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Cabell v. Zorro Productions Inc.

United States District Court, N.D. California, San Jose Division

May 30, 2017

ROBERT W. CABELL, Plaintiff,
ZORRO PRODUCTIONS INC., et al., Defendants.


          EDWARD J. DAVILA, United States District Judge

         Plaintiff Robert W. Cabell (“Plaintiff”) brings this action for copyright infringement and related claims against Zorro Productions, Inc. (“ZPI”) and ZPI's owner John Gertz (collectively, “Defendants”), in connection with a musical Plaintiff created based on the fictional character “Zorro.” Presently before the court is Defendants' Motion to Dismiss Plaintiff's Second Amended and Supplemental Complaint under Federal Rules of Civil Procedure 12(b)(2), 12(b)(6) and forum non conveniens. Dkt. No. 120.

         The Court has subject matter jurisdiction over this case pursuant to 28 U.S.C. §§ 1331 and 1338. Having carefully reviewed the pleadings and briefs submitted by the parties in this case, Defendants' Motion to Dismiss will be GRANTED IN PART and DENIED IN PART for the reasons discussed below.

         I. BACKGROUND

         The following is an overview of the factual and procedural background relevant to the instant motion, and is taken primarily from Plaintiff's Second Amended and Supplemental Complaint (“SAC”). Dkt. No. 119.

         A. Factual Background

         As discussed in this court's previous Order Granting Plaintiff's Motion for Leave to File a Second Amended Complaint (Dkt. No. 118), the character “Zorro” is a familiar one to most people. He is “well-known as the masked outlaw who defends the public against tyrannical officials and other villains.” SAC at 1-2. “Zorro” is the secret identity of Don Diego de la Vega, a Spanish nobleman, who transforms into the freedom fighter by wearing a black cape or cloak, a black sombrero, and a black mask that covers the top of his head from eye level upwards. Id. at ¶ 8. And as a fictional character, “Zorro” has been around for a while; the first “Zorro” story was written in 1919 by Johnston McCulley, and the first movie featuring the character was made in 1920 by Douglas Fairbanks, Sr. Id. at ¶¶ 7, 9. Based on this history, Plaintiff alleges that any copyright interest in the works of McCulley and Fairbanks expired in 1975 and 1976 respectively. Id. at ¶¶ 10, 11.

         In 1996, Plaintiff published a musical entitled “Z - The Musical of Zorro” (“Z Musical” or the “Musical”) based “expressly” on McCulley's 1919 story and Fairbanks' 1920 movie. Id. at ¶ 13. Zorro is portrayed in Plaintiff's musical as “a masked avenger leading a double life, donned in a black mask, black sombrero, black cape, and with a sword and whip.” Id. at ¶ 14. The musical was initially released on audio cassette and then CD format, and a stage production premiered in Eugene, Oregon in 2000. Id. at ¶¶ 19-20. Plaintiff has registered his original and revised scripts and the audio versions with the U.S. Copyright Office, and his copyright interest “extends only to the original, novel elements of his work and do not include those elements present in any Zorro works that were in the public domain as of 1996.” Id. at ¶¶ 16-18.

         Defendant ZPI is a California business corporation located in Berkeley, California. Id. ¶ 2. Plaintiff alleges on information and belief that Defendant Gertz owns, operates, and has control over ZPI, and also resides in Berkeley, California. Id. ¶ 3. Plaintiff is a resident of King County, Washington. Id. ¶ 1.

         Plaintiff contends that ZPI, despite knowing that any copyright interest in Zorro expired, has for years falsely asserted that it owns worldwide trademarks and copyrights in the name and visual likeness of Zorro. Id. at ¶¶ 21-22. To that end, Plaintiff asserts that ZPI obtained several registered trademarks between 1987 and 1997 concerning the use of the word mark “ZORRO” in story and comic books, television shows, videos featuring music and entertainment, and theater productions. Id. at ¶¶ 27-34. According to Plaintiff, Defendants “fraudulently obtained these federal trademark registrations as a means to improperly extend the copyright protection that has expired for early Zorro works.” Id. at ¶ 34. Plaintiff highlights that ZPI was unsuccessful in its prior attempt to assert federal copyright and trademark infringement claims concerning Zorro. Id. at ¶¶ 25-27 (citing Sony Pictures Ent., Inc. et. al. v. Fireworks Ent. Grp., Inc. et al, 137 F.Supp.2d 1177, 1185 (C.D. Cal. 2001) and Sony Pictures Ent., Inc. et. al. v. Fireworks Ent. Grp., Inc. et al, 156 F.Supp.2d 1148, 1162-1163 (C.D. Cal. 2001)).

         In connection with his own work, Plaintiff asserts that his script and audio performances were successful, and that Z Musical was “poised to become a Broadway hit.” Id. at ¶ 38. In 1996, Plaintiff even met with Defendant Gertz about producing the Musical, during which time Plaintiff states that he provided Gertz with a copy of the script. Id. ¶ 37. However, the conversations ultimately broke down, at which point Plaintiff alleges ZPI began, for the first time, aggressively asserting that Plaintiff's script infringed ZPI's copyrights and trademarks, and insisting that Plaintiff acquire a license from ZPI to produce it. Id.

         In consultation with legal counsel, Plaintiff proceeded with the commercial release of Z Musical without a license from Defendants. Id. By 2001, he had retained well-known choreographer and producer Wayne Cilento in anticipation of a Broadway production, and engaged the William Morris agency to represent his interests in connection the Musical. Id. at ¶ 39. However, soon thereafter, Plaintiff alleges that Mr. Cilento and the William Morris agency were approached by Defendants and told that any performance of Plaintiff's musical would require licenses from Defendants, threatening that any unauthorized production would result in litigation. Id. at ¶ 40. As a result of this conduct, Mr. Cilento and the William Morris agency ceased work on Plaintiff's behalf and Z Musical did not appear on Broadway. Id. at ¶ 41. After the Musical was commercially released, Plaintiff alleges that Defendants also harassed and threatened litigation against other vendor's of his work, and actively discouraged third parties from producing the musical in the United States, London, Brazil, Japan, Germany and Belgium. Id. at ¶¶ 42, 45.

         In response to Defendants alleged interference and threats of litigation, in 2002 Plaintiff filed a Petition for Cancellation of ZPI's registered trademarks in the United States Patent and Trademark Office. Id. at ¶¶ 35-36, 43. However, in 2004 Plaintiff voluntarily withdrew the Petition without prejudice as part of a “walk-away agreement” negotiated by Sony Pictures out of concern for the dispute's impact on the release of its upcoming film, “Legend of Zorro.” Id. at ¶ 36. As part of the deal, Plaintiff agreed to withdraw his cancellation petition, and ZPI agreed not to challenge Plaintiff's Zorro-related copyrights and trademarks. Id.

         In early 2013, Plaintiff - through his agent, Gallissas Theaterverlag und Mediaagentur GmbH (“Gallissas”) - licensed Z Musical to affiliates in Germany so that it could be performed in Clingenberg and Villa Fuchs, Germany. Id. at 46. Soon thereafter, Plaintiff alleges ZPI again began contacting his business affiliates - including Gallissas and other licensees - making false statements regarding ZPI's copyright and trademark rights in the story and character of Zorro, and falsely claiming that Plaintiff's musical violated such rights. Id. at ¶ 47. ZPI then filed lawsuits to that effect against the Clingenberg and the Villa Fuchs productions in Germany, neither of which were successful in enjoining the production from going forward. Id. at ¶¶ 48, 50. When the lawsuits failed, Plaintiff alleges that ZPI met with Gallissas in San Francisco, California and “induced” Gallissas to represent ZPI, in breach of its contract with Plaintiff. Id. at ¶¶ 51-55.

         Outside of the disputes related to the German productions, Plaintiff contends that Defendants further interfered with his opportunities to license the production of his musical in the United States on at least three occasions. Specifically, Plaintiff alleges that in the fall of 2013, he was involved in negotiations to have his musical presented at The 5th Avenue Theatre in Seattle, Washington during the 2014 theatre season. Id. at ¶ 57. Plaintiff claims that Defendants intentionally and improperly interfered with the success of the negotiations by threatening the theatre. Id. Also in the fall of 2013, Plaintiff alleges that he was involved in similar negotiations to have his musical presented at The Philadelphia Shakespeare Theatre in Philadelphia, Pennsylvania, as well as The American Theatre Group in Rahway, New Jersey. Id. at ¶ 58. Plaintiff alleges that the negotiations with both groups were “discontinued” after the directors learned of Defendants' intent to sue third-parties involved in the production of the Musical, and Plaintiff lost both business opportunities associated with The Philadelphia Shakespeare Theatre and The American Theatre Group. Id.

         Additionally, Plaintiff alleges that ZPI financed and holds a copyright interest in a 2005 book entitled “Zorro, ” which was authored by Isabel Allende. Id. at ¶ 62. Plaintiff claims that Allende's novel copies original material from Plaintiff's script, which he alleges ZIP had access to because Plaintiff had provided Gertz with copies of the script during their 1996 discussions regarding potential collaborations. Id. at ¶¶ 61-62, 64-67. Soon after the release of Allende's novel, Plaintiff alleges that ZPI authorized and was responsible for the production of a Zorro musical based on the novel. Id. at ¶¶ 63-64. Plaintiff contends that the similarities between his script, Allende's novel, and ZPI's musical based on the novel include the use and emphasis on gypsies and flamenco dancing, as well as the fact that both stories are set as prequels to McCulley's 1919 original. Id. at ¶¶ 60, 62-66. Plaintiff also alleges that Defendants copied elements of certain songs from his musical, retitled them, and included them in ZIP's musical production. Id. at ¶ 67. ZPI's musical premiered in 2008 and has been performed in various United States jurisdictions including Atlanta, Georgia and Salt Lake City, Utah. Id. at ¶ 63.

         B. Procedural Background

         On March 13, 2013, Plaintiff filed a Complaint against ZPI, Gertz, and Stage Entertainment Licensed Productions[1] in the United States District Court for the Western District of Washington. Dkt. No. 1. Plaintiff filed a First Amended Complaint on April 8, 2013 (Dkt. No. 8), and Defendants moved to dismiss the FAC on May 16, 2013, pursuant to Federal Rules of Civil Procedure 12(b)(2) and 12(b)(6), and under the doctrine of forum non conveniens. Dkt. No. 20. After Plaintiff conducted early discovery on personal jurisdiction, the district court in Washington granted the 12(b)(2) motion and dismissed the action with respect to ZPI and Gertz. Dkt. Nos. 71, 72. In response, Plaintiff moved the court to reconsider the dismissal in favor of transfer. Dkt. Nos. 73. The court did so, reinstated the claims against ZPI and Gertz, and transferred the action to this court. Dkt. No. 84.

         On April 14, 2015, after the case was transferred to this district, Defendants again moved to dismiss on grounds of forum non-conveniens and for failure to state a claim under Rule 12(b)(6). Dkt. No. 101. Plaintiff then filed a Motion for Leave to File Second Amended and Supplemental Complaint (Dkt. No. 105), which the court granted on September 23, 2016. Dkt. No. 118. Accordingly, the court also denied without prejudice Defendants' first Motion to Dismiss. Id.

         On September 26, 2016, Plaintiff filed his SAC, asserting the following claims: (1) copyright infringement, (2) declaratory judgment of non-infringement, (3) cancellation of federal trademark registration; (4) tortious interference with contract and business expectancy; (5) common law fraud; and (6) unfair competition and unfair trade practices in violation of California Business and Professions Code § 17200. SAC at 16-20. Plaintiff also seeks a preliminary and permanent injunction against Defendants prohibiting them from making claims that Plaintiff's musical infringes upon any of Defendants' intellectual property rights. Id. at 20, ¶ G. On October 14, 2016, Defendants moved to dismiss the SAC under Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6) and on grounds of forum non-conveniens. Dkt. No. 120 (“Mot.”).


         A. 12(b)(6)

         Federal Rule of Civil Procedure 8(a) requires a plaintiff to plead each claim with sufficient specificity to “give the 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). Although particular detail is not generally necessary, the factual allegations “must be enough to raise a right to relief above the speculative level” such that the claim “is plausible on its face.” Id. at 556-57. A complaint which falls short of the Rule 8(a) standard may be dismissed if it fails to state a claim upon which relief can be granted. Fed.R.Civ.P. 12(b)(6). Dismissal of a claim under Rule 12(b)(6) may be based on a “lack of a cognizable legal theory or the absence of sufficient facts alleged under a cognizable legal theory.” Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 1988); see Mendiondo v. Centinela Hosp. Med. Ctr., 521 F.3d 1097, 1104 (9th Cir. 2008).

         At the motion to dismiss stage, the court must read and construe the complaint in the light most favorable to the non-moving party. Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 337-38 (9th Cir. 1996). The court must accept as true all “well-pleaded factual allegations.” Ashcroft v. Iqbal, 556 U.S. 662, 664 (2009). However, “courts are not bound to accept as true a legal conclusion couched as a factual allegation.” Twombly, 550 U.S. at 555. “In all cases, evaluating a complaint's plausibility is a context-specific endeavor that requires courts to draw on ... judicial experience and common sense.” Levitt v. Yelp! Inc., 765 F.3d 1123, 1135 (9th Cir. 2014) (quoting Starr v. Baca, 652 F.3d 1202, 1216 (9th Cir. 2011)).

         When deciding whether to grant a motion to dismiss, the court generally “may not consider any material beyond the pleadings.” Hal Roach Studios, Inc. v. Richard Feiner & Co., 896 F.2d 1542, 1555 n. 19 (9th Cir. 1990). However, the court may consider material submitted as part of the complaint or relied upon in the complaint, and may also consider material subject to judicial notice. See Lee v. City of Los Angeles, 250 F.3d 668, 688-89 (9th Cir. 2001). In the event that a motion to dismiss is granted, “leave to amend should be granted ‘unless the court determines that the allegation of other facts consistent with the challenged pleading could not possibly cure the deficiency.'” DeSoto v. Yellow Freight Sys., Inc., 957 F.2d 655, 658 (9th Cir. 1992) (quoting Schreiber Distrib. Co. v. Serv-Well Furniture Co., 806 F.2d 1393, 1401 (9th Cir. 1986)).

         B. 12(b)(1)

         A Rule 12(b)(1) motion challenges subject matter jurisdiction and may be either facial or factual. Wolfe v. Strankman, 392 F.3d 358, 362 (9th Cir. 2004). A facial 12(b)(1) motion involves an inquiry confined to the allegations in the complaint, whereas a factual 12(b)(1) motion permits the court to look beyond the complaint to extrinsic evidence. Id. When a defendant makes a facial challenge, all material allegations in the complaint are assumed true, and the court must determine whether lack of federal jurisdiction appears from the face of the complaint itself. Thornhill Publ'g Co. v. General Tel. Elec., 594 F.2d 730, 733 (9th Cir. 1979).


         A. Forum ...

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