Case 8:22-cv-00459-CAS-JDE Document 75 Filed 03/25/24 Page 1 of 10 Page ID #:1028
`Case 8:22-cv-00459-CAS-JDE Document 75 Filed 03/25/24 Page 1of10 Page ID #:1028
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`CIVIL MINUTES —- GENERAL
`
`‘OQ’
`
`Case No.
`Title
`
`Date March 25, 2024
` 8:22-cv-00459-CAS (JDEx)
`NKLOSURES, INC. ARCHITECTS V. AVALON LODGING, LLC ET AL
`
`Present: The Honorable
`
`CHRISTINA A. SNYDER
`
`Catherine Jeang
`Deputy Clerk
`
`Deborah Parker
`Court Reporter / Recorder
`
`N/A
`Tape No.
`
`Attorneys Present for Plaintiffs:
`Brett Wiseman
`
`Attorneys Present for Defendants:
`David Flader
`Hanif Hirji
`Erica Sunman
`
`Proceedings:
`
`DEFENDANTS AVALON LODGING, LLC AND BIPIN
`MORARI’S MOTION FOR JUDGMENT ON THE PLEADINGS
`OR PARTIAL JUDGMENT ON THE PLEADINGS UNDERFED.
`R. CIV. P. 12(C) & (H)(2)(B) (Dkt. 70, filed on FEBRUARY23,
`2024)
`
`I.
`
`INTRODUCTION
`
`On July 16, 2020, plaintiff nKlosures, Inc. Architects fka nKlosures, Inc.
`(“nKlosures”) filed an action against defendants Avalon Lodging, LLC (“Avalon”), Best
`Western International, Inc., Bipin Morari (“Morar”), W&W Land Design Consultants,
`Inc. (““W&W’”), Winston Liu, P.-E. (“Liu”), Tom Lau, AIA (“Lau”), and Does | through
`20, inclusive, in Los Angeles Superior Court (“L.A.S.C.” or “Superior Court’). Dkt. 71-
`2. On March 24, 2022, nKlosures voluntarily dismissed the action without prejudice.
`Dkt. 71-9.
`
`On March 25, 2022, nKlosuresfiled this action against defendants Avalon, Morari,
`W&W,Liu, Lau, and Does | through 10, in federal court. Dkt. 1.
`
`On August 29, 2022, nKlosuresfiled a first amended complaint (the “FAC”). Dkt.
`39. nKlosuresasserts three claimsfor relief against all defendants: (1) copyright
`infringementpursuant to 17 U.S.C. § 501; (2) breach of contract; and (3) unfair business
`practices pursuant to California Business & Professions Code § 17200 (“UCL”). Id.
`
`CV-90 (10/18)
`
`CIVIL MINUTES- GENERAL
`
`Page 1 of 10
`
`

`

`Case 8:22-cv-00459-CAS-JDE Document 75 Filed 03/25/24 Page 2 of 10 Page ID #:1029
`Case 8:22-cv-00459-CAS-JDE Document 75 Filed 03/25/24 Page 2of10 Page ID #:1029
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`CIVIL MINUTES —- GENERAL
`
`‘Oo’
`
`Case No.
`Title
`
`Date March 25, 2024
` 8:22-cv-00459-CAS (JDEx)
`NKLOSURES, INC. ARCHITECTS V. AVALON LODGING, LLC ET AL
`
`On September8, 2022, Avalon and Morarifiled a motion to dismiss the FAC.
`Dkt. 41. On November 17, 2022, the Honorable Ronald S.W. Lew, United States District
`Judge, granted in part and denied in part Avalon and Morari’s motion to dismiss, and
`dismissed nKlosures’ UCL claim without leave to amend.! Dkt. 51.
`
`On February 23, 2024, Avalon and Morarifiled a motion for judgment on the
`pleadingsor partial judgment on the pleadings under Federal Rules of Civil Procedure
`12(c) and 12(h)(2)(B). Dkt. 70. That same day, Avalon and Morari filed a request for
`judicialnotice in support of their motion. Dkt. 71. On March 4, 2024, nKlosuresfiled
`an opposition to Avalon and Morari’s motion. Dkt. 72. On March 8, 2024, Avalon and
`Morarifiled a reply in support oftheir motion.? Dkt. 73.
`
`On March25, 2024, the Court held a hearing on Avalon and Morari’s motion for
`judgmenton the pleadingsor partial judgmenton the pleadings. Having carefully
`considered the parties’ arguments and submissions, the Court finds and concludes as
`follows.
`
`' This case was randomlyreassigned to this Court on June 8, 2023, following Judge
`Lew’s death. Dkt. 62.
`? Avalon and Morari requestthat the Court take judicial notice of ten exhibits. Dkt. 71.
`Theseinclude: (1) nKlosures’ January 13, 2022 Copyright Registration; (2) nKlosures’
`initial state-court complaint, in Case No. 20BBCV00441 (L.A.S.C.); (3) September3,
`2021 Order in Case No. 20BBCV00441 (L.A.S.C.); (4) nKlosures’ First Amended
`Complaint in Case No. 20BBCV00441 (L.A.S.C.); (5) L-A.S.C. December 16, 2021
`Order in Case No. 20BBCV00441 (L.A.S.C.); (6) nKlosures’ Second Amended
`Complaint in Case No. 20BBCV00441 (L.A.S.C.); (7) the demurrer Avalonfiled in
`connection with the SAC and related Request for Judicial Notice; (8) L-A.S.C. March 23,
`2022 tentative ruling on Avalon’s demurrer to the SAC in Case No. 20BBCV00441
`(L.A.S.C.); (9) nKlosures’ voluntary dismissal of action in Case No. 20BBCV00411
`(L.A.S.C.); and (10) Judge Ronald S.W. Lew’s November 17, 2022 Order denying in
`part and granting in part Avalon’s motionto dismiss under Fed. R. Civ. P. 12(b)(6). Id.
`The Court finds that judicial notice of these exhibits is appropriate pursuant to Federal
`Rule of Evidence 201.
`> Avalon and Morari attach to their reply a proposal sent by nKlosuresandassert that the
`Court may judicially notice it becauseit is referenced in the FAC. Dkt. 73 at 11; dkt. 73-
`1, exh. A.
`
`CV-90 (10/18)
`
`CIVIL MINUTES- GENERAL
`
`Page 2 of 10
`
`

`

`Case 8:22-cv-00459-CAS-JDE Document 75 Filed 03/25/24 Page 3 of 10 Page ID #:1030
`Case 8:22-cv-00459-CAS-JDE Document 75 Filed 03/25/24 Page 3of10 Page ID #:1030
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`CIVIL MINUTES —- GENERAL
`
`‘Oo’
`
`Case No.
`Title
`
`Date March 25, 2024
` 8:22-cv-00459-CAS (JDEx)
`NKLOSURES, INC. ARCHITECTS V. AVALON LODGING, LLC ET AL
`
`il.
`
`BACKGROUND
`
`On or around May 25, 2014, nKlosures, which is a licensed architectural firm,
`entered into a contract with Thakor Patel to provide architectural design services for a
`new hotel (the “Project”) and provide four phases of work:(1) initial studies; (2) site
`planning andpreliminary design; (3) final conceptual design; and (4) consulting services.
`FAC 4 12. Pursuantto the contract, nKlosures was“the sole author, owner, and
`copyright holderofall architectural plans”that it provided to Patel for the Project and
`would beretained by Patel to serve as the Design Architect and the Architect of Record
`for the Project once the Planning Department Approvals for the Hotel Project proposed
`on the Property were received. Id. nKlosures timely performed pursuantto the contract
`and stampedall of its designs and drawingsfor the Project with the following language:
`
`No copies, transmission, reproductions or electronic manipulations of any
`portion of these drawings in whole or in part are to be made without the
`express written permission from [nKlosures]. All content in these drawings
`(including concepts, designs, imagery, graphics and logo) are the property of
`{nKlosures].
`
`Id. § 13. On or around June 5, 2015, nKlosures learned that Patel wasselling the Project
`to Avalon and Bipin Morari, Avalon’s principal. Id. 45, 14. Nikhil Kamat, nKlosures’
`principal, called Morari and explained that nKlosures was the Architect of Record for the
`Project, had obtainedall approvals for the Project, and could continue its work on the
`Project. Id. § 15. Morari asked for a proposal for nKlosures’ continuing to work on the
`Project. Id. “Kamat madeit clear that unless [Morari] agreed to use [nKlosures] as the
`architect on the Project, [Morari] could not use the architectural drawings andplans.” Id.
`Morari knewthat nKlosures was disclosing its architectural drawings and plans on the
`condition that they could not be used without paying nKlosures and using nKlosures as
`the Project’s architect. Id.
`
`On June 26, 2015, Kamat emailed Morari with the proposal for the next stage of
`development, which included: (1) design development; (2) architectural construction
`documents; (3) agency review and bidding; and (4) construction phaseservices. Id. § 17.
`It also included proposals for other services for the Project and a cost estimate ($90,000
`for nKlosures’ services plus $200/hour for additional services). Id. Kamat further
`indicated in the proposal that nKlosures was the sole owner and copyright holderofall of
`
`CV-90 (10/18)
`
`CIVIL MINUTES- GENERAL
`
`Page 3 of 10
`
`

`

`Case 8:22-cv-00459-CAS-JDE Document 75 Filed 03/25/24 Page 4 of 10 Page ID #:1031
`Case 8:22-cv-00459-CAS-JDE Document 75 Filed 03/25/24 Page 4of10 Page ID #:1031
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`CIVIL MINUTES —- GENERAL
`
`‘OQ’
`
`Case No.
`Title
`
`Date March 25, 2024
` 8:22-cv-00459-CAS (JDEx)
`NKLOSURES, INC. ARCHITECTS V. AVALON LODGING, LLC ET AL
`
`its architectural drawingsandplansandthat it would grant Avalon and Morari a license
`to use them for the Project upon execution of the contract. Id. Morari had several phone
`calls with Kamat regarding the proposal on June 26 and June 27, 2015, and ultimately
`accepted the proposal knowingthatif he used the architectural drawings and plans, he
`would have to pay for them and use nKlosures as the architect. Id. § 18. However,
`Morari “abruptly cut off all contact” with Kamat. Id. Because he had not heard anything
`for several weeks and Morari further did not respondto his July 14, 2015 email, Kamat
`“inferred that [Morari] was notinterested in using [nKlosures’ | architectural drawings
`and plans and wasnot interested in having [nKlosures]| perform the work.” Id. 4 19.
`
`nKlosures did not know that its drawings and plans were included in a PowerPoint
`presentation that apparently had been used to marketthe property. Id. 20. On or
`around June 22, 2020, Kamat “saw an advertisement for sale of a hotel since constructed
`on the property” and learned that Morari and Avalon had hired W&W,Liu, and Lau as
`consultants on the Project. Id. 21. Even though Morari had agreed not to do so unless
`nKlosures wasretained as the architect, Morari, Avalon, W&W,Liu, and Lau used
`nKlosures’ preliminary schematic level design and drawings, which nKlosures had
`provided to Patel. Id. “The drawingsand design ostensibly created by W&W,[Liu], and
`[Lau] were almost exactly the sameas the plans and designs which werecreated by
`[nKlosures].” The use of nKlosures’ plans and drawings withoutits permission or
`knowledgeorthe license to do so causedit a loss of substantial revenue. Id. § 23.
`
`On or around January 18, 2022, nKlosures received confirmation that its January
`13, 2022 Copyright Application was accepted by the United States Copyright Office and
`that its “plans and drawings for the Burbank Hotel were granted Copyright Registration
`Certificate No. VA 2-282-647.” Id. 4¥ 24-25.
`
`Il, LEGAL STANDARD
`
`A motion for judgment on the pleadings brought pursuant to Fed. R. Civ. P. 12(c)
`provides a meansof disposing of cases whenall material allegations of fact are admitted
`in the pleadings and only questions of law remain. See McGann v. Emst & Young, 102
`F.3d 390, 392 (9th Cir. 1996). Such a motion maybe brought“after the pleadingsare
`closed—but early enough notto delay trial.” Fed. R. Civ. P. 12(c). “Analysis under Rule
`12(c) is substantially identical to analysis under Rule 12(b)(6) because, under both rules,
`a court must determine whetherthe facts alleged in the complaint, takenastrue, entitle
`
`CV-90 (10/18)
`
`CIVIL MINUTES- GENERAL
`
`Page 4 of 10
`
`

`

`Case 8:22-cv-00459-CAS-JDE Document 75 Filed 03/25/24 Page 5 of 10 Page ID #:1032
`Case 8:22-cv-00459-CAS-JDE Document 75 Filed 03/25/24 Page 5of10 Page ID #:1032
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`CIVIL MINUTES —- GENERAL
`
`‘Oo’
`
`Case No.
`Title
`
`Date March 25, 2024
` 8:22-cv-00459-CAS (JDEx)
`NKLOSURES, INC. ARCHITECTS V. AVALON LODGING, LLC ET AL
`
`the plaintiff to a legal remedy.” Chavez v. United States, 683 F.3d 1102, 1108 (9th Cir.
`2012). Accordingly, while the complaint “does not need detailed factual allegations, a
`plaintiff's obligation to provide the ‘grounds’ of his ‘entitlementto relief’ requires more
`than labels and conclusions, and a formulaic recitation of the elements of a cause of
`action will not do.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007).
`“IFJactual allegations must be enough toraise a right to relief above the speculative
`level.” Id.
`
`In considering a Rule 12(c) motion, as with a 12(b)(6) motion,the district court
`mustview the facts presented in the pleadings and the inferences to be drawn from them
`in the light most favorable to the nonmovingparty. NL Indus. v. Kaplan, 792 F.2d 896,
`898 (9th Cir. 1986): In re Century 21-Re/Max Real Estate Adver. ClaimsLitig., 882 F.
`Supp. 915, 921 (C.D. Cal. 1994). However,“/i]n keeping with these principles a court
`considering a motion to dismiss can choose to begin by identifying pleadingsthat,
`because they are no more than conclusions,are not entitled to the assumption oftruth.
`While legal conclusions can provide the framework of a complaint, they must be
`supported by factual allegations.” Ashcroft v. Iqbal, 556 U.S. 662, 129 S. Ct. 1937, 1950
`(2009); Moss v. United States Secret Service, 572 F.3d 962, 969 (9th Cir. 2009) (“[F]or a
`complaint to survive a motion to dismiss, the non-conclusory ‘factual content,’ and
`reasonable inferences from that content, must be plausibly suggestive of a claim entitling
`the plaintiff to relief.”) (citing Twombly and Iqbal). Ultimately, “[d]etermining whether
`a complaintstates a plausible claim for relief will .
`.
`. be a context-specific task that
`requires the reviewing court to draw onits judicial experience and commonsense.”
`Iqbal, 129 S. Ct. at 1950. For purposes of a Rule 12(c) motion, the moving party
`concedesthe accuracyofthe factual allegations of the complaint, but does not admit
`other assertions that constitute conclusionsof law or matters that would not be admissible
`in evidenceat trial. SC Charles Alan Wright, Arthur R. Miller & Edward H. Cooper,
`Federal Practice and Procedure § 1368 (3d ed. 2004).
`
`Unless a court converts a Rule 12(b)(6) or 12(c) motion into a motion for summary
`judgment, a court generally cannot consider material outside of the complaint(e.g., facts
`presentedin briefs, affidavits, or discovery materials). In re American Cont’!
`
`Corp./Lincoln Sav. & Loan Sec. Litig., 102 F.3d 1524, 1537 (9th Cir. 1996), rev’d on
`other grounds sub nom Lexecon,Inc. v. Milberg Weiss Bershad Hynes & Lerach, 523
`U.S. 26 (1998). A court may, however, consider exhibits submitted with or alleged in the
`complaint and matters that may be judicially noticed pursuant to Federal Rule of
`
`CV-90 (10/18)
`
`CIVIL MINUTES- GENERAL
`
`Page 5 of 10
`
`

`

`Case 8:22-cv-00459-CAS-JDE Document 75 Filed 03/25/24 Page 6 of 10 Page ID #:1033
`Case 8:22-cv-00459-CAS-JDE Document 75 Filed 03/25/24 Page 6of10 Page ID #:1033
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`CIVIL MINUTES —- GENERAL
`
`‘Oo’
`
`Case No.
`Title
`
`Date March 25, 2024
` 8:22-cv-00459-CAS (JDEx)
`NKLOSURES, INC. ARCHITECTS V. AVALON LODGING, LLC ET AL
`
`Evidence 201. In re Silicon GraphicsInc. Sec. Litig., 183 F.3d 970, 986 (9th Cir. 1999):
`Lee v. City of Los Angeles, 250 F.3d 668, 689 (9th Cir. 2001).
`
`IV. DISCUSSION
`
`A.
`
`Alter Ego Liability
`
`Avalon and Morari argue that nKlosureshasfailed to allege alter ego liability to
`disregard Avalon’s corporate form andpierce the corporate veil to hold Morari liable.
`Dkt. 70 at 16-17. According to Avalon and Morari,“there are no allegations to support
`that Morari wasthe ‘guiding spirit’ behind the alleged copyright violations” to find him
`personally liable for the corporation’s wrongful conduct. Id. at 17.
`
`In opposition, nKlosuresassertsthat it alleges direct liability against Morari, not
`alter ego liability. Dkt. 72 at 4. nKlosuresalleges that it addressed the contract draft
`directly to Morari, who was“the person who madeall of the representations, received the
`contract, and personally acted in violation thereof.” Id.
`
`In reply, Avalon and Morari argue that Avalon’s corporate form requiresthatit be
`pierced before Morari can be held personally liable. Dkt. 73 at 8. According to Avalon
`and Morari, nKlosures admits it had a limited numberof exchanges with Morari and thus
`cannotallege that Morari “committed the requisite egregious acts that .
`.
`. would permit
`piercing Avalon’s corporate veil.” Id. at 10. Further, Avalon and Morari contend that
`nKlosures addressed the June 26, 2015 proposalto Patel, rather than Morari. Id.
`
`It appears that nKlosures does not seek to invoke the alter ego doctrinein this
`action but rather asserts claims against Morari based onhis alleged conduct. The Court
`finds that nKlosures hassufficiently alleged direct liability against Morari in the FAC.
`Accordingly, the Court DENIES Avalon and Morari’s motion for judgment on the
`pleadings as to claims against Morari.
`
`B.
`
`Claim for Copyright Infringement
`
`Avalon and Morari arguethat a plaintiff is not entitled to an award of attorneys’
`fees or statutory damages for a copyright infringementclaim unless “registration is made
`within three monthsafter the first publication of the work.” Dkt. 70 at 15; 17 U.S.C. §
`412(2). Although nKlosures does not allege whenthefirst publication of its drawings
`and plans occurred, Avalon and Morari assert that it had to occur on or before June 22,
`2020, when Kamatalleges he first became aware of the hotel’s existence. Dkt. 70 at 15.
`
`CV-90 (10/18)
`
`CIVIL MINUTES- GENERAL
`
`Page 6 of 10
`
`

`

`Case 8:22-cv-00459-CAS-JDE Document 75 Filed 03/25/24 Page 7 of 10 Page ID #:1034
`Case 8:22-cv-00459-CAS-JDE Document 75 Filed 03/25/24 Page 7of10 Page ID #:1034
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`CIVIL MINUTES —- GENERAL
`
`‘Oo’
`
`Case No.
`Title
`
`Date March 25, 2024
` 8:22-cv-00459-CAS (JDEx)
`NKLOSURES, INC. ARCHITECTS V. AVALON LODGING, LLC ET AL
`
`Thus, Avalon and Morari contend that nKlosuresis not entitled to statutory damagesor
`attorneys’ fees because it filed for registration in January 2022, which wasoverfifteen
`monthslate. Id.
`
`In addition, Avalon and Morari argue that nKlosures doesnotallege that the works
`are original or which portions of the work were infringed, whichis particularly critical
`here because “only ‘an architect’s original combination or arrangement of such elements
`may’ receive copyright protection” and not standard features or elements themselves. Id.
`at 21 (quoting Thomson v. HMC Group, 2015 WL 11256775, at *10 (C.D. Cal., Oct. 29,
`2015) (citation omitted)). Avalon and Morari further argue that nKlosures does not
`allege any overt acts by them andinstead “only offers conclusory allegations that do not
`allege by whom or howits plans/drawings were copied and infringed upon.” Dkt. 70 at
`22-23. Moreover, they contend that nKlosuresonly asserts legal conclusionsto hold
`them vicariously liable for the acts of W&W,Liu, and Lau but doesnot allege any direct
`financial benefit to them from the infringement. Id. at 24-25. According to Avalon and
`Morari, they would not be able to meaningfully use nKlosures’ plans/drawingssince they
`are not architects, and nKlosuresfails to allege that they knew that anyone would infringe
`on nKlosures’ plans, that they had anyrole in the alleged use of the plans to help W&W
`with the Project, or that they had “any direct involvementin infringing activity.” Id. at
`25. Finally, they assert that mere ownership ofthe land by Avalon “does not mean that
`Avalonhad anyright to control the way W&W performed its work on the Project.” Id.
`
`In opposition, nKlosuresasserts that “[t]he prevailing position of the courts is that
`a motion for judgment on the pleadings may not be granted on an issue so granular thatit
`disposesof less than a complete cause of action.” Dkt. 72 at 3. However, nKlosures
`concedesthat if Avalon and Morari havecorrectly described the timeline,it is likely not
`entitled to statutory damages and would thus not pursue such damagesat trial. Id. at 4.
`
`nKlosures further argues that it adequately pled its copyright infringementclaim,
`which doesnot need to be pled with particularity, by alleging ownership,registration, and
`infringement. Id. at 7. According to nKlosures, while it appears that Avalon and Morari
`may be challenging the originality of the copyrighted work, they do not identify any
`particular portion as “lacking sufficient originality,” and “originality is presumed in light
`of the registration.” Id. at 8. To the extent Avalon and Morari contend that nKlosures
`has not alleged infringement, nKlosuresarguesthat it has sufficiently alleged that Avalon
`and Morari possessed nKlosures’ design documents, submitted copies of the documents
`
`CV-90 (10/18)
`
`CIVIL MINUTES- GENERAL
`
`Page 7 of 10
`
`

`

`Case 8:22-cv-00459-CAS-JDE Document 75 Filed 03/25/24 Page 8 of 10 Page ID #:1035
`Case 8:22-cv-00459-CAS-JDE Document 75 Filed 03/25/24 Page 8o0f10 Page ID #:1035
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`CIVIL MINUTES —- GENERAL
`
`‘Oo’
`
`Case No.
`Title
`
`Date March 25, 2024
` 8:22-cv-00459-CAS (JDEx)
`NKLOSURES, INC. ARCHITECTS V. AVALON LODGING, LLC ET AL
`
`to the City for approval, used the documents to market the building, and “built the
`building according to those plans.” Id. (emphasisin original).
`
`In reply, Avalon and Morariassert that “the ‘appropriate’ thing to do, given
`[nKlosures’| concession that it cannot get a statutory award of damagesor attorneys’ fees
`[] would be to dismiss those remedies from the case lest it become a barrier to subsequent
`settlementefforts.” Dkt. 73 at 7. Further, they argue that nKlosures hasfailed to allege
`with “at least some degree ofparticularity overt acts” that they engaged in to support
`nKlosures’ copyright infringement claim. Id. at 15 (citation and emphasis omitted).
`
`nKlosures concedesthat failing to register the copyright within three months of the
`first publication of the work prevents it from obtaining statutory damages and attorneys’
`fees. See Alaska Stock, LLC v. Houghton Mifflin Harcourt Pub. Co., 747 F.3d 673, 678
`(9th Cir. 2014) (“Registration prior to infringementor, if the work is published, within
`three monthsof publication, is necessary for an ownerto obtain statutory damages and
`attorneys’ fees.”). Because nKlosuresis not entitled to these damages, the Court grants
`Avalon and Morari’s motion for judgment on the pleadingsas to statutory damages and
`attorneys’ fees.
`
`However, the Court finds that nKlosures has otherwise adequately pled its claim
`for copyright infringementatthis stage by alleging its ownership of the drawings and
`plans, its registration of the copyright, and the infringement by Avalon and Morari. See
`Perfect 10, Inc. v. Cybernet Ventures, Inc., 167 F. Supp. 2d 1114, 1120 (C.D. Cal. 2001)
`(“As courts have noted .
`.
`. complaints simply alleging present ownership byplaintiff,
`registration in compliance with the applicable statute and infringement by defendant have
`been held sufficient under the rules.”). Thus, the Court denies the remainder of Avalon
`and Morari’s motion regarding the copyright infringement claim. Accordingly, the Court
`GRANTSIN PARTand DENIES IN PART Avalon and Morari’s motion for judgment
`on the pleadings as to nKlosures’ copyright infringement claim.
`
`Cc.
`
`Claim for Breach of Contract
`
`First, Avalon and Morari argue that nKlosures concedesthat it only sent a
`“proposal” to Morari and thus hasnotalleged the acceptance of an implied-in-fact
`contract. Dkt. 70 at 18. Second, they argue that resjudicata precludes the breach of
`contract claim because nKlosures’ “state-court claim for false promise wasbased on the
`
`CV-90 (10/18)
`
`CIVIL MINUTES- GENERAL
`
`Page 8 of 10
`
`

`

`Case 8:22-cv-00459-CAS-JDE Document 75 Filed 03/25/24 Page 9 of 10 Page ID #:1036
`Case 8:22-cv-00459-CAS-JDE Document 75 Filed 03/25/24 Page 9of10 Page ID #:1036
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`CIVIL MINUTES —- GENERAL
`
`‘Oo’
`
`Case No.
`Title
`
`Date March 25, 2024
` 8:22-cv-00459-CAS (JDEx)
`NKLOSURES, INC. ARCHITECTS V. AVALON LODGING, LLC ET AL
`
`same facts and involved the same primary right asits claim of breach of implied-in-fact
`contract in the Federal FAC.” Id. at 18-19.
`
`In opposition, nKlosuresasserts that its dismissal of the state court action without
`prejudice doesnot constitute a final judgment. Dkt. 72 at 5. It also contendsthat a
`demurrer ruling that does not grant leave to amend, suchasthe tentative ruling on
`nKlosures’ false promise claim in Superior Court, is not determinative of whether res
`judicata bars the claim. Id. at 5-6. Moreover, nKlosuresasserts that the Superior Court
`found that nKlosures’ false promise claim failed becauseit did not allege a promise,
`which “has nothing to do with the nature of the cause of action filed here.” Id. at 6.
`Further, it argues that a breach of contract claim does not involve the same conductor the
`samerelief as a fraud/false promise claim that “seeks to avoid the contract rather than to
`enforceit.” Id. (citation omitted). Thus, nKlosuresasserts that enforcing the contractis
`not the sameprimary right as preventing the functionaltheft of its plans. Id. at 5-6.
`
`In reply, Avalon and Morariassert that the dismissed false promise claim and
`voluntary dismissal of the state court action are final judgments. Dkt. 73 at 11. They
`argue that nKlosures, “whetherit calls its cause of action a “false promise’ or a breach of
`implied-in-fact-contract,is litigating over the same primary right, the right to not haveits
`plans/drawingscopiedor used withoutits permission or payment.” Id. at 13 (emphasis in
`original). Avalon and Morari contend that nKlosuresis asserting a false promise claim
`based on their alleged agreementto accept nKlosures’ drawings/plans and promise to pay
`for the drawings/plans if Avalon and Morari used them. Id. Finally, they argue that
`nKlosures never disclosed the drawings/plansas consideration to support its implied
`contract claim. Id.
`
`Resjudicata applies when “(1) [a] claim orissue raised in the presentaction is
`identical to a claim orissuelitigated in a prior proceeding;(2) the prior proceeding
`resulted in a final judgment on the merits; and (3) the party against whom the doctrineis
`being asserted wasa party or in privity with a party to the prior proceeding.” Boekenv.
`Philip Morris USA,Inc., 48 Cal.4th 788, 797 (2010) (internal quotation marks omitted).
`
`It appears that in the March 23, 2022 tentative ruling regarding Avalon and
`Morari’s demurrer, the Superior Court sustained the demurrerasto three causes of action
`with leave to amend. See dkt. 71-8. Thus, even though the Superior Court sustained the
`demurreras to nKlosures’ false promises claim without leave to amend, nKlosuresstill
`had the opportunity at that point to cure its other claims and continuelitigating the case.
`
`CV-90 (10/18)
`
`CIVIL MINUTES- GENERAL
`
`Page 9 of 10
`
`

`

`Case 8:22-cv-00459-CAS-JDE Document 75 Filed 03/25/24 Page 10 of 10 Page ID #:1037
`Case 8:22-cv-00459-CAS-JDE Document 75 Filed 03/25/24 Page 10o0f10 Page ID #:1037
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`CIVIL MINUTES —- GENERAL
`
`‘OQ’
`
`Case No.
`Title
`
`Date March 25, 2024
` 8:22-cv-00459-CAS (JDEx)
`NKLOSURES, INC. ARCHITECTS V. AVALON LODGING, LLC ET AL
`
`See Boyd v. Freeman, 18 Cal. App. 5th 847, 856 (2017). Moreover, “[i]f.. . new or
`additional facts are alleged that cure the defects in the original pleading,it is settled that
`the former judgmentis not a bar to the subsequent action whetheror not plaintiff had an
`opportunity to amend his complaint.” Id. at 859 (citation omitted). On March 24, 2022,
`nKlosures voluntarily dismissed the state court action without prejudice. See dkt. 71-9.
`The Court doesnotfind that either the tentative ruling on the demurrerin state court or
`nKlosures’ voluntary dismissal of the state court action constitutes a final judgment on
`the merits that gives rise to resjudicata. nKlosureshasalso sufficiently pled an implied-
`in-fact contract claim in the FAC. Accordingly, the Court DENIES Avalon and Morari’s
`motion for judgment on the pleadings as to nKlosures’ breach of contract claim.
`
`V.
`
`CONCLUSION
`
`In accordance with the foregoing, the Court DENIES Avalon and Morari’s motion
`for judgmenton the pleadingsas to claims against Morari and as to nKlosures’ breach of
`contract claim. The Court GRANTSIN PARTand DENIESIN PARTthe motion as
`to nKlosures’ copyright infringementclaim.
`
`IT IS SO ORDERED.
`
`Initials of Preparer
`
`00
`
`:
`CMJ
`
`31
`
`CV-90 (10/18)
`
`CIVIL MINUTES- GENERAL
`
`Page 10 of 10
`
`