Parameters of Court Jurisdiction In Entertainment Litigations

In Toma v. Motley Crue Inc. (MCI), 11 C 6766 (N.D. Ill. 2012), Illinois-based Ron Toma had purchased the copyrights to photographs of California-based rock band M'tley Cre taken by Michael Pinter in 1981. A so-called “Belt Buckle Image” that Pinter shot was featured on the cover of M'tley Cre's first album, Too Fast for Love, and is projected on a screen during the band's concert performances of the album's title track.

In 2011, Toma sued M'tley Cre's general corporation as well as its touring company, Red, White & Crue Inc., over the “Belt Buckle Image.” Toma argued that a settlement agreement he had reached with M'tley Cre after he previously sued them over the Pinter photos allowed the band to use the “Belt Buckle Image” to promote their shows but not as part of their on-stage performances. M'tley Cre moved to dismiss Toma's latest suit, which alleged copyright infringement and breach-of-contract, by arguing the court lacked personal jurisdiction over the defendants.

District Judge John F. Grady of the U.S. District Court for the Northern District of Illinois initially noted: “The plaintiff has the burden of establishing personal jurisdiction, and where, as here, the issue is raised by a motion to dismiss and decided on the basis of written materials rather than an evidentiary hearing, the plaintiff need only make a prima facie showing of jurisdictional facts.”

Illinois' long-arm jurisdiction statute is set out in 735 ILCS 5/2-209. As to general jurisdiction, Judge Grady considered that M'tley Cre had dealt with Illinois vendors for its shows, sold albums in the state for 30 years, hired an Illinois Web design company, been sued by Toma in Illinois and sold band merchandise in Illinois via the Internet. But the district judge found these factors didn't establish a “continuous and systematic” relationship by M'tley Cre with Illinois. For example, Judge Grady observed that “MCI's contacts with Illinois-based vendors are sporadic: Toma specifically identifies only seven such vendors spanning a period of almost 30 years. The websites, and the lawsuits that Toma has filed in this District, add little to the general-jurisdiction analysis. There is no evidence indicating how much revenue the defendants generate from Internet sales to Illinois residents, nor is there any evidence that the defendants specifically target Illinois residents for such sales.”

Judge Grady acknowledged the music group's Illinois concert and record sales were more relevant but that “over the last [15] years Motley Crue has averaged one concert in Illinois every 18 months or so.” And though the district judge assumed “for purposes of the defendants' motion that the band's concerts and records sales in Illinois generate significant revenues,” he still found these insufficient to establish general jurisdiction.

As to specific jurisdiction, M'tley Cre denied they had displayed the “Belt Buckle Image” during their recent Illinois concerts. But Toma emphasized that the settlement agreement of his previous suit against M'tley Cre had been partly negotiated in Illinois. Still, Judge Grady noted that, even though the settlement stipulated it was to be governed by Illinois law, the agreement “does not require or specifically contemplate any action by the parties in Illinois.” Finding no specific jurisdiction, the judge added: “The most we can say is that the defendants displayed the Belt Buckle Image with the knowledge that the copyright holder lives in Illinois. That is not enough.” (For a discussion of specific jurisdiction in motion picture litigation, see, Madison Miracle Productions LLC v. Paradise Film Production Co. Inc., 1-11-2334 (Ill. App. Ct. 2012), in which the Appellate Court of Illinois decided the state's courts lacked specific jurisdiction over MGM Distribution in a suit alleging poor promotion of the movie Madison. The appellate court noted: “MGM Distribution itself did not conduct any marketing or distribution activities in Illinois. The record reflects that all of the in-state distribution activities with respect to 'Madison' were conducted by independent third parties. These third parties were responsible for exhibiting the movie in Illinois theaters, placing advertising for the movie in local media outlets, and distributing DVDs of the movie in this state. There is no evidence that MGM Distribution reached out to Illinois to engage any of these third parties.”)

Daddy Yankee Case

In a different case in the Northern District of Illinois, District Judge Harry D. Leinenweber allowed a copyright infringement plaintiff to conduct limited written depositions of third parties regarding the defendants' activities in Illinois. In Moser v. Ayala, 11 C 3563 (N.D. Ill. 2012), plaintiff David Moser filed an infringement suit against reggaeton artist Daddy Yankee and Interscope Records, a UMG Recordings label. While not using the terms “general” or “specific, ” Judge Leinenweber appeared to set a lower jurisdictional bar than Judge Grady did in Toma.

In Moser, Leinenweber noted that Daddy Yankee “challenges jurisdiction, despite performing and appearing at promotional events in Illinois. While sales of [Daddy Yankee's] allegedly infringing work have been sold in Illinois, Defendant UMG says only 97 copies were shipped here. That strikes the Court as enough, but jurisdiction is a particularly vexing area of law and whether those sales by UMG can be imputed to other Defendants is an open question.” Leinenweber then allowed Moser to depose Apple and Amazon, as well as Best Buy, where Daddy Yankee allegedly made a related promotional appearance. Of the latter, the district judge stated: “If true, this would help refute Ayala's claim of lack of substantial contacts with Illinois '.”

Justin Bieber and Dillinger Cases

In contrast to Moser, in RC3 Inc. v. Bieber, 3:12-cv-193-J-37 (M.D.Fla. 2012), the U.S. District Court for the Middle District of Florida decided ' in a declaratory action over the right to promote a Joustin' Beaver game application ' that even recording sessions and over a dozen concerts and appearances in the state didn't support personal jurisdiction over Bieber. The parties' court papers focused on specific jurisdiction.

Bieber and the Jacksonville, FL-based RC3 had discussed developing the Joustin' Beaver game application. But when RC3 went ahead with the project, Bieber's lawyers sent RC3 a cease-and-desist letter that stated: “[Y]ou have no right to utilize our Client's name, image, likeness, life story or identity in or in connection with the App.” The letter went on to allege a series of rights violations, including “trademark infringement, unfair competition under the Lanham Act and under state law, dilution, false designation of origin, passing off, misappropriation of name for commercial purposes, misrepresentation, violation of rights of publicity, and interference with [Bieber's] contractual obligations to third parties.” RC3 then filed its action for a declaratory ruling.

Bieber has certainly been active in Florida. RC3 claimed that Bieber's Florida “performances and personal appearances have been done arguendo as regular business, including marketing efforts, to promote his business and business activities.” RC3 further argued that Bieber Time Merchandise LLC “is under license to Bravado Merchandising and The Bridge Direct, Inc. ' The Brid[g]e Direct Inc. is based out of Boca Raton, Florida” where it “manufacture[s] and market[s] Justin Bieber figurines that bare [sic] his likeness, which is in turn the subject of this litigation.” RC3 added that Bieber is a recording artist for Island Def Jam, a subsidiary of Universal Music Group that “employ[]s marketing representatives throughout” Florida and is “under the Universal umbrella, which owns a theme park in Florida.” Plus Bieber had recorded at the Record Plant and at King of Kings Studio in Miami.

Nevertheless, Middle District Judge Roy B. Dalton Jr. noted: “Taken collectively, the Court finds that the alleged contacts ' concert performances, recording sessions, and even assuming that The Bridge Direct Inc.'s and the Island Def Jam's connections to Florida show that Bieber himself engages in general course of business activity for pecuniary benefit ' the present action does not arise from nor is it related to any of Bieber's activities in this state. Given that Florida's long-arm statute [i.e., Fla. Stat. '48.193] is to be strictly construed, contacts through which RC3 seeks to hold Bieber amenable to suit in Florida are unrelated to its declaratory judgment action claims.”

Finally, in a trademark infringement case in Indiana federal court, the Southern District of Indiana decided that a plaintiff failed to carry its burden of establishing specific jurisdiction over out-of-state defendants. The suit by the holder of the registered restaurant-services trademarks for “Dillinger's” and “Public Enemies” sued over a Chicago restaurant's use of those names. Dillinger LLC v. The Pour House on Lincoln Inc., 1:12-cv-714 (S.D.Ind. 2012).

The Pour House defendants had previously come from Illinois to Indianapolis to negotiate a licensing agreement with Dillinger LLC. But Dillinger LLC claimed, though a written agreement was reached, “[t]he failure of [the Defendants] to execute the agreement, even after further negotiations and revisions, directly and substantially caused this action to be filed.” Nevertheless, District Judge William T. Lawrence observed: “While this argument wins points for originality, this is not a breach of contract case and the failed attempt at reaching a license agreement is not relevant to any claim in this suit,” making the defendants' Indiana trip “irrelevant” to the specific jurisdiction question.

But Dillinger LLC further argued that the defendants' advertising in Chicago was likely accessible in Northern Indiana. Here Judge Lawrence noted: “The Plaintiff has not sought leave to conduct discovery to determine whether any such advertising or directed marketing actually has occurred, however. Absent evidence that the Defendants have purposefully targeted Indiana residents with their Facebook page or other advertising, there is simply no basis for this Court to exercise personal jurisdiction over them.”

Conclusion

The cases discussed in this article demonstrate that the plaintiff's burden in establishing personal jurisdiction over defendants may be no easy task, including where national celebrities and national distribution are concerned. Borrowing imagery from Toma, it might be said that making a viable case for personal jurisdiction requires strategically lining up the buckles of the jurisdictional belt, yet it's clear this isn't a one-size-fits-all proposition.

The question of whether a court has personal jurisdiction over the parties in a particular lawsuit is fundamental and often raised. The national scope of the entertainment industry ' from artist concert touring to the interstate distribution of music, motion picture, TV and other creative content ' certainly makes personal jurisdiction a common issue in entertainment litigations. This article examines several recent court rulings as examples of how judges today are determining whether personal jurisdiction exists in entertainment cases.

Defendants asking a court to dismiss them from a case may claim that the court has neither general nor specific personal jurisdiction over them. “General jurisdiction” is created through a defendant's “continuous and systematic” activities in the forum state. “Specific jurisdiction” typically involves whether a plaintiff's alleged injuries grow out of the defendant's purposeful contacts with the forum state.

M'tley Cre Case

In Toma v. Motley Crue Inc. (MCI) , 11 C 6766 (N.D. Ill. 2012), Illinois-based Ron Toma had purchased the copyrights to photographs of California-based rock band M'tley Cre taken by Michael Pinter in 1981. A so-called “Belt Buckle Image” that Pinter shot was featured on the cover of M'tley Cre's first album, Too Fast for Love, and is projected on a screen during the band's concert performances of the album's title track.

In 2011, Toma sued M'tley Cre's general corporation as well as its touring company, Red, White & Crue Inc., over the “Belt Buckle Image.” Toma argued that a settlement agreement he had reached with M'tley Cre after he previously sued them over the Pinter photos allowed the band to use the “Belt Buckle Image” to promote their shows but not as part of their on-stage performances. M'tley Cre moved to dismiss Toma's latest suit, which alleged copyright infringement and breach-of-contract, by arguing the court lacked personal jurisdiction over the defendants.

District Judge John F. Grady of the U.S. District Court for the Northern District of Illinois initially noted: “The plaintiff has the burden of establishing personal jurisdiction, and where, as here, the issue is raised by a motion to dismiss and decided on the basis of written materials rather than an evidentiary hearing, the plaintiff need only make a prima facie showing of jurisdictional facts.”

Illinois' long-arm jurisdiction statute is set out in 735 ILCS 5/2-209. As to general jurisdiction, Judge Grady considered that M'tley Cre had dealt with Illinois vendors for its shows, sold albums in the state for 30 years, hired an Illinois Web design company, been sued by Toma in Illinois and sold band merchandise in Illinois via the Internet. But the district judge found these factors didn't establish a “continuous and systematic” relationship by M'tley Cre with Illinois. For example, Judge Grady observed that “MCI's contacts with Illinois-based vendors are sporadic: Toma specifically identifies only seven such vendors spanning a period of almost 30 years. The websites, and the lawsuits that Toma has filed in this District, add little to the general-jurisdiction analysis. There is no evidence indicating how much revenue the defendants generate from Internet sales to Illinois residents, nor is there any evidence that the defendants specifically target Illinois residents for such sales.”

Judge Grady acknowledged the music group's Illinois concert and record sales were more relevant but that “over the last [15] years Motley Crue has averaged one concert in Illinois every 18 months or so.” And though the district judge assumed “for purposes of the defendants' motion that the band's concerts and records sales in Illinois generate significant revenues,” he still found these insufficient to establish general jurisdiction.

As to specific jurisdiction, M'tley Cre denied they had displayed the “Belt Buckle Image” during their recent Illinois concerts. But Toma emphasized that the settlement agreement of his previous suit against M'tley Cre had been partly negotiated in Illinois. Still, Judge Grady noted that, even though the settlement stipulated it was to be governed by Illinois law, the agreement “does not require or specifically contemplate any action by the parties in Illinois.” Finding no specific jurisdiction, the judge added: “The most we can say is that the defendants displayed the Belt Buckle Image with the knowledge that the copyright holder lives in Illinois. That is not enough.” (For a discussion of specific jurisdiction in motion picture litigation, see, Madison Miracle Productions LLC v. Paradise Film Production Co. Inc., 1-11-2334 (Ill. App. Ct. 2012), in which the Appellate Court of Illinois decided the state's courts lacked specific jurisdiction over MGM Distribution in a suit alleging poor promotion of the movie Madison. The appellate court noted: “MGM Distribution itself did not conduct any marketing or distribution activities in Illinois. The record reflects that all of the in-state distribution activities with respect to 'Madison' were conducted by independent third parties. These third parties were responsible for exhibiting the movie in Illinois theaters, placing advertising for the movie in local media outlets, and distributing DVDs of the movie in this state. There is no evidence that MGM Distribution reached out to Illinois to engage any of these third parties.”)

Daddy Yankee Case

In a different case in the Northern District of Illinois, District Judge Harry D. Leinenweber allowed a copyright infringement plaintiff to conduct limited written depositions of third parties regarding the defendants' activities in Illinois. In Moser v. Ayala , 11 C 3563 (N.D. Ill. 2012), plaintiff David Moser filed an infringement suit against reggaeton artist Daddy Yankee and Interscope Records, a UMG Recordings label. While not using the terms “general” or “specific, ” Judge Leinenweber appeared to set a lower jurisdictional bar than Judge Grady did in Toma.

In Moser, Leinenweber noted that Daddy Yankee “challenges jurisdiction, despite performing and appearing at promotional events in Illinois. While sales of [Daddy Yankee's] allegedly infringing work have been sold in Illinois, Defendant UMG says only 97 copies were shipped here. That strikes the Court as enough, but jurisdiction is a particularly vexing area of law and whether those sales by UMG can be imputed to other Defendants is an open question.” Leinenweber then allowed Moser to depose Apple and Amazon, as well as Best Buy, where Daddy Yankee allegedly made a related promotional appearance. Of the latter, the district judge stated: “If true, this would help refute Ayala's claim of lack of substantial contacts with Illinois '.”

Justin Bieber and Dillinger Cases

In contrast to Moser, in RC3 Inc. v. Bieber, 3:12-cv-193-J-37 (M.D.Fla. 2012), the U.S. District Court for the Middle District of Florida decided ' in a declaratory action over the right to promote a Joustin' Beaver game application ' that even recording sessions and over a dozen concerts and appearances in the state didn't support personal jurisdiction over Bieber. The parties' court papers focused on specific jurisdiction.

Bieber and the Jacksonville, FL-based RC3 had discussed developing the Joustin' Beaver game application. But when RC3 went ahead with the project, Bieber's lawyers sent RC3 a cease-and-desist letter that stated: “[Y]ou have no right to utilize our Client's name, image, likeness, life story or identity in or in connection with the App.” The letter went on to allege a series of rights violations, including “trademark infringement, unfair competition under the Lanham Act and under state law, dilution, false designation of origin, passing off, misappropriation of name for commercial purposes, misrepresentation, violation of rights of publicity, and interference with [Bieber's] contractual obligations to third parties.” RC3 then filed its action for a declaratory ruling.

Bieber has certainly been active in Florida. RC3 claimed that Bieber's Florida “performances and personal appearances have been done arguendo as regular business, including marketing efforts, to promote his business and business activities.” RC3 further argued that Bieber Time Merchandise LLC “is under license to Bravado Merchandising and The Bridge Direct, Inc. ' The Brid[g]e Direct Inc. is based out of Boca Raton, Florida” where it “manufacture[s] and market[s] Justin Bieber figurines that bare [sic] his likeness, which is in turn the subject of this litigation.” RC3 added that Bieber is a recording artist for Island Def Jam, a subsidiary of Universal Music Group that “employ[]s marketing representatives throughout” Florida and is “under the Universal umbrella, which owns a theme park in Florida.” Plus Bieber had recorded at the Record Plant and at King of Kings Studio in Miami.

Nevertheless, Middle District Judge Roy B. Dalton Jr. noted: “Taken collectively, the Court finds that the alleged contacts ' concert performances, recording sessions, and even assuming that The Bridge Direct Inc.'s and the Island Def Jam's connections to Florida show that Bieber himself engages in general course of business activity for pecuniary benefit ' the present action does not arise from nor is it related to any of Bieber's activities in this state. Given that Florida's long-arm statute [i.e., Fla. Stat. '48.193] is to be strictly construed, contacts through which RC3 seeks to hold Bieber amenable to suit in Florida are unrelated to its declaratory judgment action claims.”

Finally, in a trademark infringement case in Indiana federal court, the Southern District of Indiana decided that a plaintiff failed to carry its burden of establishing specific jurisdiction over out-of-state defendants. The suit by the holder of the registered restaurant-services trademarks for “Dillinger's” and “Public Enemies” sued over a Chicago restaurant's use of those names. Dillinger LLC v. The Pour House on Lincoln Inc., 1:12-cv-714 (S.D.Ind. 2012).

The Pour House defendants had previously come from Illinois to Indianapolis to negotiate a licensing agreement with Dillinger LLC. But Dillinger LLC claimed, though a written agreement was reached, “[t]he failure of [the Defendants] to execute the agreement, even after further negotiations and revisions, directly and substantially caused this action to be filed.” Nevertheless, District Judge William T. Lawrence observed: “While this argument wins points for originality, this is not a breach of contract case and the failed attempt at reaching a license agreement is not relevant to any claim in this suit,” making the defendants' Indiana trip “irrelevant” to the specific jurisdiction question.

But Dillinger LLC further argued that the defendants' advertising in Chicago was likely accessible in Northern Indiana. Here Judge Lawrence noted: “The Plaintiff has not sought leave to conduct discovery to determine whether any such advertising or directed marketing actually has occurred, however. Absent evidence that the Defendants have purposefully targeted Indiana residents with their Facebook page or other advertising, there is simply no basis for this Court to exercise personal jurisdiction over them.”

Conclusion

The cases discussed in this article demonstrate that the plaintiff's burden in establishing personal jurisdiction over defendants may be no easy task, including where national celebrities and national distribution are concerned. Borrowing imagery from Toma, it might be said that making a viable case for personal jurisdiction requires strategically lining up the buckles of the jurisdictional belt, yet it's clear this isn't a one-size-fits-all proposition.