Leftenant v. Blackmon

Opinion

1 UNITED STATES DISTRICT COURT

2 DISTRICT OF NEVADA

3 * * *

4 NATHAN LEFTENANT, ARNETT Case No. 2:18-CV-01948-RCJ-EJY LEFTENANT, JERYL BRIGHT and 5 GREGORY JOHNSON,

6 Plaintiff, ORDER

7 v.

8 LAWRENCE (“LARRY”) BLACKMON,

9 Defendants.

10 11 Pending before the Court is Plaintiffs Nathan Leftenant, Arnett Leftenant, Jeryl Bright, and 12 Gergory Johnson’s Motion for Leave to Amend the Complaint (“Plaintiffs’ Motion”). ECF No. 22. 13 The Court has reviewed Plaintiffs’ Motion, Defendant Lawrence Blackmon’s Opposition (ECF No. 14 25), and Plaintiffs’ Reply (ECF No. 30). 15 Background 16 Plaintiffs filed their original complaint on October 10, 2018, and Defendant filed his Answer 17 and Counterclaim on January 15, 2019. On April 30, 2019 the Plaintiffs filed their instant motion 18 seeking leave to amend their complaint, which was fully briefed on May 31, 2019. The undersigned 19 took the bench on August 6, 2019, at which time Plaintiffs’ Motion was pending. 20 Plaintiffs’ original complaint alleged three causes of action including tortious interference 21 with contract, conversion, and declaratory relief. Plaintiffs’ Amended Complaint seeks to add a 22 party, Tomi Jenkins, and to revise the causes of action asserted. Specifically, Plaintiffs’ Amended 23 Complaint seeks to assert four causes of action including tortious interference with contract, breach 24 of fiduciary duty, promissory estoppel, and declaratory relief. Plaintiffs contend that Defendant does 25 not object to Plaintiff Tomi Jenkins being added as a plaintiff for purposes of seeking declaratory 26 relief, but that Defendant objects to all remaining proposed amendments. 27 1 Defendant Mr. Blackmon alleges he was “a founding member of CAMEO” thereby signaling 2 that he was not the only founding member of this musical group. ECF No. 25 at 1:18-19 (emphasis 3 added); see also ECF No. 30 at 2. Plaintiffs N. Leftenant, A. Leftenant, Johnson and Jenkins contend 4 they too are founding members of CAMEO, and that Plaintiff: (i) Jenkins appeared on all 18 of 5 CAMEO’s albums as well as on its apparent current single “El Paso”; (ii) N. Leftenant “‘was 6 considered the face of CAMEO’ and appeared on more than … 16 CAMEO albums”; (iii) A. 7 Leftenant “appeared on more than … 7 CAMEO albums; (iv) Johnson “appeared on more than … 8 8 CAMEO albums [and] is credited for creating the name ‘CAMEO’”; and, (v) Bright “became a 9 featured member of CAMEO’s horn section, and appeared on more than … 5 CAMEO albums…” 10 ECF No. 23-1 ¶¶ 11-15, and 18. 11 Plaintiffs allege that they, together with Defendant, “agreed” that each current and future 12 member of CAMEO would receive an equal share of “record company advances against future 13 royalties and royalties for records that featured their vocal performances,” as well as an equal share 14 of live performance income. Id. ¶ 17.1 The alleged agreement with Plaintiff Bright was that he 15 “would receive an equal share of the net artist advances of future royalties, royalties and net live 16 performance income.” Id. ¶ 19. Defendant is further alleged to have served as CAMEO’s producer 17 and to have “administered and managed the recording agreements, including recording funds, 18 organized live performances[, …] the branding activities of the band[,] … artist advances and … 19 [payment of] CAMEO expenses.” Id. ¶¶ 23 and 29. 20 In various paragraphs of the proposed Amended Complaint, Plaintiffs allege that a number 21 of record distributing entities had agreements with CAMEO (or Atlanta Artist Records (“AAR”), 22 discussed below) that required the periodic payment of royalties for the benefit of the CAMEO 23 members. Id. ¶¶ 27, 30, 35, 38, 48, 49, 58. Plaintiffs contend that each of the agreements between 24 CAMEO and record distribution entities required CAMEO or AAR to pay advances and royalties 25 arising from CAMEO recordings to those persons or entities entitled to such payments. Id. ¶¶ 30, 26 39, 50, 58.

27 1 At some unidentified time, Plaintiffs allege that “Plaintiffs along with Defendant …, again agreed to 1 It is not disputed that Defendant served as CAMEO’s “producer” through, inter alia, AAR, 2 a company alleged to have been formed as a Georgia corporation sometime after August 2, 1982. 3 Id. ¶¶ 23 and 33. AAR is said to be owned by Plaintiffs N. Leftenant and, potentially, Jenkins, as 4 well as Defendant. Id. ¶¶ 33 and 34. AAR is also said to have done business as “Better Days Music” 5 and “Better Nights Music” beginning in August 1982. Id. ¶ 44. Plaintiffs next state that AAR was 6 “administratively dissolved” on June 12, 1992, due to Defendant’s “failure to handle administrative 7 matters”; but then contend the entity “continued to operate as a partnership[,]” among Plaintiffs N. 8 Leftenant, A. Leftenant, Bright, and Jenkins, together with Defendant, paying all CAMEO expenses 9 from “net artist advances against royalties,” royalties, and live performance income. Id. ¶¶ 51 and 10 52. At some unknown time, Plaintiffs allege that only Plaintiffs N. Leftenant and Jenkins, together 11 with Defendant, continued to do business as a partnership under the names Atlanta Artist Records, 12 Better Days Music, and Better Nights Music “in connection with CAMEO’s recordings and musical 13 compositions.” Id. ¶ 53.2 CAMEO is alleged to have produced its last album in 2000, but continued 14 to perform as CAMEO “in the years following” this release up to the present. Id. ¶¶ 57 and 60. 15 Plaintiffs alleged that they “have never received their representative share of periodic 16 payment of royalties” from any of the companies that distributed CAMEO’s music. Id. ¶ 61. 17 Plaintiffs allege Defendant received payment of royalties due AAR, but did not distribute those 18 royalties to the Plaintiffs as required. Id. ¶ 62. Plaintiffs also admit that “[n]o taxes were withheld 19 from any CAMEO distributions of net profits and no w-2’s [sic] were issued to Plaintiffs.” Id. ¶ 42. 20 In addition to the royalties and royalty advances paid by various distributors, Plaintiffs 21 alleges that, as CAMEO “featured artists,” they each entered into membership agreements with 22 SoundExchange, a national royalty collection society that apparently collects and distributes digital 23 performance royalties to recording artists and owners of music. Id. ¶¶ 70-75. Plaintiffs also allege 24 they entered into membership agreements with AARC. Id. ¶ 97. Plaintiffs contend that Defendant 25 had knowledge of Plaintiffs’ agreements with both AARC and SoundExchange. Id. ¶ 100. While 26 Plaintiffs allege that “featured artists” receive quarterly payments from SoundExchange and AARC

27 2 In 1979, Plaintiffs and Defendant are alleged to have purchased a tour bus for CAMEO with CAMEO 1 upon entering into a membership agreement, in or around 2010, Defendant is alleged to have started 2 collecting royalties from SoundExchange “acting as Plaintiffs’ agent.” Id. ¶¶ 76, 82, and 83. 3 Plaintiffs do not state whether Defendant’s role as agent was approved or unapproved; nevertheless, 4 Plaintiffs state that Defendant represented to SoundExchange that he would pay Plaintiffs their share 5 of royalties as featured artists. Id. ¶ 84. The same allegation is not made as to AARC. Defendant 6 is alleged to have collected over $103,000 of Plaintiffs’ SoundExchange royalties that he never 7 distributed, and that Defendant never paid them their share of royalties received from AARC either. 8 Id. ¶¶ 85-86. 9 After an apparent failed attempt at mediation, that would have been paid for by 10 SoundExchange, this lawsuit was filed by Plaintiffs. Id. ¶¶ 92-93. 11 Discussion 12 The Court has broad discretion to grant an amendment to a complaint and may freely do so, 13 “when justice so requires.” Fed. R. Civ. P. 15(a)(2). Denial of a leave to amend may be justified, 14 however, if the proposed amendment will cause undue delay, undue prejudice to the opposing party, 15 a request to amend is made in bad faith, a party has repeatedly failed to cure deficiencies, or the 16 amendment would be futile. Leadsinger, Inc. v. BMG Music Publ’g, 512 F.3d 522, 533 (9th Cir. 17 2008). Here, Defendant’s opposition to Plaintiffs’ proposed amended complaint is based solely on 18 futility. ECF No. 25 at 1:12. The Court considers each of Defendant’s arguments below. 19 Plaintiffs’ Proposed Tortious Inference with Contractual Relations Claim 20 Plaintiffs’ tortious interference claim is based on their membership agreements with 21 SoundExchange and AAR, about which Defendant was aware, and which agreements must have 22 preceded the time in 2010 when Defendant is alleged to have begun collecting royalties on behalf of 23 Plaintiffs as their agent. ECF No. 23-1 ¶¶ 75, 83, 97, and 100. Plaintiffs claim that Defendant is 24 wrongfully interfering with Plaintiffs’ “contractual rights to receive royalties by claiming that he is 25 solely entitled to” the SoundExchange and AARC royalties. Id. at 101. Further, Plaintiffs allege 26 that their claims for royalties includes $103,005.30 in royalties already paid to Defendant by 27 1 SoundExchange and the supposed $200,000 in royalties SoundExchange “is holding” for CAMEO 2 as of March 2018. Id. ¶¶ 85 and 95.3 Plaintiffs do not allege that AARC is holding any royalties for 3 CAMEO. 4 In order to state an intentional interference with contract claim under Nevada law, a plaintiff 5 must plead that there is a valid and existing contract about which the defendant is aware, the 6 defendant’s intent to disrupt or interfere with that contract, actual disruption or interference, and 7 damages. Local Ad Link, Inc. v. AdzZoo, LLC, Case No. 2:09-cv-01564, 2009 WL 10694069 *12 8 (D. Nev., December 15, 2009) citing Sutherland v. Gross, 772 P.2d 1287, 1290 (Nev. 1990). The 9 statute of limitations on an intentional interference with contract claim is three years. NRS 10 11.190(3)(c), Stalk v. Mushkin, 199 P.3d 18, 20 (Nev. 1990). 11 Defendant contends that Plaintiffs fail to plead that Defendant’s alleged activities actually 12 disrupted their membership agreements with SoundExchange or AARC, do not identify a particular 13 contract provision that was breached or any breach of contract by SoundExchange or AARC, and 14 that Plaintiffs have not alleged that either SoundExchange or AARC failed to pay them royalties. 15 Finally, Defendant contends that Plaintiffs’ tortious interference claim is barred by the applicable 16 three year statute of limitation. ECF No. 25 at 4-7. 17 Starting with the three year statute of limitations, Defendant is correct that any claim 18 Plaintiffs had with respect to unpaid royalties or other amounts allegedly received by Defendant 19 more than three years prior to filing their claim on October 10, 2018 is time barred. Plaintiffs clearly 20 knew that Defendant was acting as their agent and knew or should have known they were not 21 receiving quarterly periodic royalty payments from SoundExchange and AARC pursuant to their 22 membership agreements soon after they entered into their membership agreements. ECF No. 23-1 23 ¶ 82. Plaintiffs also knew that other record distributors paid royalties and they received none. Id. ¶ 24

3 Plaintiffs claim that Defendant’s refusal to sign a mediation agreement apparently sponsored by 25 SoundExchange, Defendant is interfering with Plaintiffs’ “contractual rights” to receive royalties collected by AARC and SoundExchange. However, Plaintiffs did not attach to their amended complaint a copy of any 26 agreement demonstrating that Defendant had contractually agreed to mediation as a pre-litigation resolution process, and they have made no allegation that such an agreement exists. Hence, without the existence of an 27 actual or alleged contractual provision requiring mediation, of which Defendant is aware, there can be no 1 61. Hence, all claims that pertain to Defendant’s alleged collection of royalties, which he allegedly 2 did not distribute to Plaintiffs and which occurred prior to October 10, 2015, are time barred. 3 With respect to Plaintiffs failure to adequately plead this claim, Plaintiffs allege that each of 4 them entered into a membership agreement with SoundExchange and AARC; that Defendant was 5 aware of these agreements; that Defendant held himself out as Plaintiffs’ agents to both entities; that 6 beginning in 2010 Defendant began collecting royalties from AARC and SoundExchange; that 7 SoundExchange has paid and is holding royalties for CAMEO; that Defendant never paid Plaintiffs 8 their share of AARC or SoundExchange royalties; and, that Defendant is interfering with Plaintiffs’ 9 contractual right to receive royalties from SoundExchange and AARC by claiming that he alone is 10 entitled to these royalties. 11 These allegations, at this stage of proceedings, adequately state a claim for tortious 12 interference with contract. Local Ad Link, Inc., 2009 WL 10694069 *13. 13 Plaintiffs’ Proposed Breach of Fiduciary Duty 14 To state a claim for breach of fiduciary duty under Nevada law, Plaintiffs must allege the 15 existence of a fiduciary relationship, a breach of the duty of care by the fiduciary, losses resulting 16 from the fiduciary’s breach of duty, causation, and damages. Giles v. Gen. Motors Acceptance 17 Corp., 494 F.3d 865, 880-81 (9th Cir. 2007). Nevada law, which the parties agree governs this 18 claim, applies a three year statute of limitations to a breach of fiduciary duty claim. 19 Under Nevada law, partners owe other partners and the partnership itself, the fiduciary duty 20 of loyalty, which, among other things, is limited to accounting to the partnership, holding partnership 21 assets as trustee, as well as refraining from being an adverse party, acting on behalf of an adverse 22 party, and competing with the partnership. NRS 87.4336(1)-(2). If Plaintiffs have adequately pled 23 the existence of a partnership, Plaintiffs may establish that Defendant owed his partners a fiduciary 24 duty. 25 Plaintiffs allege that in 1982, Defendant, N. Leftenant, and, on information and belief, 26 Jenkins formed AAR as a Georgia corporation. After AAR was administratively dissolved in June 27 1992, Plaintiffs claim that Plaintiffs N. Leftenant, A. Leftenant, Bright, and Jenkins, together with 1 with CAMEO’s recordings and musical compositions.” In contrast to this allegation, Plaintiffs also 2 allege that only Plaintiffs N. Leftenant and Jenkins, together with Defendant continued to do 3 business under AAR and its DBAs as a partnership. Under any circumstance, Plaintiffs never claim 4 that Plaintiff Johnson was part of a partnership with Defendant and for this reason, a partnership 5 relationship cannot be the basis of a breach of fiduciary duty with respect to any claim raised by 6 Johnson. 7 The remaining Plaintiffs describe in generalities that AAR, as a partnership, continued to pay 8 all CAMEO expenses and that Plaintiffs A. Leftenant and Jenkins, along with Defendant, AAR, and 9 Better Days and Better Nights Music, continued as a partnership in connection with CAMEO’s 10 recordings and musical compositions. Plaintiffs then make conclusory allegations that Defendant 11 was in a position of trust and confidence.4 However, merely pleading the existence of a partnership 12 is not sufficient to withstand dismissal of a claim based on such a relationship. Ely v. Perthuis, Case 13 No. 12 Civ. 1078, 2013 WL 411348 *6 (January 29, 2018, S.D.N.Y. 2013) (citations omitted). 14 Pursuant to NRS 87.060, “a partnership is an association of two or more persons to carry on 15 as co-owners a business for profit and includes a registered limited-liability partnership.” Under 16 NRS 87.870, the Nevada legislature established rules for determining whether a partnership exists. 17 Setting aside exceptions that do not apply, owning common property or part ownership in property 18 does not, itself, establish the existence of a partnership. Likewise, sharing in gross returns 19 irrespective of whether “the persons sharing them have a joint or common right or interest in any 20 property from which the returns are derive” does not create a partnership. The receipt of profits of 21 a business is prima facie evidence that the person is a partner in a business, so long as the profits 22 was not received (a) as a debt by installments or otherwise; (b) as wages of an employee or rent to 23 a landlord; (c) as an annuity to a surviving spouse or represen tative of a deceased partner; (d) as 24 interest on a lo an, though the amount of payment vary with the profits of the business; or (e) as the 25 consideration for the sale of a goodwill of a business or other property by installments or othe rwise. 26 27 1 In this case, Plaintiffs confusing allegations never plead that they carried on as co-owners of 2 a partnership for profit. Plaintiffs also do not include any joint control or management of CAMEO 3 or AAR, but that only Defendant had these responsibilities. It does appear from Plaintiffs’ pleadings 4 that they and Defendant were supposed to equally share in the net returns arising from a common 5 right or interest in royalties to be split as described in paragraph 77, 80, and 81 of the amended 6 complaint. But this alone cannot be enough to establish a partnership under Nevada law. The 7 purchase of the bus and real estate also do not establish the existence of a partnership under Nevada 8 law. Ely, 2013 WL 411348 *6. In sum, based on the allegations presented, this Court does not find 9 that Plaintiffs have alleged sufficient facts to establish, even at this state of proceedings, that some 10 of the parties may have formed a partnership, under Nevada law, at some point in time. Corporate 11 Fleet Services v. West Van, Inc., Case No. 3:08-cv-413, 2009 WL 753432 *2 (March 18, 2009, 12 W.D.N.C.); Building 11 Investors LLC v. City of Seattle, 912 F.Supp. 2d 972, 979-80 (W.D. WA., 13 2012). 14 Moreover, Plaintiffs allege facts that appear contrary to a finding that any partnership existed. 15 For example, on October 7, 2015, Defendant began a residency in Las Vegas, which Plaintiffs do 16 not state included them or otherwise involved them in any way. While Jenkins is alleged to tour 17 with the band, this allegation does not say anything about doing so as part of a partnership. Further, 18 in 2012, the Plaintiffs allege they attempted to collect royalties directly from SoundExchange despite 19 the supposed partnership and Defendant’s role as their agent. No Plaintiff alleges when they, 20 presumably, could not collect from SoundExchange they held a partnership meeting or otherwise 21 pursued their rights for breach of a partnership agreement. 22 As explained by the United States Supreme Court, the plaintiff must articulate “enough facts 23 to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 24 (2007). “A claim has facial plausibility when the plaintiff pleads factual content that allows the 25 court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” 26 Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 1949 (2009). “The plausibility standard is not akin 27 to a ‘probability requirement,’ but it asks for more than a sheer possibility that a defendant has acted 1 the above analysis, a court must accept all factual allegations as true even if doubtful in fact. 2 Twombly, 550 U.S. at 555. Nevertheless, “the tenet that a court must accept as true all of the 3 allegations contained in a complaint is inapplicable to legal conclusions.” Iqbal, 129 S.Ct. at 1949. 4 For all of these reasons, as stated above, the Court finds Plaintiffs have failed to plead the plausible 5 existence of a partnership and, as such, no fiduciary obligations flowed from Defendant to any 6 Plaintiff based on such a relationship. 7 The Court also finds no fiduciary duty grows out of the ordinary business relationship 8 between Plaintiffs and Defendant. Defendant was one founding member of the CAMEOs, along 9 with all of the Plaintiffs except Bright. ECF No. 23-1 ¶ 16. But, the totality of the factual allegations 10 suggest Defendant was not in a superior position to Plaintiffs, or more knowledgeable or powerful 11 than they were. In fact, the allegations suggest the opposite; that is, that the parties were in equal 12 positions with equal knowledge and sophistication. ECF No. 23-1 ¶¶ 10-17, 19, 21, 25, 32, 37, 40. 13 There is no allegation that the parties ever discussed or agreed upon Defendant acting in a fiduciary 14 capacity for Plaintiffs. In sum, other than Plaintiffs conclusory allegations regarding Defendant’s 15 status, there is nothing to support Defendant’s position relative to Plaintiffs as that of a fiduciary. 16 For the above stated reasons, Plaintiffs’ second cause of action for Breach of Fiduciary Duty 17 fails as a matter of law. 18 Plaintiff’s Proposed Promissory Estoppel Claim 19 Plaintiffs next assert promissory estoppel alleging that (i) Defendant was aware that 20 Plaintiffs, as featured members of CAMEO, were entitled to recording artist royalties paid by 21 SoundExchange and AARC; (ii) Defendant promised Plaintiffs they could rely on Defendant to pay 22 them their respective shares of future royalties from CAMEO recordings as well as from 23 SoundExchange and AARC, (iii) they collectively owned the CAMEO name/brand; (iv) Defendant 24 expected Plaintiffs to rely on his promise to pay future royalties and use of the CAMEO brand/mark; 25 (v) Plaintiffs relied on Defendant’s promises; and, (vi) Plaintiffs have been damaged in excess of 26 $103,005 in SoundExchange royalties, which is in Defendant’s possession.5 27 1 A claim for promissory estoppel requires a plaintiff to plead and ultimately prove that the 2 defendant is apprised of the true facts, must have intended his conduct will be acted upon or act such 3 that the plaintiff has the right to believe defendant so intended; plaintiff must be ignorant of the true 4 facts; and plaintiff relied on the conduct of defendant to his detriment. Pink v. Busch, 691 P.2d 456, 5 459 (1984). As established by Nevada law, and cited by the U.S. District Court for the District of 6 Nevada, promissory estoppel must be pled with specificity in compliance with Fed. R. Civ. P. 9(b). 7 Hasan v. Ocwen Loan servicing, LLC, No. 2:10-cv-00476, 2010WL 2757971 *2 (July 12, 2010, 8 D.Nev) (citing several Nevada Supreme Court cases not cited here). The statute of limitations for 9 this claim is four years. Seng v. MTC Financial, Inc., 749 Fed. Appx. 657, 658 (9th Cir. 2019). Any 10 claim by Plaintiffs to damages arising from alleged promissory estoppel older than four years 11 measured backward from the date the original complaint was filed, is time barred. 12 In Plaintiff’s third cause of action, Plaintiffs fail to allege that they relied to their detriment 13 with respect to the CAMEO name or brand except to say in a conclusory fashion that they have been 14 “further damaged” by Defendant claiming to be the sole owner of the CAMEO mark. This 15 conclusory statement, in and of itself, is insufficient to plead the elements of a promissory estoppel 16 claim and, as such, third claim of relief fails as to Plaintiffs’ allegations pertaining to the CAMEO 17 name or brand. Id. at **1-2. 18 While Plaintiffs state that Defendant “promised” them that Plaintiffs could rely on 19 Defendant’s conduct, as producer and administrator of CAMEO, that they would be paid their 20 respective share of royalties, and that Defendant expected Plaintiffs to rely on this representation, 21 Plaintiffs do not allege when, if ever, Defendant knew the true facts – that he had no intention of 22 paying Plaintiffs their share of royalties. While Plaintiffs say they attempted to collect royalties 23 from SoundExchange in 2012, they provide no date when SoundExchange was supposedly told by 24 Defendant that he promised to pay Plaintiffs their respective shares. Plaintiffs provide no dates at 25 all with respect to AARC or “other record company royalties.” 26 The Court finds that Plaintiffs have pled that they entered into membership agreements with 27 SoundExchange and AARC of which Defendant was aware, that Defendant collected royalties from 1 Plaintiffs their respective share of royalties. There is no place in the proposed amended complaint, 2 however, that explains when the parties “all agreed” they would share equally in these future 3 royalties. Plaintiffs also do not state who specifically was part of those who “all agreed.” 4 These claims therefore fails as a matter of law because Plaintiffs do not meet the FRCP 9(b) 5 pleading requirements, requiring specificity, depriving the Court of its ability to assess the timeliness 6 of the claims made. Hasan v. Ocwen Loan Servicing, LLC, Case No. 2:10-cv-00476, 2010 WL 7 2757971 *2 (July 12, 2010, D.Nev.) 8 Further, if there were actual “agreements” between the parties, even if such agreements were 9 oral, then Plaintiff must proceed on breach of oral contract and not on a promissory estoppel claim. 10 Samick Musical Instruments Co., Ltd. v. QRS Music Technologies, Inc., Case No. 2:15-cv-00333, 11 2017 WL 3567522 *6 (August 17, 2017, D.Nev.) (citation omitted). If the promsiee’s reliance is 12 “bargained for, the law of consideration applies; and it is only where the reliance was ungargained 13 for that there is room for application of the doctrine of promissory estoppel.” Walker v. KFC 14 Corporation, 728 F.2d 1215, 1218 (9th Cir. 1984) (citation omitted). Here, Plaintiffs repeatedly 15 reference agreed upon performances among the parties. These agreements are the antithesis of a 16 promissory estoppel claim. As such, and in the absence of the pleading specificity required of this 17 claim, Plaintiff’s third cause of action fails as a matter of law. 18 Plaintiffs’ Declaratory Relief Claims 19 Plaintiffs remaining claims are all declaratory relief actions. Declaratory relief actions 20 necessarily presume the existence of a contract.

21 Declaratory relief is a remedy, not a cause of action. See, e.g., Rodriguez v. Hayes, 591 F.3d 1105, 1120 (9th Cir. 2010) (describing “declaratory relief” as “distinct in 22 purpose from and ‘milder’ in remedy than injunctions”). “Declaratory relief is appropriate when (1) the judgment will serve a useful purpose in clarifying and 23 settling the legal relations in issue, and (2) when it will terminate and afford relief from the uncertainty, insecurity, and controversy giving rise to the proceeding.” 24 Guerra v. Sutton, 783 F.2d 1371, 1376 (9th Cir. 1986). Although Rule 57 of the Federal Rule of Civil Procedure states that “the existence of another adequate 25 remedy does not preclude a declaratory judgment,” the “availability of other adequate remedies may make declaratory relief ‘inappropriate.’ ” See Fed. R. Civ. 26 P. 57; accord Swartz v. KPMG LLP, 476 F.3d 756, 766 (9th Cir. 2007) (affirming district court dismissal of declaratory relief claim on the grounds that it was “merely 27 duplicative” of plaintiff’s other causes of action). 1 Kalaouaz and Associates S.A.R.L. v. Boardus, Case No. cv-12-3632, 2012 WL 12886213 *9 2 (October 30, 2012, C.D.Cal.). There are four elements that must be met before declaratory relief 3 may be granted:

4 (1) there must exist a justiciable controversy; that is to say, a controversy in which a claim of right is asserted against one who has an interest in contesting it; (2) the 5 controversy must be between persons whose interests are adverse; (3) the party seeking declaratory relief must have a legal interest in the controversy, that is to 6 say, a legally protectable interest; and(4) the issue involved in the controversy must be ripe for judicial determination. 7 8 Guarini v. Cox, No. 62826, 2016 WL 412824 *2 (Feb. 1, 2016, Nev.) (citation omitted). 9 Defendant does not move to dismiss Plaintiffs fourth cause of action seeking declaratory 10 judgment that Plaintiffs are entitled to royalties from SoundExchange, AARC and the other record 11 companies. ECF No. 25 at 14. Thus, the Court does not examine this claim at this time. 12 As to Plaintiffs Fifth and Sixth causes of action, they seek, respectively, declaratory judgment 13 that Plaintiffs are co-owners of the CAMEO’s trademark, and that Plaintiffs N. Leftenant and Jenkins 14 are co-owners and/or partners of AAR, Better Days Music and Better Nights Music. With respect 15 to Plaintiffs’ sixth cause of action the Court finds, as stated above, that Plaintiffs fail to plead 16 sufficient facts to establish the plausible existence of a partnership regarding the operations of AAR 17 and its DBAs. In fact, Plaintiffs’ allegations are solely that AAR operated as a partnership after it 18 was dissolved as a corporation, paid CAMEO bills, and did business in connection with CAMEO’s 19 recordings and compositions. These vague assertions assert legal conclusions without sufficient facts 20 to turn a possibility into a reasonable inference. Even at this stage of proceedings, Plaintiffs must 21 provide sufficient facts to establish the existence of a viable claim. 22 With respect to Plaintiffs’ fifth cause of action regarding whether Plaintiffs are “co-owners” 23 of CAMEO’s trademark, it is undisputed that Defendant was not the only founding member of 24 CAMEO. Proposed plaintiff Jenkins is expressly alleged to be a founding member of CAMEO, and 25 to have appeared on all 18 of the groups albums. Jenkins is also alleged to have appeared on the 26 February 1, 2019, single released under CAMEO, and being marketed as part of the group. The 27 remainder of the Plaintiffs allege that they have “continued to perform the band’s music under the 1 present. Plaintiffs also allege that their names and likenesses are still being used to market CAMEO. 2 Finally, Plaintiffs Johnson, N. Leftenant, and A. Leftenant filed a Trademark/Service Mark 3 Application, which further supports these Plaintiffs’ claims 4 Defendant argues that well established law demonstrates that when a performer leaves a 5 band, that performer has no claim for ownership in the band name. However, the facts as to whether 6 any Plaintiff left the band, Plaintiffs allege specific facts to the contrary. The parties agree on the 7 three step analysis to determine ownership of a mark when there is a dispute over ownership. Of 8 course, the Court is not asked to decide who among the litigants owns the mark in question, but only 9 whether Plaintiffs have stated a claim for declaratory relief regarding ownership. The purpose 10 underlying declaratory relief will be served by allowing this claim to go forward as a judgment will 11 clarify and settle the legal relationship of the parties as to the CAMEO mark, and it will terminate 12 and afford relief as to the uncertainty regarding the mark. 13 Accordingly, 14 IT IS HEREBY ORDERED that Plaintiffs’ Motion for Leve to Amend the Complaint (ECF 15 No. 22) is GRANTED in part and DENIED in part. 16 IT IS FURTHER ORDERED that the Amended Complaint shall be filed as to the First Cause 17 of Action, Fourth Cause of Action, and Fifth Cause of Action. 18 IT IS FURTHER ORDERED that Tomi Jenkins shall be added as a plaintiff for purposes of 19 the First, Fourth, and Fifth Causes of Action. 20 IT IS FURTHER ORDERED that the remainder of the Motion to Amend is DENIED without 21 prejudice. 22 23 DATED: September 6, 2019 24 25

26 ELAYNA J. YOUCHAH UNITED STATES MAGISTRATE JUDGE 27