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Fonovisa, Inc. v. Does 1-9

April 3, 2008

FONOVISA, INC., ET AL., PLAINTIFFS,
v.
DOES 1 - 9, DEFENDANTS.



The opinion of the court was delivered by: Lenihan, M.J.

Magistrate Judge Lisa Pupo Lenihan

Doc. No. 6

OPINION AND ORDER

Currently pending before the Court is Defendant Doe #3's Motion to Vacate the Order Granting Expedited Discovery, Motion to Dismiss the Complaint, Motion to Quash the Subpoena, and Motion to Dismiss for Improper Joinder, which the Court has converted to a Motion for Severance (Doc. No. 6). For the reasons set forth below, the Court will grant Defendant Doe # 3's Motion for Severance, but will deny Defendant Doe #3's remaining motions.

I. FACTUAL BACKGROUND & PROCEDURAL HISTORY

Plaintiffs are sixteen different business entities who claim copyright ownership or exclusive licensing rights under federal copyright law with respect to certain copyrighted sound recordings, some of which are listed in Exhibit A to their Complaint. (Compl. ¶ 23.) Plaintiffs claim valid copyright registration with respect to the sound recordings listed on Exhibit A (collectively the "copyrighted recordings"). (Id.) Plaintiffs instituted the present lawsuit alleging that the Doe Defendants have infringed on their exclusive rights under the Copyright Act, 17 U.S.C. § 101 et seq., to reproduce and distribute the copyrighted recordings to the public. (Compl. ¶ 24.) In particular, Plaintiffs contend that without their consent or authorization, each Defendant has continuously used and continues to use an online media distribution system to download and/or distribute to the public certain of the copyrighted recordings. (Compl. ¶ 25.) Plaintiffs have identified each Defendant only by the Internet Protocol ("IP") address assigned to that Defendant by his or her Internet Service Provider ("ISP") on the date and time of that Defendant's alleged infringing activity. (Compl. ¶ 20.) In order to obtain the actual names and addresses of each Defendant, Plaintiffs filed an Ex Parte Application for Leave to Take Immediate Discovery (Doc. No. 3) ("Ex Parte Application"), and memorandum of law in support thereof (Doc. No. 4). In their Ex Parte Application, Plaintiffs requested leave to serve a Rule 45 subpoena on the Defendants' ISP,*fn1 requesting documents that identify each Defendant's true name, current (and permanent) addresses and telephone numbers, e-mail addresses, and Media Access Control ("MAC") addresses. Plaintiffs contended that this information is necessary to identify the Doe Defendants and allow them to pursue this lawsuit to protect their copyrights against repeated infringement.

In support of this request, Plaintiffs submitted that good cause exists for conducting this limited discovery in advance of a Rule 26(f) conference, where there are no known defendants with whom to confer. According to Plaintiffs, good cause exists here because the Complaint alleges claims of infringement; there is a very real danger the ISP will not preserve the information Plaintiffs seek long enough to be available through the normal discovery process; the discovery requests are narrowly tailored so as not to exceed the minimum information needed to advance this lawsuit or to prejudice Defendants; and expedited discovery will substantially contribute to moving this case forward. In consideration of Plaintiffs' well-founded arguments, the Court entered an Order on December 19, 2007, granting Plaintiffs' Ex Parte Application (Doc. No. 5).

Subsequently, Plaintiffs served a Rule 45 subpoena on the ISP, who apparently notified each of the Doe Defendants of the subpoena and provided them with an opportunity to object prior to complying with the subpoena. (Pls.' Ex Parte Application, at 2 n. 1.) On February 14, 2008, Defendant Doe # 3 ("Doe # 3") filed an objection in the form of several motions, which includes a Motion to Vacate this Court's Order dated December 19, 2007 granting Plaintiffs' Ex Parte Application (Doc. No. 5), a Motion to Quash the Subpoena, a Motion to Dismiss the Complaint pursuant to Rule 12(b)(6), and a Motion to Dismiss the claims against Doe # 3 for improper joinder under Rule 20, all of which are set forth in one document (Doc. No. 6). In light of Doe # 3's motions, the Court entered an order on February 19, 2008, staying the responses to the discovery requests vis a vis Doe # 3 until the Court rules on the pending motions. The Court further ordered Plaintiffs to submit a response to the pending motions, which they did on March 5, 2008. Doe # 3 filed a reply on March 20, 2008 (Doc. No. 10).

The pending motions and Plaintiffs' opposition thereto have been fully briefed and these motions are now ripe for disposition.

II. ANALYSIS

A. Doe # 3's Motion to Dismiss Pursuant to Rule 12(b)(6)

As a preliminary matter, the Court addresses Doe # 3's Motion to Dismiss pursuant to Fed.R.Civ.P. 12(b)(6), since a decision in favor of Doe # 3 would in essence render the other motions moot. Doe # 3 submits that the only exclusive right that could possibly be implicated here is the copyright owner's right to distribution, and Plaintiffs have failed to allege in their Complaint sufficient facts to show that Defendants have actually distributed copies of the copyrighted recordings for the purposes of direct or indirect commercial advantage. Doe # 3 cites a number of cases for the proposition that no infringement occurs of a copyright owner's exclusive distribution rights where the defendant merely offers to distribute or copies the copyrighted material, but does not consummate the sale.*fn2 Plaintiffs counter with citations to authority that hold under almost identical facts that such conduct constitutes "deemed distribution" and therefore infringes a copyright owner's exclusive right to distribute.*fn3 Determination of whether a "distribution" occurred, however, depends on the factual circumstances of the case. At this stage of the litigation, the Court finds that Plaintiffs have alleged sufficient facts regarding "distribution," which must be taken as true, to survive a Rule 12(b)(6) motion.

In deciding a motion to dismiss pursuant to Fed.R.Civ.P. Rule 12(b)(6), the Court must accept as true all allegations of the Complaint and all reasonable factual inferences must be viewed in the light most favorable to the Plaintiffs. Angelastro v. Prudential-Bache Sec., Inc., 764 F.2d 939, 944 (3d Cir. 1985) (citations omitted). The Court, however, need not accept inferences drawn by Plaintiffs if they are unsupported by the facts as set forth in the Complaint. See Cal. Pub. Employees' Ret. Sys. v. Chubb Corp., 394 F.3d 126, 143 (3d Cir. 2004) (citing Morse v. Lower Merion Sch. Dist., 132 F.3d 902, 906 (3d Cir. 1997)). Nor must the Court accept legal conclusions set forth as factual allegations. Bell Atlantic Corp. v. Twombly, 127 S.Ct. 1955, 1965 (2007) (citing Papasan v. Allain, 478 U.S. 265, 286 (1986)). "Factual allegations must be enough to raise a right to relief above the speculative level." Id. (citing 5 C. Wright & A Miller, Federal Practice & Procedure § 1216, pp. 235-36 (3d ed. 2004)). Although the United States Supreme Court does "not require heightened fact pleading of specifics, [the Court does require] enough facts to state a claim to relief that is plausible on its face." Id. at 1974. Thus, a claim will be dismissed under Rule 12(b)(6) if it does not allege "enough facts to state a claim for relief that is plausible on its face." Id.

Recently, the Court of Appeals for the Third Circuit opined as to the impact of the Twombly decision on the pleading standard for purposes of a Rule 12(b)(6) motion:

In light of Twombly, Rule 8(a)(2) requires a "showing" rather than a blanket assertion of an entitlement to relief. We caution that without some factual allegation in the complaint, a claimant cannot satisfy the requirement that he or she provide not only "fair notice, but also the "grounds" on which the claim rests.

Phillips v. County of Allegheny, 515 F.3d 224, 232 (3d Cir. 2008) (citing Twombly, 127 S.Ct. at 1965 n. 3).*fn4 Thus, the Court of Appeals concluded that after Twombly, it is no longer sufficient to merely allege the elements of a cause of action; rather, Twombly requires that the complaint "'allege facts suggestive of [the proscribed] conduct.'" Id. at 233 (citing Twombly, 127 S.Ct. at 1969 n. 8). In summary, "stating . . . a claim requires a complaint with enough factual matter (taken as true) to suggest" the required element. This "does not impose a probability requirement at the ...


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