District court denies remand of lawsuit against podcast host and distributor, holding Copyright Act preempts state law claims for conversion, unjust enrichment and common law copyright infringement.
Red Apple Media brought suit against John Batchelor, the former host of The John Batchelor Show radio news program; the podcast distribution company Audiobloom; and a number of related parties in New York state court, alleging breach of contract, unjust enrichment, conversion and a number of other claims arising under state law. Red Apple claimed it held the exclusive rights to The John Batchelor Show by virtue of a “work made for hire” agreement with Batchelor and that after the show ended, Batchelor copied and rebroadcast the show’s content as part of a new radio show and podcasts distributed by Audiobloom. Audiobloom, with consent from the other defendants, removed the case to federal court, arguing that Red Apple’s claims are preempted by and are deemed to arise under the Copyright Act. In response, Red Apple moved to remand the case to state court.
The court began by noting that in enacting the Copyright Act, Congress intended to completely preempt all claims that are equivalent to those under copyright and to convert any analogous state law claims into federal claims under the act. While Red Apple argued that any state law claims that were not preempted could be severed and remanded to state court, the court explained that courts can only remand entire cases, not individual claims. And because the court could exercise supplemental jurisdiction over any state law claims that arise from the same set of facts as in a federal claim, the court needed only find federal question jurisdiction over one of Red Apple’s claims in order to deny the remand motion.
Citing Briarpatch Ltd., L.P. v. Phoenix Pictures, Inc., the court noted that in the Second Circuit, the Copyright Act preempts all claims that involve types of works protected by the Copyright Act—that is, “original works of authorship fixed in any tangible medium of expression … from which they can be perceived, reproduced, or otherwise communicated”—and that seek to vindicate legal or equitable rights that are governed by the Copyright Act—such as the exclusive right to reproduce, copy and prepare derivative works.
The court found that podcasts like The John Batchelor Show clearly fall within the ambit of the Copyright Act, as “sound recordings” are explicitly cited in the act. For a state law claim to not fall within the Copyright Act, it must contain an extra element that makes it “qualitatively different” from a copyright infringement claim.
While the court noted it may be difficult to assess whether copyright preemption applies in some cases, this was not such a case, as Red Apple alleged a cause of action for “common law copyright infringement” based on defendants rebroadcasting parts of The John Batchelor Show. Given that Red Apple admitted that the show was entitled to copyright protection, it was therefore covered by the Copyright Act. The allegations against the defendants did not contain any extra elements that made the claim qualitatively different from a claim for infringement under the Copyright Act, and so the court found that this claim was an “easy case” that was clearly preempted by the Copyright Act, which provided the court with federal question jurisdiction. Because Red Apple’s other claims are based on the same nucleus of operative fact (the alleged use of Red Apple’s copyrighted material), the court exercised supplemental jurisdiction over those claims as well.
Red Apple attempted to defeat federal jurisdiction by offering in its motion papers to voluntarily dismiss its claim for common law copyright infringement. However, the court noted that Red Apple had not formally dismissed that cause of action, and, in any event, courts decide whether there is federal question jurisdiction based on the state of play at the time of removal. So even if Red Apple had voluntarily dismissed its claim for common law copyright infringement after the case was removed, that claim would still support federal jurisdiction.
The court also assessed Red Apple’s state law conversion and unjust enrichment claims, finding that both are also preempted by the Copyright Act. The core argument of both claims was that the defendants profited from The John Batchelor Show, in which Red Apple allegedly has a copyright interest. Given that both claims are based on Red Apple’s ownership of a copyrightable work, and that Red Apple is attempting to vindicate its equitable rights stemming from its ownership of the show, both claims were preempted. The court also noted that there is binding Second Circuit precedent preempting unjust enrichment and conversion claims.
Finally, the court assessed Red Apple’s breach of contract claim. The court explained that while in some cases a breach of contract claim may not be subject to copyright preemption (for example, a case in which a copyright holder sues for failure to pay amounts owed under a contract), Red Apple’s breach of contract claim focused on the defendants’ alleged unauthorized use of Red Apple’s intellectual property. The court found that Red Apple failed to plead any additional elements that would exclude the breach of contract claim from copyright preemption. However, the court did not need to reach a definitive conclusion as to whether Red Apple’s breach of contract claim was preempted, because it had federal question jurisdiction based on Red Apple’s common law copyright, unjust enrichment and conversion claims.
Summary prepared by Tal Dickstein and Alex Inman