522 F.Supp.3d 747
E.D. Cal.2021Background
- Morena Music (Morena) produced three albums by Los Originales De San Juan and alleges an oral recording agreement with Jesús Chavez Sr. under which Morena obtained rights in the sound recordings and created the cover art; Morena later registered copyrights for both albums and cover art.
- Chavez later purportedly transferred his interests in the albums to Yellowcake (and Colonize) via a written agreement; Yellowcake registered sound recording copyrights and exploited the works (including uploads on YouTube); YCH sent DMCA takedown notices against Morena.
- Morena sued for copyright infringement (sound recordings and cover art) and state-law claims: intentional interference with prospective economic advantage, intentional interference with contractual relations, unfair competition (UCL), and conversion; YCH moved to dismiss most counterclaims under Rule 12(b)(6).
- The court considered three ownership theories alleged by Morena: (1) written/oral transfer from Chavez to Morena, (2) co-authorship/joint ownership, and (3) work-for-hire (employer/employee or commissioned work).
- The court ruled the oral-transfer theory fails under 17 U.S.C. § 204(a) (writing requirement) and dismissed infringement claims based on that theory without leave to amend; co-authorship was pleaded plausibly but creates joint ownership that precludes an infringement claim against a co-owner (dismissed with leave to amend to clarify ownership); work-for-hire as a commissioned work was dismissed without leave, employer-employee work-for-hire dismissed with leave to amend.
- The court also dismissed or limited several state-law claims as preempted by the Copyright Act or barred by § 204(a), allowed limited leave to amend for claims tied to tangible master recordings, and ordered supplemental briefing on apparent inaccuracies in Morena’s copyright registrations (potential Unicolors inquiry).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether an oral agreement transferred copyright ownership (standing/infringement) | Morena: oral recording agreement transferred rights to Morena (or at least non‑exclusive license); alternatively alleges co‑authorship | YCH: §204(a) requires a signed writing for transfers; oral transfer invalid; non‑exclusive license (if any) does not confer standing | Court: Oral transfer fails under §204(a); infringement claim based on oral transfer DISMISSED without leave to amend |
| Whether Morena is co‑author/joint owner so can sue for infringement | Morena: pleadings allege co‑authorship/co‑ownership of the albums | YCH: if joint owner, Morena cannot sue a co‑owner (Yellowcake) for infringement; Chavez’s written transfer to YCH shows joint ownership | Court: Co‑authorship plausibly pleaded, but that theory would make Yellowcake a joint owner and bar an infringement suit; claim DISMISSED with leave to amend to explain why Yellowcake is not a joint owner |
| Whether the albums are works made for hire (special commission or employee) | Morena/registrations: listing Morena as "employer for hire" supports ownership | YCH: no written work‑for‑hire agreement; Chavez likely an independent contractor; statutory writing requirement applies | Court: Specially commissioned work‑for‑hire dismissed without leave; employer/employee work‑for‑hire insufficiently alleged but may be amended (dismissed with leave) |
| Whether state claims (IIPEA, IICR, UCL, conversion) survive preemption/statute of frauds and effect of §204(a) | Morena: claims partly target tangible masters and wrongful conduct beyond copyright (e.g., conversion, interference); full performance removes statute of frauds bar | YCH: claims are equivalent to copyright rights and preempted; §204(a) bars contract‑based claims; statute of frauds applies | Court: IIPEA and UCL claims against Yellowcake/Colonize preempted; IICR and UCL claims based on copyright transfer barred by §204(a) (dismissed without leave where transfer is sole basis); conversion and IIPEA claims may be amended only to the extent they plausibly allege harms to tangible masters; court ordered supplemental briefing on registration accuracy |
Key Cases Cited
- DRK Photo v. McGraw‑Hill Global Educ. Holdings, LLC, 870 F.3d 978 (9th Cir.) (third parties may challenge standing via §204(a) and plaintiff must plead ownership)
- Jules Jordan Video, Inc. v. 144942 Canada, Inc., 617 F.3d 1146 (9th Cir.) (§204 writing requirement for transfer of exclusive copyright rights)
- Unicolors, Inc. v. H & M Hennes & Mauritz, L.P., 959 F.3d 1194 (9th Cir.) (reg. inaccuracies implicate §411 and require Copyright Office inquiry)
- ABS Entm’t v. CBS Corp., 908 F.3d 405 (9th Cir.) (creative contributions of producers/recording engineers relevant to joint‑authorship analysis)
- Sybersound Records, Inc. v. UAV Corp., 517 F.3d 1137 (9th Cir.) (a non‑exclusive license does not transfer ownership; co‑owner cannot grant exclusive rights)
- Effects Assocs. v. Cohen, 908 F.2d 555 (9th Cir.) (§204 invalidates purported transfers of ownership absent signed writing)
- Righthaven LLC v. Hoehn, 716 F.3d 1166 (9th Cir.) (standing to sue for copyright infringement is jurisdictional)
- Gold Value Int’l Textile, Inc. v. Sanctuary Clothing, Ltd., 925 F.3d 1140 (9th Cir.) (copyright registration required before filing infringement suit)
- Aalmuhammed v. Lee, 202 F.3d 1227 (9th Cir.) (elements and tests for joint works/co‑authorship)
- Ashton‑Tate Corp. v. Ross, 916 F.2d 516 (9th Cir.) (co‑authors are co‑owners and cannot sue each other for infringement)