Case 2:08-cv-01368-LRH-LRL Document 22 Filed 06/10/09 Page 1 of 7
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`UNITED STATES DISTRICT COURT
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`DISTRICT OF NEVADA
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`2:08-CV-01368-LRH-LRL
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`ORDER
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`* * *
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`SALESTRAQ AMERICA, LLC,
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`Plaintiff,
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` v.
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`JOSEPH A. ZYSKOWSKI and
`DEVMARKETING, INC.,
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`))))
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`Defendants.
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`Before the court is Plaintiff SalesTraq America, LLC’s (“SalesTraq”) Motion for
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`Preliminary Injunction (#16 ). Defendants Joseph Zyskowski and devMarketing, Inc.
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`(“devMarketing”) filed an opposition (#17) to which SalesTraq replied (#21).
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`I.
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`Facts
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`A. SalesTraq’s Evidence
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`SalesTraq is a business that provides information regarding Las Vegas-area residential
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`property on a fee-subscription basis. Before its formation, SalesTraq’s current president, Larry
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`Murphy, accumulated a large number of floor plans and information sheets published by Las Vegas
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`builders. In the course of arranging these materials into a compilation, Murphy authored three sets
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`of numeric designators. These designators are searchable by computer algorithm and encapsulate
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`Case 2:08-cv-01368-LRH-LRL Document 22 Filed 06/10/09 Page 2 of 7
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`information concerning the attributes and location of each house plan in the compilation
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`(“Information Content”). The Information Content indicates the ages of houses, the number of
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`alternative floor plans available for a given house model, and the builder associated with a given
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`floor plan. On a typical page of SalesTraq’s compilation, the Information Content appears in the
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`form of a “Details” box, which includes either a floor plan number or a model number, although
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`some pages include both numbers.
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`Since 1997, SalesTraq has provided its compilation to subscribers in two formats: its
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`website at salestraq.com and a CD-ROM or DVD. From August 2000 through August 2001,
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`Defendant Zyskowski held a six-month SalesTraq subscription and received multiple CD-ROMs or
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`DVDs. Zyskowski also held a six-month subscription to salestraq.com beginning September 20,
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`2007.
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`In late 2007, Murphy discovered devMLS.com, a website owned by Defendant
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`devMarketing. Murphy believes Defendants copied content from salestraq.com and placed that
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`content on devMLS.com. In particular, Murphy asserts that floor plans on devMLS.com contain
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`Information Content associated with the same floor plans on salestraq.com.
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`B. Defendants’ Evidence
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`In 2007, Defendant Zyskowski decided to create a database for real estate agents in the Las
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`Vegas area. As part of this endeavor, Zyskowski and a computer technician entered information
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`concerning all active Las Vegas area new home developments. After developing the active listing
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`database, Zyskowski decided to create an archived listings database containing floor plans and
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`information about house models in closed developments. To obtain this information, Zyskowski
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`purchased access to SalesTraq’s database and reviewed its archived files. If a floor plan was
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`included in an archived listing, Zyskowski used that floor plan and associated information to create
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`an archived listing in devMLS’s database.
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`While reviewing SalesTraq’s database, Zyskowski noticed floor plan numbers and model
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`Case 2:08-cv-01368-LRH-LRL Document 22 Filed 06/10/09 Page 3 of 7
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`numbers appearing on floor plan drawings. Zyskowski believed that the numbers were created by
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`builders or developers to identify floor plans or models. He therefore indicated the floor plan
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`numbers and some model numbers in the archived section of devMLS.com. The floor plan
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`numbers and model numbers in devMLS.com’s archived listings have no effect on the website’s
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`search function and have no significance for a devMLS.com user. Rather, each listing in the
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`devMLS database is assigned a unique “devMLS number,” and the archived listings are ordered by
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`square footage.
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`II.
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`Legal Standard
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`A preliminary injunction is an “extraordinary remedy that may only be awarded upon a clear
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`showing that the plaintiff is entitled to such relief.” Winter v. Natural Res. Def. Council, 129 S. Ct.
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`365, 376 (2008). To succeed, a plaintiff seeking a preliminary injunction must establish the
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`following: (1) a likelihood of success on the merits, (2) a likelihood of irreparable injury to the
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`plaintiff if injunctive relief is not granted, (3) a balance of hardships favoring the plaintiff, and (4)
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`advancement of the public interest. Id. (citations omitted). 2
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`III.
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` Discussion
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`SalesTraq seeks a preliminary injunction on the basis that it will likely succeed on its claims
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`for copyright infringement, breach of a nonexclusive license, and commercial appropriation. The
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`court now turns to each of these claims in turn.
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`A. Copyright Infringement
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`To establish a prima facie case of copyright infringement, a plaintiff must demonstrate the
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`following: “(1) ownership of the allegedly infringed material and (2) violation by the alleged
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`Prior to Winter, the Ninth Circuit also applied an alternative, “sliding-scale” test. The Court in Winter
`did not discuss the continued validity of the this sliding scale approach. However, in light of the Winter
`decision, the Ninth Circuit has indicated, “To the extent our cases have suggested a lesser standard, they are
`no longer controlling, or even viable.” Am. Trucking Associations v. City of Los Angeles, 559 F.3d 1046 (9th
`Cir. 2009). Accordingly, this court will follow the Supreme Court and require Plaintiff to make a showing
`on all four of the preliminary injunction requirements.
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`Case 2:08-cv-01368-LRH-LRL Document 22 Filed 06/10/09 Page 4 of 7
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`infringer of at least one of the exclusive rights granted to copyright holders.” LGS Architects, Inc.
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`v. Concordia Homes, 434 F.3d 1150, 1156 (9th Cir. 2006). The court concludes SalesTraq has
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`failed to show a likelihood of success on its copyright infringement claim. Specifically, SalesTraq
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`has not made an adequate showing under the second prong of a copyright infringement claim:
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`Defendants’ violation of one of the exclusive rights granted to SalesTraq by a copyright in the
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`Information Content.
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`The court will assume for purposes of SalesTraq’s motion that the Information Content is
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`copyrightable expression by its coordination or arrangement of facts concerning the location, age,
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`builder, alternative floor plans, and builder associated with each floor plan. See Feist Publications,
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`Inc. v. Rural Tel. Serv. Co., 499 U.S. 340, 357-58 (1991) (stating that facts may be copyrightable
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`when they are selected, coordinated, or arranged in an original manner). SalesTraq has failed to
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`show, however, that Defendants copied SalesTraq’s coordination or arrangement of these
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`underlying facts. See id. at 361 (stating that not all copying is copyright infringement); 4 Melville
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`B. Nimmer & David Nimmer, Nimmer on Copyright § 13.01[B] (2009) (stating that even if a
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`defendant copied a plaintiff’s work, the question still remains whether the copying gives rise to
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`liability for infringement).
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`Defendants, of course, acknowledge that devMLS.com displays the Information Content in
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`the form of floor plan numbers or model numbers. Crucially, however, Defendants also present
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`uncontroverted evidence, that the numeric Information Content has no significance for a
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`devMLS.com user. (See Second Supplemental Decl. of Joseph A. Zyskowski (#18) ¶ 14.) Indeed,
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`it appears the Information Content serves only as a means for searching facts on SalesTraq’s
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`database. (See Murphy Aff. (#16) Ex. 1 ¶ 6) (“The Information Content thus reduces into
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`numerical form, easily searchable via computer algorithm, several different types of information
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`that may be important to people searching the SalesTraq compilation . . . .”). Thus, while the
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`Information Content may serve as a designator for a creative arrangement or coordination of facts
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`Case 2:08-cv-01368-LRH-LRL Document 22 Filed 06/10/09 Page 5 of 7
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`at salestraq.com, based on the present record, the court finds the Information Content is merely an
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`unprotected set of arbitrary numbers in the context of devMLS.com. See e.g., Toro Co. v. R&R
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`Products Co., 787 F.2d 1208, 1213 (8th Cir 1986) (holding that arbitrarily assigned part numbers
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`are not original expression). SalesTraq has therefore failed to show that Defendants’ copied a
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`protectible element of SalesTraq’s compilation. As such, SalesTraq has not demonstrated a
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`likelihood of success on the merits of its copyright infringement claim.
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`B. Breach of an Implied License
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`Turning now to SalesTraq’s breach of an implied license claim, SalesTraq must prove (1)
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`the parties intended to contract, (2) the parties exchanged promises, and (3) Defendants promised
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`not to place SalesTraq’s content on Defendant’s website. See Smith v. Recrion Corp., 541 P.2d
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`663, 665 (Nev. 1975). Here, although SalesTraq presents invoices indicating that Zyskowski
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`purchased multiple subscriptions to SalesTraq’s services, the court is unable to discern how these
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`documents imply limitations on Defendants’ use of SalesTraq’s compilation. SalesTraq has
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`therefore failed to show a likelihood of success on its breach of an implied license claim.
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`C. Commercial Misappropriation
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`SalesTraq’s evidentiary deficiency also extends to its commercial misappropriation claim.
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`Although Nevada has yet to recognize a claim for misappropriation of non-trade-secret
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`information, the court believes, if presented with the issue, the Nevada Supreme Court would
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`recognize such a claim. Nevada currently recognizes conversion and unjust enrichment, claims
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`closely related to commercial misappropriation. See Mainor v. Nault, 101 P.3d 308, 317 (Nev.
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`2004); Evans v. Dean Witter Reynolds, Inc., 5 P.3d 1043, 1048 (Nev. 2000). Moreover, California,
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`which Nevada has followed when recognizing new commercial tort theories, presently recognizes
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`See U.S. Fidelity & Guar. Co. v. Peterson, 540 P.2d 1070, 1071 (Nev. 1975) (looking to California
`law as persuasive authority for establishing the implied covenant of good faith and fair dealing in the insurance
`context).
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`Case 2:08-cv-01368-LRH-LRL Document 22 Filed 06/10/09 Page 6 of 7
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`a claim for misappropriation of non-trade-secret information. See U.S. Golf Ass’n v. Arroyo
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`Software Corp., 81 Cal. Rptr. 2d 708, 714 (Ct. App. 1999).
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`The current record, however, does not demonstrate SalesTraq is likely to succeed on its
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`claim. A claim for commercial misappropriation consists of the following elements:
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`(a) the plaintiff invested substantial time, skill or money in developing its property; (b)
`the defendant appropriated and used the plaintiff's property at little or no cost to the
`defendant; (c) the defendant’s appropriation and use of the plaintiff's property was
`without the authorization or consent of the plaintiff; and (d) the plaintiff can establish
`that it has been injured by the defendant's conduct.
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`Id. In support of contention that it will succeed on its commercial misappropriation claim,
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`SalesTraq briefly addresses the first three elements but fails to provide any evidence concerning the
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`fourth, that is, whether SalesTraq has been injured by Defendants’ conduct. Rather, SalesTraq
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`avers only that “SalesTraq has been injured, to an extent that discovery will make more clear, by
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`Defendants’ misappropriation, in that SalesTraq has lost potential and existing subscribers to
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`Defendants due to Defendants’ misappropriation.” (Mot. Prelim. Inj. (#16) at 12:6-8.) This
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`assertion, however, without any evidentiary support is insufficient to meet SalesTraq’s burden of
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`showing a likelihood of success on the merits. SalesTraq’s motion for a preliminary injunction is
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`therefore denied.
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`IV.
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`Conclusion
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`SalesTraq’s evidence is sufficient to show that it may ultimately succeed on the merits of
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`this action. Nevertheless, the present record falls short of the burden SalesTraq must meet to
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`warrant issuance of a preliminary injunction. While further discovery may provide the requisite
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`showing, the court cannot grant SalesTraq’s motion based upon the current record.
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`Case 2:08-cv-01368-LRH-LRL Document 22 Filed 06/10/09 Page 7 of 7
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`IT IS THEREFORE ORDERED that SalesTraq’s Motion for Preliminary Injunction (#16)
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`is DENIED.
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`IT IS SO ORDERED.
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`DATED this 10 day of June, 2009.
`th
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`__________________________________
`LARRY R. HICKS
`UNITED STATES DISTRICT JUDGE
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