Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_11-cv-01086/USCOURTS-azd-2_11-cv-01086-3/pdf.json

Nature of Suit Code: 840
Nature of Suit: Trademark
Cause of Action: 15:1125 Trademark Infringement (Lanham Act)

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WO 

IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF ARIZONA 

AFL Telecommunications LLC,

Plaintiff, 

vs. 

SurplusEQ.com, Inc., Tech Sales, LLC, and 

Daniel Parsons and Jane Doe Parsons, 

Defendant.

No. CV11-1086-PHX-DGC

ORDER 

 On January 27, 2012, Plaintiff AFL Telecommunications LLC (“AFL”) filed a 

First Amended Complaint (“FAC”). Doc. 55. Defendants have filed a motion to dismiss 

Count 4. Doc. 56. Plaintiff has responded (Doc. 58) and Defendants have replied 

(Doc. 59). Neither party has requested oral argument. For the reasons that follow, the 

Court will deny the motion. 

I. Background.

 AFL is a wholly-owned subsidiary of Fujikura Ltd. (“Fujikura”), a Japanese 

manufacturer of fiber optic equipment. One of Fujikura’s products is a fusion splicer, a 

device that it sells under the FUJIKURA trademark. AFL is the exclusive North 

American licensee for Fujikura fusion splicers. Defendants sell fusion splicers and 

related equipment online. Each Fujikura fusion splicer contains operating software that is 

installed on the splicers during the manufacturing and licensed in the country to which it 

is shipped. 

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II. Standard.

When analyzing a complaint for failure to state a claim to relief under 

Rule 12(b)(6), the well-pled factual allegations are taken as true and construed in the light 

most favorable to the nonmoving party. Cousins v. Lockyer, 568 F.3d 1063, 1067 (9th 

Cir. 2009) (citation omitted). Legal conclusions couched as factual allegations are not 

entitled to the assumption of truth, Ashcroft v. Iqbal, 129 S. Ct. 1937, 1950 (2009), and 

therefore are insufficient to defeat a motion to dismiss for failure to state a claim, In re 

Cutera Sec. Litig., 610 F.3d 1103, 1108 (9th Cir. 2010) (citation omitted). To avoid a 

Rule 12(b)(6) dismissal, the complaint must plead “enough facts to state a claim to relief 

that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). This 

plausibility standard “is not akin to a ‘probability requirement,’ but it asks for more than 

a sheer possibility that a defendant has acted unlawfully.” Iqbal, 129 S. Ct. at 1949 

(quoting Twombly, 550 U.S. at 556). “[W]here the well-pleaded facts do not permit the 

court to infer more than the mere possibility of misconduct, the complaint has alleged – 

but it has not ‘show[n]’ – ‘that the pleader is entitled to relief.’” Id. at 1950 (quoting Fed. 

R. Civ. P. 8(a)(2)). 

III. Analysis.

 To establish a prima facie case of copyright infringement, a plaintiff must show 

(1) ownership of the allegedly infringed material and (2) a violation of at least one 

exclusive right granted to copyright holders under 17 U.S.C. § 106. A & M Records v. 

Napster, Inc., 239 F.3d 1004, 1013 (9th Cir. 2001). AFL alleges that Defendants 

distributed fusion splicers in the United States which incorporated the Fujikura operating 

software. Defendants make two primary arguments to support dismissal of this claim: 

(1) AFL has not adequately alleged ownership of a valid copyright on the operating 

software at the time of the alleged infringement, and (2) AFL has not adequately alleged 

how Defendants infringed the copyright. 

A. Ownership.

 AFL’s claim of ownership arises from a combination of (1) Fujikura’s ownership 

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of a copyright and (2) Fujikura’s licensing to AFL of the exclusive right to distribute the 

copyrighted work in the United States. A work is copyrightable under the Copyright Act 

when it is original and fixed in a tangible medium. 17 U.S.C. § 102(a). “Original, as the 

term is used in copyright, means only that the work was independently created by the 

author (as opposed to copied from other works), and that it possess at least some minimal 

degree of creativity.” Feist Publ'ns, Inc. v. Rural Tel. Serv. Co., 499 U.S. 340, 345 

(1991). AFL alleges that all versions of the operating software since its creation in 2008 

“constitute original works of authorship that were created by Fujikura employees, who 

wrote the code constituting the software in Japan and within the scope of their 

employment.” Doc. 55 ¶75. An employer owns the copyright to any copyrightable work 

created by employees within the scope of their employment. 17 U.S.C. § 101 (definition 

of “work made for hire”). AFL has sufficiently alleged that the operating software is 

owned by Fujikura and is copyrightable. 

The Copyright Act provides that “no action for infringement . . . shall be instituted 

until preregistration or registration of the copyright claim has been made in accordance 

with this title.” 17 U.S.C. § 411(a). On May 26, 2011, Fujikura obtained U.S. Copyright 

Registration No. TX 7-400-942, which covers version 1.32b of the operating software for 

the splicers. Plaintiff argues that the 2011 copyright registration is insufficient to 

maintain the current action because the alleged infringement occurred in 2009. AFL cites 

two cases which adopt the “effective registration doctrine” and hold that a plaintiff need 

not produce a separate registration relating to a pre-existing work in order to maintain an 

action for infringement of the preexisting work. See Streetwise Maps v. Vandam, Inc., 

159 F.3d 739, 747 (2d Cir. 1998) (holding that “the registration certificate relating to the 

derivative work . . . will suffice to permit [the plaintiff] to maintain an action for 

infringement based on defendants’ infringement of the pre-existing work”); Salestraq 

Am., LLC v. Zyskowski, 635 F. Supp. 2d 1178, 1181 (D. Nev. 2009) (holding that a 

registration of a 2008 version of a compilation of floor plans and locations was sufficient 

to maintain an action for infringement of the 2007 unregistered version). 

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Defendants rely on an Eleventh Circuit case which holds that when the registration 

of a work entirely fails to identify the unregistered preexisting work in the copyright 

registration, an action for infringement of the unregistered preexisting work cannot be 

maintained. Oravec v. Sunny Isles Luxury Ventures, L.C., 527 F.3d 1218, 1229-30 (11th 

Cir. 2008). Oravec recognized, however, that cases applying the effective registration 

doctrine all involve “derivative or collective works that incorporated material from 

unregistered preexisting works.” Id. at 1229. 

In this case, the FAC alleges that “[a]lthough each new numbered version [of the 

operating software] incorporates some original, copyrightable content not included in the 

immediately preceding version, all versions share substantial original, copyrightable 

content.” Doc. 55 ¶ 76. It is reasonable to infer from this allegation that each successive 

version incorporates the preceding versions. Given this allegation, the Court concludes 

that the law stated in Streetwise and Salestraq should be applied in this case. In addition 

to those cases, other courts have held that registration of a derivative work permits legal 

actions on preceding versions of the work. See, e.g., In re Indep. Serv. Orgs. Antitrust 

Litig., 964 F. Supp. 1469, 1473 (D. Kan. 1997) (holding that registration of derivative 

service manuals and software was sufficient to allow infringement claim based on 

preexisting works authored by same party); Greenwich Film Prods. v. DRG Records, 

Inc., 833 F. Supp. 248, 251-52 (S.D.N.Y. 1993) (holding that registration for motion 

picture was sufficient to cover musical compositions contained therein where plaintiff 

owned copyrights in both); 2 Melville B. Nimmer & David Nimmer, Nimmer on 

Copyright § 7.16[B][2][c] (2008) (“When the same party owns the derivative or 

collective work plus the underlying elements incorporated therein, its registration of the 

former is sufficient to permit an infringement action on the underlying parts, whether 

they be new or preexisting.”) (citation and internal quotation marks omitted)). 

The Court also notes that in Oravec the plaintiff sought to assert copyright 

infringement of unregistered three-dimensional models of an architectural work based on 

registration of architectural drawings. 527 F.3d at 1230. In Streetwise, the plaintiff was 

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asserting infringement of prior unregistered street maps based on a registration of a later 

version of the same map. 159 F.3d at 747. The allegations in the FAC suggest that an 

updated version of the splicer operating software is more like the street maps in 

Streetwise – some or all of the prior versions are still part of the work. 

The FAC alleges that Fujikura “grants to AFL the right to bring suit for 

infringement, including infringement claims existing as of the date of the agreement.” 

Doc. 55 ¶ 77. AFL argues that this allegation is sufficient to allow AFL to pursue an 

infringer for infringement that occurred prior to the assignment. The Court agrees. See 

Co-Opportunities, Inc. v. Nat’l Broadcasting Co., Inc., 510 F. Supp. 43, 46-47 (N.D. Cal. 

1981) (assignment of existing causes of action entered into after commencement of 

litigation was valid to transfer accrued claims back to the filing of the complaint). 

2. Infringement.

Defendants argue that AFL does not plausibly allege how they violated any 

exclusive and protectable right. In particular, Defendants argue that it is impossible to 

determine whether the products that it allegedly sold included the original aspects of the 

copyrighted software or even part of the software. AFL has alleged that Defendants 

distributed fusion splicers in the U.S. which incorporated Fujikura’s operating software. 

Doc. 55 ¶ 78. The exclusive rights granted to a copyright owner are found in § 106 of the 

Copyright Act, and include the exclusive right to distribute the copyrighted work. 17 

U.S.C. § 106(3). Accepting AFL’s allegations as true, as the Court must at this stage, 

AFL has adequately alleged a violation of its exclusive right to distribute. 

 IT IS ORDERED that Defendants motion to dismiss (Doc. 56) is denied. 

Dated this 9th day of April, 2012. 

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