Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_13-cv-01108/USCOURTS-casd-3_13-cv-01108-3/pdf.json

Nature of Suit Code: 820
Nature of Suit: Copyright
Cause of Action: 17:101 Copyright Infringement

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

STEVEN M. GARDNER, an

individual,

Plaintiff,

CASE NO. 3:13-cv-1108-GPC-JLB

ORDER:

(1) GRANTING IN PART AND

DENYING IN PART PLAINTIFF’S

MOTION FOR LEAVE TO FILE

SECOND AMENDED

COMPLAINT;

(2) VACATING HEARING DATE

[ECF No. 54]

v.

CAFEPRESS INC., a Delaware

Corporation, et al.,

Defendants.

I. INTRODUCTION

Before the Court is Plaintiff Steven M. Gardner’s (“Plaintiff”) Motion for Leave

to File Second Amended Complaint. (ECF No. 54.) Defendant CafePress, Inc.

(“Defendant”) filed an opposition. (ECF No. 90.) Plaintiff responded. (ECF No. 97.)

The parties have fully briefed the motion. (ECF Nos. 54, 90, 97.) TheCourt finds

the motion suitable for disposition without oral argument pursuant to Civil Local Rule

7.1(d)(1). Upon review ofthe moving papers, admissible evidence, and applicable law,

the Court GRANTS IN PART AND DENIES IN PART Plaintiff’s Motion for Leave

to File Second Amended Complaint. Due to deficiencies in Plaintiff’s Proposed Second

Amended Complaint (the “Proposed SAC”), (ECF No. 54-1), the Court DENIES

Plaintiff leave to file the Proposed SAC. However, the Court GRANTS Plaintiff leave

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to amend his complaint to add the causes of action specified in his motion and cure the

deficiencies noted herein.

II. PROCEDURAL HISTORY

On May 8, 2013, Plaintifffiled a complaint against Defendant alleging copyright

infringement. (ECF No. 1.) On May 13, 2013, Plaintiff filed a first amended complaint

(“FAC”). (ECF No. 3.) On April 4, 2014, Plaintiff filed a second lawsuit in the United

States District Court for the Southern District of California against Defendant and

PrideAndMore, Gardner v. CafePressInc.,No. 3:14-cv-0792-GPC-JLB (“Gardner II”).

(ECF No. 90-2.)

On April 1, 2014, Plaintiff filed a motion for leave to file a second amended

complaint with the Proposed SAC. (ECF No. 54.) On August 15, 2014, Defendant

opposed Plaintiff’s motion. (ECF No. 90.) On August 26, 2014, Defendant filed a

notice of errata to their opposition. (ECF No. 93.) On August 28, 2014, Plaintiff

responded to Defendant’s opposition. (ECF No. 97.)1

III. FACTUAL BACKGROUND

A. First Amended Complaint

On September 14, 2002, Plaintiff allegedly first published a 2-D artwork titled

“Alaska Wildlife.” (ECF No. 3-1.) Effective November 24, 2012, Plaintiff obtained a

registration in Alaska Wildlife from the United States Copyright Office. (Id.); VA 1-

840-780. Plaintiff alleges that Defendant owns and operates https://www.cafepress.com

where items that infringed the Alaska Wildlife copyright were advertised and sold.

(FAC ¶ 6.) Based on the foregoing, Plaintiff alleges one cause of action for copyright

infringement against Defendant. (FAC.)

/ /

Plaintiff’s response also requests that this case be consolidated with Gardner

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II.(ECF No. 97, at 2, 9.) Defendant moved to file a sur-reply to oppose consolidation.

(ECF No. 99.) Plaintiff then filed a separate motion to consolidate, (ECF No. 100), and

the Court denied Defendant’s motion to file a sur-reply as moot, (ECF No. 103.)

Accordingly, the Court will not consider Plaintiff’s request to consolidate in ruling on

this motion to amend.

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B. Proposed Second Amended Complaint

First, the Proposed SAC adds a second cause of action for violation of 17 U.S.C.

§ 1202 (“§ 1202”) against Defendant. (Proposed SAC ¶¶ 31–62.) Second, the Proposed

SAC adds three additional copyrights to the first cause of action for copyright

infringement: (1) “Find 12 Tigers,” VA 1-840-834; (2) “Polar Bears 10 Hidden Bears,”

VA 1-864-127; and (3) “Harmony of Wolves,” VA 1-851-029. (Id. ¶ 8.) Third, the

Proposed SAC adds a new defendant, Lakin Southall (“Southall”), and alleges both

causes of action against Southall. (Id. ¶¶ 8, 23, 48.) Defendant does not oppose the

addition of Southall. (ECF No.90, 10 n.4).

IV. LEGAL STANDARD

Under Federal Rule of Civil Procedure 15(a), leave to amend a complaint after

a responsive pleading has been filed may be allowed by leave of the court and “shall

freely be given when justice so requires.” Foman v. Davis, 371 U.S. 178, 182 (1962);

FED. R. CIV. P. 15(a). Granting leave to amend rests in the sound discretion of the trial

court. Int’l Ass’n of Machinists & Aerospace Workers v. Republic Airlines, 761 F.2d

1386, 1390 (9th Cir. 1985). This discretion must be guided by the strong federal policy

favoring the disposition of cases on the merits and permitting amendments with

“extreme liberality.” DCD Programs Ltd. v. Leighton, 833 F.2d 183, 186 (9th Cir.

1987). “This liberality in granting leave to amend is not dependent on whether the

amendment will add causes of action or parties.” Id.; contra Union Pac. R.R. Co. v.

Nev. Power Co., 950 F.2d 1429, 1432 (9th Cir. 1991).

BecauseRule 15(a) favors a liberal policy, the nonmoving party bearsthe burden

of demonstrating why leave to amend should not be granted. Genentech, Inc. v. Abbott

Labs., 127 F.R.D. 529, 530–31 (N.D. Cal. 1989). In assessing the propriety of

amendment, courts consider several factors: (1) undue delay; (2) bad faith or dilatory

motive; (3) repeated failure to cure deficiencies by amendments previously permitted;

(4) prejudice to the opposing party; and (5) futility of amendment. Foman, 371 U.S. at

182; United States v. Corinthian Colls., 655 F.3d 984, 995 (9th Cir. 2011). These

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factors are not equally weighted; the possibility of delay alone, for instance, cannot

justify denial of leave to amend, DCD Programs, 833 F.2d at 186, but when combined

with a showing of prejudice, bad faith, or futility of amendment, leave to amend will

likely be denied. Bowles v. Reade, 198 F.2d 752, 758 (9th Cir. 1999). The single most

important factor is whether prejudice would result to the nonmovant as a consequence

of the amendment. William Inglis & Sons Baking Co. v. ITT Cont’l Baking Co., 668

F.2d 1014, 1053 (9th Cir. 1981). The party opposing amendment bears the heavy

burden of overcoming the presumption in favor of amendment which arises absent a

demonstration of prejudice or a strong showing of any of the remaining factors. DCD

Programs, 833 F.2d at 186–87.

V. DISCUSSION

For the reasons discussed below, the Court finds that the Foman factors weigh

in favor of granting Plaintiff’s motion to amend. See Foman, 371 U.S. at 182.

A. Undue Delay

The relevant inquiry is whether the delay between when the moving party “knew

or should have known the facts and theories raised by the amendment” and the time of

the amendment is reasonable. Jackson v. Bank of Haw., 902 F.2d 1385, 1388 (9th Cir.

1990) (holding an eight month delay as unreasonable); compare AmerisourceBergen

Corp. v. Dialysist West, Inc., 465 F.3d 946, 953 (9th Cir. 2006) (holding a fifteen

month delay as unreasonable) with Anthony v. Cambra, 236 F.3d 568, 577–78 (9thCir.

2000) (holding a two month delay as reasonable). “Undue delay by itself, however, is

insufficient to justify denying a motion to amend.” Bowles, 198 F.3d at 758.

Plaintiff knew of his causes of action against Defendant and Southall for the

alleged infringement of his three additional copyrights at least as early as June 2013.

(ECF No. 93-1 ¶ 7; ECF No. 93-1, Ex. E.) It also appears that Plaintiff knew or should

have known the facts supporting his § 1202 cause of action at least as of June 2013.

Plaintiff brought this motion to amend in April 2014, at least nine months after he

apparently knew about his cause of action based on the three additional copyrights and

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approximately eleven months after Plaintiff filed suit. The Court finds that Plaintiff

unduly delayed bringing his motion to amend.

B. Bad Faith

Analyzing bad faith requires courts to focus on a moving party’s motives for

bringing an amendment. Foman, 371 U.S. at 182. Bad faith may be found where the

moving party has filed repetitious motionsto amend. Wood v. Santa Barbara Chamber

of Commerce, Inc., 705 F.2d 1515, 1520 (9th Cir. 1983). Bad faith will not be found

where the plaintiff’s allegations are “not frivolous” and where the plaintiff

“endeavor[s] in good faith to meet the [] pleading requirements.” Eminence Capital,

LLC v. Aspeon, Inc., 316 F.3d 1048, 1053 (9th Cir. 2003).

Defendant argues that Plaintiff brings this motion in bad faith to attempt to

“circumvent the Scheduling Order and th[e] Court’s partial summary judgment ruling

precluding the award of statutory damages and attorneys’ fees by filing a separate

lawsuit that mirrors this very action.” (ECF No. 90, at 10.) Defendant argues that

Plaintiffshould have included the causes of action asserted in Gardner II in this motion

to amend. (Id.) Plaintiff has since filed a motion to consolidate, (ECF No. 100), that,

if granted, would accomplish the very thing that Defendant argues Plaintiffshould have

done. Even if Defendant were correct that Plaintiff’s filing of Gardner II was in bad

faith, that alleged bad faith does not somehow impute bad faith to Plaintiff’s present

motion to amend. Accordingly, the Court finds that Plaintiff has not brought this

motion in bad faith.

C. Repeated Failure to Cure Deficiencies

Though the Court’s discretion “to deny leave to amend is particularly broad

where plaintiff has previously amended,”Ascon Properties, Inc. v. Mobil Oil Co., 866

F.2d 1149, 1160 (9th Cir. 1989), the focus is on whether the plaintiff has repeatedly

failed to cure deficiencies in the complaint. See Abagninin v. AMVAC Chem. Corp.,

545 F.3d 733, 742 (9th Cir. 2008) (citing Foman, 371 U.S. at 182). Plaintiff amended

his complaint once—in May 2013—prior to when Defendant argues Plaintiff knew

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about his claims based on the three additional copyrights. (See ECF No. 3; ECF No.

90, at 10 n.4 (arguing that Plaintiff knew about the claims based on the three additional

copyrights “as early as June 2013”).) A single previous amendment, made prior to the

time at which Plaintiff knew about several of the claims that Plaintiff wishes to add,

does not rise to the level of repeated failure to cure deficiencies.

D. Undue Prejudice to Defendant

Undue prejudice to the opposing party is the most important factor in

determining whether leave to amend should be granted. Howey v. United States, 481

F.2d 1187, 1190 (9th Cir. 1973). “Prejudice isthe ‘touchstone of the inquiry under rule

15(a)’” and “carries the greatest weight.” Eminence Capital, 316 F.3d at 1051–52

(citations omitted). In determining whether the opposing party would suffer undue

prejudice, the court considers whether the proposed amendment would “greatly change

the parties’ positions in the action, and require the assertion of new defenses.”

Morongo Band of Mission Indians v. Rose, 893 F.2d 1074, 1079 (9th Cir. 1990).

Defendant does not argue that the three new copyright claims or the addition of

Southall would prejudice Defendant. (See ECF No. 90, at 10 n.4.) However, Defendant

does argue that the addition of the § 1202 cause of action would prejudice it for two

reasons: (1) the timing of Plaintiff’s motion, and (2) that the § 1202 cause of action

significantly differs from the cause of action for copyright infringement. (See ECF No.

90, at 8–9.)

Fact discovery in this case closed on September 4, 2014. (ECF No. 73, at 2.)

Expert discovery in this case closes on November 7, 2014. (Id.) The deadline for

dispositive motions is December 5, 2014. (Id.) While the original hearing date for this

motion to amend was June 27, 2014, (see ECF No. 53), the parties jointly moved to

continue the briefing deadline and hearing date on this motion four times and the Court

granted all four motions. (ECF Nos. 61, 64, 70, 71,76, 77, 82, 84.) Defendant cannot

repeatedly jointly move to continue the briefing deadline and hearing date on this

motion and then argue that those very same dates now prejudice it.

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Moreover, on January 29, 2014, Defendant requested, in the alternative, that

Magistrate Judge Adler stay discovery in this case while Defendant’s summary

judgment motion was pending. (See ECF No. 38, at 9–10.) On February 3, 2014,

Magistrate Judge Adler stayed discovery, (ECF No. 42, at 3), and on May 13, 2014,

Magistrate Judge Adler continued the stay of discovery, (see ECF No. 76, at 2 (citing

ECF No. 74)). Plaintiff filed his motion to amend less than one year after this litigation

commenced, at a time when discovery was stayed, and more than five months before

the close of fact discovery. The Court finds that the timing of Plaintiff’s motion to

amend does not unduly prejudice Defendant and now turns to Defendant’s second

argument that it would be unduly prejudiced.

Plaintiff’s § 1202 cause of action is based on what Defendant does with the

images uploaded by its users that allegedly infringe Plaintiff’s copyright and contain

copyrightmanagement information.Similarly,Plaintiff’s copyright infringement cause

of action is based on what Defendant does with the images uploaded by its users that

allegedly infringe Plaintiff’s copyrights. While these two causes of action are based on

different legal theories, the factual underpinnings of both significantly overlap as they

are both based primarily on what happens to the allegedly infringing works after they

are uploaded to Defendant’s website. Accordingly, the Court also concludes that

neither the difference between Plaintiff’s § 1202 cause of action and Plaintiff’s

copyright infringement cause of action, nor the timing of Plaintiff’s motion, unduly

prejudice Defendant.

E. Futility

The test for determining the futility of an amendment is whether the amendment

can survive a Federal Rule of Civil Procedure 12(b)(6) motion to dismiss. Miller v.

Rykoff-Sexton, Inc., 845 F.2d 209, 214 (9thCir. 1988) (citations omitted); FED.R.CIV.

P. 12(b)(6). While a plaintiff need not give “detailed factual allegations,” a plaintiff

must plead sufficient facts that, if true, “raise a right to relief above the speculative

level.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 545 (2007). “To survive a

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motion to dismiss, a complaint must contain sufficient factual matter, accepted as true,

to ‘state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662,

678 (2009) (quoting Twombly, 550 U.S. at 547). A claim isfacially plausible when the

factual allegations permit “the court to draw the reasonable inference that the defendant

is liable for the misconduct alleged.” Id. In other words, “the non-conclusory ‘factual

content,’ and reasonable inferences from that content, must be plausibly suggestive of

a claim entitling the plaintiff to relief .” Moss v. U.S. Secret Serv., 572 F.3d 962, 969

(9th Cir. 2009). “Determining whether a complaint states a plausible claim for relief

will . . . be a context-specific task that requires the reviewing court to draw on its

judicial experience and common sense.” Iqbal, 556 U.S. at 679.

In reviewing a complaint under Rule 12(b)(6), the court must assume the truth

of all factual allegations and must construe all inferences from them in the light most

favorable to the nonmoving party. Thompson v. Davis, 295 F.3d 890, 895 (9th Cir.

2002); Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 337–38 (9th Cir. 1996). Legal

conclusions, however, need not be taken as true merely because they are cast in the

form of factual allegations. Ileto v. Glock, Inc., 349 F.3d 1191, 1200 (9th Cir. 2003);

W. Mining Council v. Watt, 643 F.2d 618, 624 (9th Cir. 1981).

Plaintiff’s Proposed SAC alleges copyright infringement by Defendant and

Southall. (Proposed SAC ¶¶ 8, 24.) Defendant does not argue that these amendments

to Plaintiff’s first cause of action would be futile and the Court finds that Plaintiff has

pled sufficient facts to support a copyright infringement cause of action based on the

three additional copyrights against Defendant and Southall.

Plaintiff’s Proposed SAC also alleges that Defendant violated § 1202 by

removing copyright management information (“CMI”), including “the name of the

author and/or copyright owner.” (Proposed SAC ¶ 3.) § 1202 creates liability for

persons who “intentionally remove or alter any [CMI],” without the authority of the

copyright owner or the law, or distribute CMI “knowing that the [CMI] has been

removed or altered without authority of the copyright owner or the law.” 17 U.S.C. §

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1202(b). The definition of CMI includes the work’s title, the author’s name, and the

copyright owner’s name, among other information. 17 U.S.C. § 1202(c).

Defendant argues that its letter to Plaintiffshowsthat it “retain[s] metadata from

the original files uploaded by users” to its website and thus Plaintiff cannot allege any

facts to support a § 1202 cause of action. (See ECF No. 93-1, Ex. D.) While this letter

supports the contention that Defendant does keep the metadata in some form, it does

not disprove the allegation that Defendant has removed metadata from at least some of

the files that Defendant distributes.

Plaintiff argues that two declarations—one attached to the motion to amend and

another submitted in opposition to Defendant’s prior summary judgment

motion—support its § 1202 cause of action by showing that Plaintiff can allege facts

showing that Defendant removes or alters CMI or distribute works knowing that CMI

has been removed or altered. (ECF No. 97, at 5 (citing ECF No. 54-3 ¶ 4; ECF No. 32

¶¶ 3–4).) Plaintiff’s proposed § 1202 allegations merely repeat the language of § 1202

and do not contain any factual allegations to support a § 1202 cause of action. (See

Proposed SAC ¶¶ 3, 48–57.) However, the declarations pointed to by Plaintiff do show

that Plaintiff can plead facts sufficient to support a § 1202 cause of action.

Accordingly, the Court finds that amendment is not futile.

While Plaintiff has unduly delayed in seeking amendment, the other four Foman

factors favor Plaintiff and undue delay by itself cannot serve as a basis for denying

leave to amend. See Bowles, 198 F.3d at 758. Accordingly, the Court GRANTS

Plaintiff leave to amend his complaint but DENIES Plaintiff leave to file the Proposed

SAC filed.

VI. CONCLUSION AND ORDER

For the reasons stated above, IT IS HEREBY ORDERED that:

1. Plaintiff’s Motion for Leave to File Second Amended Complaint, (ECF

No. 54), is GRANTED asto leave to amend his complaint, and DENIED

as to leave to file the Proposed SAC;

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2. Plaintiff SHALL FILE an amended complaint with the causes of action

specified in his Motion for Leave to File Second Amended Complaint and

cure any deficiencies noted herein by October 10, 2014; and

3. The hearing set for September 26, 2014 is VACATED.

DATED: September 25, 2014

HON. GONZALO P. CURIEL

United States District Judge

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