Opinion
02 Civ. 3850
July 15, 2002
OPINION ORDER
Nova Products, Inc. ("plaintiff) charges Kisma Video, Inc., Nectar Video, Don Y. Jayasuriya, and John Does 1-20 ("defendants") with violating Section 501(a) of the Copyright Act. Plaintiff moves this Court to reconsider the limitations it placed on plaintiff's application for a temporary restraining order ("TRO") pursuant to Fed.R.Civ.P. ("FRCP") 65 authorizing plaintiff to seize allegedly infringing material — including business documents — as well as to freeze defendants' assets. Although I granted plaintiff's TRO, I authorized an ex parte seizure only with respect to infringing merchandise. Plaintiff now claims that, in the absence of an ex parte seizure of documents, there is a substantial likelihood that defendants will secrete and possibly destroy evidence as well as assets in order to avoid potential liability for copyright infringement. For the reasons set forth herein, plaintiff's motion is denied with permission to submit a proposed order that fits within the narrow parameters allowed by the law as stated herein.
BACKGROUND
Plaintiff brought an action for copyright infringement pursuant to 17 U.S.C. § 101 et seq. ("Copyright Act") against the same defendants on July 1, 1999. On April 14, 2000, I granted plaintiff's motion for a permanent injunction enjoining defendants from manufacturing, distributing, selling, offering for sale or advertising any counterfeit copy of a Nova Video, or any merchandise bearing the trade name Nova Products, Inc., or any colorable variation thereof. However, on May 15, 2002 plaintiff's investigator, Abramo Ruggieri ("Ruggieri"), discovered that Kisma Video and its owner, Don Jayasuriya, were continuing to sell "massive numbers of bootleg copies of Nova videos." (Ruggieri Declaration at ¶ 3). Specifically, Ruggieri "counted 17 different Nova titles on the shelves, many titles having as many as five or more copies behind them. All tolled, [he estimated] that there were over a hundred bootleg copies of Nova videos on their shelves." (Id.). Consequently, on May 20, 2002 plaintiff applied for a TRO authorizing an ex parte seizure of allegedly infringing materials, including business documents, as well as a freeze of assets. Although 1 signed plaintiff's order with respect to the seizure of allegedly infringing materials, I denied his request for the seizure of business documents and a freeze of assets on the ground that the Copyright Act did not allow for a seizure of documents or a freeze of assets and that plaintiff's request did not fall within the scope of FRCP Rule 65(b). On June 13, 2002 plaintiff moved this Court to reconsider its partial denial of plaintiff's TRO.
DISCUSSION
17 U.S.C. § 503(a) ("Copyright Act") provides for seizure of certain items prior to a final determination that the defendant has infringed a plaintiff's copyright. That statute provides, in relevant part, that
[a]t any time while an action under this title is pending, the court may order the impounding, on such terms as it may deem reasonable, of all copies . . . claimed to have been made or used in violation of the copyright owner's exclusive rights, and of all plates, molds, matrices, masters, tapes, film negatives, or other articles by means of which such copies . . . may be reproduced.
Where plaintiffs can demonstrate that a danger exists of destroying or transferring infringing goods, courts in this Circuit have not hesitated to grant ex parte orders under the Copyright Act. See Century Home Enmnt., Inc. v. Laser Beat, Inc., 859 F. Supp. 636, 638 (E.D.N.Y. 1994) (citing cases). Moreover, even if equipment may be used for a legitimate purpose, it is not protected from seizure if it is alleged to have been employed for illegal purposes. Id. at 639. However, unlike the Trademark Counterfeiting Act, 15 U.S.C. § 1116(d), the Copyright Act does not provide for the impoundment or seizure of records documenting the manufacture, sale or receipt of items involved in the violation.
That statute provides, in relevant part, that "(i)n the case of a civil action arising under section 1114(1)(a) of this title or section 380 of Title 36 with respect to a violation that consists of using a counterfeit mark in connection with the sale, offering for sale, or distribution of goods or services, the court may, upon ex parte application, grant an order under subsection (a) of this section pursuant to this subsection providing for the seizure of goods and counterfeit marks involved in such violation and the means of making such marks, and records documenting the manufacture, sale, or receipt of things involved in such violation." 15 U.S.C. § 1116(d).
As noted, plaintiff brings this case under the Copyright Act. As such, he lacks statutory authority to seize business documents in addition to infringing material, and consequently relies instead on FRCP Rule 65(b), which provides that a court may issue a TRO upon proof "that immediate and irreparable injury, loss, or damage will result to the applicant before the adverse party or that party's attorney can be heard in opposition." More precisely, plaintiff adverts to a Sixth Circuit case,First Technology Safety Systems, Inc. v. Depinet, 11 F.3d 641, 652 (6th Cir. 1993), to support his contention that a court may grant a motion for an ex parte seizure of documents in copyright actions under Rule 65(b) if a plaintiff is able to demonstrate that "notice to defendants would have rendered fruitless the further prosecution of the action." In addition, plaintiff relies on In re: Vuitton et Fils, S.A., in which the Second Circuit authorized an ex parte temporary restraining order under FRCP Rule 65(b) so that the plaintiffs could "for a few hours . . . maintain the status quo, namely the defendants' inventory of counterfeit Vuitton merchandise." 606 F.2d 1, 3 (2d Cir. 1979).
The problem has to do with sufficiency. For instance, in First Technology Safety Systems, the Sixth Circuit never even reached the issue of whether an ex parte restraining order authorizing the seizure of documents preserved "the status quo for so long as is necessary to hold a hearing." Rather, it found that plaintiff failed to demonstrate that notice to defendant would render further prosecution of the action fruitless. 1 F.3d at 650. Similarly, In re: Vuitton et Fils, S.A. did not involve the seizure of documents but rather the maintenance of the status quo — in particular, the defendants' inventory of counterfeit Vuitton merchandise — for "but a few hours" under FRCP Rule 65(b). 606 F.2d at 3. In addition, the Vuitton court determined that plaintiff's experience of bringing eighty-four actions and hundreds of investigations against counterfeiters of its merchandise demonstrated that notice would indeed be futile. Id. Further, I am not convinced by plaintiff's argument that in 1997 this Court granted an ex parte seizure of, inter alia, business documents on basically the same set of facts and how could I do any less here. Quite to the contrary, in that case, Continental American Industries Conwest Resources, Inc. v. Blue Video et al., 97 Civ. 7090 (HB), plaintiff's complaint included a claim under the Trademark Infringement Act, 15 U.S.C. § 1116(d). As noted supra, at footnote 1, while 15 U.S.C. § 1116(d) authorizes ex parte seizures of business records, the Copyright Act does not.
In contrast to Vuitton, in which the status quo was maintained for but "a few hours," in this case plaintiff undoubtedly requests an ex parte order authorizing the seizure of potential documentary evidence for an indefinite amount of time — or at least for as long as it takes to rummage around on defendant's premises to locate the records and copy them. Indeed, as the Second Circuit emphasized in Vuitton, "[s]uch an order should be narrow in scope and brief in its duration." Id. at 4. In addition, whereas plaintiff is certainly correct to point out defendants' propensity to violate court orders — indeed, the injunction of this very Court — the situation here is not comparable to that inVuitton.
CONCLUSION
For the foregoing reasons, the motion to reconsider is denied with permission to submit within ten days a proposed order that meets the requirements spelled out in this opinion or the motion will be denied.