783 F.2d 1440 (9th Cir. 1986), 85-5693, Peter Starr Production Co. v. Twin Continental Films, Inc.

Docket Nº:85-5693.
Citation:783 F.2d 1440
Party Name:907 PETER STARR PRODUCTION CO., Plaintiff-Appellant, v. TWIN CONTINENTAL FILMS, INC. and Gautam Das, Defendants-Appellees.
Case Date:March 04, 1986
Court:United States Courts of Appeals, Court of Appeals for the Ninth Circuit
 
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Page 1440

783 F.2d 1440 (9th Cir. 1986)

907

PETER STARR PRODUCTION CO., Plaintiff-Appellant,

v.

TWIN CONTINENTAL FILMS, INC. and Gautam Das, Defendants-Appellees.

No. 85-5693.

United States Court of Appeals, Ninth Circuit

March 4, 1986

Argued and Submitted Feb. 7, 1986.

Page 1441

Stephen R. Rohde, Paul S. Levine, Law Office of Stephen F. Rohde, Los Angeles, Cal., for plaintiff-appellant.

David Gardner, Los Angeles, Cal., for defendants-appellees.

Appeal from the United States District Court for the Central District of California.

Before ANDERSON, PREGERSON, and WIGGINS, Circuit Judges.

WIGGINS, Circuit Judge.

Appellant Peter Starr Production Co. ("Starr") appeals from the judgment of the district court dismissing its copyright infringement action against Twin Continental Films, Inc. ("Twin") and Gautam Das, its manager, for lack of subject matter jurisdiction under 28 U.S.C. Sec. 1338(a) (1982). Starr contends that the district court erred in concluding as a matter of law that Twin committed no act in the United States that violates United States copyright law and abused its discretion in dismissing the complaint without leave to amend. We reverse and remand.

PLAINTIFF'S ALLEGATION OF FACTS 1

Starr created an original motion picture entitled "Take It to the Limit" ("the motion picture"). The motion picture and its soundtrack were properly copyrighted on July 10, 1980, and Starr has since that time complied with the Copyright Act in preserving that copyright for itself.

In May of 1983, Starr authorized Roger Riddell, a business acquaintance and agent, to "explore the possibility" of finding European distributors for a number of films including "Take It to the Limit," but specifically told him that he had no authority to bind Starr. By late June, Riddell obtained several offers for the rights to the motion picture from Alpha Films Limited ("Alpha"), but Starr rejected all of them.

On or about June 10, 1983, without authority from Starr, Twin entered into a license agreement with Alpha purporting to grant to Alpha "the exclusive license to exhibit" the motion picture in certain areas outside the United States. The license agreement was negotiated in Cannes, France, but notes on its face that it was signed in Los Angeles, California.

On August 3, Starr was shown a copy of the Twin-Alpha license agreement by an agent of Star Media Sales (no relation to Starr). Starr told the agent that Starr was not interested in dealing with Alpha and the agent informed Alpha of this.

On August 16, 1983, Alpha ordered and received a print of the motion picture from Rank Film Laboratories ("Rank"), the custodian of the motion picture's negative, in London, England. Alpha's representative assured Rank that it had a contract authorizing access with Star Media Sales, acting

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as an agent for Twin. Alpha subsequently reproduced the motion picture and distributed some 400 video cassettes of it in Sweden or the United Kingdom, or both.

Before February 17, 1984, through means not clear in the record, Alpha was told to and did stop distribution of the motion picture. As a result of the unauthorized distribution, however, another English distributor backed out of a pending distribution deal with Starr for the motion picture, causing a substantial loss to Starr.

On July 10, 1984, Starr filed the present action seeking damages and injunctive relief. Before answering the complaint, Twin moved for dismissal or in the alternative for summary judgment or for a more definite statement of facts. On February 7, 1985, the district court granted Twin's motion and dismissed the action for lack of subject matter jurisdiction. Starr timely appealed, and the case is properly before this court under 28 U.S.C. Sec. 1291 (1982). See also 28 U.S.C. Sec. 1295 (1982).

SUBJECT MATTER JURISDICTION

Subject matter jurisdiction presents a question of law, reviewable de novo by this court. Clayton v. Republic Airlines, Inc., 716 F.2d 729, 730 (9th Cir.1983). District court subject matter jurisdiction over copyright cases is grounded in 28 U.S.C. Sec. 1338(a), which provides in pertinent part:

The district courts shall have original jurisdiction of any civil action arising under any Act of Congress relating to ... copyrights.... Such jurisdiction shall be exclusive of the states in ... copyright cases.

The "Act of Congress relating to ... copyrights" is the Copyright Act of 1976, Pub.L. No. 94-553, 90 Stat. 2541 (1976), codified at Title 17 of the United States Code. Section 106 of that title, 17 U.S.C. Sec. 106 (1982), provides in relevant part:

[T]he owner of copyright under this title has the exclusive rights to do and to authorize any of the following:

...

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