United States District Court, D. Arizona
AMA Multimedia, LLC, a producer of pornographic material,
asserts copyright infringement claims against several
entities and one individual associated with the website
Porn.com: Sagan, Limited; Cyberweb, LTD; Netmedia Services,
Inc.; GLP 5, Inc.; and David Koonar. Defendants GLP and
Netmedia - a Michigan corporation and Canadian company,
respectively - move to dismiss for lack of personal
jurisdiction pursuant to Federal Rule of Civil Procedure
12(b)(2), or, in the alternative, to stay these proceedings
pending resolution of an action currently before the Supreme
Court of Barbados. Doc. 27. The parties' request for oral
argument is denied because the issues have been fully briefed
and oral argument will not aid in the Court's decision.
See Fed. R. Civ. P. 78(b); Partridge v.
Reich, 141 F.3d 920, 926 (9th Cir. 1998). The Court will
deny the stay request and hold the motion to dismiss in
abeyance until limited jurisdictional discovery and
supplemental briefing are completed.
is a video streaming website that generates revenue through
its content partnership program and advertising banners. Doc.
16, ¶¶ 56-57. AMA asserts that Defendants
Sagan, Cyberweb, Netmedia, and David Koonar are each owners
and/or operators of Porn.com and GLP. Id.,
¶¶ 46-47. AMA also alleges that GLP is doing
business as Traffic Force, an advertising and publishing
network that provides end-user traffic to websites for
profit. Doc. 16, ¶ 47. Defendants respond that Cyberweb
is the owner/operator of Porn.com. Doc. 27-3 at 3, ¶15.
September 2012, AMA joined Porn.com's Content Partnership
Program by entering into a content partner revenue sharing
agreement (“CPRA”) with GIM Corp.
(“GIM”). Doc. 33 at 6; Doc. 27-3 at 17. AMA
agreed to the CPRA by completing an automated process at
Paidperview.com. Doc. 33 at 6. There was no direct contact
between AMA and any of the Defendants. Id. The CPRA
granted GIM a license to use content provided by AMA on
websites whose advertisements are controlled by Traffic
Force. Id. The CPRA dictated the manner and form in
which AMA would provide content, and AMA granted GIM a
license only for content provided under the CPRA.
November 2015, AMA became aware that Porn.com had displayed
64 of AMA's copyright registered works over 110 separate
Porn.com affiliated URLs. Doc. 16 at ¶ 78. In December
2015, AMA provided Defendants' counsel with a draft
complaint and settlement offer regarding the alleged
infringement. Doc. 33 at 2. According to AMA, over the next
four months “Defendants provided a string of delays and
misrepresentations about the matters and settlement
negotiations.” Id. In April 2016, AMA
presented Defendants with an amended complaint and a
“deadline to choose between accepting a settlement
offer or hav[ing] the case filed in U.S. District Court, for
the District of Arizona.” Id. at 3. Defendants
requested an extension until April 28, 2016 to consider the
settlement offer, and AMA agreed. Id.
April 27, 2016, Cyberweb, Netmedia, Sagan, GLP, GIM, and
David Koonar (collectively, “Porn.com Entities”)
filed a complaint against AMA and Adam Silverman in the
Supreme Court of Barbados. Doc. 27-3 at 17-23. The Porn.com
Entities sought (1) injunctive relief to restrain
anticipatory breach of the CPRA, (2) a declaration that any
disputes related to the CPRA are governed by Barbados law and
must be adjudicated in Barbados, (3) a declaration that the
Porn.com Entities are entitled to rely on their rights under
the CPRA, (4) a declaration that the Porn.com Entities are
entitled to publicize and distribute materials provided to
them by AMA and Silverman, and (5) relief for prior breaches
of the CPRA, including damages. Id. at 17-18.
filed this action the next day, April 28, 2016. Defendants
Netmedia and GLP now move to dismiss the claims against them
for lack of personal jurisdiction, or, in the alternative, to
stay these proceedings pending completion of the Barbados
action. Docs. 27, 44, 45.
Personal Jurisdiction. A. Legal Standard.
a defendant moves to dismiss for lack of personal
jurisdiction, the plaintiff bears the burden of demonstrating
that the court has jurisdiction over the defendant.”
Pebble Beach Co. v. Caddy, 453 F.3d 1151, 1154 (9th
Cir. 2006). “Where, as here, the defendant's motion
is based on written materials rather than an evidentiary
hearing, the plaintiff need only make a prima facie showing
of jurisdictional facts to withstand the motion to
dismiss.” Mavrix Photo, Inc. v. Brand Techs.,
Inc., 647 F.3d 1218, 1223 (9th Cir. 2011). “The
plaintiff cannot ‘simply rest on the bare allegations
of its complaint, ' but uncontroverted allegations in the
complaint must be taken as true.” Id. (quoting
Schwarzenegger v. Fred Martin Motor Co., 374 F.3d
797, 800 (9th Cir. 2004). The Court may not assume the truth
of allegations in a pleading that are contradicted by an
affidavit, but factual disputes are resolved in
Plaintiff's favor. Id.
Personal Jurisdiction over Netmedia.
argues that Netmedia is subject to personal jurisdiction
under Federal Rule of Civil Procedure 4(k)(2). Doc. 38 at
7-8. Rule 4(k)(2) provides that serving a summons or filing a
waiver of service establishes personal jurisdiction over a
defendant if (1) the claim arises under federal law, (2)
“the defendant is not subject to jurisdiction in any
state's courts of general jurisdiction, ” and (3)
exercising jurisdiction is consistent with the United States
Constitution. Fed.R.Civ.P. 4(k)(2).
first factor is satisfied in this case because AMA asserts
claims of copyright infringement under federal law. The
second factor is satisfied if the defendant “does not
concede to jurisdiction in another state.” Holland
Am. Line Inc. v. Wartsila N. Am., Inc., 485 F.3d 450,
461 (9th Cir. 2007) (citation omitted). Netmedia does not
make this concession.
under the third factor - the due process analysis - “is
nearly identical to traditional personal jurisdiction
analysis with one significant difference: rather than
considering contacts between the [defendant] and the forum
state, we consider contacts with the nation as a
whole.” Id. at 462. The question, then, is
whether Netmedia has sufficient minimum contacts with the
United States so that maintenance of the suit here does not
offend traditional notions of fair play and substantial
justice. Int'l Shoe Co. v. Washington, 326 U.S.
310, 316 (1945). AMA does not allege that Netmedia's own
contacts with the United States satisfy this requirement. AMA
instead argues that Porn.com's contacts with the United
States can be imputed to Netmedia because Netmedia is an
alter ego or agent of Porn.com, and Porn.com's contacts
with the United States are sufficient to satisfy due process.
Doc. 38 at 12.
Court can dispose of the agency argument easily. The Ninth
Circuit once recognized an agency theory for personal
jurisdiction, Doe v. Unocal Corp., 248 F.3d 915, 928
(9th Cir. 2001), but the Supreme Court rejected this theory,
noting that it would “subject foreign corporations to
general jurisdiction whenever they have an instate subsidiary
or affiliate, ” Daimler AG v. Bauman, 134
S.Ct. 746, 760 (2014). The Court therefore will focus only on
AMA's alter ego argument.
Alter Ego Choice of Law.
parties do not address what law should govern the alter ego
analysis. The parties primarily cite two cases from the Ninth
Circuit, Doe v. Unocal Corp., 248 F.3d 915 (9th Cir.
2001), and Ranza v. Nike, 793 F.3d 1059 (9th Cir.
2015). Unocal looked mostly to California law, but
also cited federal court decisions from New York, Illinois,
Delaware, and Florida. See Unocal, 248 F.3d at
926-27. Ranza applies the alter ego standard set
forth in Unocal. See Ranza, 793 F.3d at