Righthaven, LLC v. Majorwager.com, Inc.

In a copyright infringement action, court rejects defendant’s motion to dismiss, finding that plaintiff did not own the copyright at the time of the infringement.

Plaintiff, owner of a copyrighted newspaper article, sued defendant, a Canadian-based sports betting Web site, for the alleged republication of that article, in violation of copyright law. The article originally appeared in the Las Vegas Review Journal on March 18, 2010. That same day, someone using the name “CLEVFAN” posted the article in the forum section of defendant’s web site. A few days later, Stephens Media LLC, the owner of the Review Journal, assigned ownership of the article to plaintiff as well as the “right to seek redress for past, present and future infringements of copyright.” Plaintiff subsequently registered the copyright with the Library of Congress.

Defendant argued that the court lacked subject matter jurisdiction, because plaintiff received assignment of the article after it was posted on defendant’s site. The court rejected this argument, relying on Silvers v. Sony Pictures Entertainment, Inc. (9th Cir. 2005), holding that an assignor may assign both ownership of a work and the right to sue for past infringements of that work. The court found that the assignment from Stephens Media to plaintiff expressly included the right to sue for past infringements. The relevant assignment language provided for “the right to seek redress for past, present and future infringements of the copyright in and to the (Article).”

Defendant, a Canadian corporation, also argued that the court lacked personal jurisdiction, and that plaintiff could seek full relief in the Canadian courts. Citing Shute v, Carnival Cruise Lines (9th Cir. 1990), the court said that personal jurisdiction in this case could be satisfied upon a three-part showing: (1) that defendant purposely availed itself of the privilege of conducting activities in the forum; (2) that the plaintiff’s claim arises out of that activity; and (3) that the exercise of jurisdiction is reasonable. Purposeful availment, in turn, exists where the “effects” test from the Supreme Court’s decision in Calder v. Jones (1983) is met: defendant must have (1) committed an intentional act that (2) was expressly aimed at the forum state and (3) caused harm that defendant knows is likely to be suffered in the forum state. Citing Columbia Pictures Television v. Krypton Broadcasting of Birmingham, Inc. (9th Cir. 1994), the court said that a willful copyright infringement by a defendant that knows or should know the principal place of plaintiff’s business satisfies the “effects” and purposeful availment tests. The court imputed to defendant the common knowledge that the Review Journal is published in Las Vegas. Thus, plaintiff satisfied the first part of the three-part Shute personal jurisdiction test. The court found the second part to be “easily satisfied” where plaintiff’s claim arises out of the republication of the article. Finally, moving to the third part of the Shute test, the court found the exercise of jurisdiction to be reasonable. The court took into account defendant’s burden of defending itself on foreign soil. However, this burden was outweighed by other factors, including the forum state’s interest in adjudicating a claim alleging damage to Nevada’s largest-circulating newspaper; a U.S. court’s interest in adjudicating violations of U.S. copyright law; and the fact that plaintiff has filed several copyright infringement suits in Nevada federal court, which could efficiently resolve all suits. Thus, the court rejected defendant’s motion to dismiss the case for lack of personal jurisdiction.

The court also rejected defendant’s argument that plaintiff failed to state a claim because it did not allege that an infringement occurred in the United States. Citing Kolbe v. Trudel (D. Ariz. 1996), the court agreed that a copyright suit must be predicated on a violation that occurred in the United States. However, making all inferences in plaintiff’s favor, the court found that the violation likely occurred in the United States since the republication of the article on defendant’s Web site was visible to computer users in the United States.