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Rano v. Sipa Press Inc.

filed: March 2, 1993.


Appeal from the United States District Court for the Central District of California. D.C. No. CV-89-4005-JSL. J. Spencer Letts, District Judge, Presiding.

Before: Melvin Brunetti, Diarmuid F. O'Scannlain, and Thomas G. Nelson, Circuit Judges. Opinion by Judge Brunetti.

Author: Brunetti

BRUNETTI, Circuit Judge:


This appeal from a dismissal for lack of personal jurisdiction and grant of summary judgment in a copyright infringement suit turns on issues of federal preemption of state law in the copyright field and the termination of copyright licenses. For the reasons stated below, we affirm in part, reverse in part, and remand.


The parties to this appeal include: Plaintiff-Appellant Kip Rano, a professional photographer and citizen of Great Britain who resides and has his principal place of business in California; and Defendants-Appellees Sipa Press, a French corporation, Sipa Press, Inc., a Delaware subsidiary corporation, and Sipa, Inc., a New York subsidiary corporation (collectively Sipa), and Goskin Sipahioglu, President and one of three owners of Sipa Press. Sipa is a photograph distribution syndicate.

In France, on or before 1978, the parties entered into an oral copyright license agreement whereby Rano granted to Sipa a non-exclusive license of unspecified duration to reproduce, distribute, sell, and authorize others to reproduce, distribute, and sell his photographs. In return, Sipa agreed to store and develop the negatives and to pay fifty percent of the net royalties generated from its sales and distributions.

The relationship went smoothly for about eight years. Pursuant to agreement, Rano submitted several thousand of his photographs to Sipa, which Sipa distributed and paid royalties for. In March of 1986, however, Rano sent a letter to Sipahioglu informing him that he was changing agencies and that he would no longer be sending his negatives to Sipa. He gave as his reasons Sipa's failure to timely pay royalties, low sales, poor photography assignments, and unwillingness to reimburse certain expenses. Starting in July of 1986, Rano made several requests that Sipa return all of the negatives he had sent to them. Finally, on March 12, 1987, Rano informed Sipahioglu that he "did not authorize Sipa to sell any more of [his] photographs."

In July of 1989, Rano sued Sipa and Sipahioglu alleging that Sipa infringed his copyright by: (1) failing to credit him for a photograph of the Duchess of York, the former Sara Ferguson; (2) failing to pay certain royalties; (3) continuing to distribute some of his photographs after he demanded their return and after he had attempted to terminate their licensing agreement; (4) failing to return some of his photographs upon demand; and (5) placing defective copyright notices on slide mounts for his photographs. Rano also alleged state breach of contract, intentional interference with economic relationship, and malicious conversion claims. As a remedy for the copyright infringement claims, Rano sought an injunction against Sipa's further use of his photographs, the delivery of the photographs for impoundment, a declaratory judgment as to the rights to his photographs, compensatory and punitive damages, and costs of the suit and attorney's fees.

The district court dismissed Rano's pendent claims for malicious conversion and intentional interference with economic relationship and granted defendant Sipahioglu's motion to dismiss for lack of personal jurisdiction. After reviewing the affidavits and memoranda submitted by the parties and conducting a hearing, the district court granted Sipa's motion for summary judgment, holding that all but one of Rano's copyright infringement claims did not constitute copyright claims under the Copyright Act, but were merely breach of contract claims. The one claim that did allege copyright infringement - failure to affix a proper copyright notice - was, as a matter of law, meritless because the notice Sipa did provide was adequate to protect his copyright. The district court dismissed the remaining pendent state claims for lack of subject matter jurisdiction.


I. Jurisdiction in the District Court

The district court had subject matter jurisdiction over Rano's action under 28 U.S.C. § 1338(a) because the suit "arises under" federal copyright law.*fn1 A mere allegation of breach of contract does not create federal jurisdiction, even if the contract involves copyright. Under the well-pleaded complaint rule,

an action arises under the federal copyright laws "if and only if the complaint is for a remedy expressly granted by the Act, . . . or asserts a claim requiring construction of the Act, . . . or at the very least and perhaps more doubtfully presents a case where a distinctive policy of the Act requires that federal principles control the Disposition of the claim."

Vestron Inc. v. Home Box Office, 839 F.2d 1380, 1381 (9th Cir. 1988) (quoting T.B. Harms Co. v. Eliscu, 339 F.2d 823 (2d Cir. 1964) (Friendly, J.), cert. denied, 381 U.S. 915 (1965)).

In this case, Rano is seeking remedies under several sections of the Copyright Act: 17 U.S.C. §§ 502 (injunctive relief), 503 (impoundment), 504 (damages and profits), and 505 (attorney's fees and costs). Thus, federal jurisdiction is proper.

II. Jurisdiction Over The Appeal.

Although Rano filed his notice of appeal based on the district court's summary judgment order, more than two weeks before the district court issued its final order dismissing the remaining pendent state claims, we will treat the notice of appeal as timely. See Eastport Assocs. v. City of Los Angeles, 935 F.2d 1071, 1074 (9th Cir. 1991) (premature notice of appeal will be directed towards a subsequently entered final decision dismissing the action); Anderson v. Allstate Ins. Co., 630 F.2d 677, 680-681 (9th Cir. 1980) (subsequent events can validate a prematurely filed appeal). As in Eastport and Anderson, there is no danger of ...

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