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One Media IP Limited v. S.A.A.R. Srl

United States District Court, M.D. Tennessee, Nashville Division

January 23, 2015

ONE MEDIA IP LIMITED, as successor-in-interest to TELOS HOLDINGS, INC., d/b/a Point Classics, Plaintiff,
v.
S.A.A.R. SrL, BELIEVE SAS d/b/a BELIEVE DIGITAL GROUP and BELIEVE US, HENRY HADAWAY ORGANISATION, LTD., HHO LICENSING LIMITED, HENRY HADAWAY, And DOES 1-10, inclusive, Defendants.

MEMORANDUM & ORDER

ALETA A. TRAUGER, District Judge.

Pending before the court are two Rule 12 motions. The first is a Motion to Dismiss for Lack of Jurisdiction filed by defendant S.A.A.R. SrL ("SAAR") (Docket No. 1), to which the plaintiff has filed a Response in opposition (Docket No. 22), and SAAR has filed a Reply (Docket No. 28). The second is a Motion to Dismiss filed by defendant Believe S.A.S. (Docket No. 38), to which the plaintiff has filed a Response in opposition (Docket No. 45), Believe S.A.S. has filed a Reply (Docket No. 55), and the plaintiff has filed a Supplemental Response (Docket No. 63). For the reasons stated herein, the court will permit the parties to conduct discovery before the court rules on the motions.

BACKGROUND

This case concerns alleged infringement of certain copyright interests held by plaintiff One Media IP Limited d/b/a Point Classics ("One Media") in a set of classical music recordings, which the court will refer to as the "Catalog."

One Media is a corporation organized under the laws of the United Kingdom. Through a series of assignments, corporate mergers, and the like, chain of title to One Media's copyright interest in the Catalog appears to trace back to the 1980s.[1] Briefly, from March 31, 1992 through June 23, 2000, several different European-based companies held title to the Catalog, and at least one of these entities licensed certain interests in the Catalog to "Henry Hadaway Organisation Limited" ("HHO #1"). HHO #1 is a British company with a principal place of business in England, and it is one of multiple companies affiliated with a British individual named Henry Hadaway. That license agreement allegedly expired at some point before June 2000.

In June 2000, title to the Catalog shifted to a series of United States-based companies affiliated with an American individual named Jim Long. On June 23, 2000, Long's company "OneMusic Corporation, " whose state of incorporation and principal place of business the plaintiff has not disclosed, acquired the catalog. On November 1, 2000, OneMusic assigned its interest in the Catalog to Point Classics, LLC ("Point Classics LLC"), a Tennessee company that Long owned and managed. Point Classics LLC obtained Certificates of Registration from the United States Copyright Office that reflect copyrights in the compositions within the Catalog.

On August 18, 2006, Point Classics LLC entered into a three-year licensing agreement with HHO #1 (the "PC/HHO #1 License") that expressly forbade HHO #1 from granting sublicenses related to the Catalog. On December 31, 2007 - during the term of the PC/HHO #1 License - Point Classics LLC assigned its interests to Telos Holdings, Inc., a Texas corporation whose principal place of business the plaintiff has not disclosed. On July 17, 2009, Telos Holdings allegedly informed Hadaway that, effective August 18, 2009 (the last date of the three-year term), the licensing agreement with HHO #1 would be terminated. Hadaway allegedly confirmed the termination of the agreement in writing.

Notwithstanding Hadaway's promise, one or more entities affiliated with him continued license and sublicense the Catalog. In August 2013 (about four years after the PC/HHO #1 License had been terminated), Telos Holdings discovered that portions of the Catalog had been illegally licensed to SAAR, which had in turn (1) contracted with Believe S.A.S. for worldwide "digital distribution" of the Catalog's compositions through music purchase websites such as iTunes, [2] and (2) sublicensed interests in the catalog to two other European companies. SAAR claimed authority to exploit the works under a licensing agreement with HHO Licensing Limited ("HHO #2"), another British company affiliated with Hadaway. Neither Telos Holdings nor its predecessors-in-interest had entered into an operative license with Hadaway after the HHO #1/PC License had expired in August 2009.

Thus, the plaintiff alleges that (1) HHO #2 illegally purported to sub-license interests in the Catalog to SAAR, in return for the remittance of fees from SAAR related to each instance of exploitation of the Catalog, (2) SAAR in turn granted illegal sub-licenses to Believe S.A.S. and two other companies; and (3) Believe S.A.S. illegally contracted with third parties to sell the works to online consumers worldwide. One Media also alleges that, notwithstanding several cease and desist letters from Telos Holdings to SAAR and Believe S.A.S., portions of the Catalog continue to be offered for sale online in both the United States and United Kingdom iTunes stores.

On April 8, 2014, Telos Holdings filed a Complaint against SAAR and "Believe Digital, " alleging federal copyright infringement claims, with respect to which it demanded declaratory and injunctive relief. (Docket No. 1.) On July 1, 2014, Telos Holdings purportedly sold its interests in the Catalog to One Media IP Limited ("One Media"), a British company that does not appear to be affiliated with Jim Long. On July 30, 2014, One Media filed a First Amended Complaint ("FAC") that (1) substitutes "One Media IP Limited as successor-in-interest to Telos Holdings, Inc." as the plaintiff; (2) restyles the "Believe" defendant as "Believe SAS d/b/a Believe Digital Group and Believe US"; and (3) adds as defendants Hadaway, HHO #1, and HHO #2 (collectively, the "Hadaway Entities"), as well as unnamed "John Doe" Hadaway-affiliated entities.[3]

As the court understands the chain of title to the Catalog, the plaintiff in this case is "One Media IP Limited, " not Telos Holdings or Point Classics LLC. Perhaps in an effort to emphasize a past Tennessee connection to the underlying facts, One Media's representations concerning the relationship between Point Classics LLC and this lawsuit appear to conflate One Media (a British company) with Telos Holdings (a Texas company with no apparent connection to Tennessee) and Point Classics LLC (a Tennessee company whose principal place of business the plaintiff has not disclosed). The plaintiff's representations concerning Point Classics LLC are also arguably inconsistent with public filings on the Tennessee Secretary of State's website. For example, even though the company filed Articles of Termination in 2009, the plaintiff claims that Point Classics LLC continued to conduct "wind down operations" through 2014 and that Point Classics LLC somehow "retains an interest" in this lawsuit.[4]

As for Believe S.A.S., Believe's in-house counsel (1) avers that Believe S.A.S. does not do business in the United States and (2) avers, somewhat cryptically, that Believe S.A.S. is "not associated with" Believe US. The plaintiff has introduced materials issued by a "Believe" entity that seem to contradict Believe S.A.S.'s position, such as "Believe" social media posts touting the opening of a New York office. The court suspects that Believe S.A.S. may be drawing a distinction between itself and a United States affiliate, although the nature of the relationship between those two entities, if any, is unclear.

SAAR has filed a Motion to Dismiss under Rule 12(b)(2), arguing that the court lacks personal jurisdiction over it. Both SAAR and the plaintiff have filed materials outside the FAC with respect to the motion. Believe S.A.S. has filed a Motion to Dismiss under Rule 12(b)(6), arguing that the court lacks personal jurisdiction over it. As with SAAR's motion, Believe S.A.S. and the plaintiff have filed materials outside the pleadings with respect to the motion. Therefore, although Believe's motion is styled as filed under Rule 12(b)(6), the court construes it as filed under Rule 12(b)(2).

The plaintiff has requested that, if the court is inclined to rule against it on the existing record, the court allow for ...


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