Testa v. Janssen

• Decision Date: 22 January 1980
• Docket Number: Civ. A. No. 76-54.
• Citation: 482 F. Supp. 1195
• Parties: Jimmy TESTA, John Thomas and Carl Thomas, Plaintiffs, v. Danny JANSSEN, Bobby Hart, Jeff S. Wald, Helen Reddy, Pocket Full of Tunes, Inc., The Wes Farrell Organization, and Capitol Records, Inc., Wes Farrell, and The Big Apple Music Company, Defendants.
• Court: U.S. District Court — Eastern District of Pennsylvania

482 F. Supp. 1195

Jimmy TESTA, John Thomas and Carl Thomas, Plaintiffs, v. Danny JANSSEN, Bobby Hart, Jeff S. Wald, Helen Reddy, Pocket Full of Tunes, Inc., The Wes Farrell Organization, and Capitol Records, Inc., Wes Farrell, and The Big Apple Music Company, Defendants.

Civ. A. No. 76-54.

United States District Court, W. D. Pennsylvania.

January 22, 1980.

Irving M. Portnoy, Pittsburgh, Pa., for plaintiff.

Robert D. Yeager, Pittsburgh, Pa., for Jeff Wald, Helen Reddy and Capitol Records.

G. Daniel Carney, Pittsburgh, Pa., Robert C. Osterberg, New York City, for Wes Farrell, The Wes Farrel Organization, Pocket Full of Tunes, Danny Janssen, Bobby Hart, and the Big Apple Music Co.

OPINION

ZIEGLER, District Judge.

I. History of Case

This is a civil action for injunctive relief and damages for alleged copyright infringement pursuant to the Federal Copyright Act, 17 U.S.C. § 101, et seq. Jurisdiction is conferred by 28 U.S.C. § 1338.

Plaintiffs, Jimmy Testa, John Thomas and Carl Thomas were assigned all right, title, and interest to an original composition entitled, "Kept on Singing" in 1971. Registration and certification of the copyright was obtained on November 15, 1971. The alleged infringement is predicated on a musical composition entitled, "Keep on Singing," allegedly written in 1972 by defendants Danny Janssen and Bobby Hart and sung by defendant, Helen Reddy. On August 28, 1972, Janssen and Hart assigned their rights to "Keep on Singing" to defendant, Pocket Full of Tunes, Inc., a company wholly owned by defendant, Wes Farrell. Pocket Full of Tunes registered a copyright for "Keep on Singing" on December 8, 1972.

The instant action was commenced on January 1, 1976. Discovery proceedings revealed that Pocket Full of Tunes had assigned its copyright to "Keep on Singing" to the Big Apple Music Company (Big Apple) on June 15, 1977. As a result, plaintiffs amended their complaint and summoned Big Apple as a defendant.

Presently before the court are the following matters: (1) the motions to dismiss for alleged want of in personam jurisdiction and venue by Big Apple and Wes Farrell; and (2) a motion to dismiss by the Wes Farrell Organization alleging want of capacity. For the reasons set forth herein, the motions to dismiss of Wes Farrell and the Wes Farrell Organization will be granted. The motion to dismiss of Big Apple will be denied.

II. The Motion to Dismiss of Big Apple

An affidavit submitted by Big Apple in support of its motion to dismiss avers that: (1) Big Apple is a New York corporation and not qualified to do business in Pennsylvania; (2) it maintains no bank account in Pennsylvania; (3) it owns no property in Pennsylvania; (4) it ships no merchandise into the forum state; and (5) it has no agents within the Commonwealth. Accordingly, Big Apple contends this court lacks in personam jurisdiction and venue is improper.

Title 28 U.S.C. § 1400(a) provides:

Civil actions, suits, or proceedings arising under any Act of Congress relating to copyrights may be instituted in the district in which the defendant or his agent resides or may be found.

As a practical matter, the test is identical for determining the question of venue and jurisdiction over a non-resident corporation. Kogan v. Longstreet, 374 F.Supp. 47, 50 (N.D.Ill.1974); Boltons Trading Corp. v. Killiam, 320 F.Supp. 1182 (S.D. N.Y.1970). Also, the reference in section 1400(a) to "may be found" does not impose a greater finding of presence than is required to obtain jurisdiction over a corporate defendant. Boltons Trading Corp. v. Killiam, supra at 1183. Therefore, if a non-resident corporation is amenable to process under the forum's long-arm statute, in personam jurisdiction and venue are extant. Time, Inc. v. Manning, 366 F.2d 690 (5th Cir. 1966); Droke House Publishers, Inc. v. Aladdin District Corp., 352 F.Supp. 1062 (N.D.Georgia 1972).

Plaintiffs rely on 42 Pa.C.S.A. § 5322(a)(1)(iii) as the basis for personal jurisdiction over Big Apple. That section provides:

General rule.—A tribunal of this Commonwealth may exercise personal jurisdiction over a person (or the personal representative of a deceased individual who would be subject to jurisdiction under this subsection if not deceased) who acts directly or by an agent, as to a cause of action or other matter arising from such person:

(1) Transacting any business in this Commonwealth. Without excluding other acts which may constitute transacting business in this Commonwealth, any of the following shall constitute transacting business for the purpose of this paragraph:

* * * * * *

(iii) The shipping of merchandise directly or indirectly into or through this Commonwealth.

Pursuant to an agreement with Broadcast Music, Inc. (BMI) that runs through June of 1980, Big Apple assigned to BMI the right to perform and license others to perform all musical compositions in which it owns or holds a copyright. BMI is authorized to distribute Big Apple's songs anywhere in the world. In return, BMI agreed to compensate Big Apple "for performances of works on broadcast stations in the United States." The alleged infringing song, "Keep on Singing," is covered by this agreement.¹ The song has been and continues to be played on radio stations in Western Pennsylvania and sold at retail outlets in this area.²

Under Pennsylvania law, a foreign corporation "indirectly" ships merchandise into the Commonwealth, pursuant to section 5322(a)(1)(iii), when it "could reasonably foresee that its product would be sold . . . to outlets around the country, and that Pennsylvania would be one such market." Washington v. U. S. Suzuki Motor Corp., 257 Pa.Super. 482, 390 A.2d 1339, 1340 (1978). The Pennsylvania Supreme Court abrogated the rule enunciated in Swavely v. Vandergrift, 397 Pa. 281, 154 A.2d 779 (1959) which required foreign corporations to defend suits in Pennsylvania only if the "middleman" or "shipper" was an agent of the foreign corporation. Image Ten, Inc. v. Walter Reade Organization, Inc., 456 Pa. 485, 322 A.2d 109, 113-114 (1974). As the court explained:

A nonregistered foreign corporation may now be subject to suit in Pennsylvania whether or not its agents or employees were ever physically present in this State and regardless of the contractual relationship between the foreign company and its Pennsylvania representative.

Id. at 114. This rule is applicable even if the middleman or shipper is a non-resident. McCrory Corp. v. Girard Rubber Corp., 225 Pa.Super. 45, 307 A.2d 435, aff'd, 459 Pa. 57, 327 A.2d 8 (1974).

The Image Ten holding is particularly apposite to the instant case because the foreign corporation was held to have "indirectly" shipped motion picture film into Pennsylvania within the meaning of the long-arm statute, even though it was never physically present in that jurisdiction and had no agents in the state. Significantly, the court rejected the claim of the foreign corporation that a motion picture film was not "merchandise." The court stated:

There is no such restriction in the statute and the word `merchandise' clearly applies to a motion picture film, just as it would to any product which is marketable because of its artistic value rather than the value of its physical components.

322 A.2d at 114.

The case law from without Pennsylvania is conflicting in a copyright infringement setting. Big Apple relies principally on Selle v. Gibb, No. 78C 3656 (N.D.Ill. August 2, 1979). In Selle, the district court held that a New York publisher was not subject to jurisdiction or venue under section 1400(a) because "all physical acts of exploitation in Illinois were conducted pursuant to contracts executed outside of Illinois, between the publisher and wholly independent third-party licensees, who are both licensed and located outside of Illinois." Id. at 6 (slip opinion). However, in Walker v. University Books, Inc., 382 F.Supp. 126 (N.D.Cal.1974), a New York resident, who allegedly infringed a copyrighted book, was held to be subject to venue and jurisdiction in California, since "defendant reasonably could have foreseen that his acts might result in copyright infringement and unfair competition in a distant state." Id. at 130-131.

In our judgment, the Pennsylvania cases, particularly Image Ten, are more persuasive and are controlling. Big Apple "indirectly" shipped the alleged infringing song and other songs into Pennsylvania through its licensee, BMI. It is of no import that Big Apple's contract with BMI was executed without Pennsylvania or that Big Apple engaged in no physical acts in the Commonwealth. Since BMI is authorized to distribute songs such as "Keep on Singing" anywhere in the United States, Big Apple could reasonably have foreseen that the song would be distributed in Pennsylvania.

Having decided that Big Apple's activities in Pennsylvania fall within the ambit of section 5322(a)(1)(iii), we must now decide whether the assertion of long-arm jurisdiction offends the due process clause of the fourteenth amendment. Columbia Metal Culvert Co. v. Kaiser Industries Corp., 526 F.2d 724, 730 (3d Cir. 1975).

Due process, in a jurisdictional context, requires that a defendant "have certain minimum contacts with the forum state such that maintenance of the suit does not offend `traditional notions of fair play and substantial justice.'" International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 158, 90 L.Ed. 95 (1945).

The exhibits and affidavit submitted by plaintiffs in opposition to Big Apple's motion indicate that "Keep on Singing" has been and continues to be played by Pennsylvania radio stations and sold at Pennsylvania stores. Moreover, the materials submitted also indicate that BMI distributes other Big Apple songs which are played on Pennsylvania stations and sold in Pennsylvania stores.³

Under these circumstances, the observations of the Court of Appeals in Edy Clover Productions, Inc. v. National Broadcasting Co., Inc., 572 F.2d 119 (3d Cir. 1978) are...