Blagman v. Apple, Inc.

307 F.R.D. 107, 2015 U.S. Dist. LEXIS 51676, 2015 WL 1787182
CourtDistrict Court, S.D. New York
DecidedApril 20, 2015
DocketNo. 12 Civ. 5453(ALC)(JCF)
StatusPublished
Cited by8 cases

This text of 307 F.R.D. 107 (Blagman v. Apple, Inc.) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Blagman v. Apple, Inc., 307 F.R.D. 107, 2015 U.S. Dist. LEXIS 51676, 2015 WL 1787182 (S.D.N.Y. 2015).

Opinion

MEMORANDUM AND ORDER

JAMES C. FRANCIS IV, United States Magistrate Judge.

Plaintiff Norman Blagman has moved pursuant to Rule 15(a)(2) of the Federal Rules of Civil Procedure for leave to file his third amended complaint. For the following reasons, the motion is granted.

Background

According to the operative complaint in this putative class action, “the digital music business consists of four groups.” (Second Amended Complaint (“2nd Am. Compl.”), ¶ 87). The artists—composers and lyricists—generally own the copyrights in the musical compositions they create; record labels generally own the copyright in the sound recordings of the artists’ compositions; “ag-gregators” acquire digital distribution rights from record labels and upload the digital recordings to online music stores; and digital music retailers sell the recordings online. (2nd Am. Compl., ¶¶ 65, 87). Defendants Apple, Inc., Amazon.com, Inc., Google, Inc., Microsoft Corp., and eMusic.com Inc. (the “Retailer Defendants”) “own and operate the largest digital music retail stores in the world.” (2nd Am. Compl., ¶ 3). Defendants The Orchard Enterprises, Inc., and Orchard Enterprises NY, Inc. (“Orchard”) are aggre-gators who “act as the middlemen between the Retailer Defendants and the record labels.” (2nd Am. Compl., ¶4). Mr. Blagman alleges that the defendants, without acquiring the necessary licenses or permissions, “have all imported, exported, reproduced, distributed, and sold ... digital recordings” of certain compositions (he has identified three) for which he owns the copyright. (2nd Am. Compl., ¶¶ 46-53).

The [defendants’ failure to properly license the music they sell derives from two factors: (a) the Retailer Defendants accept virtually all digital music content from their suppliers without adequately screening the content for unlicensed music or the suppliers for unlawful conduct; and (b) the [defendants take no direct action to obtain or confirm licenses for the music they distribute and sell and instead rely on their suppliers to perform this vital function.

(2nd Am. Compl., ¶ 7). The plaintiff further asserts that the defendants “have [ ] willfully infringed at least thousands of other copyrighted compositions in the same manner.” (2nd Am. Compl., ¶ 57).

The first amended complaint—which was filed in October 2012, three months after the original complaint—identified a “class that includes ‘[a]ll persons or entities who own all or part of one or more registered copyrighted musical compositions that have been reproduced, distributed, or sold by Defendants.’ ” Blagman v. Apple, Inc., No. 12 Civ. 5453, 2014 WL 2106489, at *1 (S.D.N.Y. May 19, 2014) (quoting Amended Complaint, ¶ 52) (“Blagman II”). The Honorable Andrew L. Carter, U.S.D.J., denied the defendants’ motions to dismiss that complaint and to strike the class allegations. Blagman v. Apple, Inc., No. 12 Civ. 5453, 2013 WL 2181709, at *8 (S.D.N.Y. May 20, 2013) (“Blagman I”). Approximately nine-and-one-half months later, the plaintiff moved to amend his complaint in order to, among other things, “narrow[] the scope of the class” by limiting it “to composition copyright holders whose songs were provided to the Retailer Defendants by 69 allegedly unlawful record labels,” which were identified on two exhibits attached to the proposed complaint. Blagman II, 2014 WL 2106489, at *1 (internal quotation marks omitted); (Orchard Label List, attached as Exh. A to 2nd Am. Compl.; [110]*110Non-Orchard Label List, attached as Exh. B to 2nd Am. Compl). Specifically, the class was described in the proposed complaint as

[t]he legal and/or beneficial owners of all or part of one or more U.S. registered copyrighted musical compositions that have been reproduced, distributed, sold, imported, or exported by the Retailer Defendants and that were supplied to the Retailer Defendants: (a) by Orchard on behalf of the record labels and aggregators listed on the Orchard Label List annexed as Exhibit A; and (b) by the record labels and aggregators listed on the Non-Orchard Label List annexed as Exhibit B.1

(2nd Am. Compl, ¶ 58). I granted the application in May 2014. Blagman II, 2014 WL 2106489, at *1, *9.

As class discovery continued, a disagreement as to the meaning of the class definition emerged. The defendants argued that the putative class consisted of copyright owners whose compositions

have been subjected to two actions. First, they must have been “reproduced, distributed, sold, imported, or exported by the Retailer Defendants.” Second, they must have been either (a) “supplied to the Retailer Defendants ... by [ ] Orchard, on behalf of the record labels and aggregators listed on the Orchard Label List annexed as Exhibit A,” or (b) “supplied to the Retailer Defendants ... by the record labels and aggregators listed on the Non-Orchard Label List annexed as Exhibit B.” Therefore, to be implicated by the class, the content must have been supplied to a Retailer Defendant by Orchard on behalf of one of the entities listed in Exhibit A or by one of the entities on Exhibit B----

(Letter of Gabrielle Levin dated Nov. 14, 2014, at 6 (first and third alterations in original) (citations omitted) (quoting 2nd Am. Compl, ¶ 58)). The plaintiff disagreed, contending that the defendants “read into the class definition the word ‘directly,’ which is plainly not there____Whether the labels listed in the Exhibits to the Second Amended Complaint supplied their tracks directly, or ... through an aggregator[ ] is not relevant to their inclusion in the [cjlass.” (Letter of Oren Giskan dated Nov. 14, 2014, at 2). That is, the plaintiff believed that the putative class included copyright owners whose compositions arrived at the Retailer Defendants from the labels on Exhibit B through an aggregator as an intermediary.

At a conference in December 2014 addressing various discovery disputes (the “December Conference”), I agreed with the defendants’ interpretation, stating:

I read the class definition as the defendants do but I don’t know that that’s the end of the story. I think that that leaves the plaintiff! ] with the option of moving to amend the class definition to perhaps include the words [“jdirectly or indirectly,!”] [and] that’s frankly a motion likely to be granted. At the same time, I would suggest to the plaintiff! ] that you may want to be careful what you wish for because expanding the class definition as you now suggest may lead to issues with respect to ascertainability once we get to the class certification stage. That obviously will be a determination for Judge Carter____ [But] the defendants should be aware that if the plaintiff! ] make[s] that motion, as I say, it’s likely to be granted.

(Transcript dated Dec. 15, 2014 (“Tr.”) at 13). I limited the discovery available to the plaintiff based on this understanding of the operative complaint’s class definition. (Order dated Dec. 15, 2014, at 1).

The plaintiff now moves again to amend his complaint. He describes three “significant” changes, two directed to the class definition and one directed to the damages claimed. (Plaintiffs Memorandum of Law in Support of Motion for Leave to File Third Amended Complaint (“PI. Memo.”) at 1-2).

The Proposed Third Amended Complaint (hereinafter, “Proposed Complaint” or “Proposed 3rd Am.

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307 F.R.D. 107, 2015 U.S. Dist. LEXIS 51676, 2015 WL 1787182, Counsel Stack Legal Research, https://law.counselstack.com/opinion/blagman-v-apple-inc-nysd-2015.