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BMG Rights Management, LLC v. Atlantic Recording Corp.

United States District Court, S.D. New York

November 2, 2017

BMG RIGHTS MANAGEMENT, LLC, et al, Plaintiffs,
v.
ATLANTIC RECORDING CORP., et al., Defendants.

          OPINION & ORDER

          KIMBA M. WOOD United States District Judge

         Defendants Atlantic Recording Corporation ("Atlantic"), WEA, Inc. ("WEA"), Omari Grandberry ("Omarion"), and Songs of Universal, Inc.[1] ("Songs of Universal") (collectively, the "Moving Defendants") have moved for reconsideration of the portion of this Court's August 24, 2017 Opinion and Order (the "Order") that held that if Plaintiffs were to show that "Post to Be" is a derivative work of "Came to Do, " that the joint owners of "Post to Be" would need to account for profits they derived from the exploitation of "Came to Do." For the reasons set forth below, the Moving Defendants' Motion for Reconsideration is GRANTED.

         I. BACKGROUND

         On September 23, 2016, Plaintiffs BMG Rights Management (US), LLC; Primary Wave Music Publishing, LLC; Nicholas Matthew Balding, Robert Clifton Brackins III, Jon Redwine, and Notting Dale Songs, Inc. brought a copyright infringement and declaratory judgment action against Defendants Atlantic, WEA, Dijon McFarlane ("DJ Mustard"), Omarion, Songs of Universal, and Songs Music Publishing, LLC ("Songs Music"). (ECF No. 1.) The Complaint alleges that these Defendants[2] infringed Plaintiffs' copyright in the song "Came to Do" by creating, manufacturing, performing, and otherwise exploiting "Came to Do" in the song "Post to Be." (See, e.g., Compl., ¶ 39.) On December 23, 2016, the Moving Defendants moved to dismiss the Complaint under Federal Rule of Civil Procedure 12(b)(6). (ECF No. 19.)

         On August 24, 2017, the Court dismissed Plaintiffs' claim for copyright infringement. The Order held that because Christopher "Chris" Brown was a copyright owner of both "Came to Do" and "Post to Be, " it was impossible for "Post to Be" to infringe on "Came to Do." (ECF No. 35, at 5-6.) For that reason, the Court partially granted Defendants' Motion to Dismiss. (Id. at 6.) The Order held, however, that if "Post to Be" is a derivative work of "Came to Do, " then Defendants could still be liable to Plaintiffs for an accounting of profits from "Post to Be." (Id.) The Moving Defendants now move for reconsideration of that latter portion of the Order. (ECF No. 44.)

         II. DISCUSSION

         A. Motion for Reconsideration

         1. Legal Standard

         "[R]econsideration of a previous order is an extraordinary remedy to be employed sparingly in the interests of finality and conservation of scarce judicial resources." In re Health Mgmt. Sys., Inc. Sec. Litig, 113 F.Supp.2d 613, 614 (S.D.N.Y. 2000) (Berman, J.) (internal quotation marks and citation omitted). To prevail on a motion for reconsideration and reargument, "the moving party must demonstrate controlling law or factual matters put before the court on the underlying motion that the movant believes the court overlooked and that might reasonably be expected to alter the court's decision." Montanile v. Nat 7 Broad. Co., 216 F.Supp.2d 341, 342 (S.D.N.Y. 2002) (Marrero, J.). "A motion for reconsideration may not be used to advance new facts, issues or arguments not previously presented to the Court, nor may it be used as a vehicle for relitigating issues already decided by the Court." Davidson v. Scully, 172 F.Supp.2d 458, 461 (S.D.N.Y. 2001) (Leisure, J.). The standard is "strict in order to dissuade repetitive arguments on issues that have already been considered fully by the court." Travelers Ins. Co. v. Buffalo Reinsurance Co., 739 F.Supp. 209, 211 (S.D.N.Y. 1990) (Cannella, J.) (internal quotation marks and citation omitted).

         2. Application

         The viability of an accounting claim against the Moving Defendants was not fully litigated before the Court issued its August 24 Order. In their original Complaint, Plaintiffs did not bring a standalone claim for an accounting. (See Compl., ECF No. 1, at 8-13.) And in their motion to dismiss papers, the parties did not discuss whether an accounting claim could be viable against the Moving Defendants, but instead only whether an accounting claim could be viable against non-party Chris Brown[3] (See Pis.' Suppl. Opp'n Mot. Dismiss, ECF No. 33, at 4; Defs.' Mem. Supp. Mot. Dismiss, ECF No. 22, at 17 n.13.) For this reason, before the Court issued the Order, the Moving Defendants did not have the opportunity to provide the Court with the legal arguments and clarifications they now make in their Motion for Reconsideration. Because these arguments were not fully considered by the Court, the Moving Defendants' Motion is now properly before it. Accordingly, the Court will reconsider the portion of its Order that permitted an accounting claim against the Moving Defendants.

         B. Accounting Claim

         1. Legal Standard

         A claim for accounting is "a creature of state law rather than of the Copyright Act." Iza Music Corp. v. W& KMusic Corp.,995 F.Supp. 417, 418 (S.D.N.Y. 1998) (Rakoff, J.). Under New York law, an accounting claim generally requires proving (i) the existence of a fiduciary or confidential relationship and (ii) the breach of that relationship. Leveraged Leasing Admin. Corp v. PacifiCorp Capital, Inc.,87 F.3d 44, 49 (2d Cir. 1996) ("In order to sustain an equitable action for accounting under New York law, a plaintiff must show either a fiduciary or confidential relationship with the defendant.") (citing Palazzo v. Palazzo,121 A.D.2d 261, 265 (1st Dep't 1986)); Soley v. Wasserman, 823 F.Supp.2d 221, 237 (S.D.N.Y. 2011) (Wood, J.) ("Under New York law, a plaintiff seeking an accounting, which is an equitable remedy, must allege both a fiduciary relationship between the plaintiff and defendant and a breach of that fiduciary duty by the defendant.") (citation and internal quotation marks omitted). In the context of copyright ownership, in particular, a copyright co-owner may bring an accounting claim against other co-owners for profits they made from exploiting the copyright. Thomson v. Larson, 147 F.3d 195, 199 (2d Cir. 1998) ("Joint authorship entitles the co-authors to equal undivided interests in the whole work-in other words, each joint author has the right to use or to license the work as he or she wishes, subject only to the obligation to account ...


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