Creative Technology, Ltd. v. Aztech System Pte., Ltd.

• Decision Date: 24 July 1995
• Docket Number: No. 93-16997,93-16997
• Citation: 61 F.3d 696
• Parties: , 1995 Copr.L.Dec. P 27,415, 35 U.S.P.Q.2d 1590, 95 Cal. Daily Op. Serv. 5751, 95 Daily Journal D.A.R. 9814 CREATIVE TECHNOLOGY, LTD., a Singapore corporation, Plaintiff-Appellant, v. AZTECH SYSTEM PTE, LTD, a Singapore corporation; Aztech Labs, Inc., a California corporation, Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 696

61 F.3d 696

64 USLW 2083, 1995 Copr.L.Dec. P 27,415,

35 U.S.P.Q.2d 1590,

95 Cal. Daily Op. Serv. 5751,

95 Daily Journal D.A.R. 9814

CREATIVE TECHNOLOGY, LTD., a Singapore corporation, Plaintiff-Appellant, v. AZTECH SYSTEM PTE, LTD, a Singapore corporation; Aztech

Labs, Inc., a California corporation, Defendants-Appellees.

No. 93-16997.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted April 10, 1995.

Decided July 24, 1995.

Robert A. Van Nest, Keker, Brockett & Van Nest, San Francisco, CA, and Joel Linzer, Crosby, Heafey, Roach, & May, Oakland, CA, for plaintiff-appellant.

William S. Coats, Carolyn F. Bostick, and Sarah W. Anderson, Brown & Bain, Palo Alto, CA, for defendants-appellees.

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

Before: FLOYD R. GIBSON, ^* HUG, and FERGUSON, Circuit Judges.

Opinion by Judge FLOYD R. GIBSON; Dissent by Judge FERGUSON.

FLOYD R. GIBSON, Senior Circuit Judge.

Creative Technology appeals the district court's forum non conveniens dismissal of its copyright infringement action. We have jurisdiction over this appeal pursuant to 28 U.S.C. Sec. 1291 (1988), and we affirm.

I. BACKGROUND

Appellant Creative Technology, Ltd. (Creative) and Appellee Aztech Systems Pte. Ltd. (Aztech) are competing Singapore corporations in the business of developing, manufacturing and distributing sound cards. ¹ Both Aztech's and Creative's principal place of business is Singapore. All the sound cards are designed, developed, and manufactured in Singapore. Creative markets its sound cards in the United States under the brand name "Sound Blaster" through Creative Labs, Inc., a California corporation and wholly owned subsidiary. Aztech, in turn, markets its sound cards in the United States under the brand name "Sound Galaxy" through Appellee Aztech Labs, Inc. (Aztech Labs), another California corporation and wholly owned subsidiary.

The present action arises from a protracted copyright dispute between Creative and Aztech. The first round of copyright litigation erupted in November of 1992 when Creative, which holds twelve registered United States copyrights in its Sound Blaster series, publicly accused Aztech of infringing on its copyrighted material through the manufacture and distribution of Aztech's Sound Galaxy series. Aztech filed the equivalent of a declaratory relief action in Singapore under the Singapore Copyright Act, ultimately resulting in a settlement agreement on December 7, 1992.

Following the repudiation of this agreement, Creative filed suit in the United States District Court for the Northern District of California, claiming that Aztech's reproduction, adaptation, and United States distribution of "Sound Blaster clones" violated Creative's exclusive rights under 17 U.S.C. Secs. 106 and 501 (1988) of the United States Copyright Act. Aztech responded by filing an action against Creative in the High Court of Singapore, alleging breach of the settlement agreement and seeking declaratory relief once again under the Singapore Copyright Act. Creative, in turn, filed mandatory counterclaims in Singapore alleging copyright infringement based on the manufacture of "Sound Blaster clones" in Singapore and their distribution abroad. Aztech Labs has consented to Singapore jurisdiction and is now a party to the ongoing Singapore action.

Aztech filed a motion to dismiss the United States action under the forum non conveniens doctrine. The district court granted Aztech's motion, concluding that Singapore offered an adequate alternative forum and that the balance of public and private interest factors favored dismissing the action in favor of adjudication in Singapore. Creative appeals.

II. DISCUSSION

The party moving for forum non conveniens dismissal must demonstrate two things: (1) the existence of an adequate alternative forum; and (2) that the balance of relevant private and public interest factors favor dismissal. Contact Lumber Co. v. P.T. Moges Shipping Co. Ltd., 918 F.2d 1446, 1449 (9th Cir.1990) (citing Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 508-09, 67 S.Ct. 839, 843, 91 L.Ed. 1055 (1947)). Creative raises three primary issues on appeal: (1) whether the district court erred in concluding that the forum non conveniens doctrine applies to the United States Copyright Act; (2) whether the district court abused its discretion in concluding that the High Court of Singapore will provide an adequate alternative forum; and (3) whether the district court abused its discretion in determining that the balance of relevant public and private interest factors favors dismissal. The scope of our review is narrow:

The forum non conveniens determination is committed to the sound discretion of the trial court. It may be reversed only when there has been a clear abuse of discretion; where the court has considered all relevant public and private interest factors, and where its balancing of these factors is reasonable, its decision deserves substantial deference.

Ceramic Corp. of America v. Inka Maritime Corp., 1 F.3d 947, 949 (9th Cir.1993) (citing Piper Aircraft Co. v. Reyno, 454 U.S. 235, 257, 102 S.Ct. 252, 266, 70 L.Ed.2d 419 (1981)).

A. Applicability of the Forum Non Conveniens Doctrine

The forum non conveniens doctrine is inapplicable to certain federal statutes such as the Jones Act ¹ or the Federal Employers' Liability Act ² (FELA) which contain special provisions mandating venue in the United States district courts. Zipfel v. Halliburton Co., 832 F.2d 1477, 1487 (9th Cir.1987), cert. denied, 486 U.S. 1054, 108 S.Ct. 2819, 100 L.Ed.2d 921 (1988). Because of this, a choice of law determination must be made before the district court dismisses an action under the forum non conveniens doctrine. Pereira v. Utah Transp., Inc., 764 F.2d 686, 688 (9th Cir.1985), cert. dismissed, 475 U.S. 1040, 106 S.Ct. 1253, 89 L.Ed.2d 362 (1986). Creative argues that its claim is governed exclusively by the United States Copyright Act, 17 U.S.C. Sec. 101 et seq. (1988). As a result, Creative contends that the forum non conveniens doctrine is inapplicable to its claim because 28 U.S.C. Sec. 1338(a) ³ invests the federal district courts with "exclusive" jurisdiction over claims arising under the United States Copyright Act.

Regardless of which nation's law applies, Creative's argument is without merit. The inapplicability of the forum non conveniens doctrine to the Jones Act and FELA is based on "[a] privilege of venue, granted by the legislative body which created this right of action...." Baltimore & Ohio R.R. Co. v. Kepner, 314 U.S. 44, 54, 62 S.Ct. 6, 10, 86 L.Ed. 28 (1941). As the Eleventh Circuit explained in La Seguridad v. Transytur Line, 707 F.2d 1304 (11th Cir.1983), "[t]he court must ascertain if there is anything about the specific federal statute which indicates that Congress implicitly spoke to, and rejected, the application of forum non conveniens doctrine to a suit thereunder." Id. at 1310 n. 10. 28 U.S.C. Sec. 1338(a) is not the same type of mandatory venue provision found in either the Jones Act or FELA. That statute merely states that United States district courts shall have exclusive jurisdiction of United States copyright claims over state courts.

Our conclusion is reinforced by this Court's previous decision in Lockman Found. v. Evangelical Alliance Mission, 930 F.2d 764 (9th Cir.1991). In that decision, the plaintiff brought an action for certain non-copyright claims and for copyright infringement under both United States and Japanese law. Id. at 766. Following the forum non conveniens dismissal of its complaint by the district court, the plaintiff appealed both the dismissal of its noncopyright claims and the district court's refusal to allow it to amend its complaint to drop the copyright claims. Id. This Court affirmed both the district court's forum non conveniens dismissal and its decision to deny the plaintiff's motion to amend its complaint, concluding that the copyright and non-copyright claims were too closely intertwined to be severed. Id. at 772. Based on an analysis of the complaint as a whole, including the copyright claims, we concluded that "[i]n this case, there is no arguably applicable law that would end the forum non conveniens inquiry, so no potentially dispositive choice of law determination need have been made." Id. at 771. We believe this statement of the law to be equally applicable to the instant case.

The dissent inaccurately faults our decision for failing to take the principle of national treatment into account. Both the Universal Copyright Convention (U.C.C.) and the Berne Convention for the Protection of Literary and Artistic Works (Berne) mandate a policy of national treatment in which copyright holders are afforded the same protection in foreign nations that those nations provide their own authors. See U.C.C. Art. II; Berne, Art. V. The dissent accurately points out that the principle of national treatment implicates a rule of territoriality in which " '[t]he applicable law is the copyright law of the state in which the infringement occurred, not that of the state of which the author is a national or in which the work was first published.' " Subafilms, Ltd. v. MGM-Pathe Comm., 24 F.3d 1088, 1097 (9th Cir.1994) (en banc) (quoting 3 David Nimmer and Melville B. Nimmer, Nimmer on Copyright Sec. 17.05 at 17-39 (1994)).

The law of this forum, however, includes the forum non conveniens doctrine. The dissent argues that "the principle of national treatment requires that United States copyright law be applied in order to remedy infringing conduct that occurred in the United States." Post at 706. We do not agree with this sweeping conclusion. National treatment and territoriality are choice of law principles, See Subafilms, 24 F.3d at 1097; 3 Nimmer, supra Sec. 17.05 at 17-39, and do not preclude the application of the forum non conveniens doctrine merely because a foreign author alleges...