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`UNITED STATES DISTRICT COURT
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`SOUTHERN DISTRICT OF CALIFORNIA
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`VICTOR WILLIS,
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` Case No.: 15cv1078 BTM(RBB)
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`Plaintiff,
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`ORDER GRANTING
`DEFENDANTS’ MOTIONS TO
`DISMISS
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` v.
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`SCORPIO MUSIC (BLACK
`SCORPIO) S.A., CAN’T STOP
`PRODUCTIONS, INC., AND
`HENRI BELOLO,
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`Defendants.
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`Defendants Scorpio Music (“Scorpio”), Henri Belolo (“Belolo”), and Can’t
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`Stop Productions, Inc. (“CSP”), have filed motions to dismiss the Complaint. For
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`the reasons discussed below, Defendants’ motions to dismiss are GRANTED.
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`I. BACKGROUND
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`In a prior lawsuit, Scorpio Music S.A. v. Willis, Case No. 11cv1557
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`BTM(RBB), Scorpio and CSP sought a judicial determination regarding the
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`percentage of copyrights to 24 compositions (“24 Disputed Works”) that Victor
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`Willis was entitled to recover upon termination of his grants of copyright. Willis
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`filed a counterclaim for a declaratory judgment that Belolo did not contribute to the
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`Case 3:15-cv-01078-BTM-RBB Document 20 Filed 01/19/16 Page 2 of 11
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`authorship of the lyrics or the music of the 24 Disputed Works and that Willis was
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`entitled to recapture 50% of the copyright interests in each of those works. (Willis
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`did not dispute that Jacque Morali composed the music to these works.)
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`After a jury trial in February 2015, the Court issued a judgment that decreed
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`that Belolo is not a joint author of 13 of the 24 Disputed Works (the “13
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`Compositions”), including “YMCA,” and that Willis has recaptured 50% of the
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`copyrights in those 13 works.
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`On May 13, 2015, Willis commenced this action. Willis alleges that all
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`financial and business decisions of CSP and its wholly-owned publishing division,
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`Can’t Stop Music (“CSM”) were solely made by Belolo. (Compl. ¶ 23.) According
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`to Willis, Belolo caused CSP/CSM to utilize a form contract that denominated
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`songwriters that assigned their works to CSP/CSM as “adapters,” even though
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`such songwriters routinely created original music and lyrics that were not based
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`upon any previously existing work. (Compl. ¶¶ 28-29.) Belolo also allegedly
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`caused CSP/CSM to enter into a sub-publishing agreement with Scorpio (the
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`“Scorpio Sub-Publishing Agreement”), under which Scorpio licensed allegedly
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`original French songs to CSP/CSM for CSP/CSM to create English language
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`“adaptations” of the alleged French songs. (Compl. ¶¶ 23, 39.) Willis alleges that
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`Belolo engaged in these actions to create a foundation for Belolo’s knowingly false
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`claim to authorship of the lyrics of purported “Foreign Works” referred to in the form
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`Case 3:15-cv-01078-BTM-RBB Document 20 Filed 01/19/16 Page 3 of 11
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`contracts, including the 13 Compositions. (Compl. ¶ 30.)
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`Belolo, by and through CSP, filed in the United States Copyright Office
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`registrations for each of the 13 Compositions. (Compl. ¶ 40.) The Registrations
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`identify Belolo as a co-author of the lyrics. (Compl. ¶ 43.)
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`Willis claims that by falsely claiming authorship, Belolo effectively obtained
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`for himself a 50% share of royalties for all usages of the musical compositions
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`governed by the form contract. (Compl. ¶ 31.) Belolo, by and through CSP/CSM
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`caused registrations of the 13 Compositions with SACEM (the French rights
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`organization that administers the collection and distribution of royalties for uses of
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`musical compositions), which has remitted to Belolo a 50% share of royalties
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`pursuant to its policy of remitting a 50% portion of royalties to the author of the
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`underlying original language lyrics for all territories around the world except the
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`United States. (Compl. ¶¶ 35-36.)
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`Belolo also caused registrations of the 13 Compositions with BMI, the
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`American performing rights organization that administers the collection and
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`distribution of royalties for uses of musical compositions in the United States.
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`(Compl. ¶ 37.) Based on such registrations, BMI has remitted to Belolo a 25%
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`share of nondramatic performance royalties pursuant to its policy of remitting
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`royalties to the author of the underlying original language lyrics. (Compl. ¶ 38.)
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`Willis alleges that as a result of his fraudulent conduct, Belolo has advanced
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`Case 3:15-cv-01078-BTM-RBB Document 20 Filed 01/19/16 Page 4 of 11
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`his own self-interest to the detriment of Willis and has obtained substantial gains
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`and advantages to which he is not entitled. (Compl. ¶ 40.) Accordingly, Willis
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`asserts the following claims against Defendants: (1) unjust enrichment (against
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`Belolo); (2) conversion (against Belolo); (3) misappropriation (against Belolo), and
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`(4) fraud (against all Defendants).
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`The Complaint also asserts claims based on allegedly unauthorized dramatic
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`“grand rights” performances of the 13 Compositions, 20 additional compositions,
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`and “Macho Man,” by Sixuvus, Ltd. (“Sixuvus”). According to the Complaint,
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`during the three years prior to the commencement of this action, Sixuvus, an entity
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`dominated and controlled by Belolo and CSP, presented grand rights public
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`performances of the songs at issue through the group then performing under the
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`name “Village People.” (Compl. ¶ 52.) Willis alleges that CSP authorized third
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`parties including Sixuvus to present the dramatic performances on a royalty-free
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`license basis, charging only for the use of the Village People trademark. (Compl.
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`¶ 59.) CSP has never reported or paid to Willis proceeds from the dramatic
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`performances. (Compl. ¶ 60.)
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`Willis asserts the following claims in connection with the dramatic grand
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`rights performances: (1) vicarious copyright infringement (against Belolo); and (2)
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`breach of fiduciary duty (against CSP).
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`Case 3:15-cv-01078-BTM-RBB Document 20 Filed 01/19/16 Page 5 of 11
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`II. DISCUSSION
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`A. Claims Based on Belolo’s False Claim of Authorship
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`Willis’s
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`four causes of action (unjust enrichment, conversion,
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`misappropriation, and fraud) are based on Willis’s allegations that Belolo, through
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`CSP/CSM, carried out a scheme that allowed Belolo to falsely claim to be an author
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`of the lyrics of the 13 Compositions and thereby obtain credit and royalties, to
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`which he was not entitled, in connection with the exploitation of the works. These
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`claims are barred by the doctrine of res judicata because they could have been
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`brought in the prior action.
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` The doctrine of res judicata “bars relitigation of all grounds of recovery that
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`were asserted, or could have been asserted, in a previous action between the
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`parties, where the previous action was resolved on the merits.” United States ex
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`rel. Barajas v. Northrop Corp., 147 F.3d 905, 909 (9th Cir. 1998). “It is immaterial
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`whether the claims asserted subsequent to the judgment were actually pursued in
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`the action that led to the judgment; rather, the relevant inquiry is whether they could
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`have been brought.” Id.
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`There are three elements to a successful res judicata defense: (1) an identity
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`of claims; (2) a final judgment on the merits; and (3) privity between the parties.
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`United States v. Liquidators of European Federal Credit Bank, 630 F.3d 1139,
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`1150 (9th Cir. 2011). There was a final judgment on the merits in the prior case
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`and the parties in that case and this case are the same.
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`Therefore, the pivotal question is whether there is “an identity of claims.” In
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`deciding the identity of claims, the Ninth Circuit has applied four criteria:
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`(1) whether rights or interests established in the prior judgment would
`be destroyed or impaired by prosecution of the second action; (2)
`whether substantially the same evidence is presented in the two
`actions; (3) whether the two suits involve infringement of the same
`right; and (4) whether the two suits arise out of the same transactional
`nucleus of facts.
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`Constantini v. Trans World Airlines, 681 F.2d 1199, 1201-02 (9th Cir. 1982)
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`(quoting Harris v. Jacobs, 621 F.2d 341,434 (9th Cir. 1980)). “The fourth criterion
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`– the same transactional nucleus of facts – is the most important.” Liquidators,
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`630 F.3d at 1151. Accordingly, “[n]ewly articulated claims based on the same
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`nucleus of facts may still be subject to a res judicata finding if the claims could
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`have been brought in the earlier action.” Tahoe-Sierra Pres. Council, Inc. v. Tahoe
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`Reg’l Planning Agency, 322 F.3d 1064, 1078 (9th Cir. 2003).
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`Willis’s first through fourth causes of action are based on the same
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`transactional nucleus of facts as his counterclaim in the prior action. Willis’s
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`counterclaim included allegations that are substantially similar to those alleged in
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`his current Complaint regarding Belolo causing CSP/CSM to utilize the form
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`contract with songwriters like Willis and causing CSP/CSM to enter into the Scorpio
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`Sub-Publishing Agreement so that Belolo could claim to be an author of lyrics of
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`purported “Foreign Works” (including the 13 Compositions) and obtain royalties
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`from SACEM and BMI. (Counterclaim [Doc. 35] in Case No. 11cv1557 at ¶¶ 79-
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`92.)
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`Although Willis’s counterclaim did not seek recovery for pre-termination
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`royalties obtained by Belolo based on his alleged authorship of the works in
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`dispute, Willis clearly could have brought such claims at that time. Willis chose to
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`limit his counterclaim to the issue of recaptured copyright ownership and post-
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`termination income in connection therewith.
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`Willis argues that Defendants should be judicially estopped from arguing res
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`judicata because Defendants argued in the prior action that the only damages
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`available to Willis were post-termination damages. However, Defendants argued
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`that Willis’s damages were limited because Willis’s counterclaim did not assert any
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`claims for damages relating to pre-termination royalties collected by Belolo.
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`Defendants’ current res judicata argument is not inconsistent with their prior
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`position that the judgment should not include pre-termination monetary relief.
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`Thus, judicial estoppel does not preclude Defendants’ res judicata defense.
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`Willis’s first through fourth causes of action are barred by the doctrine of res
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`judicata. Therefore, the motions to dismiss are granted as to these causes of
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`action.
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`B. Vicarious Copyright Infringement Claim
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`In his fifth cause of action, Willis alleges that Belolo is vicariously liable for
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`copyright infringement committed by Sixuvus. This claim fails because the factual
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`allegations fail to establish that any infringement occurred.
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`One “infringes vicariously by profiting from direct infringement while declining
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`to exercise a right to stop or limit it.” Metro-Goldwyn-Mayer Studios Inc. v.
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`Grokster, Ltd., 545 U.S. 912, 930 (2005). Here, however, there was no underlying
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`infringement because CSP granted Sixuvus a license for dramatic performances
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`of the compositions at issue. (Compl. ¶¶ 58-59.) According to Willis, “CSP has
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`the exclusive rights to license Scorpio’s copyright interest in the composition in the
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`United States. . . . CSP has the exclusive rights to commercially exploit the subject
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`copyright interests in the United States . . . .” (Opp. at 17:26-18:7.)
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`A co-owner of a copyright cannot be liable to another co-owner for
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`infringement of the copyright. Cortner v. Israel, 732 F.2d 267, 271 (2d Cir. 1984).
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`Similarly, someone who has been granted rights by a co-owner of a copyright has
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`a valid defense to an infringement action brought by another co-owner. Batiste v.
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`Island Records, Inc., 179 F.3d 217, 223-224 (5th Cir. 1999).
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` Based on the facts before the Court, there was no underlying infringement
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`by Sixuvus. Therefore, Willis’s vicarious infringement claim fails.
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`C. Breach of Fiduciary Duty
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`In his sixth cause of action, Willis alleges that CSP breached its fiduciary
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`duty to Willis to maximize the value and financial return of the subject
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`compositions. (Compl. ¶ 92.) Willis contends that CSP breached its fiduciary duty
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`by granting a royalty-free license for dramatic performances. (Compl. ¶ 93.)
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`Willis’s claim for breach of fiduciary duty fails because it does not appear that
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`CSP owed a fiduciary duty toward Willis. It is true that a co-owner of a copyright
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`must account to other co-owners for profits earned from licensing or using the
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`copyright. 1 Oddo v. Ries, 743 F.2d 630, 633 (9th Cir. 1984). But courts have
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`rejected the proposition that a duty to account to a co-owner is tantamount to owing
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`a fiduciary duty. See Brian Jonestown Massacre v. Davies, 2014 WL 4076549, at
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`* 5 (N.D. Cal. Aug. 18, 2014) (dismissing breach of fiduciary duty claim brought by
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`one co-author against another); Margo v. Weiss, 1998 WL 2558, at * 9 (S.D.N.Y.
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`1998) (rejecting proposition that co-authors owe fiduciary duties to one another –
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`“[I]t appears that, with limited exceptions not applicable here, the only duty that
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`exists between co-authors is the duty to account for profits.”).
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`Accordingly, the Court grants the motions to dismiss as to Willis’s breach of
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`1 It is actually unclear whether CSP owes a duty of accounting to Willis. A licensee, as
`opposed to a transferee, “has no duty to account to the joint owners of a work other than to the
`particular joint owner who is his licensor.” 1 Nimmer on Copyright § 6.12 [C][3]. A grant
`executed by less than all of the joint owners of a copyright is necessarily non-exclusive, and a
`non-exclusive grant is not regarded as a “transfer,” but only a “license.” Id.
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`fiduciary duty claim.
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`D. Personal Jurisdiction over Belolo
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`In his motion, Belolo also argues that the Court lacks personal jurisdiction
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`over him. The Court denies without prejudice Belolo’s motion to dismiss for lack
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`of personal jurisdiction. If the Court had not dismissed Plaintiff’s claims for failure
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`to state a claim, the Court would have allowed Plaintiff to conduct jurisdictional
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`discovery. See Laub v. U.S. Dept. of Interior, 342 F.3d 1080, 1093 (9th Cir. 2003)
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`(explaining that jurisdictional discovery should be granted when “the jurisdictional
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`facts are contested or more facts are needed.”) Further discovery regarding
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`Willis’s claim that Scorpio and CSP are alter egos of Belolo “might well”
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`demonstrate facts sufficient to constitute a basis for jurisdiction. Harris Rutsky &
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`Co. Ins. Serv. v. Bell & Clements, 328 F.3d 1122, 1135 (9th Cir. 2003).
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`//
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`III. CONCLUSION
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`For the reasons discussed above, Defendants’ motions to dismiss [Docs. 6
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`and 11] are GRANTED. Plaintiff’s Complaint is DISMISSED. The Court grants
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`Plaintiff leave to file an amended complaint. If Plaintiff chooses to do so, the
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`amended complaint must be filed within 30 days of the entry of this Order.
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`IT IS SO ORDERED.
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`Dated: January 19, 2016
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