Court Opinion

ID: 2670724
Source: CourtListenerOpinion
Date Created: 2014-04-21 20:32:26.729618+00
Date Added: 2024-06-11T13:16:56.901079
License: Public Domain

NOT FOR PUBLICATION

                    UNITED STATES COURT OF APPEALS                            FILED
                            FOR THE NINTH CIRCUIT                             APR 21 2014

                                                                          MOLLY C. DWYER, CLERK
                                                                            U.S. COURT OF APPEALS

MERIT HOMES, LLC, an Arizona limited             No. 12-15977
liability company,
                                                 D.C. No. 2:10-cv-02030-SMM
              Plaintiff - Appellant,

  v.                                             MEMORANDUM*

JOSEPH CARL HOMES, LLC, an
Arizona limited liability company; et al.,

              Defendants - Appellees.

                   Appeal from the United States District Court
                            for the District of Arizona
              Stephen M. McNamee, Senior District Judge, Presiding

                        Argued and Submitted April 9, 2014
                            San Francisco, California

Before: KLEINFELD, NGUYEN, and WATFORD, Circuit Judges.

       Plaintiff Merit Homes, LLC, appeals from the district court’s order granting

summary judgment in favor of Defendant Joseph Carl Homes, LLC (“JCH”). We

have jurisdiction pursuant to 28 U.S.C. § 1291. Reviewing de novo, we affirm.

        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
      We need not decide whether an express license was granted by Merit Homes

to National Bank of Arizona (“NBA”), because at a minimum Merit Homes

granted to NBA, and NBA’s successors and assigns, an implied copyright license

to use the Felten Group plans in order to complete the relevant construction

project. “[G]rants of nonexclusive copyright licenses need not be in writing.”

Foad Consulting Grp., Inc. v. Azzalino, 270 F.3d 821, 825 (9th Cir. 2001) (citation

omitted). A “nonexclusive copyright license may be granted orally or by

implication,” id. at 826 (citation omitted), and a nonexclusive license supported by

consideration is irrevocable, Asset Mktg. Sys., Inc. v. Gagnon, 542 F.3d 748, 757

(9th Cir. 2008).

      Merit Homes was one of two members in Arboleda Ranch, LLC, and

contracted with the Felten Group for the Felten Group to provide schematic design

and construction plans for the project. The Construction Loan Agreement between

Arboleda Ranch, with Merit Homes as guarantor, and NBA provided that, “[a]s

additional security for the payment of the Loan, [Arboleda Ranch] hereby

collaterally transfers and assigns to [NBA] . . . all of [Arboleda Ranch]’s right,

title, and interest” to the Felten Group plans. In addition, Arboleda Ranch

expressly warranted and represented that “all rights, title and interest” of “any

                                          2
predecessors to [Arboleda Ranch]’s interest with respect to the [Felten Group

plans]” had “been duly assigned and transferred” to Arboleda Ranch.

      Under the Construction Loan Agreement, NBA had the right to “use the

[Felten Group plans] for any purpose relating to the improvements, including but

not limited to . . . the completion” of the project. Moreover, this right “inure[d] to

the benefit of [NBA], its successors and assigns, including any purchaser upon

foreclosure of the Deed of Trust, [and] any receiver in possession” of the relevant

real property.

      Furthermore, the Construction Deed of Trust granted NBA a security interest

in “[a]ll present and future plans, specifications, [and] drawings.” In the event of

default, NBA had the right to use the “plans and specifications to be used in the

actual construction of the improvements” to complete the project. Upon “default

(and failure to cure, if applicable),” the Construction Deed of Trust also authorized

NBA “and [its] successors and assigns” to use the Felten Group plans.

      Arboleda Ranch, and Merit as guarantor, defaulted on the construction loan.

Therefore, based on the loan provisions discussed above, NBA and its successors

and assigns, including JCH, had at least an implied license to use the Felten Group

plans to complete the project.

      AFFIRMED.

                                           3