HB Prods., Inc. v. Faizan
| Decision Date | 13 May 2022 |
| Docket Number | CIV. NO. 19-00487 JMS-KJM |
| Citation | 603 F.Supp.3d 910 |
| Parties | HB PRODUCTIONS, INC., Plaintiff, v. Muhammad FAIZAN, Defendant. |
| Court | U.S. District Court — District of Hawaii |
Kerry S. Culpepper, Kailua Kona, HI, for Plaintiff.
ORDER SUSTAINING PLAINTIFF'S OBJECTIONS, ECF NO. 79, TO THE MARCH 29, 2022 FINDINGS AND RECOMMENDATION, ECF NO. 78
Plaintiff HB Productions, Inc. ("Plaintiff") objects under 28 U.S.C. § 636(b)(1) to Magistrate Judge Kenneth J. Mansfield's March 29, 2022 Findings and Recommendation ("F&R"), ECF No. 78, to deny Plaintiff's Motion for Default Judgment Against Defendant Muhammad Faizan ("Defendant") due to lack of personal jurisdiction. ECF No. 79. As discussed below, the court concludes that it has personal jurisdiction over Defendant. Accordingly, the court SUSTAINS Plaintiff's Objections and REJECTS the F&R.
On September 9, 2019, Plaintiff filed a complaint against Defendant and multiple unnamed "doe" defendants. ECF No. 1. Plaintiff subsequently filed the first and second amended complaints against Defendant only. ECF Nos. 40, 64. Despite being served with copies of at least the first and second amended complaints and the Motion for Default Judgment underlying this Order, see ECF Nos. 41, 65, & 75-9, Defendant has yet to make an appearance in or otherwise respond to this case.
Plaintiff sought entry of default judgment based on the first amended complaint three separate times. In the first two, the magistrate judge found and recommended that the court deny entry of default judgment because Plaintiff failed to establish that its claims against Defendant were "sum certain" as required by Federal Rule of Civil Procedure 55(b)(1). See ECF Nos. 46, 52. Although the first finding and recommendation was not appealed to this court, see ECF No. 49, the second was, and the court adopted it in full, see ECF Nos. 53 & 54. In addressing Plaintiff's third motion for default judgment, ECF No. 55, the magistrate judge found and recommended that the court deny entry of default judgment for a different reason—lack of personal jurisdiction. See ECF No. 58; see also In re Tuli , 172 F.3d 707, 712 (9th Cir. 1999) (). Plaintiff objected to that finding and recommendation, ECF No. 59, but the court overruled the objection and provided Plaintiff the opportunity to file a second amended complaint, ECF No. 60. The court held that Plaintiff's allegations "failed to demonstrate that [the foreign] Defendant's activities were expressly aimed at the United States or Hawaii" and thus that "Plaintiff failed to show that Defendant's contacts [were] sufficient to invoke nationwide [personal] jurisdiction pursuant to [the federal long-arm statute]." Id. at PageID # 565. To a large degree, the court grounded its decision in AMA Multimedia, LLC v. Wanat , 970 F.3d 1201 (9th Cir. 2020), and 42 Ventures, LLC v. Rend , 2020 WL 6257069 (D. Haw. Oct. 23, 2020), affirmed in part , 2021 WL 5985018 (9th Cir. Dec. 16, 2021) (mem.). See ECF No. 60 at PageID ## 557–62.
Plaintiff filed the Second Amended Complaint ("SAC") on December 2, 2020, ECF No. 64, which attempted to "allege facts sufficient to comply with Wanat ’s newer guidance on express aiming," ECF No. 60 at PageID # 565. The action was stayed pending an appeal in 42 Ventures. See ECF No. 67. The stay was lifted on December 16, 2021, when the Ninth Circuit issued its decision in 42 Ventures. See ECF Nos. 68, 68-1. On January 14, 2022, Plaintiff requested that the Clerk of Court enter default against Defendant for failure to appear or otherwise defend the SAC. ECF No. 73. The Clerk entered default on January 19, 2022. ECF No. 74.
On January 27, 2022, Plaintiff filed his latest Motion for Default Judgment under Federal Rule of Civil Procedure 55(b)(2), seeking injunctive relief and an award of $179,668.27 for various damages and costs. ECF No. 75. The magistrate judge issued the March 29, 2022 F&R recommending that the request for entry of default judgment be denied. See ECF No. 78. He found that Defendant's allegations of direct infringement "[did] not demonstrate express aiming at the United States" and, likewise, that Defendant's allegations of contributory infringement—namely, operating his websites—"fail[ed] to establish that Defendant's intentional act of operating [those websites] [was] expressly aimed at the United States." Id. at PageID ## 775, 780. Plaintiff had thus failed to establish that Defendant "purposefully directed his actions toward the United States," and the court lacked personal jurisdiction over Defendant as a result. Id. at PageID # 780. Plaintiff timely objected to the F&R on March 30, 2022. See ECF No. 79.
In the SAC, Plaintiff claims that Defendant engaged in direct and contributory infringement of Plaintiff's copyright on the motion picture Hellboy , in violation of the Copyright Act of 1976, 17 U.S.C. § 101 et seq. ECF No. 64 at PageID # 582, ¶¶ 1–2. Plaintiff seeks both injunctive and monetary relief. See id. at PageID ## 624, 626–27.
The SAC alleges four principal actions in support of Plaintiff's infringement claims: First, Defendant "ripped" legitimate copies of Hellboy to create pirated digital copies, id. at PageID # 602, ¶¶ 71–73; second, Defendant distributed full or partial pirated copies of Hellboy through a "torrent" network, id. at PageID ## 582–83, 587–88; third, Defendant operated websites that published downloadable torrent files, including the torrent files associated with the pirated copies of Hellboy, see id. at PageID ## 583–84, 601; and fourth, Defendant uploaded torrent files associated with Hellboy onto other movie piracy sites, see id. at PageID ## 585–86, ¶¶ 19–20. Defendant was not physically present in the United States while committing the alleged actions—instead, Defendant sat behind his keyboard in Gujranwala, Pakistan. See id. at PageID # 601, ¶ 68 (); ECF No. 60 at PageID # 560 (order adopting prior findings and recommendation) ("Nor does Plaintiff allege any facts showing that Defendant ... was physically present in the United States to upload his files.").
For the first action—ripping1 —Defendant allegedly purchased a Blu-Ray-disc version of Hellboy from a United States retailer and bypassed the anti-copying protections on that Blu-Ray disc in order to create a directly infringing copy. ECF No. 64 at PageID # 625, ¶ 182. The SAC does not specify where or on what computer Defendant ripped the Blu-Ray disc. Defendant also allegedly ripped a digital "streaming copy" of Hellboy that Defendant had purchased on Amazon.com, also a United States retailer. Id. at PageID # 625, ¶¶ 183–84. Defendant purchased and streamed that copy using a computer with a United States-based IP address2 because, at the time, "geographic restrictions prevented [Hellboy ] from being publicly performed (streamed) in Pakistan." Id. , ¶ 183. Although the SAC does not provide specifics, it is technologically possible that, given the ubiquity of remote computing via leased virtual machines,3 Defendant purchased from and streamed to a computer in the United States despite residing abroad. The SAC does not specify where or on what computer Defendant ripped the streaming copy. The SAC implies that Defendant used a virtual machine in the United States to purchase and stream , and that Defendant used his computer in Pakistan to facilitate the remote connection to that virtual machine, but the SAC does not specify on which of those computers Defendant conducted the ripping actions. See id. at PageID # 596, ¶ 52.
For the second action—distributing and reproducing pirated copies through a torrent network—Defendant allegedly "sent ... at least a piece of [a digital copy of Hellboy ] 16,942 times" "to specific IP addresses in the United States using ... BitTorrent," "one of the most common peer-to-peer file sharing protocols." Id. at PageID ## 587–88, 605, ¶¶ 22–24, 89. Those pirated digital copies were initially created through the ripping actions described above, making Defendant the "initial seeder" of the digital copies and thus a contributory infringer, according to the SAC. See id. at PageID ## 608, 623, ¶¶ 102, 173.
As an "initial seeder," Defendant both made available for transfer over the Internet the "target files," i.e., the digital copies of Hellboy , and created the "torrent files" associated with those target files. See id. at PageID # 608, ¶ 102; see also Columbia Pictures Indus., Inc. v. Fung , 710 F.3d 1020, 1027 (9th Cir. 2013) (describing torrent architecture). The persons who received or downloaded the target files over the BitTorrent network are referred to as "leechers." Fung , 710 F.3d at 1028. "Once [a] leecher has downloaded one or more pieces of [a target file], he, too, can be a seeder by sending other leechers the pieces that he has downloaded." Id. In that way, BitTorrent implements a hybrid peer-to-peer filesharing networking, permitting leechers to simultaneously receive different pieces of a target file from different seeders, instead of from a single seeder or central repository that can become overloaded with requests. See id. at 1026–27 ; ECF No. 64 at PageID ## 605–06, ¶ 90.
Notably, after Defendant initially seeded the target files, the file-transfer process was largely hands-off from his perspective. Defendant needed only to publish the torrent files corresponding to the target files on the web for others to download. See ECF No. 64 at PageID ## 608–09, ¶¶ 103–11; Fung , 710 F.3d at 1027 (...
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