Fahmy v. Jay Z - Big Pimpin' Rule 58 Decision
Fahmy v. Jay Z - Big Pimpin' Rule 58 Decision
2:07-cv-05715-CAS(PJWx)
Title
Date
February 1, 2016
CHRISTINA A. SNYDER
Catherine Jeang
Deputy Clerk
Not Present
Court Reporter / Recorder
N/A
Tape No.
Not Present
Not Present
Proceedings:
I.
On August 31, 2007, plaintiff Osama Ahmed Fahmy (plaintiff) filed suit against
defendants Jay-Z (aka Shawn Carter) (Jay-Z), Timothy Mosley (Mosley), Kyambo
Joshua, Rob Bourdon, Brad Delson, Mike Shinoda, Dave Farrell, Joseph Hahn, Chester
Bennington, Big Bad Mr. Hahn Music, Chesterchaz Publishing, EMI Blackwood Music
Inc., EMI Publishing Ltd., Kenji Kobayashi Music, Lil Lulu Publishing, Machine Shop
Recordings LLC, Marcy Projects Productions II, MTV Networks Enterprises Inc.,
Nondisclosure Agreement Music, Paramount Home Entertainment Inc., Paramount
Pictures Corporation, Radical Media, Rob Bourdon Music, Roc-A-Fella Records LLC,
Timbaland Productions Inc., UMG Recordings Inc., Universal Music and Video
Distribution Inc., and Warner Music Inc., alleging various claims of copyright
infringement. Dkt. 1. In brief, plaintiff alleged that the song Big Pimpin (Big
Pimpin) infringed his rights in the song Khosara, Khosara (Khosara).
On October 21, 2015, the Court granted defendants motion for judgment as a
matter of law. Dkt. 708. In that order, the Court determined that in a 2002 agreement
between plaintiff and Mohsen Mohammed Jaber (Jaber), the owner of an Egyptian
music company, plaintiff had assigned all of his economic rights in Khosara to Jaber. Id.
at 18. The Court also determined that, to the extent plaintiff may have retained any moral
rights in Khosara, those rights arose under Egyptian law and were therefore not
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cognizable as a matter of American law. Id. at 11. Accordingly, the Court concluded as
follows:
In summary, the 2002 Agreement provides that plaintiff assigns the
financial usage rights as stated in the Law No. 82 OF THE YEAR
2002. As of the signing of that agreement, Jaber was solely,
fully, and irrevocably the owner of all of the economic rights in
the Khosara musical composition. Of course, plaintiff retains the
moral rights to the Khosara musical composition. As a matter of
Egyptian law, no contract could ever purport to assign an artist or his
successors moral rights in a work. However, because plaintiff may
only pursue a claim in this court based on infringement of economic
rights, he is not the legal or beneficial owner of an exclusive right
under a copyright for purposes of this suit. Accordingly, plaintiff
does not have standing to bring the instant suit for copyright
infringement.
Id. at 18.
In light of this order, on November 16, 2015, plaintiff filed the instant motion for
entry of a final judgment pursuant to Federal Rule of Civil Procedure 58. Dkt. 713. On
November 23, 2015, defendants filed an opposition, Dkt. 715, and on November 30,
2015, plaintiff filed a reply, Dkt. 716. The Court held a hearing on December 14, 2015.
At the hearing, defendants requested that the Court permit them to file supplemental
briefing addressing whether plaintiff had asserted that he suffered actual damages in this
action. The Court granted this request. Accordingly, on December 18, 2015, defendants
filed a supplemental brief in opposition to plaintiffs motion, Dkt. 724, and on December
24, 2015, plaintiff filed his own supplemental brief, Dkt. 725. Having carefully
considered the parties arguments, the Court finds and concludes as follows.1
On December 28, 2015, defendants filed a request for further oral argument.
However, the Court has already heard oral argument regarding the instant motion and
does not find that additional oral argument is necessary. See also C.D. Cal. L.R. 7-15
(where appropriate and where not required by statute, the Court may dispense with oral
argument on any motion). Accordingly, defendants request is DENIED.
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ANALYSIS
Subject to several exceptions, none of which is relevant here, Federal Rule of Civil
Procedure 58 provides that every judgment must be set out in a separate document. In the
instant motion, and in light of the Courts order granting defendants motion for
judgment as a matter of law, plaintiff requests that the Court enter a final judgment.
Nonetheless, the parties do not agree on the form that this judgment should take.
Principally, the parties dispute whether the Courts prior order finding that plaintiff
lacked standing constituted a dismissal of plaintiffs case on the merits. More
specifically, the parties dispute whether the Court determined that plaintiff lacked
standing as a matter of constitutional standingi.e., Article IIIs requirement of an injury
in factor statutory standingi.e., that he had not demonstrated that he was the owner
of a valid interest in a copyright, the statutory requirement to bring an action pursuant to
the Copyright Act
Constitutional standing derives from the case-or-controversy requirement of
Article III and limits the jurisdiction of federal courts to cases in which the plaintiff has
suffered (1) an injury in fact; (2) that is fairly . . . traceable to the challenged action of
the defendant; and (3) that it is likely, as opposed to merely speculative, that the
injury will be redressed by a favorable decision. Lujan v. Defenders of Wildlife, 504
U.S. 555, 560 (1992) (citations omitted). As courts have recognized, constitutional
standing is an aspect of subject matter jurisdiction and . . . no matter how important the
issue, a court lacking jurisdiction is powerless to reach the merits under Article III of the
Constitution. Fleck & Associates, Inc. v. Phoenix, City of, an Arizona Mun. Corp., 471
F.3d 1100, 1106 n.4 (9th Cir. 2006) (citing Adarand Constructors, Inc. v. Mineta, 534
U.S. 103, 110 (2001)); see also Hollingsworth v. Perry, 133 S.Ct. 2652, 2659 (2013)
(Because we find that petitioners do not have standing, we have no authority to decide
this case on the merits, and neither did the Ninth Circuit.). Accordingly, if the Court
dismissed plaintiffs case for lack of constitutional, i.e. Article III, standing, the Court
would have lacked jurisdiction to reach the merits of plaintiffs case.
By contrast with constitutional standing, the question of statutory standing
involves whether a legislatively conferred cause of action encompasses a particular
plaintiffs claim Lexmark Intern., Inc. v. Static Control Components, Inc., 134 S.Ct.
1377, 1387 (2014). As the Supreme Court has explained, statutory standing does not
implicate subject-matter jurisdiction and instead is generally considered to go to the
merits of a plaintiffs claim. Id. at 1387 n.4. Specifically in the context of the Copyright
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Act, courts have generally held that a finding that a plaintiff does not own a valid interest
in a copyright is properly construed as a determination that a plaintiff lacks statutory, not
constitutional, standing. See, e.g., Minden Pictures, Inc. v. John Wiley & Sons, Inc., 795
F.3d 997 (9th Cir. 2015) ([T]he issue is whether Minden has a statutory right to sue for
infringement under the Copyright Act, which is properly addressed in a motion under
Rule 12(b)(6), not whether Minden has satisfied the requirements of Article III, which is
properly addressed in a motion under Rule 12(b)(1).).
In the instant case, the Court determined that plaintiff had assigned all of his
economic rights in Khosara to Jaber and therefore was not [t]he legal or beneficial
owner of an exclusive right under a copyright. Moreover, in reaching this decision the
Court cited and relied upon the standard set forth in 17 U.S.C. 501(b)the standing
provision of the Copyright Act. Accordingly, the Courts ruling is appropriately
considered as a determination that plaintiff lacked statutory standing.
Nonetheless, plaintiff argues that, under the circumstances of this case, statutory
standing also implicates the Courts jurisdiction under Article III. Specifically, plaintiff
contends that he has never asserted that he suffered any actual damages in this case (such
as lost sales or other economic losses). Therefore, plaintiff argues that the sole injury in
fact asserted in this case was for a violation of plaintiffs statutory rights under the
Copyright Act. Accordingly, in plaintiffs view, when the Court determined that plaintiff
was not the owner of a valid copyright in Khosara, it necessarily determined that the only
injury in fact alleged by plaintiff was not cognizable. In other words, plaintiff argues that
because he asserted only a violation of his statutory rights, and did not assert any actual
damages, the statutory and constitutional standing inquiries effectively merged in this
case.
There is some authority to support plaintiffs argument. For example, in
Righthaven LLC v. Hoehn, 716 F.3d 1166 (9th Cir. 2013), the plaintiff sought only
statutory relief under the Copyright Act and did not assert any actual damages. The
defendant moved either: (a) to dismiss plaintiffs case for lack of standing; or (b) in the
alternative, for summary judgment on the grounds of a claimed fair use defense.
Righthaven LLC v. Hoehn, 792 F. Supp. 2d 1138, 1143-44 (D. Nev. 2011). The district
court determined that the plaintiff did not possess any exclusive rights necessary to
bring suit, and therefore granted the defendants motion to dismiss for lack of standing.
Id. Nonetheless, the district court then went on to address the defendants fair use
defense and concluded that, in the alternative, defendant was also entitled to summary
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judgment on its fair use defense. Id. at 1147, 1151. On appeal, the Ninth Circuit held
that it was an error for the district court to have reached the fair use defense because,
having determined that the plaintiff did not own a cognizable interest in the copyright at
issue, the district court lacked subject matter jurisdiction to reach the merits of the case.
Righthaven, 716 F.3d at 1172. Thus, Righthaven suggests that, where a plaintiff asserts
only a violation of his statutory rights under the Copyright Act, and does not assert any
actual damages, or other injury in fact, a determination as to statutory standing also
implicates the Courts subject matter jurisdiction under Article III. See also Fernandez v.
Brock, 840 F.2d 622, 630 (9th Cir. 1988) ([A] plaintiff who merely claims that a
defendant violated a statutory duty does not necessarily satisfy the requirement of injury
in fact in article III.).
On the other hand, numerous courts have held that a decision regarding statutory
standing under the Copyright Act goes to the merits of a case, rather than the courts
subject-matter jurisdiction. See, e.g., Minden Pictures, Inc., 795 F.3d at 1001;
HyperQuest, Inc. v. NSite Solutions, Inc., 632 F.3d 377, 381 (7th Cir. 2011). And, the
Ninth Circuit has stated that the violation of a statutory right is usually a sufficient
injury in fact to confer standing. Robins v. Spokeo, Inc., 742 F.3d 409, 412 (9th Cir.
2014), cert granted, 135 S.Ct. 1892 (2015); see also Fulfillment Servs. Inc. v. United
Parcel Serv., Inc., 528 F.3d 614, 61819 (9th Cir. 2008) (The injury required by Article
III can exist solely by virtue of statutes creating legal rights, the invasion of which
creates standing. ) (quoting Warth v. Seldin, 422 U.S. 490, 500 (1975)).
However, the Court does not need to determine whether plaintiff may have Article
III standing in the absence of an allegation that he has suffered actual damages, because
plaintiff is incorrect about the allegations he has made in this case. Contrary to plaintiffs
assertion, he has claimed actual damages since the inception of this case. In his
complaint, plaintiff alleged that he had suffered damages and would continue to suffer
damages as a result of defendants alleged infringement. Dkt. 1. Thus, at the time
plaintiff initiated this action he alleged that he had suffered actual damages. See also
NewmanGreen, Inc. v. AlfonzoLarrain, 490 U.S. 826, 830 (1989) (The existence of
federal jurisdiction ordinarily depends on the facts as they exist when the complaint is
filed.); Haro v. Sebelius, 747 F.3d 1099, 1108 (9th Cir. 2013) (We consider whether
the elements of Article III standing, as articulated in Lujan, were satisfied at the time the
complaint was filed.).
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At no point in this case did plaintiff ever dismiss or waive his claim for actual
damages. See Dkt. 531, at 7 (noting that plaintiff had not voluntarily abandoned any
pleaded claims). And plaintiff continued to assert that he had suffered actual damages
throughout this case. See, e.g., Dkt 416, at 22 (Therefore, regardless of Plaintiffs claim
for disgorgement of wrongful profits, Plaintiff requires Defendants financial statements
in order to calculate its actual damagesa form of relief that even Defendants admit
remains available.); Dkt. 433, at 12 (All partiesas well as the Ninth Circuitagree
that a reasonable royalty is a valid measure of actual damages in a copyright case.); Dkt.
531, at 1 (If infringement is proven, then the plaintiff is entitled to his actual damages
suffered as a result of infringement.). Lastly, in the Final Pretrial Conference Order,
plaintiff identified the amount of plaintiffs actual damages as one of the issues to be
tried to the jury. Dkt. 628. Accordingly, from the initiation of this case and continuing
until trial, plaintiff asserted that he was seeking actual damages.
Nonetheless, plaintiff argues that he had abandoned his claim for actual damages
by the time that trial began. Specifically, he notes that, in their motions in limine,
defendants explained that Plaintiff has produced not a single shred of evidence, nor
proffered any lay person or expert testimony, that would support any measure of actual
damages . . . Plaintiff cannot recover actual damages, and should be barred from
attempting to present evidence at this late stage. Dkt. 565, at 1, 3. Plaintiff did not
oppose this motion, Dkt. 582, and the Court granted it, Dkt. 626. Further, plaintiff notes
that, in their proposed jury instructions, none of the parties submitted instructions on
actual damages. See Dkt. 655, 657. However, what is dispositive regarding whether or
not plaintiff waived his claim for actual damages is the Final Pretrial Conference Order,
which unequivocably stated that plaintiff was seeking actual damages. A final pretrial
conference order controls the course of the action unless the court modifies it. Fed. R.
Civ. P. 16(d) (emphasis added); see also El-Hakem v. BJY Inc., 415 F.3d 1068, 1077 (9th
Cir. 2005) (A pretrial order controls the subsequent course of the action unless modified
upon a showing of good cause. ) (citing Zivkovic v. Southern Cal. Edison Co., 302
F.3d 1080, 1087 (9th Cir.2002)). At no point did either party move the Court to modify
the pretrial conference order, and the original order stating that plaintiff was seeking
actual damages remained in effect until the end of this case.
Further, that plaintiff ultimately failed to present evidence of his actual damages at
trial is of little import to the issue of plaintiffs standing under Article III. Rather, the fact
that plaintiff failed to substantiate his alleged claim for actual damages indicates, not that
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plaintiff lacked standing, but that plaintiff did not prevail on the merits of his claim.2
Jurisdiction established at the pleading stage by a claim of injury that is not successfully
challenged at that stage is not lost when at trial the plaintiff fails to substantiate the
allegation of injury; instead the suit is dismissed on the merits. Kohen v. Pac. Inv.
Mgmt. Co. LLC, 571 F.3d 672, 677 (7th Cir. 2009) (Posner, J.); see also Lexmark, 134 S.
Ct. at 1387 n.4 (the absence of a valid (as opposed to arguable) cause of action does not
implicate subject-matter jurisdiction).
Accordingly, when the Court ultimately dismissed this case for lack of statutory
standing, that did not deprive the Court of subject-matter jurisdiction. Rather,
jurisdiction under Article III was independently established because plaintiff claimed,
throughout this case, that he had suffered actual damages as a result of defendants
alleged infringement of Khosara. Numerous courts have found that, where Article III
jurisdiction is independently established, a decision that a plaintiff lacks statutory
standing under the Copyright Act constitutes a decision on the merits. See, e.g., Ray
Charles Found. v. Robinson, 795 F.3d 1109 (9th Cir. 2015); Minden Pictures, Inc., 795
F.3d at 1001; HyperQuest, Inc., 632 F.3d at 381.
Therefore, the Court finds that the judgment in this case should reflect that this
action was decided on the merits and the dismissal of plaintiffs claims should be with
prejudice. See also, HyperQuest, Inc., 632 F.3d at 381 (affirming where district court
determined that plaintiff lacked statutory standing under the Copyright Act and noting
that the [district] court correctly realized that its ruling was one with prejudice); In re
Kohner, 2015 WL 4980435, at*2 (Bankr. D. Ariz. Aug. 19, 2015) (In the Ninth Circuit,
dismissals for lack of statutory standing qualify as Rule 12(b)(6) dismissals for failure to
state a claim and have preclusive effect.) (emphasis added) (citing Vaughn v. Bay Envtl.
Mgmt., Inc., 567 F.3d 1021, 1024 (9th Cir.2009)).
The fact that plaintiff did not present evidence of his actual damages at trial is
also of no consequence to the issue presented by this motion. The Court bifurcated the
damages and liability phase of trial in this case and granted judgment as a matter of law
in favor of defendants at the end of the liability phase of the trial. Accordingly, this case
did not reach the damages phase of trial and neither party presented any evidence
regarding the appropriate measure of plaintiffs damages.
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Moreover, even if it is assumed, arguendo, that plaintiff lacked Article III standing,
and thus that the Court did not have jurisdiction to reach the merits of this case, the
Court would still find that it had jurisdiction to dismiss this case with prejudice as an
exercise of the Courts inherent authority to determine its own jurisdiction. See Steel Co.
v. Citizens for a Better Envt., 523 U.S. 83, 118 (1998) (a court always has jurisdiction
to determine its own jurisdiction) (Stevens, J., concurring) (citing United States v. Mine
Workers, 330 U.S. 258, 290 (1947)). A dismissal for lack of subject-matter jurisdiction
is not a judgment on the merits that precludes a later action on the same claim in a court
that does have subject-matter jurisdiction. But the dismissal does preclude relitigation of
the same jurisdiction issue. 18A Wright & Miller, Federal Practice and Procedure: Civil
Procedure 4336 (2d. ed.); see also Reed v. Columbia St. Marys Hosp., 782 F.3d 331,
335 (7th Cir. 2015) (It is generally true that a dismissal said to be without prejudice for
lack of subject-matter jurisdiction can, through the doctrine of issue preclusion, bar the
invocation of a federal courts subject-matter jurisdiction in a second lawsuit based on the
same facts); Okoro v. Bohman, 164 F.3d 1059, 1063 (7th Cir.1999) (It may seem
paradoxical to suggest that a court can render a preclusive judgment when dismissing a
suit on the ground that the suit does not engage the jurisdiction of the court. But the
paradox is superficial. A court has jurisdiction to determine its own jurisdiction.).
Finally, the Court finds that defendants should be declared the prevailing parties in
this action. [A] prevailing party is one who has been awarded some relief by the
court. Buckhannon Bd. & Care Home, Inc. v. W. Va. Dept of Health & Human Res.,
532 U.S. 598, 603 (2001). Numerous courts in the Ninth Circuit have found that a
defendant who obtains a determination that the plaintiff lacks statutory standing under the
Copyright Act is a prevailing party. See, e.g., Cadkin v. Bluestone, 290 F. Appx 58,
59 (9th Cir. 2008); Maljack Prods., Inc. v. GoodTimes Home Video Corp., 81 F.3d 881,
885, 889 (9th Cir. 1996); Minden Pictures, Inc., 2014 WL 172447, at *8 (N.D. Cal. Apr.
29, 2014); Choyce v. SF Bay Area Indep. Media Ctr., 2014 WL 5597274, at*4 (N.D. Cal.
Nov. 3, 2014). This is exactly the relief defendants obtained here when the Court granted
defendants motion for judgment as a matter of law. Accordingly, defendants are the
prevailing parties in this action.3
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CONCLUSION
In accordance with the foregoing, the Court enters the following final judgment in
this action, which shall be set forth in a separate document pursuant to Rule 58 of the
Federal Rule of Civil Procedure.
Pursuant to the Courts order dated October 21, 2015 granting Defendants Motion
for Judgment as a Matter of Law, Dkt. 708, it is HEREBY ORDERED ADJUDGED
AND DECREED as follows:
(1)
connoted discretion. Fogerty v. Fantasy, Inc., 510 U.S. 517, 533 (1994). The Ninth
Circuit has articulated five non-exclusive factors to consider in determining whether to
grant a prevailing party attorneys fees: [1] the degree of success obtained; [2]
frivolousness; [3] motivation; [4] objective unreasonableness (both in the factual and
legal arguments in the case); and [5] the need in particular circumstances to advance
considerations of compensation and deterrence. Inhale, Inc. v. Starbuzz Tobacco, Inc.,
739 F.3d 446, 449 (9th Cir. 2014) (quoting Jackson v. Axton, 25 F.3d 884, 890 (9th Cir.
1994)). Here, the Court finds it significant that no finding was ever made regarding the
underlying claim of copyright infringement. See also Minden Pictures., 2014 WL
1724478, at *6 ([W]hile Wiley undoubtedly succeeded in this action, the Court finds the
degree of success is mitigated by the fact that no substantive ruling regarding the
underlying question of infringement was made.). Furthermore, as the parties are well
aware, this case involved numerous, complicated questions of Egyptian law, many of
which remained contested until very late stages in this litigation and were crucial to the
Courts finding that plaintiff lacked statutory standing. Under these circumstances, the
Court cannot find that the arguments advanced by plaintiff were objectively
unreasonable, nor can the Court find that plaintiffs claim was frivolous.
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That plaintiffs claims for copyright infringement under the United States
Copyright Act, 17 U.S.C. 101, et seq., and for Unfair Business Practices
under Cal. Bus. Prof. Code 17200 and common law be, and hereby are,
dismissed on the merits in their entirety with prejudice;
(3)
That defendants are the prevailing parties on those claims set forth in
paragraph 2; and
(4)
That this judgment does not address whether plaintiff has the right to assert a
claim for alleged infringement of his foreign moral rights, if any, in any
jurisdiction that recognizes such rights.4
IT IS SO ORDERED.
00
Initials of Preparer
00
CMJ
Defendants request that the Court enter judgment dismissing all defendants who
were originally named in this action. Early in this litigation, in August 2008, the Court
dismissed without prejudice defendants Kyambo Joshua, Lil Lulu Publishing, Marcy
Projects Productions II, Inc., and Radical Media. Dkt. 91. Nonetheless, defendants now
request that the Court enter an order dismissing these defendants with prejudice. Plaintiff
has never sought to rename these defendants in this action and the Court does not find it
appropriate to reassert jurisdiction over these defendants so that the Court may dismiss
them againthis time with prejudice. Accordingly, the judgment entered by the Court
does not include these defendants.
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