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Onza Partners SL v. Sony Pictures Entertainment Inc.

USDC, C.D. California, February 15, 2017

In copyright and implied contract dispute over NBC’s new time-travel show “Timeless,” district court denies Sony’s motion to dismiss claims brought by producer of show created and broadcast in Spain, holding that decision on issue of substantial similarity was “better suited for summary judgment,” and that Sony did not have valid “blurt out” defense to implied contract claim.

Onza Partners SL sued Sony Pictures Entertainment Inc., among others, for copyright infringement and breach of implied contract regarding the Sony-produced NBC television series “Timeless.” Onza holds copyrights in the TV show “El Ministerio del Tiempo” (“The Department of Time”), which began airing in Spain in February 2015. Both shows follow three time travelers, one woman and two men, on government missions to “protect the timeline.” Onza claims that it entered negotiations with defendants around July 2015 about licensing an American version of “El Ministerio del Tiempo.” These negotiations went so far as a licensing offer from Sony and a counteroffer from Onza. However, Sony failed to respond to the counteroffer and ceased negotiations in August 2015, according to Onza. In August 2015, online magazine “Deadline Hollywood” reported that “Sony is producing a show called ‘Time,’” which eventually became “Timeless.”

Regarding Onza’s copyright infringement claim, Sony claimed there is no “substantial similarity” between the two works. In the Ninth Circuit, a plaintiff must establish three elements to show copyright infringement: (1) plaintiff’s ownership of a valid copyright, (2) defendant’s access to the copyrighted work, and (3) “substantial similarity” between plaintiff’s copyrighted work and defendant’s allegedly infringing work. Applying the “extrinsic test” to compare Onza’s and Sony’s works objectively, the district court noted the high bar a defendant faces to defeat a copyright infringement claim based on substantial similarity at the early stage of a motion to dismiss. Sony argued that the district court could make a determination on the issue of substantial similarity by comparing only the pilot episodes of the two shows, while Onza maintained that the district court could not dismiss its infringement claim unless it looked beyond the pilots and examined all of the works at issue. While the district court stated it was not necessary to compare all of the works on a motion to dismiss, it declined to decide the issue of substantial similarity based only on the pilot episodes. Denying Sony’s motion to dismiss the copyright infringement claim, the district court found the issue of substantial similarity was “better suited for summary judgment,” when the comparison between the protected and allegedly infringing works would be more focused.

Next, the district court addressed Onza’s implied contract claim. Onza claimed the parties began negotiations to produce an American version of “El Ministerio del Tiempo” and they discussed payment for licensing Onza’s show. But when Onza rejected Sony’s licensing offer, Sony “took [Onza’s] idea anyway without paying compensation,” according to Onza. Sony countered with a “blurt out” defense under the 2013 decision in Quirk v. Sony Pictures Entertainment Inc. In Quirk, plaintiff approached a movie studio about producing a film based on his book, and the studio wrote two scripts, but eventually decided not to make the movie. Years later, a different studio produced a movie allegedly similar to plaintiff’s novel, and plaintiff sued that studio, alleging that the second studio got plaintiff’s idea from plaintiff’s book and from the first studio’s scripts. The Quirk court found that plaintiff had no “bilateral expectation of payment” from the second studio, stating that “[t]he idea man who blurts out his idea without having first made his bargain has no one but himself to blame for the loss of his bargaining power.” In the present case, Sony claimed that Onza similarly “blurted out” its idea behind “El Ministerio del Tiempo,” and therefore could not bring an implied contract claim. However, the district court found that Quirk was distinguishable from the present action because Onza engaged in licensing negotiations with Sony directly and their discussions demonstrated a “bilateral expectation of payment.” If defendants had made “Timeless” “without any communication with [Onza],” then Sony could argue that Onza “blurted out” its idea and could not establish an implied contract, but that was not the case here, said the district court. Accordingly, it denied Sony’s motion to dismiss the breach of an implied contract claim.

Summary prepared by Jonathan Zavin and Joel Ernst