Carter v. Pallante
256 F. Supp. 3d 791
N.D. Ill.2017Background
- Tollie Carter, sole heir to songwriters Calvin Carter and James Bracken, regained rights to many songs (via renewal in the 1980s–90s and termination effective Dec. 31, 2014).
- Carter alleges ARC (owned by Fuji and administered by BMG) and co-defendants licensed his songs after he reclaimed rights, causing third parties to publicly perform the works and generating royalties the publishers retained.
- Carter sued for federal copyright infringement (direct, contributory, vicarious), DMCA (false copyright management information), and state claims (unjust enrichment, deceptive trade practices, tortious interference).
- Publisher Defendants moved to dismiss under Rules 12(b)(1), 12(b)(2), and 12(b)(6), arguing lack of jurisdiction and failure to state claims, and that certain state claims are preempted by the Copyright Act.
- The Court denied dismissal for lack of subject-matter jurisdiction and for lack of personal jurisdiction (prima facie contacts via licensing to Illinois entities).
- On the merits, the Court denied dismissal of the federal copyright and DMCA claims, but dismissed without prejudice unjust enrichment and tortious interference (preempted), and dismissed deceptive trade practices in part (reverse passing off preempted; false-advertising theory may proceed).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Subject-matter jurisdiction (12(b)(1)) | Federal copyright claims invoke §1331; thus court has jurisdiction. | Plaintiff’s copyright claims fail on the merits, so jurisdiction lacking. | Denied — merits challenge belongs to Rule 12(b)(6); complaint not frivolous under Bell v. Hood. |
| Personal jurisdiction (12(b)(2)) | Publishers licensed songs to Illinois entities causing injury in Illinois. | Publishers had only incidental contacts with Illinois; insufficient purposeful direction. | Denied — prima facie showing of purposeful direction via licensing to Illinois; exercising jurisdiction fair. |
| Copyright infringement (direct, contributory, vicarious) (12(b)(6)) | Publishers licensed works after Carter reclaimed rights; third-party public performances caused infringement. | Pleadings lack specifics (who, what, when); insufficient to state plausible claims. | Denied — Rule 8 pleading suffices; specifics are discovery matters; contributory and vicarious claims plausible. |
| DMCA §1202 claim | Publishers provided false copyright management info to licensees (misidentified owner) in connection with licenses. | §1202 intended for technological/Internet contexts; plaintiff fails to allege information conveyed "with copies." | Denied — §1202 text is broad; no Internet requirement; allegations sufficiently plead false CMI conveyed with licenses. |
| Statute of limitations re: renewal songs | Alleged ongoing infringements (including up to 2016) make claims timely. | Renewals occurred decades earlier, so claims time-barred. | Denied — accrual tied to date of alleged infringing acts; complaint alleges recent infringements. |
| State-law claims (preemption under 17 U.S.C. §301) | State claims address harms beyond copyright injury (e.g., failure to pay royalties, deceptive advertising). | Claims are equivalent to rights under §106 and thus preempted. | Partially granted — unjust enrichment and tortious interference dismissed (preempted); IUDTPA reversed-passing-off theory dismissed but false-advertising theory may proceed; leave to amend limited claims. |
Key Cases Cited
- Bell v. Hood, 327 U.S. 678 (federal-court jurisdiction not defeated by failure to state a claim)
- Feist Publ’ns, Inc. v. Rural Tel. Serv. Co., 499 U.S. 340 (elements of copyright infringement)
- Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd., 545 U.S. 913 (contributory and vicarious infringement principles)
- Ashcroft v. Iqbal, 556 U.S. 662 (plausibility standard for pleadings)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (pleading must be plausible)
- International Shoe Co. v. Washington, 326 U.S. 310 (minimum contacts for personal jurisdiction)
- Tamburo v. Dworkin, 601 F.3d 693 (Seventh Circuit on specific personal jurisdiction)
- Purdue Research Foundation v. Sanofi-Synthelabo, 338 F.3d 773 (prima facie personal jurisdiction showing at pleading stage)
- Chicago Building Design, P.C. v. Mongolian House, Inc., 770 F.3d 610 (separate accrual rule and statute-of-limitations guidance in copyright cases)
- Murphy v. Millennium Radio Group, LLC, 650 F.3d 295 (DMCA §1202 covers false CMI broadly)
- Bausch v. Stryker Corp., 630 F.3d 646 (preemption is an affirmative defense; Rule 12(c) typically appropriate)
- Baltimore Orioles, Inc. v. Major League Baseball Players Ass’n, 805 F.2d 663 (state-law claim equivalent if infringed by mere act of reproduction/performance/distribution)