Incarcerated Entertainment, LLC v. Warner Bros. Pictures

261 F. Supp. 3d 1220
CourtDistrict Court, M.D. Florida
DecidedMay 10, 2017
DocketCase No: 8:16-cv-1302-T-35AAS
StatusPublished
Cited by4 cases

This text of 261 F. Supp. 3d 1220 (Incarcerated Entertainment, LLC v. Warner Bros. Pictures) is published on Counsel Stack Legal Research, covering District Court, M.D. Florida primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Incarcerated Entertainment, LLC v. Warner Bros. Pictures, 261 F. Supp. 3d 1220 (M.D. Fla. 2017).

Opinion

ORDER

MARY S. SCRIVEN, UNITED STATES DISTRICT JUDGE

THIS CAUSE comes before the Court for consideration of Defendant Warner Bros. Picture’s Motion to Dismiss (Dkt. 89), to which Plaintiff Incarcerated Entertainment, LLC has responded in opposition (Dkt. 99). Defendant submits twenty-two exhibits in support of its motion to [1225]*1225dismiss (Dkts. 90, 91), to which Plaintiff has filed a response in partial opposition (Dkt. 97). Plaintiff submits four exhibits in support of its response in opposition (Dkt. 98), to which Defendant objects (Dkt. 100). Upon consideration of all relevant filings, case law, and being otherwise fully advised, the Court DENIES the motion to dismiss.

I. BACKGROUND

According to the Amended Complaint, Plaintiff Incarcerated Entertainment, LLC owns the rights to the life story of Efraim Diveroli. (Dkt. 78 at ¶3) In this action, Plaintiff sues Defendant Warner Bros. Pictures (“Warner”) for false advertising and unfair competition, based on Warner’s promotion of the movie War Dogs as the “true story” of Diveroli’s path to becoming an international arms dealer.

As alleged, at age 18, Diveroli started a small business specializing in arms, ammunition trading, and bidding on U.S. Government defense contracts. (Id. at ¶ 12) By 2007, Diveroli’s company, AEY, Inc., outbid established defense contractors Northrop Grumman and Lockheed Martin and was awarded a $298 million contract to supply arms and ammunition to support the United States’ war effort in Afghanistan. (Id. at ¶¶ 14-15) Diveroli relied on select lower-level employees to assist his business, including David Packouz, a neighborhood acquaintance. (Id. at ¶ 15)

In March 2008, the U.S. Government suspended AEY Inc.’s contracts based on allegations that the company had violated pre-existing arms embargos. (Id. at ¶ 16) At age 22, Diveroli was indicted by a federal grand jury in Miami and ultimately accepted a four-year plea deal. (Id at ¶¶ 16-17) Diveroli’s associate, Packouz, was sentenced to house arrest. (Id at ¶ 22)

During his incarceration, Diveroli was contacted by Guy Lawson, a well-known journalist and author who wanted to write an article about Diveroli’s story. (Id. at ¶ 19) In March 2011, Rolling-Stone magazine published Lawson’s article, The Stoner Arms Dealers: How Two American Kids Became Big-Time Weapons Traders. (Id. at ¶ 22) The article featured accounts by both Diveroli and Packouz. (Id.) In August 2011, Lawson optioned the movie rights for the article to Warner. (Id. at ¶¶ 23-24) Lawson later expanded the article into a book, Arms and the Dudes. (Id. ati42)

By February 2014, Diveroli’s own manuscript, Once a Gun Runner, was sufficiently complete for Plaintiff to market the movie rights. (Id. at ¶¶ 29-30) Diveroli’s business partner, Ross Reback, contacted a number of producers and studios, including Warner. (Id. at ¶¶ 31-33) Although Warner considered the proposal, Warner eventually declined to pursue a consulting arrangement with Diveroli. (Id. at ¶¶ 34-35) Instead, Warner retained David Packouz as a consultant and enlisted Guy Lawson as a producer. (Id. at ¶¶ 41-44)

The gravamen of the Amended Complaint is that Warner grossed more than $85 million by promoting War Dogs as Diveroli’s “true story” when it was not the true story. (Id. at ¶¶ 1-2, 78) As the owner of the rights to Diveroli’s story, Plaintiff alleges that it has been effectively shut out of the marketplace because consumers are more likely to purchase a ticket to War Dogs than to purchase Diveroli’s memoir, Once a Gun Runner. (Id. at ¶¶ 3, 72, 75)

The Amended Complaint identifies a number of allegedly false advertisements, including statements in movie trailers, social media posts, and promotional interviews with War Dogs' director, Todd Phil[1226]*1226lips, screenwriter Stephen Chin, and stars Jonah Hill, Miles Teller, and Bradley Cooper. (Id. at ¶¶ 49-70) For instance, Jonah Hill stated that War Dogs is “one of the craziest movies I’ve ever been in—in a great way. And it’s all true.” (Id. at ¶ 67) Miles Teller told interviewers on multiple occasions, “these are real people” and “real guys who are still alive.” (Id. at ¶ 59) Stephen Chin stated that he wanted to be “deeply true to their story,” (Id. at ¶ 62) Todd Phillips explained that “we certainly tried to follow what happened as closely as possible I think. If you know the story at all, we pretty much stick to the facts as much as we can.” (Id. at ¶ 65)

In Counts I and III of the Amended Complaint, Plaintiff asserts' violations of the Lanham Act, 15 U.S.C. § 1125(a)(1)(B), which creates a civil cause of action against “[a]ny person who ,.; uses in commerce any ,.. false or misleading. representation of fact, which ,,in commercial advertising or promotion, misrepresents the nature; characteristics, qualities, or geographic origin of his or her or another person’s go'ods, services, or commercial activities.” In Counts II and IV, Plaintiff. brings state-law claims for unfair competition pursuant to Florida’s Deceptive and Unfair Trade Practices Act (FDUTPA), Fla. Stat. § 501.204(1), which prohibits “unfair methods of competition, unconscionable acts or practices, and unr fair or deceptive acts or practices in the conduct of any trade or commerce.”

In the instant motion to dismiss, Warner argues that the challenged statements are riot actionable because "they include protected artistic or political speech under the First Amendment. In the alternative, Warner argues that the Amended Complaint fails to allege the necessary facts in support of Plaintiffs claims. With the limited exceptions outlined below, the Court holds that Plaintiff states plausible claims for relief.

II. STANDARD

The threshold for surviving a motion to dismiss for failure to state a claim, under Fed. R. Civ. P. 12(b)(6) is a low one. Quality Foods de Centro Am., S.A., v. Latin Am. Agribusiness Dev. Corp., S.A., et al., 711 F.2d 989, 995 (11th Cir. 1983). A plaintiff must plead only sufficient facts to state a claim for relief that is plausible on its face. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 561-62, 127 S.Ct. 1955, 167 L.Ed,2d 929 (2007). Although a complaint challenged by a Rule 12(b)(6) fnotion to dismiss does not need detailed factual allegations, a plaintiff is still obligated to provide the “grounds” for his entitlement to relief. Berry v. Budget Rent A Car Sys., Inc., 497 F.Supp.2d 1361, 1364 (S.D. Fla. 2007) (quoting Twombly, 550 U.S. at. 555, 127 S.Ct. 1955), In evaluating the súffieieh-cy of a complaint in light of a, motion to dismiss, the well-pleaded facts must, be accepted as true and construed in the light most favorable to the plaintiff. Quality Foods, 711 F.2d at 994-95.

Warner briefly asserts that Plaintiffs claims must be pleaded with specificity under Fed. R. Civ. P. 9(b) because the claims are “grounded in fraud.” (Dkt.

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261 F. Supp. 3d 1220, Counsel Stack Legal Research, https://law.counselstack.com/opinion/incarcerated-entertainment-llc-v-warner-bros-pictures-flmd-2017.