NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS MAR 6 2024 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT
BILL GAEDE; NILA GAEDE, husband and No. 23-35217 wife, 23-35531
Plaintiffs-Appellants, D.C. No. 3:22-cv-00380-YY
v. MEMORANDUM* MICHAEL DELAY; ANASTASIA BENDEBURY; BIOSPINTRONICS, LLC,
Defendants-Appellees.
Appeal from the United States District Court for the District of Oregon Youlee Yim You, Magistrate Judge, Presiding
Submitted March 6, 2024**
Before: BENNETT, BADE, and COLLINS, Circuit Judges.
In these consolidated appeals, Plaintiffs-Appellants Bill and Nila Gaede
appeal from the district court’s final judgment dismissing the case with prejudice,
and they challenge the district court’s order denying their motion for leave to file a
* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. ** The panel unanimously concludes this case is suitable for decision without oral argument. See Fed. R. App. P. 34(a)(2). second amended complaint, as well as the district court’s order awarding attorney’s
fees to Defendants-Appellees. “We review the denial of leave to amend for an
abuse of discretion, but we review the question of futility of amendment de novo.”
Wochos v. Tesla, Inc., 985 F.3d 1180, 1197 (9th Cir. 2021) (quoting United States
v. United Healthcare Ins. Co., 848 F.3d 1161, 1172 (9th Cir. 2016)). We review
the award of attorney’s fees for abuse of discretion. Cadkin v. Loose, 569 F.3d
1142, 1147 (9th Cir. 2009) (“A district court abuses its discretion when its decision
is based on an inaccurate view of the law or a clearly erroneous finding of fact.”
(citation omitted)). We have jurisdiction under 28 U.S.C. § 1291, and we affirm in
part and reverse in part.
1. Courts “should freely give leave [to amend] when justice so requires.”
Fed. R. Civ. P. 15(a). But a district court does not abuse its discretion by denying
leave to amend if the “amendment would be futile or the plaintiff has failed to cure
the complaint’s deficiencies despite repeated opportunities.” AE v. County of
Tulare, 666 F.3d 631, 636 (9th Cir. 2012). Reviewing the proposed amendments
de novo, Wochos, 985 F.3d at 1197, the district court properly denied leave to file a
second amended complaint given the insufficiency of the proposed amendments.
As the district court noted, “Plaintiffs’ proposed amendments to the complaint
continue to reflect claims over ‘ideas’ and not copyrightable original expression of
those ideas.” Indeed, the Gaedes concede in their opening brief that the ideas that
2 they wish to protect “are not patentable” and are “not protected by Title 17 U.S.C.
because, as it stands today, copyright only protects the expressions of the ideas.”
See 17 U.S.C. § 102(b) (“In no case does copyright protection for an original work
of authorship extend to any idea, procedure, process, system, method of operation,
concept, principle, or discovery, regardless of the form in which it is described,
explained, illustrated, or embodied in such work.”). Accordingly, the proposed
amendments to their copyright claim would be futile. See AE, 666 F.3d at 636.
In the alternative, the Gaedes argue that the “idea-expression dichotomy”
under copyright law is unconstitutionally vague and violates the Equal Protection
Clause of the Fourteenth Amendment. They acknowledge that they did not make
this argument before the district court but argue that they were not allowed an
opportunity to do so. They do not explain, however, why they could not have
included this claim in their proposed second amended complaint. “A party
normally may not press an argument on appeal that it failed to raise in the district
court.” One Indus., LLC v. Jim O’Neal Distrib., Inc., 578 F.3d 1154, 1158
(9th Cir. 2009). We therefore decline to address this argument in the first instance.
The Gaedes also contend that the district court erred when it found that the
proposed amendments to their unfair competition claim under the Lanham Act
would be futile. In the proposed second amended complaint, the Gaedes cite
Dastar Corp. v. Twentieth Century Fox Film Corp., 539 U.S. 23 (2003), to support
3 their assertion that Defendants-Appellants “repackage[d] intellectual property as
their own” in violation of 15 U.S.C. § 1125(a)(1)(A). In that case, the Supreme
Court explained that, under § 1125 of the Lanham Act, the phrase “origin of
goods” refers to “the producer of the tangible product sold in the marketplace” and
is “incapable of connoting the person or entity that originated the ideas or
communications that ‘goods’ embody or contain.” Id. at 31–32. The Court also
noted that individuals do not “face Lanham Act liability for failing to credit the
creator of a work,” and the Lanham Act should not be read “as creating a cause of
action for, in effect, plagiarism.” Id. at 36 (emphasis omitted). In sum, the
Lanham Act was “not designed to protect originality or creativity,” and is not
concerned with “the author of any idea, concept, or communication.” Id. at 37
(emphasis omitted). Because the Gaedes assert that “[t]he issue before the [district
court] was that plaintiff Bill Gaede is the originator of the theory,” and that “[t]he
defendants are not the originators of the ideas contained in [the services they sell
on the internet],” the district court correctly concluded that the proposed
amendments would be futile.
Therefore, the district court did not abuse its discretion by denying leave to
amend because the proposed second amended complaint would have been futile.
AE, 666 F.3d at 636.
2. The district court abused its discretion by awarding $15,080 in
4 attorney’s fees to Defendant-Appellee Biospintronics, LLC. First, the district court
acted within its discretion by finding that a fees award was warranted under
17 U.S.C. § 5051 because the claims in the complaints were “objectively
unreasonable, if not frivolous.” As explained above, it is a basic tenet of both
copyright law and the Lanham Act that neither protects an “idea” or “discovery.”
See 17 U.S.C. § 102(b); Dastar, 539 U.S. at 32–37. The Gaedes’ repeated efforts
to assert such claims could reasonably be characterized as “unreasonable, if not
frivolous.” See Love v.
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NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS MAR 6 2024 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT
BILL GAEDE; NILA GAEDE, husband and No. 23-35217 wife, 23-35531
Plaintiffs-Appellants, D.C. No. 3:22-cv-00380-YY
v. MEMORANDUM* MICHAEL DELAY; ANASTASIA BENDEBURY; BIOSPINTRONICS, LLC,
Defendants-Appellees.
Appeal from the United States District Court for the District of Oregon Youlee Yim You, Magistrate Judge, Presiding
Submitted March 6, 2024**
Before: BENNETT, BADE, and COLLINS, Circuit Judges.
In these consolidated appeals, Plaintiffs-Appellants Bill and Nila Gaede
appeal from the district court’s final judgment dismissing the case with prejudice,
and they challenge the district court’s order denying their motion for leave to file a
* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. ** The panel unanimously concludes this case is suitable for decision without oral argument. See Fed. R. App. P. 34(a)(2). second amended complaint, as well as the district court’s order awarding attorney’s
fees to Defendants-Appellees. “We review the denial of leave to amend for an
abuse of discretion, but we review the question of futility of amendment de novo.”
Wochos v. Tesla, Inc., 985 F.3d 1180, 1197 (9th Cir. 2021) (quoting United States
v. United Healthcare Ins. Co., 848 F.3d 1161, 1172 (9th Cir. 2016)). We review
the award of attorney’s fees for abuse of discretion. Cadkin v. Loose, 569 F.3d
1142, 1147 (9th Cir. 2009) (“A district court abuses its discretion when its decision
is based on an inaccurate view of the law or a clearly erroneous finding of fact.”
(citation omitted)). We have jurisdiction under 28 U.S.C. § 1291, and we affirm in
part and reverse in part.
1. Courts “should freely give leave [to amend] when justice so requires.”
Fed. R. Civ. P. 15(a). But a district court does not abuse its discretion by denying
leave to amend if the “amendment would be futile or the plaintiff has failed to cure
the complaint’s deficiencies despite repeated opportunities.” AE v. County of
Tulare, 666 F.3d 631, 636 (9th Cir. 2012). Reviewing the proposed amendments
de novo, Wochos, 985 F.3d at 1197, the district court properly denied leave to file a
second amended complaint given the insufficiency of the proposed amendments.
As the district court noted, “Plaintiffs’ proposed amendments to the complaint
continue to reflect claims over ‘ideas’ and not copyrightable original expression of
those ideas.” Indeed, the Gaedes concede in their opening brief that the ideas that
2 they wish to protect “are not patentable” and are “not protected by Title 17 U.S.C.
because, as it stands today, copyright only protects the expressions of the ideas.”
See 17 U.S.C. § 102(b) (“In no case does copyright protection for an original work
of authorship extend to any idea, procedure, process, system, method of operation,
concept, principle, or discovery, regardless of the form in which it is described,
explained, illustrated, or embodied in such work.”). Accordingly, the proposed
amendments to their copyright claim would be futile. See AE, 666 F.3d at 636.
In the alternative, the Gaedes argue that the “idea-expression dichotomy”
under copyright law is unconstitutionally vague and violates the Equal Protection
Clause of the Fourteenth Amendment. They acknowledge that they did not make
this argument before the district court but argue that they were not allowed an
opportunity to do so. They do not explain, however, why they could not have
included this claim in their proposed second amended complaint. “A party
normally may not press an argument on appeal that it failed to raise in the district
court.” One Indus., LLC v. Jim O’Neal Distrib., Inc., 578 F.3d 1154, 1158
(9th Cir. 2009). We therefore decline to address this argument in the first instance.
The Gaedes also contend that the district court erred when it found that the
proposed amendments to their unfair competition claim under the Lanham Act
would be futile. In the proposed second amended complaint, the Gaedes cite
Dastar Corp. v. Twentieth Century Fox Film Corp., 539 U.S. 23 (2003), to support
3 their assertion that Defendants-Appellants “repackage[d] intellectual property as
their own” in violation of 15 U.S.C. § 1125(a)(1)(A). In that case, the Supreme
Court explained that, under § 1125 of the Lanham Act, the phrase “origin of
goods” refers to “the producer of the tangible product sold in the marketplace” and
is “incapable of connoting the person or entity that originated the ideas or
communications that ‘goods’ embody or contain.” Id. at 31–32. The Court also
noted that individuals do not “face Lanham Act liability for failing to credit the
creator of a work,” and the Lanham Act should not be read “as creating a cause of
action for, in effect, plagiarism.” Id. at 36 (emphasis omitted). In sum, the
Lanham Act was “not designed to protect originality or creativity,” and is not
concerned with “the author of any idea, concept, or communication.” Id. at 37
(emphasis omitted). Because the Gaedes assert that “[t]he issue before the [district
court] was that plaintiff Bill Gaede is the originator of the theory,” and that “[t]he
defendants are not the originators of the ideas contained in [the services they sell
on the internet],” the district court correctly concluded that the proposed
amendments would be futile.
Therefore, the district court did not abuse its discretion by denying leave to
amend because the proposed second amended complaint would have been futile.
AE, 666 F.3d at 636.
2. The district court abused its discretion by awarding $15,080 in
4 attorney’s fees to Defendant-Appellee Biospintronics, LLC. First, the district court
acted within its discretion by finding that a fees award was warranted under
17 U.S.C. § 5051 because the claims in the complaints were “objectively
unreasonable, if not frivolous.” As explained above, it is a basic tenet of both
copyright law and the Lanham Act that neither protects an “idea” or “discovery.”
See 17 U.S.C. § 102(b); Dastar, 539 U.S. at 32–37. The Gaedes’ repeated efforts
to assert such claims could reasonably be characterized as “unreasonable, if not
frivolous.” See Love v. Associated Newspapers, Ltd., 611 F.3d 601, 614–15
(9th Cir. 2010) (listing factors relevant to awarding attorney’s fees).
Second, the district court thoroughly explained its basis for finding that the
rates billed were reasonable, and it properly applied the relevant standards under
our case law. See Range Rd. Music, Inc. v. E. Coast Foods, Inc., 668 F.3d 1148,
1155 (9th Cir. 2012).2 The district court properly made “specific findings” on
counsel’s hourly rate based on his experience and as compared to the billing rates
of other attorneys practicing in his geographic area. Transgo, Inc. v. Ajac
1 Section 505 of the Copyright Act provides: “In any civil action under this title, the court in its discretion may allow the recovery of full costs by or against any party other than the United States or an officer thereof. Except as otherwise provided by this title, the court may also award a reasonable attorney’s fee to the prevailing party as part of the costs.” 2 Contrary to the Gaedes’ assertion, pro bono counsel may recover attorney’s fees. Indeed, “[a]ttorneys’ fees are recoverable by pro bono attorneys to the same extent that they are recoverable by attorneys who charge for their services.” Legal Voice v. Stormans Inc., 757 F.3d 1015, 1017 (9th Cir. 2014).
5 Transmission Parts Corp., 768 F.2d 1001, 1027 (9th Cir. 1985).
But the district court abused its discretion in finding the billed hours
submitted by counsel were reasonably attributed to work performed for
Biospintronics, LLC. The Gaedes challenge the reasonableness of the hours billed
because, they argue, some of this time reflects work performed for pro se
Defendants-Appellees Michael DeLay and Anastasia Bendebury, rather than
Biospintronics, LLC, and therefore this time should not have been included in the
lodestar analysis. We agree. Although Biospintronics, LLC’s only members are
DeLay and Bendebury, nothing in the motion for attorney’s fees or the supporting
declarations shows that counsel billed only for the hours spent advising
Biospintronics, LLC. Although the district court acknowledged that Biospintronics
“bears ‘the burden of documenting the appropriate hours expended in the
litigation,’ and [is] required to ‘submit evidence in support of those hours
worked,’” United Steelworkers of Am. v. Ret. Income Plan for Hourly-Rated Emps.
of Asarco, Inc., 512 F.3d 555, 565 (9th Cir. 2008) (quoting Gates v. Deukmejian,
987 F.2d 1392, 1397 (9th Cir.1992)), it did not distinguish counsel’s time advising
Bendebury and DeLay on their pro se motions to dismiss, from counsel’s time
advising those individuals, as members of Biospintronics, LLC, for the purpose of
advising the entity.
Indeed, Bendebury and DeLay acknowledge that after the first amended
6 complaint was filed, counsel “took on the full burden of advising Defendants’ legal
strategy and on the specifics of their motions practice,” and “[w]ith his guidance,
Defendants prepared a motion to dismiss the [first amended complaint].” These
events occurred before counsel appeared on behalf of Biospintronics, LLC. Thus,
it is unclear whether counsel’s motion for attorney’s fees improperly included fees
for time spent advising Bendebury and DeLay as individuals.
Because Biospintronics, LLC failed to sufficiently “document[] the
appropriate hours expended in the litigation” on its behalf, rather than on behalf of
all Defendants, id., the district court abused its discretion in finding that the hours
billed were reasonable. We therefore reduce the attorney’s fees award to
Biospintronics, LLC to $7,930, because $7,1503 in fees were incurred before
counsel appeared on behalf of Biospintronics, LLC.
AFFIRMED IN PART and REVERSED IN PART.
3 $500 hourly rate multiplied by hours billed from March 25, 2022 to August 8, 2022.