Nichols v. Club for Growth Action

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
__________________________________
)
ROGER NICHOLS, et al., )
)
Plaintiffs, )
)
v. ) Civil Action No. 16-220 (RMC)
)
CLUB FOR GROWTH ACTION, )
)
Defendant. )
_________________________________ )
OPINION
Club for Growth Action is a political organization that broadcast a 30-second
political advertisement on Wisconsin television and the Internet in September 2015. The
advertisement challenged the record of former-Senator Russ Feingold, who was then running for
re-election against Ron Johnson. Roger Nichols, an individual, and Three Eagles Music, a
division of Roger Nichols, Inc., sue Club for Growth Action, alleging that the advertisement
violated copyrights held by Three Eagles Music and Mr. Nichols’ rights under trademark law.
Club for Growth Action moves to dismiss, arguing that Plaintiffs’ allegations have plead them
out of court by demonstrating that its use of the copyrighted work was fair use. The Court finds
that Plaintiffs have adequately alleged a copyright violation and will not decide the issue of fair
use without discovery. However, Plaintiff has failed to allege adequately a Lanham Act claim.
The motion to dismiss will be granted in part and denied in part.
I. FACTS
Mr. Nichols composed both the lyrics and music of the song Times of Your Life.
Times of Your Life was first recorded in 1975 by Paul Anka. Three Eagles Music (Three Eagles)
is a division of Roger Nichols Music, Inc. and the owner of the copyrights to both the musical
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composition and lyrics of Times of Your Life. The registration numbers of the two copyrights are
EU529514 and EU599114. Three Eagles Music and Mr. Nichols have authorized use of Times
of Your Life in commercials for Kodak and the television show Mad Men.
Club for Growth Action (Club for Growth) is a conservative political action
organization that raises funds and creates advertisements to promote conservative candidates for
public office. In 2015, Club for Growth created two 30-second commercials focused on
challenging former Senator Russ Feingold’s attempt to regain his Senate seat. One commercial
featured Times of Your Life (the Ad). The Ad altered a majority of the lyrics, but did not alter
any of the musical composition for the portion of the song used in the commercial. The
commercial was available on the Internet and aired on television in Wisconsin. “At no time has
the Club obtained, or attempted to obtain, a license, authorization, or other permission from
Three Eagles Music to use or exploit Times of Your Life . . . . Nor did [Mr.] Nichols consent to
allow it to capitalize on his reputation as a songwriter for the purpose of promoting its political
agenda.” Am. Compl. [Dkt. 9] ¶ 22.
Plaintiffs first filed suit in federal court in California. Because Plaintiffs are
Oregon residents, Club for Growth resides in Washington, D.C., and the Ad was aimed at a
Wisconsin political campaign, Club for Growth moved to dismiss for lack of personal
jurisdiction and other pleading failures. Plaintiffs took a voluntary dismissal of their California
complaint and filed a similar Complaint in the District Court for the District of Columbia.
Compl. [Dkt. 1]. Club for Growth moved to dismiss and Plaintiffs filed an Amended Complaint
on April 29, 2016. Am. Compl. [Dkt. 9].
Club for Growth again moved to dismiss for failure to state a claim and because
Plaintiffs’ Complaint alleged facts demonstrating the Ad was fair use. Mot. [Dkt. 10]. Plaintiffs
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opposed, Opp’n [Dkt. 12], and Defendant replied. Reply [Dkt. 14].1 The motion is ripe for
review.2
II. LEGAL STANDARD
A. Motion to Dismiss – Fed. R. Civ. P. 12(b)(6)
Club for Growth moves to dismiss pursuant to Federal Rule of Civil Procedure
12(b)(6) for failure to state a claim. A complaint must be sufficient “to give a defendant fair
notice of what the . . . claim is and the grounds upon which it rests.” Bell Atl. Corp. v. Twombly,
550 U.S. 544, 555 (2007) (internal citations omitted). Although a complaint does not need
detailed factual allegations, a plaintiff’s obligation to provide the grounds of his entitlement to
relief “requires more than labels and conclusions, and a formulaic recitation of the elements of a
cause of action will not do.” Id. The facts alleged “must be enough to raise a right to relief
above the speculative level.” Id. “[A] complaint needs some information about the
circumstances giving rise to the claims.” Aktieselskabet Af 21. Nov. 2001 v. Fame Jeans, Inc.,
525 F.3d 8, 16 n.4 (D.C. Cir. 2008). A complaint must contain sufficient factual matter to state a
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Defendant also filed a Notice of Supplemental Authority, Notice [Dkt. 15], which Plaintiffs
moved to strike. Mot. to Strike [Dkt. 16]. The Court will deny Plaintiffs’ Motion to Strike.
2
Federal District Courts have original, federal-question, subject matter jurisdiction under 28
U.S.C. §§ 1331 and 1338(a) and (b). Section 1338(a) provides that “[t]he district courts shall
have original jurisdiction of any civil action arising under any Act of Congress relating to
patents, plant variety protection, copyrights and trademarks.” 28 U.S.C. § 1338(a). Section
1338(b) provides that “[t]he district courts shall have original jurisdiction of any civil action
asserting a claim of unfair competition when joined with a substantial and related claim under
the copyright, patent, plant variety protection or trademark laws.” Id. § 1338(b). This case
arises under both the federal Copyright Act, 17 U.S.C. § 101 et seq., and the Lanham Act, 15
U.S.C. § 1051 et seq. Therefore, the Court has subject matter jurisdiction pursuant to 28 U.S.C.
§§ 1331 and 1338. The Court also has diversity jurisdiction as the parties are all citizens of
different states (Club for Growth of the District of Columbia, Three Eagles and Mr. Nichols of
Oregon) and the amount in controversy exceeds $75,000. See 28 U.S.C. §§ 1332(a)(1) and
1367(a). Club for Growth asserted that personal jurisdiction and venue were appropriate in the
District of Columbia when the suit was initially filed in California.
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claim for relief that is “plausible on its face.” Twombly, 550 U.S. at 570. When a plaintiff
pleads factual content that allows the court to draw the reasonable inference that the defendant is
liable for the misconduct alleged, then the claim has facial plausibility. Ashcroft v. Iqbal, 556
U.S. 662, 678 (2009). “The plausibility standard is not akin to a ‘probability requirement,’ but it
asks for more than a sheer possibility that a defendant has acted unlawfully.” Id. A court must
treat the complaint’s factual allegations as true, “even if doubtful in fact.” Twombly, 550 U.S. at
555. But a court need not accept as true legal conclusions set forth in a complaint. Iqbal, 556
U.S. at 678.
In deciding a motion under Rule 12(b)(6), a court may consider the facts alleged
in the complaint, documents attached to the complaint as exhibits or incorporated by reference,
and matters about which the court may take judicial notice. Abhe & Svoboda, Inc. v. Chao, 508
F.3d 1052, 1059 (D.C. Cir. 2007). Generally, when a court relies upon matters outside the
pleadings, a motion to dismiss must be treated as one for summary judgment and disposed of
pursuant to Rule 56. See Fed. R. Civ. P. 12(d). “However, where a document is referred to in
the complaint and is central to the plaintiff’s claim, such a document attached to the motion
papers may be considered without converting the motion to one for summary judgment.” Nat’l
Shopmen Pension Fund v. Disa, 583 F. Supp. 2d 95, 99 (D.D.C. 2008) (citation omitted).
The Court requested copies of the Ad and Times of Your Life, as they were
incorporated by reference in the Amended Complaint. See Nov. 14, 2016 Minute Order. Both
Plaintiffs and Defendant provided disks to the Court and objected to the notice and disk of the
opposing party. See Notices and Objections [Dkts. 18-22]. As the Court will deny Defendant’s
motion to dismiss the copyright claim, the Court will also not decide which version of the Ad
and song are appropriate to decide the issue of substantial similarity.
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B. Copyright Infringement
To state a claim for copyright infringement, a plaintiff must allege facts showing
that it owns a registered copyright and that the defendant has taken enough original elements
protected by that copyright to create a substantially similar copy. Feist Publ’ns, Inc. v. Rural
Tel. Serv. Co., 499 U.S. 340, 361 (1991) (ruling that plaintiff must prove “(1) ownership of a
valid copyright, and (2) copying of constituent elements of the work that are original”). The
second part of this standard gets complicated. Copying alone does not prove infringement;
rather, “a plaintiff must establish actionable copying to prevail.” Prunte v. Universal Music
Group, Inc., 699 F. Supp. 2d 15, 22 (D.D.C. 2010) (Prunte II). Both “actual copying and
substantial similarity . . . are clearly required, and the latter inquiry concerns whether actual
copying is legally actionable.” Sturdza v. United Arab Emirates, 281 F.3d 1287, 1295 (D.C. Cir.
2002).
When arguing that a copy has substantial similarity to the original work, a
plaintiff must first identify which aspects of the work are protectable by copyright. “‘[N]o
author may copyright facts or ideas. The copyright is limited to those aspects of the work—
termed “expression”—that display the stamp of the author’s originality.’” Id. (quoting Feist
Publ’ns, 499 U.S. at 350). Once the protectable elements of a work are identified, the
comparison between those protectable elements and the challenged work can be done. See id. at
1296. “‘Substantial similarity’ exists where ‘the accused work is so similar to the plaintiff’s
work that an ordinary reasonable person would conclude that the defendant unlawfully
appropriated the plaintiff’s protectable expression by taking material of substance and value.’”
Id. (citing Country Kids ‘N City Slicks, Inc. v. Sheen, 77 F.3d 1280, 1288 (10th Cir. 1996)).
The plaintiff’s legally protected interest is . . . his interest in the
potential financial returns from his [work] which derive from the lay
public’s approbation of his efforts. The question, therefore, is
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whether defendant took from plaintiff’s works so much of what is
pleasing to the . . . lay . . . audience . . . that defendant wrongfully
appropriated something which belongs to the plaintiff.
Id. (quoting Arnstein v. Porter, 154 F.2d 464, 473 (2d Cir. 1946)). In determining substantial
similarity, a jury compares “not only [] the two works’ individual elements in isolation, but also
[] their overall look and feel.” Id. Works are substantially similar if the “ordinary observer”
would overlook the differences between the two and “regard their aesthetic appeal as the same.”
Id. Because this test often involves “an extremely close question of fact, summary judgment has
traditionally been frowned upon in copyright litigation.” Id. (quoting A.A. Hoehling v. Universal
City Studios, Inc., 618 F.2d 972, 977 (2nd Cir. 1980)); see also Prunte v. Universal Music
Group, 484 F. Supp. 2d 32, 41 (D.D.C. 2007) (Prunte I) (“Substantial similarity is a question
that should be decided either by a factfinder at trial or, in some cases, in the context of a motion
for summary judgment, not on a motion to dismiss for failure to state a claim under Rule
12(b)(6).”).
Even when a work has been copied and the result is substantially similar to the
original, a successful defense of “fair use” will forestall recovery. The doctrine of fair use arises
out of 19th century American common law, see Folsom v. Marsh, 9 F. Cas. 342 (C.C.D. Mass.
1841) (no. 4,901), and has now been codified by Congress. Section 107 of the 1976 Copyright
Act provides:
Notwithstanding the provisions of sections 106 and 106A
[identifying the rights of a copyright holder], the fair use of a
copyrighted work, including such use by reproduction in copies or
phonorecords or by any other means specified by that section, for
purposes such as criticism, comment, news reporting, teaching
(including multiple copies for classroom use), scholarship, or
research, is not an infringement of copyright. In determining
whether the use made of a work in any particular case is a fair use
the factors to be considered shall include –
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(1) the purpose and character of the use, including whether such use
is of a commercial nature or is for nonprofit educational
purposes;
(2) the nature of the copyrighted work;
(3) the amount and substantiality of the portion used in relation to
the copyrighted work as a whole; and
(4) the effect of the use upon the potential market for or value of the
copyrighted work.
The fact that a work is unpublished shall not itself bar a finding of
fair use if such finding is made upon consideration of all the above
factors.
17 U.S.C. § 107. The uses identified in the first paragraph of § 107 only “give some idea of the
sort of activities the courts might regard as fair use under the circumstances . . . . This listing
was not intended to be exhaustive, . . . or to single out any particular use as presumptively a fair
use.” Harper & Row Publishers, Inc. v. Nat’l Enters., 471 U.S. 539, 561 (1985). The “central
purpose” of the investigation into the first factor is to determine “whether the new work merely
supersedes the objects of the original creation, or instead adds something new, with a further
purpose or different character, altering the first with new expression, meaning, or message.”
Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569, 579 (1994). The new work must be
transformative. However, if “the commentary has no critical bearing on the substance of style of
the original composition, which the alleged infringer merely uses to get attention or to avoid the
drudgery in working up something fresh, the claim to fairness in borrowing from another’s work
diminishes.” Id. at 580.
“Fair use is a mixed question of law and fact,” id. at 560, and determinations of
fair use involve a fact-intensive review of the record. Therefore, fair use is not traditionally
decided on a motion to dismiss. See Roe v. Bernabei & Wachtel PLLC, 85 F. Supp. 3d 89, 99
n.8 (D.D.C. 2015) (“Th[e fair use] defense is premature and the Court will not address it on a
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Rule 12(b)(6) motion.”); Katz v. Chevaldina, 900 F. Supp. 2d 1314, 1316 (S.D. Fla. 2012)
(“[T]he general rule [is] that fair use defenses are not ripe for determination before the summary
judgment stage.”); Browne v. McCain, 612 F. Supp. 2d 1125, 1130 (C.D. Cal. 2009) (“[I]n light
of a court’s narrow inquiry [on a motion to dismiss] and limited access to all potentially relevant
and material facts needed to undertake the [fair use] analysis, courts rarely analyze fair use on a
12(b)(6) motion.”); but cf. Brownmark Films, LLC v. Comedy Partners, 682 F.3d 687 (7th Cir.
2002) (converting a motion to dismiss to a motion for summary judgment and deciding the issue
of fair use).
C. Lanham Act, 15 U.S.C. § 1125
The Lanham Act provides a civil cause of action for false association and false
advertising. Section 1125(a) provides in pertinent part that:
(1) Any person who, on or in connection with any goods or services,
or any container for goods, uses in commerce any word, term, name,
symbol, or device, or any combination thereof, or any false
designation of origin, false or misleading description of fact, or false
or misleading representation of fact, which—
(A) is likely to cause confusion, or to cause mistake, or to deceive
as to the affiliation, connection, or association of such person with
another person, or as to the origin, sponsorship, or approval of his
or her goods, services, or commercial activities by another person,
or
(B) in commercial advertising or promotion, misrepresents the
nature, characteristics, qualities, or geographic origin of his or her
or another person’s goods, services, or commercial activities,
shall be liable in a civil action by any person who believes that he
or she is or is likely to be damaged by such act.
15 U.S.C. § 1125(a). Section 1125(a)(1)(A) details the cause of action for false association and
§ 1125(a)(1)(B) describes false advertising. The Lanham Act only restricts commercial speech,
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or speech connected with a good or service. See Farah v. Esquire Magazine, 736 F.3d 528, 541
(D.C. Cir. 2013) (Farah II).
III. ANALYSIS
Defendant moves to dismiss, arguing that the Amended Complaint fails to allege
copyright infringement, but instead itself admits facts that demonstrate the validity of the fair use
defense and that no violation of any copyright occurred. Defendant also argues that the
Amended Complaint fails to allege a Lanham Act claim because the speech is not commercial
and Mr. Nichols has not adequately alleged association between his name and the song Times of
Your Life to allow for a finding of false association. Plaintiffs disagree and argue a
determination of fair use is not appropriate on a motion to dismiss and the Amended Complaint
adequately sets forth the elements of a Lanham Act false association claim.
A. Count I – Copyright Infringement
“A plaintiff seeking to establish copyright infringement must prove ‘(1)
ownership of a valid copyright, and (2) copying of constituent elements of the work that are
original.’” Stenograph LLC v. Bossard Assoc., Inc., 144 F.3d 96, 99 (D.C. Cir. 1998) (quoting
Feist Publ’ns, 499 U.S. at 361). Plaintiffs must allege facts showing ownership of the copyrights
at issue and copying of constituent elements of the work that are original. The Amended
Complaint adequately alleges, and Defendant does not dispute, that Three Eagles owns the
copyrights for the lyrics and musical composition of Times of Your Life. Am. Compl. ¶ 12. The
first prong of copyright infringement is, therefore, properly alleged.
The Amended Complaint also alleges that both the lyrics and musical
composition were original works created by Mr. Nichols, and Defendant does not dispute those
facts. Additionally, Plaintiffs allege that Defendant copied a 30-second portion of the musical
composition and made no alterations to the melody or tone of portion of the musical composition
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that was used. Defendant focuses its argument on the differences between the lyrics of Times of
Your Life and the lyrics used in the Ad and does not dispute that the musical composition itself
was not altered. Plaintiffs have also adequately alleged copying of original elements with
respect to the musical composition.
The majority of each party’s briefing focused on the differences between the
lyrics and whether original elements were copied or whether fair use applies. Plaintiffs allege
that “the Club’s sole alteration to the composition is to some of the song’s lyrics,” and that the
use “take[s] from the very heart of the original work.” Am. Compl. ¶¶ 19, 23. Defendant argues
that the lyrics are not substantially similar and the words the Ad and Times of Your Life have in
common are not “original and protected elements of the Song.” Mot. at 7. Although Defendant
argues the limited overlap of the lyrics is not sufficient to allege the copying of original
elements, the Court takes the allegations of the Amended Complaint as true for the purposes of a
motion to dismiss and Plaintiffs have alleged that the lyrics to Times of Your Life are an original
work. See Twombly, 550 U.S. at 555.
Defendant’s arguments about originality are relevant to determining whether the
two works are substantially similar, which is not an appropriate question on a motion to dismiss.
See Prunte I, 484 F. Supp. 2d at 41 (“Substantial similarity is a question that should be decided
either by a factfinder at trial or, in some cases, in the context of a motion for summary judgment,
not on a motion to dismiss for failure to state a claim under Rule 12(b)(6).”); see also Sturdza,
281 F.3d at 1295 (“The substantial similarity inquiry consists of two steps. The first requires
identifying which aspects of the artist’s work, if any, are protectable by copyright.”). Because
Plaintiffs adequately alleged that the lyrics and musical composition are original and this Court
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will not decide substantial similarity at this time; Plaintiffs have adequately alleged copyright
infringement of the lyrics.3
Defendant adds that even if Plaintiffs adequately alleged a copyright
infringement, Plaintiffs also alleged fair use. Fair use is not traditionally determined on a motion
to dismiss and this Court will not disrupt that tradition. See Roe, 85 F. Supp. 3d at 99 n.8.
Defendant’s motion to dismiss Count I will be denied.
B. Count II – Lanham Act
Defendants also move to dismiss Count II of the Amended Complaint arguing
that: (1) the Lanham Act was not intended to provide copyright-like rights for all those
associated with a copyrighted work; (2) the Lanham Act only prohibits the use of a work in
connection with goods or services, or in commerce; (3) the Amended Complaint failed to allege
adequate facts that could show the potential to be misled by the use of the song in the Ad; (4)
Mr. Nichols failed to allege malice; and (5) Mr. Nichols failed to alleged any actual damages.
Plaintiffs respond by arguing that: (1) a motion to dismiss is an improper way to resolve the
fact-intensive question of a false endorsement claim; (2) the Lanham Act also protects political
speech and Club for Growth provides a service covered by the Lanham Act; (3) Plaintiff is not
required to plead malice; and (4) the Amended Complaint adequately alleged confusion because
allegations of actual confusion are not required.
Section 1125(a) of the Lanham Act provides a cause of action for false
association against:
(1) Any person who, on or in connection with any goods or services,
or any container for goods, uses in commerce any word, term, name,
3
The Court will not address the question of whether the singer on the Ad sounded like Paul
Anka because Plaintiffs have not alleged ownership of the copyright for the recording of Mr.
Anka’s version of Times of Your Life.
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symbol, or device, or any combination thereof, or any false
designation of origin, false or misleading description of fact, or false
or misleading representation of fact, which—
(A) is likely to cause confusion, or to cause mistake, or to deceive as
to the affiliation, connection, or association of such person with
another person, or as to the origin, sponsorship, or approval of
his or her goods, services, or commercial activities by another
person.
15 U.S.C. § 1125(a)(1).
This Court, affirmed by the D.C. Circuit, has previously held that “the Lanham
Act restricts only commercial speech, as commercial speech is entitled to reduced protection
under the First Amendment.” Farah v. Esquire Magazine, Inc., 863 F. Supp. 2d 29, 40 (D.D.C.
2012) (Farah I) (collecting cases holding Lanham Act only applicable to commercial speech);
see also Farah II, 736 F.3d at 541.4 Farah I noted that the First Amended does not protect
confusing commercial speech, such as that involving competitors labeling products with a
confusing mark, but “‘trademark rights do not entitle the owner to quash an unauthorized use of
the mark by another who is communicating ideas or expressing points of view.’” Farah I, 863 F.
Supp. 2d at 41 (quoting Bosley Med. Inst., Inc. v. Kremer, 403 F.3d 672, 677 (9th Cir. 2005)).
Farah I involved a satirical article on a matter of public interest, which was
published on a blog run by Esquire Magazine. Because the blog used the plaintiff’s name in
connection with political speech expressing a point of view, rather than commercial speech
promoting the magazine, the Court determined it was not covered by the Lanham Act. The Ad at
issue here is similarly political speech expressing a point of view, not commercial speech
4
Plaintiffs cite Browne v. McCain, 612 F. Supp. 2d 1125 (C.D. Cal. 2009), for the proposition
that political speech is covered by the Lanham Act. While the Court respects the opinions of
other district court judges, it is bound by the precedent of the D.C. Circuit, as set forth in Farah
II, which restricts the Lanham Act to commercial speech.
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attempting to promote a good or service. The Lanham Act only covers speech “in connection
with any goods or services,” and Plaintiffs have failed to allege facts indicating that Club for
Growth’s Ad involved a good or service covered by the Lanham Act. Count II will be dismissed
pursuant to Rule 12(b)(6) for failure to state a claim upon which relief may be granted.
IV. CONCLUSION
For the reasons discussed above, Defendant’s Motion to Dismiss, Dkt. 10, will be
granted in part and denied in part. Count II will be dismissed. Defendant shall file an Answer to
the Amended Complaint within 21 days. A memorializing order accompanies this opinion.
Date: January 31, 2017 /s/
ROSEMARY M. COLLYER
United States District Judge
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