Omar Jaso v. Coca Cola Company , 435 F. App'x 346 ( 2011 )

Case: 10-20786 Document: 00511557863 Page: 1 Date Filed: 08/01/2011
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
August 1, 2011
No. 10-20786 Lyle W. Cayce
Clerk
OMAR JASO,
Plaintiff - Appellant
v.
THE COCA COLA COMPANY; THE COCA COLA EXPORT
CORPORATION; MCCANN ERICKSON,
Defendants - Appellees
Appeal from the United States District Court
for the Southern District of Texas
USDC No. 4:10-CV-2423
Before KING, DAVIS, and GARZA, Circuit Judges.
PER CURIAM:*
Plaintiff–Appellant Omar Jaso commenced this lawsuit against
Defendants–Appellees, alleging, inter alia, that they had infringed a copyright
he held in a musical composition by creating a derivative composition that they
used in a widespread advertising campaign. Defendants moved for dismissal of
Jaso’s amended complaint under Federal Rule of Civil Procedure 12(b)(6) on the
basis that Jaso’s claims were barred by the statute of limitations and otherwise
*
Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH CIR.
R. 47.5.4.
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failed to state a claim. In response, Jaso sought to further amend his complaint.
The district court granted Defendants’ motion to dismiss on the basis that Jaso’s
claims were time-barred and refused to allow a further amendment to his
complaint on the basis that those claims, as pled, were also time-barred. We
REVERSE and REMAND for further proceedings as to the claims alleged in
Jaso’s proposed second amended complaint that did not facially occur outside of
the limitations period. We otherwise AFFIRM the judgment of the district court.
I. Factual & Procedural Background
Omar Jaso claims that he composed a musical work entitled “El Juego,”
which he registered with Mexico’s Public Copyright Registry in 1987. Jaso
claims that, in 1994, he learned that The Coca Cola Company (“Coca Cola”) and
The Coca Cola Export Corporation (“Export”) were using a song entitled “Always
Coca-Cola” (“Always”) in an advertising campaign produced by its marketing
company, McCann Erickson (“McCann”) (Coca Cola, Export, and McCann,
collectively, “Defendants”). He alleges that Coca Cola registered “Always” with
the United States Copyright Office in 1994. Jaso alleges that Defendants
derived “Always” from “El Juego” without his permission and that they continue
to use it to market Coca Cola products.
In 1994, Jaso commenced an unsuccessful lawsuit for criminal copyright
infringement against Coca Cola in Mexico. On July 7, 2010, Jaso commenced
this lawsuit against Defendants, alleging that Defendants’ creation and use of
“Always” infringed his copyright in “El Juego” in violation of United States
copyright law, 17 U.S.C. §§ 101, et seq. Additionally, Jaso claimed that: (1) Coca
Cola contributed to copyright infringement by third parties; (2) Defendants
engaged in “racketeering activity” in violation of 18 U.S.C. § 1962(c); (3)
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Defendants’ use of “Always” was unfair competition in violation of the Lanham
Act, 15 U.S.C. § 1125(a), and Texas unfair competition law; (4) Defendants were
unjustly enriched by their use of an unauthorized derivative of “El Juego”; (5)
Defendants conspired to deprive Jaso of his intellectual property in violation of
Texas law; and (6) he was entitled to a declaratory judgment stating that Coca
Cola’s copyright in “Always” was invalid and his copyright in “El Juego” was
valid.
After Jaso filed his first amended complaint,1 Defendants moved to dismiss
all of Jaso’s claims on the basis that they were facially barred by the applicable
statutes of limitations. Defendants argued that Jaso was aware of his claims
against Defendants beginning in 1994, and that the applicable statutes of
limitations for those claims had run. Defendants also argued that none of Jaso’s
claims had been alleged with sufficient factual specificity to establish liability.
Coca Cola and Export attached, as an exhibit to their joint motion to dismiss, a
document purporting to demonstrate that the advertising campaign that used
the song “Always” ended in 2000 and was replaced with a different advertising
campaign. This document was a printout of a webpage entitled “Highlights in
the History of Coca-Cola Television Advertising” (“Highlights Exhibit”) taken
from the Library of Congress’s website.
In response to Defendants’ motion to dismiss, Jaso claimed that the
statutes of limitations should have been equitably tolled because he was unable
to commence his suit against Defendants until he moved to the United States in
2008 and because he had been threatened with death in 2000 if he pursued any
1
Although this was denominated Jaso’s “first amended complaint,” it was, in fact, his
second attempt to amend his complaint because he had failed to properly sign his “amended
complaint.”
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copyright claims against Coca Cola. Jaso simultaneously moved to amend his
complaint, for the third time, proposing what he designated as his Second
Amended Complaint. Jaso argued that the amendment should be allowed
because it incorporated his equitable tolling arguments and provided greater
factual detail for several of his claims.
The district court attempted to resolve all of these issues at an initial
conference on October 22, 2010. Throughout the conference, counsel for Coca
Cola stated as a fact that Coca Cola had used “Always” in marketing ten years
ago but had stopped in approximately 2000.2 Although it is not clear whether
the district court based its decision on the Highlights Exhibit or Defendants’ flat
assertions that their use of “Always” stopped on that date, the district court
accepted that Coca Cola stopped using “Always” in marketing after 2000 and
relied upon this “fact” when making its final decision. The district court rejected
Jaso’s allegations of infringement by Defendants in the first amended complaint
2
At the initial conference, counsel for Coca Cola stated that he personally listened to
“El Juego,” and that “there are a string of . . . seven or eight notes in [‘El Juego’] that have
some similarity to that same seven or eight notes in [‘Always’].” With respect to Defendants’
use of “Always,” the following exchange occurred:
THE COURT: Is Coca-Cola using the music now?
MS. JAMES (Counsel for Jaso): Yes.
....
MR. BABER (Counsel for Coca Cola): Your Honor, to the best of my knowledge,
we are not.
THE COURT: Do you know when, to the best of your knowledge, you stopped?
MR. BABER: Yes, your Honor . . . . [T]his jingle was used in connection with
what was called the “Coca-Cola Always” campaign. The campaign launched in
. . . February 1993 in the US, and it was used up until approximately 2000. So,
10 years ago was when it was used as the marketing/advertising campaign for
the company’s products.
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and proposed second amended complaint that could have occurred after 2000,
reasoning that Jaso did not plead “an act by the person you’re suing . . . within
the limitations period.”
The district court also rejected the equitable tolling arguments that Jaso
asserted in his proposed second amended complaint. The district court was not
persuaded by Jaso’s claim that the statute of limitations should have been tolled
until 2008 when Jaso arrived in the United States, reasoning that Jaso’s absence
from the country did not bar his access to the United States court system. The
district court also concluded that Jaso’s allegations that he and his family had
been threatened with harm in 2000 if he pursued a copyright claim against Coca
Cola did not toll the statute of limitations on his claims. The district court
reasoned that those threats “didn’t last 17 years” and this argument was
“inconsistent with [Jaso] having persisted . . . in his criminal complaint against
Coca Cola [in Mexico].”
The district court concluded that “[t]he time within which Mr. Jaso can
complain about acts between 1993 and 2000 has long ago passed,” and entered
a final judgment in favor of Defendants on all of Jaso’s claims. Jaso now
appeals.
II. Discussion
On appeal Jaso does not challenge the district court’s dismissal of his first
amended complaint as time-barred. Instead, Jaso’s entire argument on appeal
is that he should have been allowed to amend his complaint because the
proposed second amended complaint: (1) alleged unlawful acts by Defendants
within the limitations period; and (2) established Jaso’s entitlement to equitable
tolling of the statute of limitations. Defendants contend that the district court
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properly concluded that Jaso’s proposed second amended complaint was time-
barred on its face because it failed to allege any unlawful acts by Defendants
within the applicable limitations periods.
As discussed above, the district court’s basis for denying Jaso leave to
amend his complaint was the “fact,” which the district court considered
established, that any unlawful acts committed by Defendants ceased in 2000 and
that Jaso’s proposed second amended complaint did not overcome this hurdle.3
This court ordinarily reviews denial of a motion to amend for abuse of discretion.
City of Clinton, Ark. v. Pilgrim’s Pride Corp., 632 F.3d 148, 152 (5th Cir. 2010).
But when, as in this case, “the district court’s denial of leave to amend was based
solely on futility, we apply a de novo standard of review identical, in practice, to
the standard used for reviewing a dismissal under Rule 12(b)(6).” Id. (citation
omitted). Thus, resolution of Jaso’s appeal hinges on the burden of proving the
affirmative defense of limitations at the 12(b)(6) stage. The burden of pleading
and establishing the statute of limitations defense falls upon the defendant. See
FED. R. CIV. P. 8(c)(1).
Under the Rule 12(b)(6) standard of review, this court accepts “all well-
pleaded facts as true and construe[s] the complaint in the light most favorable
to the plaintiff.” In re Great Lakes Dredge & Dock Co., 624 F.3d 201, 210 (5th
Cir. 2010) (citation omitted). A plaintiff typically is not required to plead, in the
complaint, facts that negate an affirmative defense. See Davis v. Ind. State
Police, 541 F.3d 760, 763 (7th Cir. 2008); see also Jones v. Bock, 549 U.S. 199,
216 (2007) (plaintiffs are not required to “specially plead or demonstrate” a
3
Although Defendants’ motion to dismiss also alleged that Jaso’s first amended
complaint otherwise failed to state a claim, the district court’s decision did not rest on that
allegation, and we decline to address it here.
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response to the affirmative defense of failure to exhaust administrative remedies
in a complaint brought under the Prison Litigation Reform Act). Nor did the
pleading standards announced in Bell Atlantic Corp. v. Twombly, 550 U.S. 544(2007), “revise the allocation of burdens concerning affirmative defenses.” Davis,
541 F.3d at 763. With respect to the statute of limitations defense, dismissal at
the 12(b)(6) stage is proper only “where it is evident from the [complaint] that
the action is barred and the [complaint] fail[s] to raise some basis for tolling.”
Jones v. Alcoa, Inc., 339 F.3d 359, 366 (5th Cir. 2003); 5B CHARLES ALAN WRIGHT
& ARTHUR R. MILLER, FEDERAL PRACTICE & PROCEDURE, § 1357 at 714–21 (3d ed.
2004) (“[T]he inclusion of dates in the complaint indicating that the action is
untimely renders it subject to dismissal for failure to state a claim.”). Stated
differently, because an adequately stated claim “ ‘may be supported by showing
any set of facts consistent with the allegations in the complaint,’ ” dismissal for
failure to state a claim based on the statute of limitations defense should be
granted only when “the plaintiff’s potential rejoinder to the affirmative defense
was foreclosed by the allegations in the complaint.” Goodman v. Praxair, Inc.,
494 F.3d 458, 466 (4th Cir. 2007) (en banc) (quoting Twombly, 550 U.S. at 563).
Therefore, to determine whether the district court properly concluded that
allowing Jaso to submit the second amended complaint was futile, we examine
the proposed amendments to determine whether Defendants’ conduct, as alleged,
clearly occurred outside of the limitations period applicable to Jaso’s claims.
A. Jaso’s Copyright Infringement Claim
Jaso contends that the district court’s refusal to allow him to amend his
complaint was in error—and that his complaint should not have been
dismissed—because his proposed second amended complaint alleged that
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Defendants continue to infringe his copyright in “El Juego” to the present day.
Defendants respond that Jaso’s proposed second amended complaint was futile
because it did not allege any acts of infringement within the statutory period and
because Defendants ceased using “Always” to market Coca Cola in 2000.
The parties do not dispute that Jaso’s proposed second amended complaint
alleges that he holds a copyright in “El Juego.”4 As a copyright holder in “El
Juego,” Jaso has the exclusive right, subject to certain limitations, to reproduce
the work, prepare derivative works, distribute copies of the work, and perform
the work publicly. 17 U.S.C. § 106(1)–(6). “Anyone who violates any of the
exclusive rights of the copyright owner . . . is an infringer of the copyright.” 17
U.S.C. § 501(a).
A civil action for copyright infringement must be commenced “within three
years after the claim has accrued.” 17 U.S.C. § 507(b). In this circuit, each act
of infringement gives rise to an independent claim, and the defendant “is only
liable for his acts of infringement committed within three years prior to
[p]laintiff’s lawsuit.” Makedwde Publ’g Co. v. Johnson, 37 F.3d 180, 182 (5th
Cir. 1994) (emphasis removed) (citing Stone v. Williams, 970 F.2d 1043, 1049
(2nd Cir. 1992)); see also 3 MELVILLE B. NIMMER & DAVID NIMMER, NIMMER ON
COPYRIGHT § 12.05[B][1][c], at 12-150.4 (2011) (“If infringement occurred within
three years prior to filing, the action will not be barred even if prior
infringements . . . occurred more than three years previously.”). Therefore, the
district court’s decision to disallow Jaso’s proposed second amended complaint
4
Jaso may be relying, in part, on his Mexican copyright and the Berne Convention. See
17 U.S.C. 104(b); see also 1 MELVILLE B. NIMMER & DAVID NIMMER, NIMMER ON COPYRIGHT
§ 5.07[B], at 5-68 (2011) (“[P]ublished works authored by Berne nationals and domiciliaries
are protected under U.S. copyright law.”).
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was proper if it is evident from the proposed second amended complaint that no
acts of infringement occurred within the limitations period.
Jaso’s first amended complaint stated that the suit was brought to redress
“Defendants’ unlawful production, offering, distribution and sale of commercial
novelt[y] items including but not limited to: calculators, telephones, musical
toys and the like, as well as causing the music to be performed on the internet.”
Jaso also alleged in the first amended complaint that “Defendants produce and
sell commercials and other advertising products containing ‘Always Coca Cola,’
an unauthorized derivative of [‘El Juego’].”
In his proposed amendment, Jaso added the allegation that from “[1]994
to present . . . Coca Cola America copyrighted an unauthorized derivative of El
Juego,” that Coca Cola and Export “distributed the music internationally,” and
that McCann “created unauthorized derivatives for Coca Cola America in
America that were distributed internationally.” Jaso’s proposed second amended
complaint further alleged that Coca Cola sold commercials using the infringing
music through Export to international distributors and received royalties for the
use of “Always.” The proposed second amended complaint also alleged that
McCann distributed the infringing commercial advertisements in Mexico.
We make no finding regarding whether Jaso’s allegations of infringement
from 1994 to present are sufficient to state a claim under ordinary pleading
standards governing a complaint. See Ashcroft v. Iqbal, — U.S. —, 129 S. Ct.
1937, 1949 (2009) (requiring complaint to “contain sufficient factual matter,
accepted as true, to state a claim to relief that is plausible on its face” (citation
and internal quotation marks omitted)). Instead, we focus on the district court’s
stated reason for disallowing Jaso’s proposed amendment to his copyright
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infringement claim: that Jaso did not point to “an act by [Defendants] . . . within
the limitations period.” We conclude that Jaso’s statement in the second
amended complaint describing Defendants’ conduct “in [1]994 to present”
alleges, albeit barely, that Defendants committed some acts of copyright
infringement within three years of filing the complaint. Thus, Jaso’s potential
response to the affirmative defense of the statute of limitations—that specific
acts of infringement occurred within the limitations period—is not “foreclosed
by the allegations in the complaint.” See Goodman, 494 F.3d at 466; cf. EPCO
Carbon Dioxide Prods., Inc. v. JP Morgan Chase Bank, 467 F.3d 466, 471 (5th
Cir. 2006) (dismissal at the 12(b)(6) stage due to statute of frauds defense was
improper because proof of a written contract was not “foreclosed by the face of
[Plaintiff’s] pleadings”).
Defendants argue that Jaso’s allegations of infringement are nevertheless
facially barred by the statute of limitations because the “Always” advertising
campaign ended in 2000, as proven by the Highlights Exhibit. Thus, according
to Defendants, any alleged act of infringement occurred at least ten years before
Jaso filed his complaint, and the claim is barred by the statute of limitations.
This fact does not appear on the face of Jaso’s proposed second amended
complaint. To the extent that the district court relied on the Highlights Exhibit
or Defendants’ assertion that the “Always” advertising campaign ended in 2000,
its acceptance of such a pivotal fact was, to say the very least, flawed.5 See
5
Counsel for McCann urges that this court can take judicial notice of the facts stated
in the Highlights Exhibit. McCann also claims that the facts stated in the Highlights Exhibit
should be accepted because, in its briefing below, McCann asked the district court to take
judicial notice of the Highlights Exhibit, and Jaso did not object. We accept neither
proposition advanced by McCann. First, it is not at all clear from the record that the district
court took judicial notice of the Highlights Exhibit. In deciding that Defendants had ceased
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Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308, 322 (when ruling on
a Rule 12(b)(6) motion, the court may only “consider the complaint in its
entirety, as well as other sources courts ordinarily examine . . . , in particular,
documents incorporated into the complaint by reference, and matters of which
a court may take judicial notice”); see also Sw. Bell Tel. LP v. City of Houston,
529 F.3d 257, 263 (5th Cir. 2008) (“[W]hen deciding, under Rule 12(b)(6),
whether to dismiss for failure to state a claim, the court considers, of course, only
the allegations in the complaint.”). Therefore, the district court erred in
concluding that Jaso’s second amended complaint, on its face, alleged only
infringing conduct outside of the limitations period.6 Defendants raise several
other arguments regarding whether Jaso’s second amended complaint otherwise
fails to state a claim for copyright infringement. We express no opinion on the
validity of those arguments, which the district court should examine on remand.
using “Always” in advertising, the district court made no reference to the Highlights Exhibit,
but, apparently, relied on the flat assertion by counsel for Coca Cola to establish this fact.
Second, although this court has, in the past, taken judicial notice of information posted on a
government website, see, e.g., Kitty Hawk Aircargo, Inc. v. Chao, 418 F.3d 453, 457 (5th Cir.
2005), the Highlights Exhibit—an unattributed, uncited overview of Coca Cola’s television
advertising history—is not a “source[] whose accuracy cannot reasonably be questioned,” FED.
R. EVID. § 201(b). Third, the Highlights Exhibit describes only Coca Cola’s television
advertising history. By contrast, Jaso’s second amended complaint describes a far broader
spectrum of marketing activity by Defendants, so the Highlights Exhibit does not preclude all
of Jaso’s allegations of copyright infringement.
6
For identical reasons, we conclude that the district court should have allowed Jaso to
amend his complaint because his contributory infringement claim against Coca Cola was not
facially barred by the statute of limitations. See Alcatel USA, Inc. v. DGI Techs., Inc., 166 F.3d
772, 790 (5th Cir. 1999) (“A party is liable for contributory infringement when it, with
knowledge of the infringing activity, induces, causes or materially contributes to infringing
conduct of another.”) There is no dispute in this case that the statute of limitations for
contributory copyright infringement is the same as for ordinary copyright infringement, and
Jaso’s claims of contributory copyright infringement are not facially outside of the limitations
period.
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B. Jaso’s RICO Claim
Jaso next contends that the district court’s refusal to allow him to amend
his complaint was in error because his proposed second amended complaint
alleged that Defendants’ infringement of Jaso’s copyright in “El Juego” was
criminal copyright infringement in violation of 18 U.S.C. § 2319, and therefore
constituted an injury caused by a violation of the Racketeer Influenced and
Corrupt Organizations Act (“RICO”). See 18 U.S.C. § 1962(c) (it is “unlawful” to
conduct an “enterprise’s affairs through a pattern of racketeering activity”);
§ 1961(1) (the definition of “racketeering activity” includes a violation of 18
U.S.C. § 2319). A civil action may be brought by “[a]ny person injured in his
business or property” by a § 1962 violation. 18 U.S.C. § 1964(c).
The statute of limitations on a civil RICO claim is four years after the
claim has accrued. Agency Holding Corp. v. Malley-Duff & Assocs., Inc., 483 U.S.
143, 156 (1987). In this circuit, a civil RICO claim accrues on the date “when a
plaintiff knew or should have known of his injury.” Rotella v. Wood, 528 U.S.
549, 553–54 (2000). We also apply a “separate accrual” rule when RICO claims
potentially involve a series of separate injuries. Love v. Nat’l Med. Enters., 230
F.3d 765, 774–75 (5th Cir. 2000). Under this rule, “[w]hen a pattern of RICO
activity causes a continuing series of separate injuries . . . a civil RICO
claim . . . accrue[s] for each injury when the plaintiff discovers, or should have
discovered that injury.” Id. at 773 (citing Bankers Trust Co. v. Rhoades, 859
F.2d 1096, 1102 (2d Cir. 1988)) (emphasis added).
Jaso’s first amended complaint and proposed second amended complaint
alleged that, from 1994 to 2010, Coca Cola, Export, and McCann “comprised an
association of fact . . . by virtue of their affiliation with each other [through] their
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use of the advertisement system to facilitate the illegal distribution of
[i]nfringing commercial advertisements.” Both complaints also stated that,
“[f]rom 1994 through 2010, Coca Cola America engaged in a pattern of
racketeering acts when it repeatedly infringed Jaso’s copyrights by publishing
and distributing internationally commercials containing infringing music as well
as causing the music to be published on the internet.”7 Jaso alleged that he had
been injured by these acts.
Jaso’s second amended complaint supplemented the alleged RICO
violations in the first amended complaint by enumerating fifteen criminal
violations that fell under the definition of “racketeering activity” in § 1961(1).
Several of these allegations involved criminal copyright infringement in violation
of 18 U.S.C. § 2319. Specifically, Jaso alleged that Defendants willfully
infringed his copyrights in “El Juego” in violation of 18 U.S.C. § 2319 when they
“falsely copyrighted and distributed Plaintff’s copyrighted work”; when they
“sold and exported the master commercials containing the infringing works to
foreign entities”; and when they “repeatedly aired and made public on the
internet the Plaintiff’s copyrighted work.”
As with Jaso’s copyright infringement claim, we cannot conclude from the
face of Jaso’s proposed second amended complaint that these alleged acts of
criminal copyright infringement occurred outside of the limitations period.
Reading Jaso’s individual allegations of racketeering activity added in the
second amended complaint in conjunction with his allegations that the
7
Although this allegation appears in the RICO claim portion of Jaso’s complaints and
is not specifically incorporated into his copyright infringement claim, it can also be read as an
allegation of copyright infringement within the limitations period. See Iqbal, 129 S. Ct. at
1961 (evaluating plaintiff’s allegations by “[t]aking the complaint as a whole”).
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racketeering activity occurred from 1994 to 2010, he has alleged that individual
acts of racketeering occurred within the limitations period. Pursuant to this
court’s separate accrual rule, even if Jaso knew RICO violations had occurred in
1994, he could still recover for injuries caused by criminal copyright
infringement that occurred within four years of the date he commenced his
lawuit. See Love, 230 F.3d at 775. Accordingly, the district court erred in
denying Jaso’s motion to amend on the basis that his RICO claim was facially
barred by the statute of limitations.8 We reverse the district court on the statute
of limitations ground at this stage of the proceedings. As stated above, we
pretermit any evaluation of whether Jaso’s second amended complaint has
otherwise properly stated a claim for a violation of § 1962(c).
C. Jaso’s Lanham Act Claim
Jaso next contends that the district court’s refusal to allow him to amend
his complaint was in error because his proposed second amended complaint
alleged violations of the Lanham Act, 15 U.S.C. § 1125(a). Jaso argues that
Defendants “reverse passed off”9 Jaso’s musical composition as their own when
Coca Cola “filed a fraudulent copyright on ‘El Juego’ and affixed a copyright
notice to their use of ‘El Juego’ worldwide.”
The Lanham Act “establishes no limitations period for claims alleging
unfair competition or false advertising.” Conopco, Inc. v. Campbell Soup Co., 95
8
For reasons stated in our discussion of Jaso’s copyright infringement claim, the
district court could not rely on the Highlights Exhibit, or counsel’s assertion that use of
“Always” stopped in 2000, to conclude that Jaso’s RICO claim was facially barred by the
statute of limitations.
9
“Reverse passing off” is a species of Lanham Act violation in which a “producer
misrepresents someone else’s goods or services as his own.” Dastar Corp. v. Twentieth Century
Fox Film Corp., 539 U.S. 23, 27 n.1 (2003).
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F.3d 187, 191 (2d Cir. 1996). Therefore, courts apply the defense of laches to
untimely claims, looking to “the most appropriate or the most analogous state
statute of limitations for laches purposes.” Id. (citation and internal quotation
marks omitted). The parties do not dispute, and we assume for purposes of this
case, that the most analogous Texas statute of limitations for a Lanham Act
claim is the four-year statute of limitations applied to fraud claims under
§ 16.004 of the Texas Civil Practice & Remedies Code. See, e.g., Mary Kay, Inc.
v. Weber, 601 F. Supp. 2d 839, 859–60 (N.D. Tex. 2009) (“In Texas, a Lanham Act
violation is governed by the four year statute of limitations under Texas law.”
(citation and internal quotation marks omitted)). The time period for laches
under the Lanham Act “begins when the plaintiff knew or should have known
of the infringement.” Elvis Presley Enters., Inc. v. Capece, 141 F.3d 188, 205 (5th
Cir. 1998) (citation omitted). The defense of laches requires proof that there was
(1) a “delay in asserting a right or claim”; (2) “that the delay was inexcusable”;
and (3) “that undue prejudice resulted from the delay.” Id. (citation and internal
quotation marks omitted).
Jaso’s delay in asserting his Lanham Act claim may have been
inexcusable: Jaso stated in his complaint that he was aware that the conduct
he has alleged as reverse passing off—obtaining a copyright for
“Always”—occurred in 1994, when he commenced his criminal copyright
infringement claim against Coca Cola. However, Defendants do not contend that
Jaso’s delay in bringing his Lanham Act claim prejudiced them. See Johnson v.
Crown Enters., Inc., 398 F.3d 339, 344 (5th Cir. 2005) (“All that [appellees] argue
is that [the appellant] waited too long [to file]. This argument does not satisfy
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their burden [of proving laches].”).10 Nor does Jaso’s complaint facially establish
any undue prejudice to Defendants from his delay. Accordingly, the district
court erred in concluding that Jaso’s complaint established that Jaso’s Lanham
Act claim was untimely. As with Jaso’s other claims, our decision to remand is
limited to our conclusion that the laches defense is not apparent on the face of
Jaso’s proposed second amended complaint.11
D. Jaso’s Unjust Enrichment Claim
Jaso’s proposed second amended complaint included a claim for unjust
enrichment under Texas law. Jaso has waived any challenge to the district
court’s judgment with respect to this claim, however, by failing to address it on
appeal. See, e.g., Thibault, 612 F.3d at 849 n.7.
10
Other circuits that have addressed laches in the context of a Lanham Act claim have
determined that a delay beyond the limitations period creates the presumption that laches
applies, which the purported owner of the mark must rebut. See Jarrow Formulas, Inc. v.
Nutrition Now, Inc., 304 F.3d 829, 837 (9th Cir. 2002) (collecting cases); see also 6 J. THOMAS
MCCARTHY, MCCARTHY ON TRADEMARKS & UNFAIR COMPETITION, § 31:23 at 31-75–31-78 (4th
ed. 2011). Generally, this court requires the defendant to prove all three elements of the
laches defense, and Defendants have not argued otherwise. Nor do our cases applying laches
in the context of a Lanham Act violation appear to have applied the same presumption as
other circuits. See Elvis Presley Enters., 141 F.3d at 205–06 (stating that laches defense was
unavailable because, even if plaintiff’s delay in bringing Lanham Act claim was inexcusable,
defendants failed to prove undue prejudice from the delay).
11
Jaso’s proposed second amended complaint also alleged a violation of Texas’s unfair
competition law. Jaso has waived this claim by failing to discuss it on appeal. See, e.g.,
Thibault v. Bellsouth Telecomms., Inc., 612 F.3d 843, 849 n.7 (5th Cir. 2010) (holding that
breach of contract claim that was not presented as an issue on appeal was waived).
Furthermore, because this claim is based on Coca Cola’s filing of the “Always” copyright, this
claim is facially barred by the two-year statute of limitations applicable to such a claim. See
Daboub v. Gibbons, 42 F.3d 285, 290–91 (5th Cir. 1995) (stating that a Texas state law claim
for unfair competition was time barred “as the underlying alleged wrongful act took place
[seventeen years before filing suit], when [defendant] acquired a copyright and property
interest in the song”).
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E. Jaso’s Civil Conspiracy Claim
Jaso’s proposed second amended complaint included a claim for civil
conspiracy under Texas law. Jaso makes only two oblique references to this
claim on appeal, neither of which attempts to explain why it was not time-
barred. Accordingly, Jaso has not properly briefed whether the district court
erred in denying him leave to amend this claim, and we do not consider it. See
FED. R. APP. P. 28(a)(9)(A); see also United States v. Scroggins, 599 F.3d 433, 446
(5th Cir. 2010) (“It is not enough to merely mention or allude to a legal theory.”
(citation and internal quotation marks omitted)).
F. Jaso’s Request for a Declaratory Judgment
Jaso argues that his proposed second amended complaint demonstrates
that he was entitled to a declaratory judgment stating that Coca Cola’s copyright
in “Always” was invalid because the copyright Coca Cola filed failed to state that
it was derived from “El Juego.” The district court rejected Jaso’s claim on the
same basis it rejected his other claims, stating that “whatever it was Coca-Cola
did, it did it a long, long time ago.” On appeal, Coca Cola concedes that no
specific statute of limitations applies to Jaso’s request for a declaratory
judgment, and instead it asserts several other bases for denying Jaso declaratory
relief. Because we find that the district court should have allowed Jaso to
amend his complaint as to his claims for copyright infringement, contributory
copyright infringement, RICO violations, and Lanham Act violations, we reverse
and remand to allow the district court to address these arguments in the first
instance.
G. Jaso’s Request for Equitable Tolling
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Jaso next argues that the district court erred in refusing to allow his
proposed second amended complaint because he properly alleged that the statute
of limitations on his claims should have been equitably tolled. Equitable tolling
“applies principally where the plaintiff is actively misled by the defendant about
the cause of action or is prevented in some other extraordinary way from
asserting his rights.” Rashidi v. Am. President Lines, 96 F.3d 124, 128 (5th Cir.
1996). But a plaintiff who “fails to act diligently cannot invoke equitable
principles to excuse that lack of diligence.” Baldwin Cnty. Welcome Ctr. v.
Brown, 466 U.S. 147, 152 (1984) (per curiam); see also Rashidi, 96 F.3d at 128(declining to apply equitable tolling to claim where plaintiff “could have filed his
claim properly with even a modicum of due diligence”).
As the first basis for equitable tolling, Jaso claims that the statute of
limitations on all of his claims should be tolled because, in 2000, Jaso was
“threatened at gunpoint to stop all lawsuits against Coca Cola” and because
“there was a kidnapping attempt against his son in Mexico as well as other
threats of violence against his immediate family.” Broadly speaking, this type
of threat could be viewed as falling under conduct by the defendant that
prevents the plaintiff “in some other extraordinary way from asserting his
rights.” Rashidi, 96 F.3d at 128. Assuming, without deciding, that this conduct
could equitably toll the statute of limitations, it does not do so in this case.
Jaso’s complaint refers only to two instances in which he or his family was
threatened with harm. Both instances occurred in 2000. Proof of threats have
been considered in tolling the statute of limitations only where “the threats
themselves continue up to the point that the plaintiff brings her action.” Baye
v. Diocese of Rapid City, 630 F.3d 757, 762 (8th Cir. 2011); see also Rakes v.
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United States, 442 F.3d 7, 26 (1st Cir. 2006) (plaintiff must demonstrate that
threats leading to duress were continuous before equitably tolling the statute of
limitations); Overall v. Estate of Klotz, 52 F.3d 398, 404 (2d Cir. 1995) (same).
Accordingly, this form of equitable tolling is not available to Jaso, and the
district court correctly rejected its application.12
As a second basis for tolling the statute of limitations, Jaso claims that he
could not commence his lawsuit against Defendants from Mexico and had to wait
until he arrived in the United States in 2008. The district court correctly
rejected this argument. Aside from his physical presence in Mexico, Jaso has not
alleged that any “extraordinary” circumstance prevented him from obtaining
local counsel and commencing his suit against Defendants in the United States.
Furthermore, Jaso arrived in the United States in 2008 and did not commence
his lawsuit against Defendants until July 7, 2010. Jaso has not demonstrated
that he pursued his rights with due diligence, and he cannot invoke equitable
tolling on this ground.13 Thus, the district court properly denied Jaso’s motion
to amend with respect to his equitable tolling claims, and Jaso’s claims based on
12
Relatedly, Jaso appears to claim that Coca Cola threatened him, that these threats
were aided by the Mexican government, and that the threats were “in essence” torture. Thus,
according to Jaso, his claims were brought within the ten-year statute of limitations under the
Alien Tort Claims Act (ATCA), 28 U.S.C. § 1350. See, e.g., Chavez v. Carranza, 559 F.3d 486,
492 (6th Cir. 2009) (applying ten-year statute of limitations from Torture Victims Prevention
Act to ATCA claim based on torture and extrajudicial killing). Jaso has waived this argument
on appeal by failing to raise it below in response to Defendants’ motion to dismiss. See Miller
v. Nationwide Life Ins. Co., 391 F.3d 698, 701 (5th Cir. 2004).
13
Jaso also argues that a hodgepodge of other factors prevented him from timely
commencing his suit against Coca Cola, including the assertions that he suffered from
depression and drug dependency and that he was incarcerated in Mexico for four and one half
months in 2000 on charges that were later dismissed. None of these factors justified tolling
the statute of limitations on any of Jaso’s claims.
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individual acts of copyright infringement, racketeering activity, and violations
of the Lanham Act that occurred outside of the limitations period are barred on
remand.
III. Conclusion
The district court’s judgment denying Jaso leave to amend his complaint
is AFFIRMED as to Jaso’s unjust enrichment, civil conspiracy, and Texas unfair
competition claims, and his request that the statue of limitations on all of his
claims be equitably tolled or be governed by the ATCA. The judgment of the
district court denying Jaso leave to amend his complaint is REVERSED and
REMANDED as to Jaso’s copyright infringement, contributory copyright
infringement, RICO, Lanham Act, and declaratory judgment claims. On
remand, the district court should address Defendants’ arguments as to various
other deficiencies in Jaso’s proposed second amended complaint regarding these
remaining claims. Each party shall bear its own costs.
20