`II. LEGAL STANDARD
`
`Generally, appellate review of district court rulings must wait until after a final
`judgment. 28 U.S.C. § 1291 (conferring “jurisdiction of appeals from all final decisions
`of the district courts”); Romoland Sch. Dist. v. Inland Empire Energy Ctr., LLC, 548
`F.3d 738, 747 (9th Cir. 2008) (“A district court order is . . . not appealable unless it
`disposes of all claims as to all parties or unless judgment is entered in compliance with
`Federal Rule of Civil Procedure 54(b).”). However, a district judge who issues “an order
`not otherwise appealable” may certify a question for appeal in writing if the judge is “of
`the opinion that such order [(1)] involves a controlling question of law [(2)] as to which
`there is substantial ground for difference of opinion and [(3)] that the immediate appeal
`from the order may materially advance the ultimate termination of the litigation.” 28
`U.S.C. § 1292(b). “Certification under § 1292(b) requires the district court to expressly
`find in writing that all three § 1292(b) requirements are met.” Couch v. Telescope Inc.,
`611 F.3d 629, 633 (9th Cir. 2010). “[T]he party pursuing the interlocutory appeal bears
`the burden of so demonstrating.” Id. (citation omitted). “Section 1292(b) is a departure
`from the normal rule that only final judgments are appealable, and therefore must be
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`construed narrowly.” James v. Price Stern Sloan, Inc., 283 F.3d 1064, 1067 n.6 (9th
`Cir. 2002).
`III. DISCUSSION
`
`A. Controlling Question of Law
`
`“[A]ll that must be shown in order for a question to be ‘controlling’ is that
`resolution of the issue on appeal could materially affect the outcome of litigation in the
`district court.” In re Cement Antitrust Litig., 673 F.2d 1020, 1026 (9th Cir. 1981).
`Notwithstanding, the requirement is to “be interpreted in such as way as to implement”
`the policy that § 1292(b) “be applied sparingly and only in exceptional cases.” Id. at
`1027.
`As articulated, the second and third issues the Halicki Parties identify for review
`
`are not controlling. The Halicki Parties’ construction of the second issue posits a theory
`of character copyrightability based upon a single work. (See Mot. 13 (“If a correct
`interpretation of the law allows the analysis of Eleanor based on the Remake alone,
`there are sufficient characteristics identified by the Court (both physical and conceptual)
`to find her character copyrightable.”).) The construction of the third issue supposes the
`existence of a copyrightable interest in a character as featured in one or some but not
`all works in which it appears, and the destruction of such interest upon consideration of
`the full domain of appearances. (See id. at 14 (contending that “additional varied traits”
`of Eleanor in the remake film should not “destroy the Eleanor character” from the
`original).) Both are defective in their premise, as these issues were not presented or
`decided at summary judgment. In their motion, the Halicki Parties advanced an
`argument that Eleanor is entitled to copyright protection based on the vehicle’s
`appearances across four films. (E.g., Halicki CMSJ 6–11, 21–24, ECF No. 294.)
`Accordingly, the Court did not have occasion to “deny[] copyrightability to a character
`based on its repeated appearance in one work,” or to “determin[e] that an otherwise
`copyrightable character becomes uncopyrightable if a new iteration of the same
`character has traits and attributes varied with prior iterations.” (Mot. 1.) Instead, the
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`Court rested its decision on a review of the films “as a closed, cohesive universe of
`works, which is consistent with how Ninth Circuit panels have applied the test.” (MSJ
`Order 9.) Although the Court made observations and raised questions about how the
`copyrightability
`test should be applied when a character exhibits different
`characteristics across a number of works, the second and third issues as stated are not
`germane to the Court’s conclusion on copyrightability. (See id. at 10 (“These
`reservations about the Daniels test, however, fall outside the scope of what this Court
`is asked, and has authority, to do here.”).) Thus, while the Court would appreciate
`guidance from the Ninth Circuit as to whether a character may be copyrightable based
`on its appearance in a single work and whether a character may lose copyrightability
`upon publication of a new work, such guidance could not materially affect the outcome
`of the copyrightability analysis here. The issues clearly are not controlling.
`
`The first issue presents a somewhat closer question. At the least, the issue is
`actually germane to the MSJ Order, as the Court predicated its resolution of the second
`prong of the Daniels test upon a review of the complete body of works in which Eleanor
`appears. An appellate decision directing the Court to modify the scope of its second-
`prong review could materially affect the copyrightability analysis. Although the Shelby
`Parties present persuasive arguments why the question is not controlling, (Opp’n 7–12),
`the Court assumes for the sake of argument that it is.
`
`B.
`Substantial Ground for Difference of Opinion
`
`“A substantial ground for difference of opinion exists where reasonable jurists
`might disagree on an issue’s resolution . . . .” Reese v. BP Exploration (Alaska) Inc.,
`643 F.3d 681, 688 (9th Cir. 2011). The second element may be met “where the circuits
`are in dispute on the question and the court of appeals of the circuit has not spoken on
`the point, if complicated questions arise under foreign law, or if novel and difficult
`questions of first impression are presented.” Couch, 611 F.3d at 633 (internal quotation
`marks omitted); see also Reese, 643 F.3d at 688 (“[W]hen novel legal issues are
`presented, on which fair-minded jurists might reach contradictory conclusions, a novel
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`issue may be certified . . . .”). Disagreement with a court’s application of settled law,
`standing alone, does not suffice. Couch, 611 F.3d at 633.
`
`There is no substantial ground for difference of opinion on the first issue. Ninth
`Circuit law is consistent and settled as to the principle that “the persistence of a
`character’s traits and attributes” is “key” to the copyrightability inquiry. DC Comics v.
`Towle, 802 F.3d 1012, 1020 (9th Cir. 2015); accord Daniels v. Walt Disney Co., 958
`F.3d 767, 771 (9th Cir. 2020) (“Consistently recognizable characters . . . whose
`physical characteristics may change over various iterations, but who maintain consistent
`and identifiable character traits and attributes across various productions and
`adaptations, meet the test.”). Other than the Court’s own musings in dicta, the Halicki
`Parties identify no authority calling into question or dispute that the second-prong
`inquiry requires courts to analyze character copyrightability based on a review of the
`works in which the character appears. (Mot. 15–17; see MSJ Order 9–10.) E.g., Daniels,
`958 F.3d at 773 (evaluating “every iteration” of the Moodsters); DC Comics, 802 F.3d
`at 1021 (drawing “a consistent theme” of Batmobile’s traits and attributes from
`“throughout the comic books, television series, and motion picture”). Without such
`authority, their case for a substantial ground for difference in opinion is lacking. See
`Rieve v. Coventry Health Care, Inc., 870 F. Supp. 2d 856, 880 (C.D. Cal. 2012) (“Here,
`‘[s]ignificantly, defendants have not provided a single case that conflicts with the
`district court’s construction or application of [the applicable law].’” (alterations in
`original) (quoting Couch, 611 F.3d at 633)).
`
`The Halicki Parties also argue that this element is met because two Ninth Circuit
`panels implied in dicta based on an inexhaustive review of the relevant works that
`Eleanor meets the second prong of the copyrightability test. (Mot. 15.) The Court has
`already opined on the weight of those panels’ observations. (MSJ Order 5–7.) In any
`event, to the extent the Halicki Parties submit that the Court’s application of facts to
`law is in tension with the panels’ dicta, the Halicki Parties’ argument is inapposite to
`this element of § 1292(b). See Couch, 611 F.3d at 633 (“That settled law might be
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`applied differently does not establish a substantial ground for difference of opinion.”).
`
`This jurisdictional element is not met.
`
`C. Material Advancement of Ultimate Termination of Litigation
`
`Although the motion fails at the second element, the Court considers the third
`element as well. Courts have found the element met where early resolution of the issue
`on appeal “may avoid protracted and expensive (but ultimately unnecessary) litigation
`and the burdens on the litigants and court system that would result from the denial of
`§ 1292(b) certification.” Moffett v. Recording Radio Film Connection, Inc., No. CV 19-
`3319 PSG (KSx), 2020 U.S. Dist. LEXIS 201232, at *12 (C.D. Cal. Jan. 31, 2020)
`(internal quotation marks omitted). “[C]ourts consider the effect of a reversal by the
`court of appeals on the management of the case, including whether litigation will be
`conducted in substantially the same manner regardless of the outcome of the appeal.”
`North v. Superior Hauling & Fast Transit, Inc., No. EDCV 18-2564 JGB (KKx), 2019
`U.S. Dist. LEXIS 217692, at *7 (C.D. Cal. July 10, 2019) (citations and internal
`quotation marks omitted).
`
`Here, a bench trial on the remaining claims is set for March 2023. The Halicki
`Parties submit that they certainly will present the copyrightability decision to the Ninth
`Circuit for review, either now or after final judgment. (Mot. 18; see J. Statement 10,
`ECF No. 353 (declining to submit to alternative dispute resolution, citing an anticipated
`appeal).) Accordingly, the Court assesses the possible outcomes of an interlocutory
`appeal now and a final appeal later.
`
`Upon an interlocutory appeal, no matter the Ninth Circuit’s disposition, the case
`undoubtedly will be remanded to this Court for further proceedings. If the summary
`judgment decision is reversed or remanded with instructions, then the Court anticipates,
`based on the parties’ litigation posture after decision of the first round of summary
`judgment motions and on the second-round arguments the Court declined to address in
`light of its copyrightability ruling, that further proceedings will be contentious and
`resource-intensive. For example, even if the circuit court were to determine there is an
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`independent copyright interest in the Eleanor character and specify the contours of that
`interest, there likely would be significant further litigation in this Court over whether
`the accused vehicles are substantially similar to Eleanor. (See generally Shelby MPSJ,
`ECF No. 296.) If the decision is affirmed, then the case will return to this Court in the
`same position in which it stands today, and the parties will prepare for a bench trial that
`likely will require more time and resources than the parties would expend on a bench
`trial in 2023 given that witnesses’, counsel’s, and the Court’s familiarity with the case
`will erode. Cf. Pagtalunan v. Galaza, 291 F.3d 639, 643 (9th Cir. 2002) (“Unnecessary
`delay inherently increases the risk that witnesses’ memories will fade and evidence will
`become stale.”). No matter which way the Ninth Circuit rules on the interlocutory
`appeal, and no matter the outcome of trial after, one group of parties or another is likely
`to appeal any final judgment, which might give rise to further proceedings here after a
`second trip to the circuit court. (See, e.g., Opp’n 21 (arguing that “a minimum of two
`appeals on just the copyright counterclaims is all but guaranteed” in the event of an
`interlocutory appeal given unanswered questions on “lack of distinctiveness, standing
`and substantial similarity”).)
`
`On the other hand, upon a final appeal after trial, a reversal or remand on the
`copyrightability issue not only would give rise to further proceedings that would be as
`contentious and resource-intensive as the proceedings that would ensue after an
`interlocutory victory for the Halicki Parties, but also might substantially waste the
`parties’ and the Court’s work in the two months between now and the bench trial. Even
`so, an affirmance would effectively end the litigation, and the parties’ decades-long
`dispute, in its entirety.
`
`This simple decision tree presents an obvious answer. An interlocutory appeal
`would conserve resources only if the Halicki Parties prevail. Even if they were to
`prevail, the appeal would prolong the resolution of this litigation relative to the possible
`outcomes if an appeal were taken after final judgment. In other words, an interlocutory
`appeal would do nothing but delay the ultimate resolution of this case and increase the
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`nA&WOWNO
`CoOND
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`risk and magnitude of wasted time and resources. Cf U.S. Rubber Co v. Wright, 359
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`F.2d 784, 785 (9th Cir. 1966) (vacating order granting interlocutory appeal of “nothing
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`morethan an uncertain question of law relevant to only one of several causes of action
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`alleged below,” as “no disposition we might make of this appeal on its merits could
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`materially affect the course oflitigation in the district court’). This element is unmet.
`
`IV. CONCLUSION
`
`The Halicki Parties fail
`
`to demonstrate that all
`
`three of the jurisdictional
`
`requirements of 28 U.S.C. § 1292(b) are met. The Court denies the motion.
`
`IT ISSO ORDERED.
`
`Dated:January30,2023
`
`bak Lbeure:
`
`MARK ©. SCARSI
`UNITED STATES DISTRICT JUDGE
`
`