Facebook, Inc. v. Vachani

577 B.R. 838
CourtDistrict Court, N.D. California
DecidedAugust 31, 2017
DocketCase No. 17-CV-03184-LHK
StatusPublished
Cited by2 cases

This text of 577 B.R. 838 (Facebook, Inc. v. Vachani) is published on Counsel Stack Legal Research, covering District Court, N.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Facebook, Inc. v. Vachani, 577 B.R. 838 (N.D. Cal. 2017).

Opinion

ORDER DENYING MOTION FOR WITHDRAWAL OF REFERENCE

Re: Dkt. No. 1

LUCY H. KOH, United States District Judge

The instant case arises from the motion of Plaintiff Facebook, Inc. (“Facebook”) to ■withdraw the reference to bankruptcy of Adversary Proceeding No. 13-4226 against Defendant Steven Vachani (“Vachani”), which is now pending before Bankruptcy Judge Roger L. Efremsky. Civ. ECF No. l-l.1 Pursuant, to Bankruptcy Local Rule [840]*8405011—2(b), upon filing of the motion for withdrawal of reference in the Bankruptcy Court, the motion was assigned a new civil case number in the District Court and assigned to the undersigned judge. Having considered the briefing of the parties, the relevant law, and the record in the instant case and all related cases, the Court DENIES Plaintiffs motion for withdrawal of reference.

I. BACKGROUND

A. Factual Background

The instant case is related to the case Facebook, Inc. v. Power Ventures, Inc. (“Power Ventures”), No. 08-CV-05780. The instant case and the Power Ventures case share the same factual background. Facebook owns and operates the social networking website located at face-book.com. Power ECF No. 9, ¶2. Power Ventures (“Power”) is a corporation incorporated in the Cayman Islands and doing business in California. Id. 1110. At the times relevant to the instant case and the Power Ventures case, Power has operated the website www.power.com, which offered to integrate users’ various social media accounts into a single experience. Id. Va-chani is the Chief Executive Officer of power.com. Power Ventures Answer ¶ 11.

In December 2008, Facebook brought against Power and Vachani (“Power Ventures Defendants”) the Power Ventures case, which alleges violations of the Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003 (“CANSPAM Act”), 15 U.S.C § 7701; the Computer Fraud and Abuse Act (“CFAA”), 18 U.S.C. § 1030; California Penal Code § 502; and the Digital Millennium Copyright Act (“DMCA”), 17 U.S.C. § 1201; copyright infringement under 17 U.S.C. § 101; trademark infringement under 15 U.S.C. §§ 1114 and 1125(a) and under California law; and violations of California Business and Professions Code Section 17200. Power ECF Nos. 1, 9. Face-book complained that the Power Ventures Defendants employed Facebook’s proprietary- data without its permission by inducing Facebook users to provide their login information and then using that information to “scrape” Facebook’s proprietary material. Power ECF No. 9, ¶¶ 49, 50, 52. The Power Ventures Defendants then displayed Facebook’s material on power.com. Id. ¶ 52. Facebook asserts that it never gave the Power Ventures Defendants permission to use its material in this way. Id. ¶ 54.

Facebook also accuses the Power Ventures Defendants of sending unsolicited and deceptive email messages to Facebook users. Power FAC ¶¶ 65-69. To launch their site, the Power Ventures Defendants promised power.com users a chance to win $100 if they invited and signed up the most new users to the Power Ventures Defendants’ site. Id. ¶ 65. The Power Ventures Defendants provided to their users a list of the users’ Facebook friends from which the users could choose people to whom to send the invitation. Id. ¶ 66. Power.com sent commercial emails to those friends that included on the “from” line a “@facebookmail,com” address. Id. ¶¶ 66, 68. The content of the message included a line that the message was from “The Face-book Team.” Id. ¶ 69, 70. Facebook contends that it never gave permission to send [841]*841these messages and that the emails were deceptive because they “do not properly identify the initiators of the messages, nor do they provide clear or conspicuous notice that the messages are advertisements for” power.com. Id. ¶71. The Court initially entered judgment in the Power Ventures ease on September 25, 2013. Power ECF No. 374. After remand from the Ninth Circuit, the Court entered a revised judgment in the Poiver Ventures case on May 2, 2017. Power ECF No. 437.

As discussed below, during the pendency of the Power Ventures case, Vachani filed for personal bankruptcy on August 27, 2012. Bankr. ECF No. 1; Power Ventures ECF Nos. 353-54. As part of that bankruptcy, Facebook filed the adversary proceeding at issue here, which alleged that the debt that Vachani owed Facebook as a result of the judgment in the Power Ventures case was nondischargeable. Adv. ECF No. 1. On May 30, 2017, Facebook filed the instant motion for withdrawal of reference of the adversary proceeding. Adv. ECF No. 36.

B. Relevant Procedural History of Power Ventures

On December 30, 2008, Facebook filed the complaint in the Power Ventures case. Power ECF No. 1. On January 13, 2009, Facebook filed a First Amended Complaint. Power ECF No. 9. On February 18, 2011, Judge Ware granted the parties’ stipulation to dismiss Facebook’s DMCA claim, copyright and trademark infringement claims, and claims for violations of California Business and Professions Code Section 17200. Power ECF No. 97. On May 9, 2011, Defendants moved for summary judgment on Facebook’s CFAA, Section 502, and CAN-SPAM Act claims. Power Ventures ECF No. 98. On November 17, 2011, Facebook moved for summary judgment on Facebook’s § 502 and CFAA claims. Power ECF No. 214 (“§ 502/CFAA Motion”). On November 18, 2011, Facebook moved for summary judgment on Facebook’s CAN-SPAM Act claim. Power ECF No. 215. On February 16, 2012, Judge Ware issued an order denying Defendants’ motion for summary judgment and granting summary judgment in Facebook’s favor as to Facebook’s § 502, CFAA, and CAN-SPAM Act claims. Power ECF No. 275 (“February 16, 2012 order”).

In the February 16, 2012 order, Judge Ware requested additional briefing regarding Vachani’s individual liability and the amount of damages Facebook should receive in light of the February 16, 2012 order. Id. at 19. On April 17, 2012, Face-book filed its supplemental brief regarding damages and the liability of Vachani. Power ECF No. 299 (“Facebook Damages/Liability Brief’). On August 15, 2012, Vachani submitted a supplemental brief regarding damages and Vachani’s personal liability. Power ECF No. 317.

On August 27, 2012, Defendants provided notice that both Power and Vachani had filed for bankruptcy. ECF Nos. 323, 324. Noting that pursuant to 11 U.S.C. § 362

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Cite This Page — Counsel Stack

Bluebook (online)
577 B.R. 838, Counsel Stack Legal Research, https://law.counselstack.com/opinion/facebook-inc-v-vachani-cand-2017.