Cong v. Zhao

• Court: District Court, W.D. Washington
• Decided: February 12, 2025
• Docket: 2:21-cv-01703
• Status: Unknown

Opinion

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5 6 7 8 UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON 9 AT SEATTLE 10 11 FANG CONG and LIN JIANG, CASE NO. 2:21-cv-01703-TL 12 Plaintiffs, ORDER ON MOTION TO DISMISS v. 13 XUE ZHAO and “Conveyor Belt Sushi”, 14 Defendants. 15

16 17 This matter is before the Court on Defendant Xue Zhao’s Motion to Dismiss Under the 18 Doctrine of Forum Non Conveniens. Dkt. No. 65. Having reviewed Plaintiffs Fang Cong and Lin 19 Jiang’s response (Dkt. No. 66), Defendant Zhao’s reply (Dkt. No. 67), and the relevant record, 20 the Court GRANTS the motion. 21 I. BACKGROUND 22 The Court assumes familiarity with the facts of this matter. Relevant to the instant 23 motion, Plaintiffs bring claims of direct copyright infringement and “false statements and 24 misrepresentation” against Defendant and “Conveyor Belt Sushi” (an apparent alias of 1 Defendant1) for the alleged use of Plaintiffs’ artwork in the video game Things As They Are 2 (“TATA”). See Dkt. No. 52 (Amended Complaint) ¶¶ 194–210. The Court previously dismissed 3 with prejudice Valve Corporation as a defendant. See Dkt. No. 63. The Court also denied 4 Defendant’s previous motion to dismiss. See Dkt. No. 64. However, Defendant was given

5 another opportunity to address his argument that the United States is an improper venue. See id. 6 at 4–5. Defendant now brings the instant motion for dismissal under the doctrine of forum non 7 conveniens. See Dkt. Nos. 65, 67 (reply). Plaintiffs oppose. See Dkt. No. 66. 8 II. LEGAL STANDARD 9 A district court may dismiss a case where litigation in a foreign forum would be more 10 convenient for the litigants. Piper Aircraft Co. v. Reyno, 454 U.S. 235, 250 (1981). However, the 11 common-law doctrine of forum non conveniens should only be employed sparingly. Boston 12 Telecomms. Grp. v. Wood, 588 F.3d 1201, 1212 (9th Cir. 2009) (citing Dole Food Co. v. Watts, 13 303 F.3d 1104, 1118 (9th Cir. 2002)); accord Carijano v. Occidental Petroleum Grp., 643 F.3d 14 1216, 1224 (9th Cir. 2011). In determining whether to dismiss a case on these grounds, a court

15 considers: (1) whether an adequate alternative forum exists; and (2) whether the balance of private 16 and public interest factors weigh in favor of dismissal. Lueck v. Sundstrand Corp., 236 F.3d 1137, 17 1142 (9th. Cir. 2001); accord Carijano, 643 F.3d at 1224. A defendant bears the burden of 18 establishing these factors. Carijano, 643 F.3d at 1224. A court ultimately decides “whether 19 defendants have made a clear showing of facts which establish such oppression and vexation of a 20 defendant as to be out of proportion to plaintiff’s convenience, which may be shown to be slight or 21 nonexistent.” Boston Telecomms., 588 F.3d at 1206 (quoting Dole, 303 F.3d at 1118). 22

23 1 Plaintiffs allege that Defendant Zhao admitted in a Chinese court that “he used the identity of ‘Conveyor Belt Sushi’ to communicate with Plaintiffs and other artists he hired.” Dkt. No. 52 ¶ 177; see also Dkt. No. 66 at 1–2 24 (“Defendant Xue Zhao refers to himself as ‘Conveyor Belt Sushi’ in Chinese courts and as ‘Abai’ in U.S. courts.”). 1 Finally, “[a] determination of forum non conveniens ‘is committed to the sound discretion 2 of the trial court’ and ‘may be reversed only when there has been a clear abuse of discretion; 3 where the court has considered all relevant public and private interest factors, and where its 4 balancing of these factors is reasonable, its decision deserves substantial deference.’” Boston

5 Telecomms., 588 F.3d at 1206 (quoting Creative Tech., Ltd. v. Aztech Sys. Pte., Ltd., 61 F.3d 6 696, 699 (9th Cir. 1995)). 7 III. DISCUSSION 8 Defendant argues that China is available as an adequate alternative forum (see Dkt. 9 No. 65 at 4–5) and that the private- and public-interest factors weigh in favor of dismissal (see 10 id. at 5–6). In opposition, Plaintiffs argues, among other things, that China is not an appropriate 11 forum (see Dkt. No. 66 at 5–8) and that the factors weigh against dismissal (see id. at 12–16). 12 The Court first considers whether China is an adequate alternative forum before 13 reviewing the factors, if appropriate. 14 A. Adequate Alternative Forum

15 An adequate alternative forum is one where (1) the defendant is amenable to process 16 there and (2) the other jurisdiction “offers a satisfactory remedy.” Carijano, 643 F.3d at 1225. 17 “This test is easy to pass . . . .” Tuazon v. R.J. Reynolds Tobacco Co., 433 F.3d 1163, 1178 (9th 18 Cir. 2006); see also Lueck, 236 F.3d at 1143 (“[I]t is only in ‘rare circumstances . . . where the 19 remedy provided by the alternative forum . . . is so clearly inadequate or unsatisfactory, that it is 20 no remedy at all,’ that this requirement is not met.” (quoting Lockman Found. v. Evangelical All. 21 Mission, 930 F.2d 764, 768 (9th Cir. 1991))). 22 As an initial matter, Defendant has indicated that he is amenable to service of process in 23 China; indeed, he insists he is subject to it, and he identifies the court in which he believes the

24 case should be heard. See Dkt. No. 65 at 4; Carijano, 643 F.3d at 1225 (affirming that “voluntary 1 submission to service of process” is sufficient to meet the first requirement of an adequate 2 alternative forum). The Parties’ prior litigation in China is further evidence that Defendant is 3 amenable to process there. See Dkt. No. 65 at 2. Plaintiffs appear to suggest that Chinese courts 4 would not have jurisdiction (see Dkt. No. 66 at 5), but the argument is muddled and fails in light

5 of Defendant’s arguments and the record in this case.2 6 The main dispute, then, is whether China can provide Plaintiffs with “some” remedy for 7 their claims if merited. Lueck, 236 F.3d at 1143; accord Ranza v. Nike, Inc., 793 F.3d 1059, 1077 8 (9th Cir. 2015) (“A foreign forum must merely provide ‘some’ remedy.”). While “an alternate 9 forum offering a ‘clearly unsatisfactory’ remedy is inadequate,” a dismissal on grounds of forum 10 non conveniens “‘may be granted even though the law applicable in the alternative forum is less 11 favorable to the plaintiff’s chance of recovery.’” Carijano, 643 F.3d at 1225 (quoting Piper, 454 12 U.S. at 250, 254 n.22); accord Tuazon, 433 F.3d at 1178 (holding that less-favorable substantive 13 law in the alternate forum is “relevant only if it would completely deprive plaintiffs of any 14 remedy or would result in unfair treatment”).

15 Defendant argues that China has a “mature legal system for copyright protection” with 16 “detailed provisions on compensation on copyright infringement, so surely the Chinese could 17 provide quite sufficient remedy for Plaintiffs if merited.” Dkt. No. 65 at 4, 5. Defendant also 18 argues that the case was heard and resolved through mediation by the Qingdao Shinan District 19 People’s Court in June 2023. Id. at 2, 4. In opposition, Plaintiffs argue that the outcome of the 20 Chinese mediation was “inadequate,” noting that the court lacks enforcement power over U.S. 21 companies and did not consider or resolve Plaintiffs’ U.S. copyright claims. See Dkt. No. 66 at 22 23 2 Defendant also clarifies that an “objection to jurisdiction” that he made in the prior Chinese litigation concerned 24 venue within China, not the ability of any Chinese courts to hear the case. See Dkt. No. 67 at 9–10. 1 5–7. Plaintiffs adds that it is difficult to enforce Chinese court judgments in the United States. 2 See id. at 7. 3 The Court finds that China is an adequate alternative forum for this copyright dispute. 4 Crucially, Plaintiffs concede Defendant’s assertion that “China has a mature legal system for

5 copyright protection.” Dkt. No. 65 at 4; see Dkt. No. 66 at 12 (concession). Plaintiffs note how 6 they “have been able to advance the litigation process by utilizing effective information obtained 7 in China” through a lawsuit against Weibo and use of China’s Central Authority to serve process 8 on Defendant. Dkt. No. 66 at 12. Plaintiffs also state that “litigating in both countries” is “crucial 9 to fully protect Plaintiffs’ rights,” suggesting again that China offers some remedy for their 10 claims. Id. (emphasis added). Further, “[n]umerous federal and state courts, . . . including the 11 Supreme Court, have found China and its judicial system to be an adequate alternative forum.” 12 King.com Ltd. v. 6 Waves LLC, No. C13-3977, 2014 WL 1340574, at *3 (N.D. Cal. Mar. 31, 13 2014) (internal citation omitted) (in copyright dispute between two foreign corporations, 14 concluding that China is an adequate alternative forum); see also Sinochem Int’l Co. Ltd. v.

15 Malaysia Int’l Shipping Corp., 549 U.S. 422, 435 (2007) (in negligent-misrepresentation dispute, 16 concluding the matter “is a textbook case for immediate forum non conveniens dismissal”). 17 Indeed, Plaintiffs do not dispute that they have already received “some” remedy through 18 the case in China in which they agreed to a settlement through mediation. See Dkt. No. 66 at 5–7. 19 Plaintiffs assert that the mediation did not cover infringements that occurred after the mediation 20 was reached (see id. at 6), but they noticeably do not assert that they could not file a new case in 21 China addressing new infringements not covered by the prior case. Plaintiffs also argue that the 22 Parties’ Chinese mediation was “limited to the infringement within the Chinese market and could 23 not address infringing activities in other countries or regions” (Dkt. No. 66 at 6; see also id. at 8),

24 a point that Defendant disputes (see Dkt. No. 67 at 8). But even if true, that fact would not 1 prevent dismissal, as a lesser or circumscribed remedy for Defendant’s alleged copyright 2 infringement is still “some” remedy. See Creative Tech., 61 F.3d at 702 (in copyright dispute, 3 holding that “[w]hile the scope of relief available in the High Court of Singapore may not be 4 what [plaintiff] envisioned when it filed its claim in the United States district court, the forum

5 non conveniens doctrine does not require it to be so”); cf. Lockman Found., 930 F.2d at 768 (in 6 copyright dispute, holding that even if Japanese courts rejected entire RICO and Lanham Act 7 claims, that fact would not be sufficient to establish a clearly inadequate remedy when plaintiffs 8 could still recover on tort and contract claims). Moreover, Defendant points out that a Chinese 9 court could order him to remove TATA from the Steam platform, which he (as the game developer) 10 would be able to do—further evidence that a remedy is available. See Dkt. No. 67 at 2–3. 11 While Plaintiffs concede China’s “mature copyright legal system,” they argue “this does 12 not mean that Chinese courts are capable of effectively collecting and handling all aspects of this 13 case.” Dkt. No. 66 at 12. Plaintiffs seem to want to maintain a case in the United States because, 14 they explain, “Plaintiffs are heavily reliant on the discovery process in U.S. courts to obtain

15 critical evidence from Valve. The Chinese judicial process lacks a similar evidence disclosure 16 mechanism, placing Plaintiffs at a significant disadvantage, which is unfair.” Id. at 12–13. But 17 this does not make the Chinese courts inadequate. See Lockman Found., 930 F.2d at 768 18 (rejecting plaintiff’s argument that Japanese courts were inadequate because Japan’s procedural 19 rules regarding pretrial discovery are “not identical to those in the United States”). Finally, 20 Plaintiffs also admit that “China, as a forum, may provide a solution for certain disputes,” but 21 argue that “relying solely on Chinese courts cannot ensure that Plaintiffs receive full and 22 effective relief.” Id. (emphasis added). But again, a lack of “full and effective relief,” or relief 23 akin to what a U.S. court would provide, does not entitle Plaintiffs to maintain their case here.

24 Even if Chinese law is ultimately “less favorable” than U.S. law, Plaintiffs do not argue that 1 there is no remedy; dismissal is thus permitted. Carijano, 643 F.3d at 1225; see also Loya v. 2 Starwood Hotels & Resorts Worldwide, Inc., 583 F.3d 656, 664 (9th Cir. 2009) (in affirming 3 dismissal, noting the district court’s observation that “Mexican courts would afford some 4 remedy, even though less than available in this country”).

5 B. Balance of Interests 6 Given the existence of an adequate alternative forum, the Court next evaluates the 7 balance of private and public interest factors. 8 Naturally, the Parties do not agree on how to weigh the balance of interests here. 9 Compare Dkt. No. 65 at 5–6 and Dkt. No. 67 at 4–7, with Dkt. No. 66 at 12–15. As an initial 10 matter, the Court reiterates that “a foreign plaintiff’s choice of forum merits less deference than 11 that of a plaintiff who resides in the selected forum, and the showing required for dismissal is 12 reduced,” even if some deference is still merited. Lueck, 236 F.3d at 1145 (citing Gemini Cap. 13 Grp., Inc. v. Yap Fishing Corp., 150 F.3d 1088, 1091 (9th Cir. 1998)). Thus, Plaintiffs’ selection 14 of this District receives less deference than it would if Plaintiffs resided here. Still, “less

15 deference is not the same thing as no deference.” Carijano, 643 F.3d at 1227 (quoting Ravelo 16 Monegro v. Rosa, 211 F.3d 509, 514 (9th Cir. 2000)). The Court reviews all the private- and 17 public-interest factors to reach a final determination. 18 1. Private-Interest Factors 19 “The district court should look to any or all of the [private-interest factors] which are 20 relevant to the case before it, giving appropriate weight to each.” Lueck, 236 F.3d at 1145. “It 21 should consider them together in arriving at a balanced conclusion.” Id. at 1145–46. The 22 following private-interest factors must be considered: (1) the residence of the parties and the 23 witnesses; (2) the forum’s convenience to the litigants; (3) access to the physical evidence and

24 other sources of proof; (4) whether unwilling witnesses can be compelled to testify; (5) the cost 1 of bringing witnesses to trial; (6) the enforceability of the judgment; and (7) “all other practical 2 problems that make trial of a case easy, expeditious, and inexpensive.” Lueck, 236 F.3d at 1145 3 (quoting Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 508 (1947)). 4 Defendant argues that the private-interest factors weigh in favor of dismissal. See Dkt.

5 No. 65 at 5. Defendant argues that the Parties and “relevant” witnesses are Chinese nationals and 6 live in China, “which makes it exceedingly inconvenient and costly for them to appear in the 7 U.S. court.” Id. Defendant also argues that the “main evidence . . . is published in Chinese on 8 communication software and social media platforms of China,” making access to proof and 9 verification of that proof easier in China. Id. Finally, Defendant argues that enforceability of the 10 judgment is easier in China, “considering the Chinese citizenship of both parties.” Id. 11 In response, Plaintiffs argue that the private-interest factors weigh against dismissal. See 12 Dkt. No. 66 at 12–14. Plaintiffs suggest that “video conferencing” can relieve the burden of 13 litigation here. Id. at 13. Plaintiffs also argue that “there are numerous professional service 14 providers” capable of helping the Parties process and verify evidence across borders. Id. Finally,

15 Plaintiffs argue that U.S. courts have “direct jurisdiction” over U.S. copyright disputes, and that 16 Defendant has demonstrated his ability overcome any legal differences, language barriers, or 17 cultural differences. See id. at 14. 18 The Court finds that the private-interest factors weigh in favor of dismissal. All Parties 19 are individuals located in China. See Nexon Korea Corp. v. Ironmace Co. Ltd., No. C23-576, 20 2023 WL 5305996, at *8 (W.D. Wash. Aug. 17, 2023) (noting that all Parties were in Korea, the 21 alternative forum). China is plainly a more convenient forum, as most of the witnesses (including 22 the most important witnesses) and evidence are in China or written in Chinese, often on Chinese 23 digital platforms—meaning that evidence would need to be transported and/or translated for

24 litigation in the United States. See id. (noting that “it would be more convenient for all Parties to 1 litigate this matter in Korea,” where “most” witnesses and evidence were located); cf. Carijano, 2 643 F.3d at 1231 (instructing that a court should evaluate “the materiality and importance of the 3 anticipated . . . witnesses’ testimony and then determine their accessibility and convenience to 4 the forum” (quoting Boston Telecomms., 588 F.3d at 1209)). Indeed, a review of Plaintiffs’

5 allegations in the Amended Complaint demonstrates that China is the nexus of Defendant’s 6 alleged infringement. See, e.g., Dkt. No. 52 ¶¶ 36–58; see also Ranza, 793 F.3d at 1078 (in 7 affirming dismissal, weighing private-interest factors in favor of dismissal where alleged harm 8 occurred in alternative forum, “relevant documents and witnesses [were] mostly located abroad,” 9 and “plaintiff does not even reside in the United States”); Creative Tech., 61 F.3d at 703 (in 10 affirming dismissal, finding no abuse of discretion in weighing private-interest factors in favor of 11 dismissal where “[b]oth primary parties, the key infringing conduct, and the bulk of the 12 witnesses” were located in an alternative forum). 13 Plaintiffs further argue that there are difficulties in enforcing Chinese court judgments in 14 the United States (Dkt. No. 66 at 7), but there is no evidence (or argument) that judgments

15 cannot be enforced in China, the alternative forum.3 Cf. Carijano, 643 F.3d at 1231–32 16 (weighing this factor against dismissal where enforceability of judgments was difficult in the 17 alternative forum). As to other “practical problems,” Plaintiffs point to video conferencing, but 18 the Court’s expectation is that all proceedings occur in person; the Court does not rely wholesale 19 on video conferencing, and Plaintiffs are not entitled to assert as much. Even though other 20 challenges (e.g., language barriers, cultural differences) could be overcome, that fact does not 21 outweigh the other circumstances here. Finally, the compulsion of unwilling witnesses or the 22

23 3 On the contrary, Defendant reports that he has paid the full amount due to Plaintiffs under their Chinese mediation agreement (see Dkt. No. 67 at 2) and that Plaintiffs “voluntarily accepted the mediation agreement and received the 24 amount stipulated in the agreement in June 2023 without raising any objection” (id. at 3). 1 cost of bringing witnesses to trial are neutral factors at most, as the Parties do not offer any 2 evidence or argument on them. Therefore, the private-interest factors weigh in favor of dismissal. 3 2. Public-Interest Factors 4 A court considers the following public-interest factors in evaluating an assertion of forum

5 non conveniens: (1) local interest of lawsuit; (2) the court’s familiarity with governing law; 6 (3) burden on local courts and juries; (4) congestion in the court; and (5) the costs of resolving a 7 dispute unrelated to this forum. Lueck, 236 F.3d at 1147 (first citing Piper, 454 U.S. at 259–61; 8 then citing Gulf Oil Corp., 330 U.S. at 508–09). These factors are weighed against each other in 9 a balancing test to determine if they favor dismissal. Id. at 1145. 10 Defendant contends that the public-interest factors weigh in favor of dismissal. See Dkt. 11 No. 65 at 5–6. Defendant argues that this case concerns a game “made by Chinese, available 12 only in Chinese, and promoted only on Chinese platforms . . . which makes the buyers almost all 13 Chinese,” all of which involve no U.S. interest in the matter. Id. at 5. Defendant also argues that 14 it would be a “heavy and undue burden on U.S. judicial resources” to hear cases like this one

15 (i.e., disputes between international game developers who release games on Steam). Id. at 6. 16 Finally, Defendant argues that differences between U.S. and Chinese laws, language, and culture 17 would result in “unnecessary problems in conflicts of law” and inefficient adjudication. Id. 18 In response, Plaintiffs argue that the public-interest factors weigh against dismissal. See 19 Dkt. No. 66 at 14–15. Plaintiffs contend that Defendant’s actions “have had a substantial impact 20 on commerce in the United States,” noting “Steam’s role as the sole sales platform” for TATA. 21 Id. at 14. Plaintiffs point out that many sales of TATA come from the United States and other 22 countries. See id. at 15; see also Dkt. No. 66-1 (exhibit) at 9 (showing breakdown of TATA 23 players as 57.1 percent Chinese, 14.3 percent American, and 28.6 percent “others”). Finally,

24 Plaintiffs dismiss Defendant’s concern about a wave of similar cases. See Dkt. No. 66 at 15. 1 The Court finds that the public-interest factors weigh in favor of dismissal. The Western 2 District of Washington may have a small interest in this matter, given that a small portion (14.3 3 percent) of total TATA sales occur in the United States (see Dkt. No. 66-1 at 9; Dkt. No. 67-1) 4 and Valve, the operator of Steam, is headquartered here (see Dkt. No. 52 ¶¶ 25–26). “[B]ut this

5 interest does not compare to the public resources that would be spent maintaining the action 6 here.” Nexon, 2023 WL 5305996, at *7. “On balance, it does not follow that the alleged 7 infringement would give rise to a greater local interest in the resolution of this matter than if the 8 matter is resolved in [China].” Id.; see also Creative Tech., 61 F.3d at 704 (in affirming 9 dismissal, finding “the United States’ interest in resolving this controversy and the relation of the 10 jury community to this controversy are extremely attenuated” where dispute was between two 11 foreign corporations and did not involve American-made products or “substantively” involve 12 American companies). Further, given the Parties’ prior litigation in China, the United States’s 13 interest is “significantly diminished” because the Court would likely be “relitigating claims 14 already decided in a foreign proceeding.” Ranza, 793 F.3d at 1079. Finally, the remaining factors

15 (i.e., familiarity with governing law, burden on local courts and juries, and congestion in the 16 courts) are all neutral at most, particularly since the Court has found China to be an adequate 17 alternative forum. See supra section III.A; see also Carijano, 643 F.3d at 1232 (noting that these 18 three factors “are all concerned with how well-equipped a jurisdiction is to handle a case”). 19 Therefore, the public-interest factors weigh in favor of dismissal. 20 * * * 21 As both the private and public interest factors weigh in favor of dismissal, the Court 22 concludes that this matter should be dismissed for forum non conveniens. 23

24 1 IV. CONCLUSION 2 Accordingly, Defendant Xue Zhao’s Motion to Dismiss Under the Doctrine of Forum 3 Non Conveniens (Dkt. No. 65) is GRANTED. 4 Dated this 12th day of February 2025.

5 A 6 Tana Lin United States District Judge 7

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