Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_13-cv-00109/USCOURTS-casd-3_13-cv-00109-0/pdf.json

Nature of Suit Code: 290
Nature of Suit: Other Real Property Actions
Cause of Action: 28:1331(a) Fed. Question: Real Property

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

DISH NETWORK L.L.C., et al.,

Plaintiffs,

v.

DANIAL PIERCE, et al.,

Defendants.

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Case No. 13-cv-109-L(WVG)

ORDER DISMISSING ACTION

WITHOUT PREJUDICE FOR LACK

OF SUBJECT MATTER

JURISDICTION

On January 15, 2013, Plaintiffs Dish Network L.L.C., Echostar Techologies L.L.C., and

Nagrastar LLC commenced this action to void a fraudulent transfer of an asset by Defendants

Danial Pierce, Sincha Pierce, and Yong Suk Yi, and recover the asset to satisfy a $64.9 million

judgment against Mr. Pierce among others. Plaintiffs file this action based on “ancillary subject

matter jurisdiction” because Plaintiffs seek to enforce a judgment previously entered by this

Court in Dish Network L.L.C. v. Sonicview USA, Inc., No. 09-cv-1553-L(WVG), 2012 WL

1965279 (S.D. Cal. May 31, 2012). (Compl. ¶ 7.)

For the following reasons, the Court finds that Plaintiffs’ complaint is facially deficient

and DISMISSES WITHOUT PREJUDICE this action in its entirety for lack of subject matter

jurisdiction.

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I. LEGAL STANDARD

“Federal courts are courts of limited jurisdiction.” Kokkonen v. Guardian Life Ins. Co. of

Am., 511 U.S. 375, 377 (1994). “They possess only that power authorized by Constitution or a

statute, which is not to be expanded by judicial decree.” Id. (internal citations omitted). “It is to

be presumed that a cause lies outside this limited jurisdiction and the burden of establishing the

contrary rests upon the party asserting jurisdiction.” Id. (internal citations omitted); see also

Abrego Abrego v. The Dow Chem. Co., 443 F.3d 676, 684 (9th Cir. 2006). 

“[A]ncillary jurisdiction typically involves claims by a defending party haled into court

against his will, or by another person whose rights might be irretrievably lost unless he could

assert them in an ongoing action in federal court.” Owen Equip. & Erection Co. v. Kroger, 437

U.S. 365, 376 (1978). “Ancillary jurisdiction may extend to claims having a factual and logical

dependence on ‘the primary lawsuit,’ but that primary lawsuit must contain an independent basis

for federal jurisdiction.” Peacock v. Thomas, 516 U.S. 349, 355 (1996) (citing Owen Equip &

Erection, 437 U.S. at 376) (citations omitted). “The court must have jurisdiction over a case or

controversy before it may assert jurisdiction over ancillary claims.” Id. (citing Mine Workers v.

Gibbs, 383 U.S. 715, 725 (1996)). “In a subsequent lawsuit involving claims with no

independent basis for jurisdiction, a federal court lacks the threshold jurisdictional power that

exists when ancillary claims are asserted in the same proceeding as the claims conferring federal

jurisdiction.” Id. (citing Kokkonen, 511 U.S. at 380-81; H.C. Cook Co. v. Beecher, 217 U.S.

497, 498-99 (1910)). “Consequently, claims alleged to be factually interdependent with and,

hence, ancillary to claims brought in an earlier federal lawsuit will not support federal

jurisdiction over a subsequent lawsuit.” Id.

Although there has not been a request for dismissal, it is well-established that “a district

court’s duty to establish subject matter jurisdiction is not contingent upon the parties’

arguments.” See United Investors Life Ins. Co. v. Waddell & Reed Inc., 360 F.3d 960, 966 (9th

Cir. 2004). Courts may consider the issue sua sponte. Demery v. Kupperman, 735 F.2d 1139,

1149 n.8 (9th Cir. 1984). Indeed, the Supreme Court has emphasized that “district courts have

an ‘independent obligation to address subject-matter jurisdiction sua sponte.’” Grupo Dataflux

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v. Atlas Global Grp., L.P., 541 U.S. 567, 593 (2004) (quoting United States v. S. Cal. Edison

Co., 300 F. Supp. 2d 964, 972 (E.D. Cal. 2004)).

II. ANALYSIS

Sonicview USA involved claims for violations of the Digital Millennium Copyright Act

(“DMCA”), 17 U.S.C. § 1201, the Federal Communications Act (“FCA”), 47 U.S.C. § 605, and

the Electronic Communications Privacy Act, 18 U.S.C. § 2511. In that case, the defendants

distributed piracy devices and software in violation of the DMCA and FCA. Sonicview USA,

2012 WL 1965279, at *7-14. The Court entered judgment in favor of the plaintiffs for

approximately $66 million. Id. at *14. The Court had jurisdiction in that case because it

involved a federal question. Also, only Danial Pierce was a defendant in Sonicview USA among

Defendants in this case.

In this action, Plaintiffs assert only state-law claims against Defendants for Avoidance

and Recovery of Actual and Fraudulent Transfers under California Civil Code §§ 3439.04(a) and

3439.05. The asset in question that was allegedly fraudulently transferred is located at 3156

Lynscott Drive, Marina, California 93933, which is not within the boundaries of the Southern

District of California. Plaintiffs allege that Danial Pierce and Sincha Pierce fraudulently and 1

thus wrongfully transferred this asset from the Pierce Family Trust in their capacities as trustees

to Sincha Pierce and Yong Suk Yi by quitclaim deed with no or nominal consideration paid. 

(Compl. ¶¶ 15–23.)

Once judgment was entered in the original copyright lawsuit, the ability to resolve

simultaneously factually intertwined issues vanished. See Peacock, 516 U.S. at 355. And

neither the convenience of litigants nor considerations of judicial economy can justify the

extension of ancillary jurisdiction over Plaintiffs’ fraudulent-transfer claim. See id.

Furthermore, there is insufficient factual dependence between the claims raised this action and

the Sonicview USA action to justify the extension of ancillary jurisdiction. As discussed above,

 The Court notes that the location of the asset in question suggests there may also be a 1

problem with venue. See 28 U.S.C. § 1391(b).

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this action exclusively involves state-law claims for the fraudulent transfer of an asset, whereas

the original action involved liability under the DMCA and FCA. The claims in these actions

have no factual or logical interdependence, and under these circumstances, no greater

efficiencies would be created by the exercise of federal jurisdiction over them. See Kokkenon,

511 U.S. at 380.

III. CONCLUSION & ORDER

Accordingly, because the complaint does not allege facts necessary to establish subject

matter jurisdiction over this action, the Court DISMISSES WITHOUT PREJUDICE this

action in its entirety for lack of subject-matter jurisdiction. See Peacock, 516 U.S. at 355-56. If

Plaintiffs can correct these deficiencies in the complaint, they may file an amended complaint by

April 8, 2013. See 28 U.S.C. § 1653.

IT IS SO ORDERED.

DATED: March 27, 2013

M. James Lorenz

United States District Court Judge

COPY TO: 

HON. WILLIAM V. GALLO

UNITED STATES MAGISTRATE JUDGE

ALL PARTIES/COUNSEL

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