Mattel, Inc. v. Bryant, No. CV 04-9059 NM (RNBX).

CourtUnited States District Courts. 9th Circuit. United States District Courts. 9th Circuit. Central District of California
Writing for the CourtManella
Citation441 F.Supp.2d 1081
Decision Date04 March 2005
Docket NumberNo. CV 04-9059 NM (RNBX).
PartiesMATTEL, INC., a Delaware corporation, Plaintiff, v. Carter BRYANT, an individual; and Does 1 through 10, inclusive, Defendant. And Related Counterclaims
441 F.Supp.2d 1081
MATTEL, INC., a Delaware corporation, Plaintiff,
v.
Carter BRYANT, an individual; and Does 1 through 10, inclusive, Defendant.
And Related Counterclaims
No. CV 04-9059 NM (RNBX).
United States District Court, C.D. California.
March 4, 2005.

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Tania Marie Krebs, John B. Quinn, Michael T. Zeller, Jon D. Corey, Quinn Emanuel Urquhart Oliver and Hedges, Los Angeles, CA, for Plaintiff.

David K. Caplan, Ellie Schwimmer, Keats McFarland & Wilson, Beverly Hills, CA, Douglas A. Wickham, Keith A. Jacoby, Robert F. Millman, Littler Mendelson, Los Angeles, CA, for Defendant.

ORDER DENYING PLAINTIFF MATTEL, INC.'S MOTION TO REMAND AND CERTIFYING QUESTION FOR INTERLOCUTORY REVIEW

MANELLA, District Judge.


I. INTRODUCTION

On April 27, 2004, Mattel, Inc. ("Mattel"), the world's largest manufacturer and marketer of toys, dolls, games, and stuffed toys and animals, filed the instant Complaint against its former employee, Carter Bryant ("Bryant"), in the Superior Court for the County of Los Angeles. The Complaint fails to state the amount in controversy and asserts generically-phrased causes of action for: (1) breach of contract; (2) breach of fiduciary duty; (3) breach of duty of loyalty; (4) unjust enrichment; and (5) conversion. On May 14, 2004, Bryant filed a Notice of Removal. On August 20, 2004, the court granted Mattel's motion to remand, finding that Bryant had failed to demonstrate the presence of either federal question jurisdiction or diversity jurisdiction. On November 2,

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2004, Bryant filed a second Notice of Removal. On December. 7, 2004, MGA Entertainment ("MGA"), pursuant to stipulation and order, intervened as a defendant. Pending before the court is Mattel's Motion to Remand.

II. FACTUAL & PROCEDURAL BACKGROUND
A. Allegations in Mattel's Complaint

Mattel employed Bryant as a product designer from September 1995 through April 1998, and from January 1999 through October 2000. Compl. ¶ 9. Upon starting his second term, Bryant signed an Employee Confidential Information and Inventions Agreement, in which he agreed not to "engage in any employment or business other than for [Mattel], or invest or assist (in any manner) any business competitive with the business or future business plans of [Mattel]." Id. 1110. Bryant assigned to Mattel all rights, title, and interest in the "inventions" he conceived of, or reduced to practice, during his employment. Id.

Bryant also completed Mattel's Conflict of Interest Questionnaire. Id. 11. Bryant certified that he had not worked for any of Mattel's competitors in the prior twelve months and had not engaged in any business dealings creating a conflict of interest. Id. Bryant agreed to notify Mattel of any future events raising a conflict of interest. Id.

The Complaint asserts that, "[i]n late November 2003, Mattel learned that Bryant had secretly aided, assisted and worked for a Mattel competitor ... by entering into an agreement with the competitor, during the time [he] was employed by Mattel ... ." Id ¶ 12. "Bryant's agreement with the competitor obligated Bryant to provide product design services to the competitor on a top priority' basis." Id. Furthermore, it "provided ... that Bryant would receive royalties and other consideration for sales of products on which [he] provided aid or assistance; that all work and services furnished by Bryant to the competitor under the agreement would be considered `works for hire'; and that all intellectual property rights to preexisting work by Bryant purportedly would be assigned to the competitor." Id. The Complaint also alleges that "Bryant converted, misappropriated and misused Mattel property and resources for the benefit of, and to aid and assist, Bryant personally and Mattel's competitor." Id.

In support of its first motion to remand, Mattel provided a copy of this agreement between Bryant and MGA. See Zeller Decl., Ex. 9 (MGA Agreement). Pursuant to the agreement, signed September 18, 2000, Bryant agreed to provide product design services for MGA's line of "Bratz" dolls (the "Bratz"). Id.1 In return, MGA agreed to pay Bryant $5,500 per month for the first six months and $5,000 per month for the next three months. Id. MGA also agreed to pay Bryant a 3% royalty on the Bratz he worked on. Id.

B. The First Notice of Removal

On May 14, 2004, pursuant to 28 U.S.C. § 1441, Bryant filed his first notice of removal.2 Bryant argued that this court had subject matter jurisdiction under both 28

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U.S.C. § 1331 (federal question jurisdiction) and 28 U.S.C. § 1332 (diversity jurisdiction).3 First, Bryant asserted that the court had jurisdiction under § 1331 because Mattel's claims likely implicated the rights to the Bratz and, therefore, would "require construction of federal intellectual property laws . . . ." Opp. to First Mot. to Remand at 11. Second, Bryant contended that the court had jurisdiction under § 1332 because he was of diverse citizenship from Mattel and the rights to the Bratz, worth "millions," were in controversy. Id. at 1-2, 5-6.

On June 14, 2004, Mattel filed a motion to remand, arguing it did not know whether the Bratz were in controversy because it did not know whether Bryant developed the Bratz while still employed by Mattel. See, e.g., July 12, 2004 Rep. at 4 (disclaiming knowledge of "whether rights to Bratz are indeed at stake here").

C. August 20, 2004 Order

On August 20, 2004, the court granted Mattel's motion to remand, finding that Bryant had failed to demonstrate the presence of subject matter jurisdiction. First, the court found that Bryant had failed to demonstrate federal question jurisdiction because the face of the Complaint asserted only state law claims. See Aug. 20, 2004 Order at 8. Second, the court found that Bryant had failed to demonstrate diversity jurisdiction because he had not shown that the rights to the Bratz were in controversy. See id. at 6.

D. Events Occurring Between the First and Second Notices of Removal

On August 12, 2004, Mattel produced to Bryant a July 18, 2003 Wall Street Journal article that suggested Bryant had copied a scrapped Mattel project, known as "Toon Teens," in creating the Bratz. Not. of Removal ¶ 21.4

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On August 16, 2004, upon Bryant's specific request, Mattel produced to Bryant drawings of the Toon Teens. Jacoby Decl. ¶ 5. Mattel also produced the copyright registration for the Toon Teens drawings filed November 28, 2003, four years after the drawings were allegedly created. Not. of Removal ¶ 21; Zeller Decl. ¶27.5 Mattel had failed to produce these documents in response to Bryant's June 14, 2004 comprehensive Request for Production. Jacoby Decl. ¶ 5; Zeller Decl., Ex. 36; Second Zeller Decl., Ex. 6.6 When Mattel eventually produced the Toon Teens documents in August, it maintained: "Mattel does not believe the Toon Teens drawings and documents . . . are responsive to defendant's propounded document requests." Zeller Decl., Ex. 36.

On September 8, 2004, Bryant filed a cross-complaint against Mattel asserting claims for unfair competition, rescission, declaratory relief, and fraud. See Cross-Compl. On September 9 and 10, 2004, Bryant filed papers in state court arguing that Mattel's action was implicitly premised upon the allegation that Bryant copied the Toon Teens in developing the Bratz. Zeller Decl., Exs. 8 (Bryant's Mot. for Protective Order) & 45 (Bryant's Case Management Statement).

On October 8, 2004, Mattel again produced to Bryant the above-mentioned Toon Teens documents, this time in response to Bryant's discovery request seeking "[a]ll documents . . . that evidence, relate or refer to Toon Teen's [sic] similarity to any toy sold under the trademark or trade name `Bratz.'" Jacoby Decl. ¶ 8; Second Zeller Decl., Ex. 7.

On October 11, 2004, Mattel produced to Bryant evidence of a document-exchange agreement it has with a company being sued by MGA for infringing the copyrights to the Bratz. Jacoby Decl. ¶ 9 & Ex. 7. The company had requested that Mattel send it documents relating to the Toon Teens "so that [it] [could] challenge the originality of MGA's design [in the Bratz] and [MGA's] corresponding claim to copyright." Jacoby Decl., Ex. 7.

On October 13, 2004, Mattel produced to Bryant an anonymous letter received by Mattel's CEO in August 2002, alleging that Bryant had stolen the idea for the Bratz from Mattel. Jacoby Decl. ¶ 10 & Ex. 8. Mattel also produced documents indicating that this letter triggered an investigation in 2002 into Bryant's conduct. Id.

Mattel has aggressively pursued discovery relating to the Bratz. See Not. of

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Removal ¶21. In late October 2004, "Mattel[] . . . informed . . . Bryant it would no longer honor a previously agreed upon discovery limitation[] that Mattel would seek only documents related to the `first generation of Bratz designs.'" Not. of Removal ¶ 21; Jacoby Decl. ¶ 13 & Exs. 9, 13, 14.

E. Second Notice of Removal

On November 2, 2004, Bryant filed a second Notice of Removal based upon both § 1331 (federal question) and § 1332 (diversity) jurisdiction.7 Bryant asserts that the Complaint presents a federal question because events occurring since the first removal and remand demonstrate that Mattel's conversion claim involves the rights to the Bratz and is completely preempted by the Copyright Act. Not. of Removal ¶¶ 10, 29, 34. Bryant also contends that there is diversity jurisdiction because he and Mattel are of diverse citizenship and the same facts demonstrate that the amount in controversy exceeds $75,000. See id. 11119-24.

F. Events Occurring After Bryant Filed the Second Notice of Removal

On November 2, 2004, Bryant filed a Complaint in federal court seeking a declaratory judgment that the Bratz do not violate Mattel's copyrights.

From November 4 through November 8, 2004, Mattel's lead counsel took Bryant's deposition and questioned Bryant regarding not...

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28 practice notes
  • Vandeventer v. Guimond, No. 07-4018-JAR.
    • United States
    • United States District Courts. 10th Circuit. United States District Courts. 10th Circuit. District of Kansas
    • July 10, 2007
    ...or service or process. 18. Chavez v. Kincaid, 15 F.Supp.2d 1118, 1125 (D.N.M.1998). 19. See, e.g., id.; Mattel, Inc. v. Bryant, 441 F.Supp.2d 1081, 1090-91 (C.D.Cal.2005); Integra Bank, N.A. v. Greer, No. IP 4:02-CV-244 B/H, 2003 WL 21544260, at *3 (S.D.Ind. June 26, 20. Mattel, Inc., 441 F......
  • Leys v. Lowe's Home Centers, Inc., Case No. 1:08-cv-1084.
    • United States
    • United States District Courts. 6th Circuit. United States District Court (Western District Michigan)
    • January 9, 2009
    ...of removal, it does not consider the materials submitted by the Defendants post-removal.") (emphasis added); Mattel, Inc. v. Bryant, 441 F.Supp.2d 1081, 1091 n. 11 (C.D.Cal.2005) ("Because these arguments did not appear in the notice of removal, the court need not consider them."), aff'd o.......
  • Graves v. IBT Local 572, Case No. CV 11-5173 PSG (FMOx)
    • United States
    • United States District Courts. 9th Circuit. United States District Courts. 9th Circuit. Central District of California
    • August 17, 2011
    ...the burden of establishing that removal is proper. See Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992); Mattel, Inc. v. Bryant, 441 F. Supp.2d 1081, 1089 (C.D. Cal. 2005). Federal subject matter jurisdiction is satisfied through removal if the case could have originally been filed in......
  • Oakland Cnty. v. Fed. Nat'l Mortg. Ass'n, Civil Action No. 11-12666
    • United States
    • United States District Courts. 6th Circuit. United States District Court (Eastern District of Michigan)
    • September 20, 2011
    ...action." The text does not require that a plaintiff must be able to sue a putative defendant-intervenor. See Mattel, Inc. v. Bryant, 441 F. Supp. 2d 1081, 1097 (C.D. Cal. 2005) (noting, in discussing whether intervention would destroy diversity jurisdiction, "'[W]hether the context is remov......
  • Request a trial to view additional results
28 cases
  • Vandeventer v. Guimond, No. 07-4018-JAR.
    • United States
    • United States District Courts. 10th Circuit. United States District Courts. 10th Circuit. District of Kansas
    • July 10, 2007
    ...or service or process. 18. Chavez v. Kincaid, 15 F.Supp.2d 1118, 1125 (D.N.M.1998). 19. See, e.g., id.; Mattel, Inc. v. Bryant, 441 F.Supp.2d 1081, 1090-91 (C.D.Cal.2005); Integra Bank, N.A. v. Greer, No. IP 4:02-CV-244 B/H, 2003 WL 21544260, at *3 (S.D.Ind. June 26, 20. Mattel, Inc., 441 F......
  • Leys v. Lowe's Home Centers, Inc., Case No. 1:08-cv-1084.
    • United States
    • United States District Courts. 6th Circuit. United States District Court (Western District Michigan)
    • January 9, 2009
    ...of removal, it does not consider the materials submitted by the Defendants post-removal.") (emphasis added); Mattel, Inc. v. Bryant, 441 F.Supp.2d 1081, 1091 n. 11 (C.D.Cal.2005) ("Because these arguments did not appear in the notice of removal, the court need not consider them."), aff'd o.......
  • Graves v. IBT Local 572, Case No. CV 11-5173 PSG (FMOx)
    • United States
    • United States District Courts. 9th Circuit. United States District Courts. 9th Circuit. Central District of California
    • August 17, 2011
    ...the burden of establishing that removal is proper. See Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992); Mattel, Inc. v. Bryant, 441 F. Supp.2d 1081, 1089 (C.D. Cal. 2005). Federal subject matter jurisdiction is satisfied through removal if the case could have originally been filed in......
  • Oakland Cnty. v. Fed. Nat'l Mortg. Ass'n, Civil Action No. 11-12666
    • United States
    • United States District Courts. 6th Circuit. United States District Court (Eastern District of Michigan)
    • September 20, 2011
    ...action." The text does not require that a plaintiff must be able to sue a putative defendant-intervenor. See Mattel, Inc. v. Bryant, 441 F. Supp. 2d 1081, 1097 (C.D. Cal. 2005) (noting, in discussing whether intervention would destroy diversity jurisdiction, "'[W]hether the context is remov......
  • Request a trial to view additional results

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