IP/Entertainment Law Weekly Case Update for Motion Picture Studios and Television Networks -- July 25, 2012


Table of Contents

Mandeville-Anthony v. The Walt Disney Company, USCA Ninth Circuit, July 17, 2012
 Click here for a copy of the full decision.

  • Ninth Circuit affirms district court’s grant of judgment on the pleadings in favor of defendants on copyright infringement claims finding, as a matter of law, no substantial similarity between protected elements of plaintiff’s works and the defendants’ “CARS” movies, and that plaintiff’s claim for breach of an implied contract was time-barred under California’s two-year statute of limitations.

Plaintiff Jake Mandeville-Anthony brought suit against defendants The Walt Disney Company, Walt Disney Pictures, Disney Enterprises, Inc., Pixar d/b/a Pixar Animation Studios for copyright infringement and breach of implied contract, alleging that he owns the copyright in two works, Cookie & Co. and Cars/Auto-Excess/Cars Chaos, that defendants had access to those works at the time that they created the animated films CARS and CARS 2, and the spin-off television series Cars Toon, and that defendants used those works to create their works without compensating him.

After answering plaintiff’s complaint, defendants moved for judgment on the pleadings on both plaintiff’s copyright and contract claims, asserting that as a matter of law, the plaintiff’s works were not substantially similar to their films, and their works were independently created. Defendants also raised the two-year statute of limitations as a bar to the breach of implied contract claim. The district court granted defendants’ motion and dismissed plaintiff’s copyright infringement claim without leave to amend, finding that defendants had sufficiently shown that their movies were not substantially similar to plaintiff’s works in their protectable elements such as plot, sequence of events, pace, characters, theme, mood and setting as a matter of law. The court also dismissed plaintiff’s claim for breach of implied contract as time-barred under California’s two-year statute of limitations. The two years begin to run from the date of the alleged breach – in this case, no later than June 2006, the date on which the motion picture CARS was released in theaters – and the statute of limitations expired in June 2008, but plaintiff did not bring suit until March 2011. (Read our summary of the district court’s decision here).

On appeal, the Ninth Circuit affirmed the district court’s dismissal of the copyright claim, finding “no substantial similarity between protected elements of his copyrighted works and comparable elements of the defendants' works as a matter of law, and any similarity in the general concepts of car racing and anthropomorphic cars is unprotected.” The court also affirmed the district court’s dismissal of plaintiff’s breach of implied contact claim as time-barred, noting that that absent evidence of concealment or misrepresentation, a cause of action for breach of contract accrues on the date of injury, rejecting plaintiff’s arguments that “delayed discovery” and “continuing violations” theories applied to extend the statute of limitations.

Dish Network, LLC v. American Broadcasting Companies, Inc., USDC S.D. New York, July 19, 2012
 Click here for a copy of the full decision.

  • New York district court dismisses Dish Network’s declaratory judgment action against several television networks to the extent that it pertains to copyright and contract claims brought by the television networks in a later-filed action in California, finding that, although the New York action was first filed, it was improperly brought in anticipation of the networks’ suit.

Dish Network, LLC (Dish) brought suit against defendants American Broadcasting Companies, Inc., CBS Corp., NBCUniversal Media, Fox Entertainment Group, Inc., Fox television Holdings, Inc., and Fox Cable Network Services, LLC (the networks) seeking declaratory judgment that its new digital video recording service with “PrimeTime Anytime” (PTAT) and “Auto Hop” features did not infringe the networks copyrights or breach Dish’s license agreements with the networks. PTAT allows viewers to record all HD primetime TV programming on the ABC, CBS, Fox, and NBC networks simultaneously and view the shows for up to eight days after they have aired. Auto Hop allows the viewer to skip all commercials during prime time recordings with the touch of a button.

In an article published May 23, 2012, Hollywood Reporter indicated that many of the networks were reviewing their Dish license agreements and consulting with various law firms in anticipation of litigation against Dish. The next day, Dish filed this action for declaratory judgment in the Southern District of New York. Three hours later, several of the networks (although not ABC), brought their copyright infringement action in the Central District of California.

Dish moved for an anti-suit injunction to enjoin the networks from prosecuting their action in California, and the Fox Networks moved to dismiss Dish’s declaratory judgment action as an improper anticipatory suit. CBS and NBCUniversal similarly moved to dismiss, transfer, or stay Dish’s declaratory judgment suit in light of their action in California.

The court granted the networks’ motion to dismiss Dish’s lawsuit as an improper anticipatory suit, rejecting Dish’s argument that its lawsuit was entitled to priority under the “first-filed According to court, the first-filed rule does not apply where the “balance of convenience” favors the later-filed action and “special circumstances” militate in favor of the later action, including cases in which the first action is a declaratory judgment action brought in anticipation of a coercive suit for the purpose of gaining “home field advantage,” where the coercive suit will resolve the issues. The court found that the declaratory judgment action was improperly anticipatory because Dish filed the suit in response to a specific and direct threat of impending litigation, and was improperly anticipatory. The court noted that the Dish complaint was only 13 pages long, failed to identify the relevant copyrights, and did not raise the contractual provisions at issue. In addition, although it was not a party-to-party communication threatening litigation, the Hollywood Reporter article was sufficiently direct in that it indicated that a lawsuit would be filed within a month and identified the networks’ specific claims. Accordingly, the court dismissed those portions of Dish’s complaint pertaining to copyright claims and contract claims raised in the California action, with prejudice, while retaining all copyright and contract claims not raised in the California action.

For more information, please contact Jonathan Zavin at jzavin@loeb.com or at 212.407.4161.

Westlaw decisions are reprinted with permission of Thomson/West. If you wish to check the currency of these cases, you may do so using KeyCite on Westlaw by visiting http://www.westlaw.com/.

Circular 230 Disclosure: To assure compliance with Treasury Department rules governing tax practice, we inform you that any advice (including in any attachment) (1) was not written and is not intended to be used, and cannot be used, for the purpose of avoiding any federal tax penalty that may be imposed on the taxpayer, and (2) may not be used in connection with promoting, marketing or recommending to another person any transaction or matter addressed herein.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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