Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_17-cv-04006/USCOURTS-cand-3_17-cv-04006-4/pdf.json

Nature of Suit Code: 820
Nature of Suit: Copyright
Cause of Action: 28:1338 Copyright Infringement

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UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

REARDEN LLC, et al.,

Plaintiffs,

v.

THE WALT DISNEY COMPANY, et al.,

Defendants.

REARDEN LLC, et al.,

Plaintiffs,

v.

CRYSTAL DYNAMICS, INC., et al.,

Defendants.

REARDEN LLC, et al.,

Plaintiffs,

v.

TWENTIETH CENTURY FOX FILM 

CORPORATION, et al.,

Defendants.

REARDEN LLC, et al.,

Plaintiffs,

v.

PARAMOUNT PICTURES 

CORPORATION, et al.,

Defendants.

Case No. 17-cv-04006-JST 

ORDER GRANTING IN PART AND 

DENYING IN PART DEFENDANTS’ 

MOTIONS TO DISMISS

Re: ECF No. 69

Case No. 17-cv-04187-JST 

Re: ECF No. 65, 79

Case No. 17-cv-04191-JST

Re: ECF No. 46

Case No. 17-cv-04192-JST

Re: ECF No. 45

Case 3:17-cv-04006-JST Document 85 Filed 06/18/18 Page 1 of 12
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Now before the Court are the consolidated motions to dismiss by three defendants in these 

four consolidated cases and a motion for joinder from the fourth defendant. The Court will grant 

the motions to dismiss in part and deny them in part. 

I. BACKGROUND

This action centers on the MOVA Contour Reality Capture Program (“MOVA Contour” or 

“MOVA”), which – as the name suggests – is a program for capturing the motion of the human 

face to create images used in motion pictures. The ownership of this program and related 

hardware (collectively, the “Mova assets”) was contested in an earlier action.1 See Shenzhenshi, et 

al. v. Rearden, et al., No. 15-CV-00797 JST, ECF No. 1 (N.D. Cal. Feb. 20, 2015). On August 

11, 2017, the Court found that Rearden owns the MOVA assets. See Shenzhenshi, et al. v. 

Rearden, et al., No. 15-CV-00797 JST, ECF No. 427 at 18 (N.D. Cal. Aug. 11, 2017).

Plaintiffs Rearden LLC and Rearden Mova LLC (collectively, “Rearden”) now bring these 

actions against Defendants for copyright, patent, and trademark infringement. No. 17-cv-04006 

JST ECF No. 63 (“Disney FAC”); No. 17-cv-04187 JST ECF No. 49 (“Crystal FAC”); No. 17-cv04191 JST ECF No. 41 (“Fox FAC”); No. 17-cv-04192 JST ECF No. 40 (“Paramount FAC”). 

Rearden alleges that the Defendants’ special effects vendor, Digital Domain 3.0 (“DD3”), directly 

infringed patents and the copyright in the MOVA Contour program. See id. Rearden alleges that 

Defendants contracted with DD3 “to provide facial performance capture services and output works 

made with the patented Contour systems and methods and the copyrighted Contour program.” Disney 

FAC ¶ 97. See also Crystal FAC ¶ 94; Fox FAC ¶ 103, Paramount FAC ¶ 91. The Court previously 

issued an order granting in part and denying in part Defendants’ motions to dismiss the complaint. 

Rearden filed amended complaints on March 6, 2018. The studio Defendants – Disney, Fox, and 

Paramount (hereinafter “Defendants”) – move for partial dismissal of the first amended complaint. 

Defendant Crystal Dynamics joins the motion. 

 

1 The Statement of Decision in that action includes a summary of the facts underlying the 

ownership dispute. See Shenzhenshi, et al. v. Rearden, et al., No. 15-CV-00797 JST, ECF No. 

427 (N.D. Cal. Aug. 11, 2017). 

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II. LEGAL STANDARD 

While a complaint need not contain detailed factual allegations, facts pleaded by a plaintiff 

must be “enough to raise a right to relief above the speculative level.” Bell Atl. Corp. v. Twombly, 

550 U.S. 544, 555 (2007). To survive a Rule 12(b)(6) motion to dismiss, a complaint must 

contain sufficient factual matter that, when accepted as true, states a claim that is plausible on its 

face. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). “A claim has facial plausibility when the 

plaintiff pleads factual content that allows the court to draw the reasonable inference that the 

defendant is liable for the misconduct alleged.” Id. While this standard is not a probability 

requirement, “[w]here a complaint pleads facts that are merely consistent with a defendant’s 

liability, it stops short of the line between possibility and plausibility of entitlement to relief.” Id. 

(internal quotation marks and citation omitted). In determining whether a plaintiff has met this 

plausibility standard, the Court must “accept all factual allegations in the complaint as true and 

construe the pleadings in the light most favorable” to the plaintiff. Knievel v. ESPN, 393 F.3d at 

1072. If the motion to dismiss is granted, the court should grant leave to amend “even if no 

request to amend the pleading was made, unless it determines that the pleading could not possibly 

be cured by the allegation of other facts.” Doe v. United States, 58 F.3d 494, 497 (9th Cir. 1995) 

(internal quotation marks and citation omitted). 

III. DISCUSSION

Defendants argue that Rearden’s secondary copyright liability claims for vicarious and 

contributory copyright infringement should be dismissed. ECF No. 69 at 13.2 They also argue 

that Rearden’s amended direct patent infringement claims should be dismissed. Id. at 24. 

A. Vicarious Copyright Infringement

“To succeed in imposing vicarious liability, a plaintiff must establish that the defendant 

exercises the requisite control over the direct infringer and that the defendant derives a direct 

financial benefit from the direct infringement.” Perfect 10, Inc. v. Amazon.com, Inc., 508 F.3d 

1146, 1173 (9th Cir. 2007). Defendants argue that the studios are not vicariously liable for DD3’s 

 

2 Unless otherwise noted, all electronic case filing number citations are to documents filed in 

Rearden LLC, et al., v. The Walt Disney Company, et al., Case No. 17-cv-04006.

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use of unlicensed software because (1) Rearden does not allege that any studio had both the right 

and practical ability to supervise DD3’s use of infringing software and (2) Rearden does not allege 

that any studio obtained a direct financial benefit. ECF No. 69 at 14-18.

1. Requisite Control

“A vicarious infringer ‘exercises control over a direct infringer when he has both a legal 

right to stop or limit the directly infringing conduct, as well as the practical ability to do so.’” 

Williams v. Gaye, 885 F.3d 1150, 1177 (9th Cir. 2018) (quoting Amazon.com, 508 F.3d at 1173). 

First, Defendants argue that Rearden does not plausibly allege that the Studios had the 

right to stop or limit the infringing conduct because Rearden does not allege that any Studio has 

“the contractual right to control the selection or operation of the software DD3 used or otherwise 

had any involvement in the process of operating the equipment that DD3 used to supply its 

services.” ECF No. 69 at 14. Defendants cite Perfect 10, Inc. v. Amazon.com, Inc., 508 F.3d 

1146, 1173-74 (9th Cir. 2007) for this proposition. ECF Nos. 69 at 14; 78 at 7.

In Amazon.com, plaintiff Perfect 10 appealed the denial of a preliminary injunction against 

defendants Amazon.com and Google. Amazon.com, 508 F.3d at 1157. The Ninth Circuit 

evaluated Perfect 10’s arguments that Google was vicariously liable for third-party websites’ 

reproduction, display, and distribution of unauthorized copies of Perfect 10’s images on the 

internet. Id. at 1173. The Ninth Circuit held that Perfect 10 did not demonstrate a likelihood of 

success in establishing that Google had the right and ability to stop or limit the infringing activities 

of third party websites. Id. 1173. The court noted that Google had the contractual right to 

terminate Perfect10’s “Adsense partnership” but that this did not “give Google the right to stop 

direct infringement by third party websites” because “[a]n infringing third-party website can 

continue to reproduce, display, and distribute its infringing copies of Perfect 10 images after its 

participation in the Adsense program has ended.” Id. at 1173-74. 

The Ninth Circuit contrasted Google’s capabilities to those of the swap meet operators in 

Fonovisa, Inc. v. Cherry Auction, Inc., 76 F.3d 259, 262-63 (9th Cir. 1996). In Fonovisa, the 

Ninth Circuit found that a swap meet operator’s “broad contract with its vendors” was sufficient to 

satisfy the control requirement because it “had the right to terminate vendors for any reason 

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whatsoever and through that right had the ability to control the activities of vendors on the 

premises.” Id. at 263. Unlike Fonovisa, Google did not have “contracts with third-party websites 

that empower Google to stop or limit them from reproducing, displaying, and distributing 

infringing copies of Perfect 10's images on the Internet.” Amazon.com, 508 F.3d at 1173. 

The Ninth Circuit also noted that Google was not similarly situated to Napster in A&M 

Records, Inc. v. Napster, Inc., 239 F.3d 1004, 1011 (9th Cir. 2001). “Because Napster had a 

closed system requiring user registration, and could terminate its users' accounts and block their 

access to the Napster system, Napster had the right and ability to prevent its users from engaging 

in the infringing activity of uploading file names and downloading Napster users' music files 

through the Napster system. By contrast, Google cannot stop any of the third-party websites from 

reproducing, displaying, and distributing unauthorized copies of Perfect 10's images because that 

infringing conduct takes place on the third-party websites.” Amazon.com, 508 F.3d at1174 

(internal quotation marks and citations omitted.)

Here, the Studios are more similarly situated to the swap meet operator and Napster. 

Rearden alleges that DD3 provided services pursuant to contracts that gave each studio “the 

unrestricted right to cancel any portion of the Services.” Disney FAC ¶¶ 137, 151, 168; Fox FAC 

¶¶ 133, 146; Paramount FAC ¶¶ 115, 128. Thus, Rearden alleges that the Studios had the right to 

prevent DD3 from engaging in the infringing activity because they had the unrestricted right to 

cancel the use of the MOVA Contour program. Unlike in Amazon.com, where Google only had 

the right to terminate the Adsense partnership—which would not have stopped direct infringement 

by third parties—the studios could have ended the direct infringement by cancelling the use of the 

MOVA Contour program. See Perfect 10, 508 F.3d at 1174. See also Routt v. Amazon.com, Inc., 

584 F. App'x 713, 714-15 (9th Cir. 2014) (“A defendant has control over a third party's infringing 

conduct when the defendant can directly put an end to that conduct.”).

Next, Defendants argue that Rearden “fails to allege that any Studio had the practical 

ability to supervise the loading of MOVA Contour into RAM.” ECF No. 69 at 15. However, 

Rearden alleges that “[Defendants were] in a position to police DD3’s infringing acts. [They] had the 

authority and practical ability to observe and evaluate services provided by DD3 and—if [Defendants]

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deemed those services inadequate, improper, or unlawful—require DD3 to remedy the services or 

cancel DD3’s provision of services to defendants but declined to exercise that right.” Disney FAC ¶¶

137, 168; Fox FAC ¶¶ 133,146; Paramount FAC ¶¶ 115, 128. Thus, Rearden provides factual 

allegations that at least suggest that Defendants had control of DD3 through their ability to observe 

and evaluate DD3’s services. 

Defendants contend that these allegations are not plausible because Rearden “does not 

allege that any Studio had any interaction with the technical aspect of the MOVA Contour system 

or the software itself” and that “all of the practical hands-on involvement” is alleged to have rested 

with DD3. ECF No. 69 at 15. At this stage, however, the Court must “accept all factual 

allegations in the complaint as true.” Knievel, 393 F.3d at 1072. It is not implausible that through 

their observation and evaluation of services, Defendants could have observed the infringing 

activity and directed DD3 to stop using the MOVA Contour program. 3 Therefore, Rearden 

sufficiently alleges “a legal right to stop or limit the directly infringing conduct, as well as the 

practical ability to do so.” Williams, 885 F.3d at 1177 (internal citation and quotation marks 

omitted). 

2. Direct Financial Benefit 

“Financial benefit exists where the availability of infringing material acts as a draw for 

customers.” Ellison v. Robertson, 357 F.3d 1072, 1078 (9th Cir. 2004) (internal quotation marks 

and citations omitted). “[T]he size of the ‘draw’ relative to a defendant's overall business is 

immaterial. Indeed, [t]he essential aspect of the ‘direct financial benefit’ inquiry is whether there 

is a causal relationship between the infringing activity and any financial benefit a defendant reaps, 

regardless of how substantial the benefit is in proportion to a defendant's overall profits.” Perfect 

10, Inc. v. Giganews, Inc., 847 F.3d 657, 673 (9th Cir.), cert. denied, 138 S. Ct. 504, (2017) 

(internal quotation marks and citation omitted). “There is no requirement that the draw be 

substantial.” Ellison, 357 F.3d 1072, 1079 (9th Cir. 2004).

 

3 Vicarious liability “allows imposition of liability when the defendant profits directly from the 

infringement and has a right and ability to supervise the direct infringer, even if the defendant 

initially lacks knowledge of the infringement.” Metro-Goldwyn-Mayer Studios Inc. v. Grokster, 

Ltd., 545 U.S. 913, 931 n.9 (2005). 

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Rearden alleges that Defendants “had an obvious and direct financial interest in 

exploitation of Rearden’s copyright in the Contour program” because they believed that Contour 

performance motion capture would make movie characters more believable which would in turn 

“draw a wider audience to the films.” Disney FAC ¶ 138, 169; Fox FAC ¶ 134; Paramount FAC ¶ 

116. Defendants argue that the relationship “between loading MOVA Contour into RAM and the 

ultimate appearance on screen of ‘believable and compelling’ CG characters that ‘draw a wider 

audience’ to theaters is highly attenuated.” ECF No. 69 at 17. They contend that “Rearden has 

not plausibly alleged that DD3’s use of unlicensed software constitutes a draw for moviegoers, as 

opposed to providing an added benefit to the finished movie.” ECF No. 69 at 18. 

Defendants cite Ellison v. Robertson, 357 F.3d 1072, 1079 (9th Cir. 2004) to support their 

arguments. Notably, in Ellison, the Ninth Circuit considered the lower court’s summary judgment 

dismissal of a copyright infringement action against America Online, Inc. (AOL). Id. at 1074. 

The question before the court was “whether there [was] a triable issue of a material fact regarding 

whether AOL received a direct financial benefit from the copyright infringement.” Id. at 1079. 

Ultimately, the court concluded that plaintiff had not offered enough evidence for a reasonable

juror to find a direct financial benefit. Id.

Here, the Court is not asked whether Rearden has sufficient evidence to create a triable 

issue of material fact. The Court is only asked whether Rearden plausibly alleged a direct 

financial benefit. It has. See Rams v. Def Jam Recordings, Inc., 202 F. Supp. 3d 376, 385 

(S.D.N.Y. 2016) (finding that plaintiffs sufficiently alleged that a recording artist benefited 

financially from the use of a copyrighted portrait on various marketing and advertising materials, 

including the album cover of a hit single and its remixes, despite the attenuated connection 

between the image and the profits

4

); c.f., Thomson v. HMC Grp., No. CV1303273DMGVBKX, 

 

4 The court held that plaintiffs sufficiently alleged that the recording artist, Felton, benefitted 

financially from the infringing activity “[b]ecause the image of Rams with her index finger 

perpendicular to her closed lips is commonly understood to mean “Shh, don't tell,” [therefore] the 

image communicates the title of Felton's song, ‘Don't Tell 'Em.’ As the literal ‘face’ of Felton's single, 

Flemming's portrait of Rams therefore plays a role in the song's, and therefore, Felton's marketability, 

reaping him direct financial benefits in the form of album sales.” Rams, 202 F. Supp. 3d at 385. 

Case 3:17-cv-04006-JST Document 85 Filed 06/18/18 Page 7 of 12
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2014 WL 12589313, at *4 (C.D. Cal. July 25, 2014) (finding that plaintiff had not sufficiently 

alleged that defendant had a financial interest in the infringing activity because he did “not allege 

that the use of his designs acts as a ‘draw’” for [defendant’s] patients).

Therefore, Rearden has sufficiently alleged vicarious copyright infringement. Defendants’ 

motion to dismiss is denied. 

B. Contributory Copyright Liability 

“[A] defendant is a contributory infringer if it (1) has knowledge of a third party's 

infringing activity, and (2) “induces, causes, or materially contributes to the infringing conduct.”

Perfect 10, Inc. v. Visa Int'l Serv. Ass'n, 494 F.3d 788, 795 (9th Cir. 2007). Regarding the first

element, generally speaking, “‘actual knowledge of specific acts of infringement’ is required for 

contributory infringement liability.” Luvdarts, LLC v. AT & T Mobility, LLC, 710 F.3d 1068, 

1072 (9th Cir. 2013) (quoting A&M Records, Inc. v. Napster Inc., 239 F.3d 1004, 1021 (9th Cir. 

2001)).

1. Knowledge

Rearden alleges that Disney “had previously contracted with Rearden and/or its controlled 

entities to provide authorized facial performance capture services and Contour program output 

works . . . and had performed intellectual property due diligence.” Disney FAC ¶ 116. It alleges 

that Disney performed intellectual property due diligence when it contracted with DD3, and based 

upon this due diligence it knew or should have known that DD3 did not have the right to offer or 

provide services and works made using the patented and copyrighted program. Id. Assuming the 

truth of these allegations, it is not an unreasonable inference that Defendants became aware of 

Rearden’s copyright and DD3’s infringing activity before contracting with DD3. As the Court 

previously stated, the allegations are unquestionably thin, but they are enough to survive a motion 

to dismiss.5 

Rearden alleges that Fox and Paramount “had previously contracted with Rearden and its 

 

5 The Court previously noted that it “has its doubts that Disney actually engaged in the kind of 

intellectual property due diligence with either Rearden or DD3 that plaintiff alleges, but 

nonetheless concludes that the allegation survives an Iqbal/Twombly challenge.” See ECF No. 60.

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controlled [entities] to provide authorized [Contour] facial performance capture services and 

Contour program output works.” Fox ¶ 98, 107, 117; Paramount ¶ 92. Significantly, Rearden 

does not allege that Fox and Paramount previously performed due diligence when they directly

contracted with Rearden, but instead simply alleges that “[o]n information and belief, Fox [and 

Paramount] likewise conducted due diligence to determine whether DD3 was authorized to offer 

the Contour system, methods, and Contour program.” Id. The plaintiff may “plead facts ‘alleged 

upon information and belief where the facts are peculiarly within the possession and control of the 

defendant or where the belief is based on factual information that makes the inference of 

culpability plausible.’” Kelsey K. v. NFL Enterprises, LLC, 254 F. Supp. 3d 1140, 1143 (N.D. 

Cal. 2017) (quoting Soo Park v. Thompson, 851 F.3d 910, 928–29 (9th Cir. 2017)). Here, unlike 

with Disney, Rearden does not have any additional factual information about the Paramount and 

Fox allegations to make the inference of culpability plausible. 

However, Rearden does argue that the due diligence allegations are bolstered by

allegations that the studios, through employees and agents, “reviewed color and grayscale Contour 

output works that were consistently and extensively marked with Rearden’s [] copyright notice.” 

Fox ¶ 117; Paramount ¶ 92. Both parties debate the likelihood that a studio representative would 

actually have seen the copyright notice and whether it would adequately alert that employee that 

DD3 was using the software without a license. See ECF No. 69 at 21-22; 74 at 24-26; 78 at 13-14. 

At this early stage, however, the Court must “construe the pleadings in the light most favorable” to 

the plaintiff. Knievel, 393 F.3d at 1072. Even if it is unlikely that a studio representative saw the 

copyright notice, it is not implausible. And it is not implausible that a copyright notice would 

have given the studio representative reason to know of the direct infringement. See Ellison, 357 at 

F.3d at 1076 (“We have interpreted the knowledge requirement for contributory copyright 

infringement to include both those with actual knowledge and those who have reason to know of 

direct infringement.”). 

2. Material Contribution

Rearden also alleges that Defendants, either directly or through an agent, contracted with 

DD3 to provide facial performance capture services and output works using the patented and 

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copyrighted Contour program. Disney FAC ¶ 113 Fox FAC ¶137; Paramount FAC ¶ 119. They 

allege that Defendants “initiated and scheduled each facial performance capture session with DD3 

using the Contour program” and that “[e]ach of the requests for facial performance captures caused 

DD3 to use the Contour program, which created an infringing copy of the program for non-transitory 

duration in the RAM of Contour system computers.” See, e.g., Disney FAC ¶¶ 131, 144, 174, 175; 

Fox FAC ¶¶ 138, 139; Paramount FAC ¶¶ 109, 120, 121.

Defendants argue that “hiring a vendor does not materially contribute to the vendor’s 

infringing use of unlicensed software.” ECF No. 69 at 18. But, Rearden does not simply allege that 

Defendants hired a vendor. It alleges Defendants directed that vendor to use the copyrighted MOVA

program by contracting with DD3 to use the MOVA Contour program. See Med-Sys., Inc. v. 

Masterson Mktg., Inc., No. 11CV695 JLS BLM, 2011 WL 5873399, at *7 (S.D. Cal. Nov. 23, 2011)

(finding that counterclaimant had not adequately alleged material contribution because the 

counterclaimant merely alleged that counter defendant “was involved in all of the contracting with 

[counterclaimant], and not that [counter defendant] took any affirmative steps to foster [] distribution 

and display of the copyrighted materials...[The counterclaimant] must allege that counter defendant

had some involvement in directing the infringing use of the photos in order to state a claim for 

contributory infringement....”)

Defendants argue that “DD3 loaded the Contour software program into computers’ RAM 

without any knowledge, assistance, or encouragement from any Studio” and that “the Studios were not 

directly (or indirectly) involved in DD3’s decision to use the MOVA Contour software program, 

DD3’s alleged decision to use the software without a license, or any of the technical elements of 

DD3’s interactions with the software.” ECF Nos. 69 at 19, 78 at 10. This very well may be true and

Defendants are free to argue at summary judgment or trial that Rearden has not sufficiently 

established that Defendants directed DD3 to use the copyrighted MOVA Contour program. 

However, at this motion to dismiss stage, these allegations plausibly allege that Defendants

induced, caused, or materially contributed to the infringing conduct. See Visa, 494 F.3d at 795.

C. Direct Patent Infringement 

Under the patent law, one is liable for direct infringement if she “without authority makes, 

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uses, offers to sell, or sells any patented invention, within the United States or imports into the 

United States any patented invention during the term of the patent.” 35 U.S.C. § 271(a). In 

Centillion Data Sys., LLC v. Qwest Commc'ns Int'l, Inc., 631 F.3d 1279, 1284 (Fed. Cir. 2011), the 

Federal Circuit held that “to ‘use’ a system for purposes of infringement, a party must put the 

invention into service, i.e., control the system as a whole and obtain benefit from it.” This 

requires “a party . . . to use each and every . . . element of a claimed [system].” Id. However, a 

party is not required to “exercise physical or direct control over each individual element of the 

system.” Id. 

The Federal Circuit has since explained that “[i]n an analysis of a system claim under 

Centillion, proof of an infringing ‘use’ of the claimed system under § 271(a) requires the patentee

to demonstrate that the direct infringer obtained ‘benefit’ from each and every element of the 

claimed system.” Intellectual Ventures I LLC v. Motorola Mobility LLC, 870 F.3d 1320, 1329 

(Fed. Cir. 2017). And, it recently explicitly clarified that Centillion pertained to a situation where 

each party possessed at least some of the elements of the system. Grecia v. McDonald's Corp., 

No. 2017-1672, 2018 WL 1172580, at *3 (Fed. Cir. Mar. 6, 2018).6 

The Court dismissed Rearden’s first direct infringement claim against Disney because 

Rearden did not plausibly allege that Disney used the patented MOVA Contour system under 

Centillion. ECF No. 60. Rearden argues that Centillion applies to its amended complaint because 

the “FACs allege that the components of the claimed system were in the joint possession of 

Defendants and DD3.” ECF No. 74 at 31. Rearden alleges that the contract between DD3 and 

Disney MPG was a “Facility Use and Services Agreement” where DD3 authorized Disney to use 

designated portions of DD3’s facilities in connection with the shoot, subject to supervision by any 

DD3 employee which DD3 may deem appropriate. Disney FAC ¶ 195, 232, 267, 305, 341. DD3 

also alleges that the contract grants Disney the right to cancel any portion of the services subject 

only to the duty to pay for costs and services performed before the allegation and that Disney 

transmitted a request to DD3 to initiate and schedule each performance capture session. Id.

 

6 Pursuant to Ninth Circuit Rule 36-3, Grecia is not precedential. Nevertheless, the Court uses it 

as persuasive authority. 

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¶¶ 196, 233, 268, 306, 342. Finally, Rearden alleges that Disney provided facial performers and 

directors to start and terminate each session, start and stop each take, and to choose “Selects.”

7

 Id.

¶¶ 132-33; 145-46; 163-64; 176-77; 199-200; 236-27; 309-10 345-46. 

These allegations show that Disney contracted with DD3. However, they fail to show that 

that Disney was in possession of any of the elements of the MOVA system.w Therefore, 

Centillion does not apply. 

Without Centillion, Rearden does not provide any authority that it adequately alleges direct 

infringement. Rearden does not argue that it can allege use without possessing any element of the 

claimed system nor does it provide any authority supporting this contention. Rearden having 

twice failed to allege a sufficient direct infringement claim, Defendant’s motion to dismiss that

claim is granted with prejudice. See Salameh v. Tarsadia Hotel, 726 F.3d 1124, 1133 (9th Cir. 

2013) (citation omitted) (“A district court’s discretion to deny leave to amend is ‘particularly 

broad’ where the plaintiff has previously amended.”). 

D. Motions for Joinder 

Defendants in Rearden LLC, et al., v. Crystal Dynamics, Inc., et al., Case No. 17-cv-4187-

JST, filed a motion for joinder in the studio Defendants’ motions to dismiss and reply briefs, ECF 

Nos. 65, 79. The Court grants the motion. 

CONCLUSION

The motions to dismiss the vicarious and contributory copyright infringement claims are 

denied. The motions to dismiss the direct patent infringement claims are granted with prejudice. 

IT IS SO ORDERED.

Dated: June 18, 2018

______________________________________

JON S. TIGAR

United States District Judge

 

7 The FAC defines “Selects” as “the Contour capture takes which were deemed ‘good takes’ by 

the director.” FAC ¶ 133. 

Case 3:17-cv-04006-JST Document 85 Filed 06/18/18 Page 12 of 12