Mmas Research, LLC v. the Charite

• Court: Court of Appeals for the Ninth Circuit
• Decided: March 13, 2024
• Docket: 23-55202
• Status: Unpublished

Opinion

NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS MAR 13 2024 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT

MMAS RESEARCH, LLC, a Washington No. 23-55202 Limited Liability Company, D.C. No. Plaintiff-Appellant, 2:21-cv-01406-MWF-JPR

v. MEMORANDUM* THE CHARITE; ANIKA STEINER; ELISABETH THEISSEN, Dr.; SMARTPATIENT GMBH, a German corporation; MY THERAPY; DOES, 1-50, inclusive,

Defendants-Appellees.

Appeal from the United States District Court for the Central District of California Michael W. Fitzgerald, District Judge, Presiding

Argued and Submitted February 13, 2024 Pasadena, California

Before: W. FLETCHER, NGUYEN, and LEE, Circuit Judges.

This case involves a copyright dispute between MMAS Research, a medical

software company, and The Charité, a German hospital. MMAS alleges that Charité

infringed its copyright to the Morisky Widget, a medical software program, by using

* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. the Morisky Widget in unauthorized medical studies. The district court dismissed

the suit under Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6), finding that

MMAS lacked standing to pursue a copyright claim because it did not own the

Morisky Widget and that MMAS failed to allege a copyright violation.

MMAS raises three arguments on appeal. First, MMAS argues that the district

court erred in concluding it lacked standing to sue. Second, MMAS argues that the

district court erred in analyzing its copyright claim under the Copyright Act rather

than the Digital Millenium Copyright Act (DMCA). Third, MMAS argues that the

district court erred in dismissing its state law claims because there was diversity

jurisdiction over those claims.1 We have jurisdiction under 28 U.S.C. § 1291 and

affirm.

1. The district court erred in concluding that MMAS lacked standing to sue

for copyright infringement. The district court found that a 2020 preliminary

settlement agreement from a separate lawsuit between MMAS and Dr. Donald

Morisky transferred the Morisky Widget from MMAS to Dr. Morisky. But that

agreement—which simply outlined terms MMAS and Dr. Morisky “desire[d] to

1 MMAS also argues that the district court should have considered Charité’s unclean hands before dismissing MMAS’s claims. Because unclean hands are a defense against a party seeking equitable relief, not a reason to find that a complaint plausibly alleged a claim, this argument is meritless. See Ellenburg v. Brockway, Inc., 763 F.2d 1091, 1097 (9th Cir. 1985), abrogated on other grounds by Watkins v. Westinghouse Hanford Co., 12 F.3d 1517, 1527 (9th Cir. 1993).

2 consent and agree to” sometime in the future—was never finalized. MMAS thus

never transferred its copyright and remains the registered owner of the Morisky

Widget. Similarly, because the agreement was a private contract between Dr.

Morisky and MMAS, and because it was never finalized, it was not an abandonment

of MMAS’s right to sue Charité for copyright infringement. See Hampton v.

Paramount Pictures Corp., 279 F.2d 100, 104 (9th Cir. 1960) (finding abandonment

where copyright owner’s actions demonstrated the intent to “surrender the[ir] rights

and allow the public to copy”).

2. The district court did not err in analyzing MMAS’s copyright claim under

the Copyright Act rather than the DMCA. The district court analyzed MMAS’s

claim under the Copyright Act, concluding that MMAS failed to state a claim

because it had not alleged any domestic acts of infringement. On appeal, MMAS

does not contend that Charité infringed its copyright under the Copyright Act or

argue that the district court erred in concluding that MMAS failed to allege a

Copyright Act violation. Instead, MMAS argues that the district court should have

analyzed its claims under the DMCA. Although MMAS referenced the DMCA in

the caption of its operative pleading, MMAS did not allege facts that prove a DMCA

violation, make a DMCA argument to the district court, or otherwise alert the district

court that it was pursuing a claim under the DMCA. For example, although MMAS

contends on appeal that Charité violated the DMCA’s “prohibition on the removal

3 or alteration of copyright management information,” MMAS never mentioned

copyright management information in its operative pleading or district court

briefing. MMAS instead presented its claims as if they were traditional copyright

infringement claims. The district court thus did not err in analyzing MMAS’s

complaint under the Copyright Act rather than the DMCA.

3. The district court did not err in dismissing the state law claims. MMAS

argues that the district court erred in dismissing its state law claims because there

was diversity jurisdiction over those claims. MMAS did not allege the citizenship

of the parties other than smartpatient GmbH in its operative complaint, and its

allegation that “there is a complete diversity of citizenship” is insufficient to invoke

the court’s jurisdiction. Kanter v. Warner-Lambert Co., 265 F.3d 853, 857–58 (9th

Cir. 2001). Although “[d]effective allegations of jurisdiction may be amended,” id.

at 858 (quoting 28 U.S.C. § 1653), the district court previously put MMAS on notice

that its jurisdictional allegations were defective, and MMAS did nothing to correct

them. The district court thus did not err in dismissing those claims.

AFFIRMED.