Vestron, Inc. v. Home Box Office, Inc.

Decision Date24 February 1988
Docket NumberNo. 87-6229,87-6229
Citation839 F.2d 1380
Parties1988 Copr.L.Dec. P 26,245, 6 U.S.P.Q.2d 1016 VESTRON, INC., Plaintiff-Appellant, v. HOME BOX OFFICE INC., and HBO Video, Inc., Defendants-Appellees. Ninth Circuit
CourtU.S. Court of Appeals — Ninth Circuit

Marc Marmaro, Jeffer, Mangels & Butler, Los Angeles, Cal., and Robert J. Jossen, Shereff, Friedman, Hoffman & Goodman, New York City, for plaintiff-appellant.

Marc W. Rappel, Latham & Watkins, Los Angeles, Cal., for defendants-appellees.

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

Before HUG, BRUNETTI and KOZINSKI, Circuit Judges.

HUG, Circuit Judge:

This case comes to us on appeal from the district court's final order dismissing the action for lack of subject matter jurisdiction. The appeal was heard on an expedited basis. We concluded that jurisdiction existed under the Federal Copyright Act, 17 U.S.C. Sec. 101 et seq. (1982), and therefore reversed and remanded to the district court. We issued an unpublished order to this effect immediately to expedite the district court's consideration of Vestron's request for a preliminary injunction, and indicated that an opinion would follow. This opinion provides the analysis for the earlier order. The question before us is whether a complaint that pleads a claim for copyright infringement properly invokes federal jurisdiction even though the defendant admits the allegedly infringing use and disputes only the issue of contractual ownership of the copyright.

FACTS

Vestron, the plaintiff and appellant, alleges that it owns the exclusive American

videocassette distribution rights to two films, Hoosiers and Platoon, and that HBO has infringed on these rights. Vestron obtained the videocassette rights to both films from their producer, Hemdale Film Corporation and Hemdale Video Corporation ("Hemdale"), through two contracts executed in August 1985 and April 1986. After the films were released for theatrical distribution and their success was evident, Hemdale and Vestron had a dispute that brought the validity of their contracts into question. Hemdale notified Vestron that it was terminating the contracts, and that Vestron no longer held the videocassette rights. Hemdale and Vestron then brought several contract actions in state court, still pending, that have no bearing on the question before us. Subsequently, Hemdale sold the exclusive videocassette rights to both films to HBO, the defendant and appellee here. HBO manufactured and began distribution of videocassettes of Hoosiers and Platoon, and Vestron responded by bringing this action in federal court against HBO's infringing use.

STANDARD OF REVIEW

The district court granted HBO's Fed.R.Civ.P. 12(b)(1) motion to dismiss for lack of subject matter jurisdiction and denied Vestron's motion for a preliminary injunction. We review the district court's dismissal for lack of subject matter jurisdiction de novo. McIntyre v. McIntyre, 771 F.2d 1316, 1317 (9th Cir.1985). Because the district court dismissed the action before reaching the merits, our review is confined to the jurisdictional issue.

ANALYSIS

In order for Vestron's action to invoke federal subject matter jurisdiction, it must arise under federal copyright law. We note that federal courts have exclusive jurisdiction over actions that arise under federal copyright law. 28 U.S.C. Sec. 1338(a) (1982). Although the action clearly involves a copyright, this fact alone does not satisfy federal jurisdictional requirements. Effects Assocs., Inc. v. Cohen, 817 F.2d 72, 73 (9th Cir.1987). For example, where a suit is for a naked declaration of copyright ownership without a bona fide infringement claim, federal courts decline jurisdiction. Topolos v. Caldewey, 698 F.2d 991, 994 (9th Cir.1983). However, that is not the case here.

We determine whether an action arises under federal copyright law by reference to the well-pleaded complaint rule. "[W]hether a case is one arising under ... a law ... of the United States ... must be determined from what necessarily appears in the plaintiff's statement of his own claim in the [complaint], unaided by anything alleged in anticipation or avoidance of defenses...." Franchise Tax Bd. of California v. Construction Laborers Vacation Trust, 463 U.S. 1, 10, 103 S.Ct. 2841, 2846, 77 L.Ed.2d 420 (1983) (quoting Taylor v. Anderson, 234 U.S. 74, 75-76, 34 S.Ct. 724, 58 L.Ed. 1218 (1914)). Under this rule, Vestron's complaint is dispositive initially of the issue of subject matter jurisdiction. Moreover, assertion of defenses by HBO, or anticipation of those defenses by Vestron, does not defeat jurisdiction. Effects Assocs., 817 F.2d at 73. If Vestron's complaint makes out a bona fide infringement claim, then the federal court has jurisdiction.

We have settled on Judge Friendly's formulation of copyright jurisdiction law as our test to determine jurisdiction in cases such as this one: "[A]n action arises under the federal copyright laws 'if and only if the complaint is for a remedy expressly granted by the Act, ... or asserts a claim requiring construction of the Act, ... or, at the very least and perhaps more doubtfully, presents a case where a distinctive policy of the Act requires that federal principles control the disposition of the claim.' " Effects Assocs., 817 F.2d at 73 (quoting T.B. Harms Co. v. Eliscu, 339 F.2d 823, 828 (2d Cir.1964) (Friendly, J.), cert. denied, 381 U.S. 915, 85 S.Ct. 1534, 14 L.Ed.2d 435 (1965)). Our test sets forth three independent grounds for sustaining federal jurisdiction in copyright cases. If any of these three grounds is satisfied, the federal courts have jurisdiction.

We need go no further than the first of the three grounds to find that Vestron's complaint satisfies our pleading requirements and, therefore, that it confers jurisdiction The fact that Vestron claims ownership of the copyrights through a contested contract governed by state law is not fatal to federal jurisdiction. It is well-settled that "[t]he beneficial owner of a copyright ... is entitled to establish the facts supporting his claim of beneficial ownership, even though that may require interpretation of a contract." Topolos, 698 F.2d at 994. In...

To continue reading

Request your trial
57 cases
  • Brown-Thomas v. Hynie
    • United States
    • U.S. District Court — District of South Carolina
    • 21 August 2019
    ...exists." Scholastic Entm't, Inc. v. Fox Entm't Grp., Inc. , 336 F.3d 982, 985 (9th Cir. 2003) (citing Vestron, Inc. v. Home Box Office, Inc. , 839 F.2d 1380, 1381 (9th Cir. 1988) ). For purposes of deciding subject-matter jurisdiction in this perplexing area of the law, the United States Co......
  • Image Software v. Reynolds and Reynolds Co
    • United States
    • U.S. Court of Appeals — Tenth Circuit
    • 23 August 2006
    ...matter jurisdiction over claim alleging copyright infringement and seeking damages and injunctive relief under Copyright Act); Vestron, Inc., 839 F.2d at 1381-82 (holding federal court had subject matter jurisdiction over claim for copyright infringement seeking an injunction, "damages and ......
  • Johnson v. Altamirano
    • United States
    • U.S. District Court — Southern District of California
    • 2 December 2019
    ...RJN Ex. 1 ¶¶ 3, 17-21.) Thus, the Court sat in federal question jurisdiction over the prior action. See Vestron, Inc. v. Home Box Office, Inc., 839 F.2d 1380, 1381 (9th Cir. 1988) ("[F]ederal courts have exclusive jurisdiction over actions that arise under federal copyright law."). As a res......
  • Kelly v. Roker
    • United States
    • U.S. District Court — Northern District of California
    • 4 June 2014
    ...claim in the [complaint], unaided by anything alleged in anticipation or avoidance of defenses . . . ." Vestron, Inc. v. Home Box Office, Inc., 839 F.2d 1380, 1381 (9th Cir. 1988) (quoting Franchise Tax Bd. of Cal. v. Constr. Laborers Vacation Trust, 463 U.S. 1, 10 (1983)). If a complaint m......
  • Request a trial to view additional results

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT