United States District Court, D. Arizona
ORDER
Honorable John J. Tuchi United States District Judge
At
issue is pro se Plaintiff Ebone Leroy East's
Amended Complaint (Doc. 8, Compl.), which he filed pursuant
to the Court's order dismissing with leave to refile his
first Complaint (Doc. 7). The Court instructed Plaintiff that
any Amended Complaint must state a claim over which the Court
has jurisdiction, but Plaintiff's new Complaint fails to
satisfy that requirement. Therefore, the Court will dismiss
Plaintiff's Amended Complaint with leave to file a Second
Amended Complaint by May 16, 2019, should he elect to do so.
Plaintiff
asserts both negligent and fraudulent misrepresentation
against Defendants Symphonic Distribution and Ballast Point
Ventures. (Compl. at 3.) Plaintiff's misrepresentation
claims are largely unchanged from his original Complaint.
Plaintiff alleges that he entered into a contract with
Defendants in 2016, under which Defendants were to act as
Plaintiff's music label and distributor. (Compl. at 4.)
Plaintiff further alleges that under the contract, he was to
receive 80 percent of all proceeds from his music sales, and
“keep 100% of his Copyright.” (Compl. at 4.)
Plaintiff now alleges that Defendants “suspended [his]
account for . . . asking about the monies [] owed by
Defendants.” (Am. Compl. at 3.) Defendants paid
Plaintiff $29.81 on April 2, 2019, which Plaintiff believes
is “payable from [80 percent] of [his] total [m]usic
[sales], ” but falls far short of the amount he is owed
under the agreement that parties allegedly reached. (Am.
Compl. at 3.)
Plaintiff's
misrepresentation claims suffer from the same flaws as those
in his original Complaint. Under Arizona law, fraudulent
misrepresentation requires a showing of “a false
material representation made with the speaker's knowledge
of its falsity or ignorance of its truth and with the intent
that it be acted upon by the listener; the listener's
ignorance of its falsity, reliance on its truth, and the
right to rely on its truth; and consequent and proximate
injury.” Dillon v. Zeneca Corp., 42 P.3d 598,
603 (Ariz.Ct.App. 2002) (citing Davis v. First Nat'l
Bank of Arizona, 605 P.2d 37 (Ariz.Ct.App. 1979)).
Negligent misrepresentation, as recognized by Arizona law,
arises when a party fails to exercise reasonable care and,
“in the course of . . . [a] transaction in which he has
a pecuniary interest, supplies false information for the
guidance of others in their business transactions, ”
and the recipient justifiably relies on the information to
its detriment. Haisch v. Allstate Ins. Co., 5 P.3d
940, 944 (Ariz.Ct.App. 2000) (quoting Restatement (second) of
Torts § 552(1), cmt. b (1977)).
Plaintiff
again fails to state a claim for negligent misrepresentation
because a misrepresentation must be an “assertion that
is not in accord with the facts as they exist at the time the
assertion is made.” Pauma Band of Luiseno Mission
Indians of Pauma & Yuima Reservation v. California,
813 F.3d 1155, 1164 (9th Cir. 2015). “Such facts
include past events as well as present circumstances but do
not include future events. An assertion limited to future
events . . . may be a basis of liability for breach of
contract, but not of relief for misrepresentation.”
Id. Here, Plaintiff's claim hinges on an alleged
assertion based solely on future events-the future sale of
Plaintiff's music and how much money he would make from
those sales. Any assertion that Defendants made about how
much money Plaintiff should expect to make was an assertion
about future events. Thus, liability for negligent
misrepresentation cannot lie.
As for
fraudulent misrepresentation, Plaintiff alleges that
Defendants made a representation that “when made, was
known to be false and reckless.” On its face, such a
representation may appear to qualify as promissory fraud,
which requires the making of a promise with no intent to
perform-in other words, that the promisor knew he was lying
when he entered into an agreement with the promisee. See
Trollope v. Koerner, 470 P.2d 91, 100 (Ariz. 1970). But
it is unclear what representation Plaintiff refers to in his
Amended Complaint. Plaintiff alleges that Defendants made a
deposit of $29.81 in his account, and that “this
representation by the Defendants is false.” (Am. Compl.
at 3.) It is not clear how the payment of money could be
construed as a false representation. It is even less clear
how it could be construed as the making of a promise with no
intent to perform. Perhaps the fraud that Plaintiff alludes
to is the original agreement that Plaintiff would retain 80
percent of his total music sales, but this is not clear from
the face of Plaintiff's Amended Complaint.
Plaintiff
also adds a claim for copyright infringement to his Amended
Complaint. (Am. Compl. at 3.) While Plaintiff is correct that
such a claim would require him to prove “(1) ownership
of a valid copyright . . . [and] (2) the actionable copying
by the defendants of constituent elements of the work that
are original, ” Plaintiff fails to establish that he
owns a valid copyright. (Am. Compl. at 3.) Plaintiff attaches
an application and proof of payment for a copyright, which he
mailed on April 13, 2019, but does not indicate that his
copyright has been granted. Further, Plaintiff's
copyright infringement claim alleges that “Defendants
illegally copyrighted” his work “[o]n or about
February 8th, 2017, ” over two years before
he filed his copyright application. (Am. Compl. at 3.)
For the
reasons stated above, Plaintiff's Amended Complaint fails
to state a claim for fraudulent misrepresentation, negligent
misrepresentation or copyright infringement. If a defective
complaint can be cured, the plaintiff is entitled to amend
the complaint before the action is dismissed. Lopez v.
Smith, 203 F.3d 1122, 1127-30 (9th Cir. 2000). Here, the
Court will give Plaintiff another opportunity to amend his
Complaint, but any Second Amended Complaint must comply with
the Federal Rules of Civil Procedure, the Local Rules, and
the provisions of this Order.
IT
IS THEREFORE ORDERED that Plaintiffs Amended
Complaint (Doc. 8) is dismissed with permission to file a
Second Amended Complaint by May 16, 2019, that complies with
the provisions of this Order.
IT
IS FURTHER ORDERED that if Plaintiff does not file a
Second Amended Complaint by May 16, 2019, the Clerk shall
dismiss ...