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Sullivan v. Flora, Inc.

United States District Court, W.D. Wisconsin

August 12, 2016

AMY LEE SULLIVAN d/b/a DESIGN KIT, Plaintiff,
v.
FLORA, INC., Defendant.

          OPINION AND ORDER

          WILLIAM M. CONLEY District Judge

         In her amended complaint, Amy Sullivan alleges that defendant Flora, Inc. violated 17 U.S.C. § 101 by improperly using plaintiff’s copyrighted materials. Before this court is defendant’s Rule 12(b)(7) motion to dismiss plaintiff’s amended complaint for failure to join Designomotion, Inc., and Eva Kao, who were named as defendants in plaintiff’s original complaint but then were voluntarily dismissed without prejudice by plaintiff’s unilateral filing of Rule 41(a)(1) notices. (Dkt. #18.) The remaining defendant, Flora, contends that because plaintiff created the materials in dispute jointly with these two other parties, those parties are required to determine actual ownership of the materials. Flora further contends that ownership of these materials must be resolved before this court decides any infringement claim. For the reasons set forth below, the court finds that Rule 19(a) does not require joinder of these two parties. Therefore, it will deny defendant’s motion to dismiss for failure to join a required party.

         Also before the court is plaintiff’s motion for leave to file a second amended complaint, adding an unjust enrichment claim (dkt. #26), which the court will grant for the reasons provided at the end of this opinion.

         BACKGROUND

         On February 15, 2013, Sullivan entered into an agreement with Designomotion, Inc., to produce artwork for two videos, entitled “Flora 7-Sources” and “Flor-Essence.” These videos were for Designomotion’s client, Flora, Inc. Eva Kao, a Designomotion employee, helped develop the videos. Sullivan completed the artwork for both videos by May 31, 2013.

         On October 15, 2013, Sullivan discovered that Flora had reused her artwork from these two videos in new promotional advertising. Sullivan contacted Flora the next day about this usage. Some of the images were subsequently removed by October 17.

         On November 6, 2013, Sullivan obtained a copyright for the illustrations she provided for the “Flora 7-Sources” video. On December 12, 2013, she also obtained a separate copyright for the illustrations she provided for the “Flor-Essence” video.

         On the same date, December 12, 2013, Sullivan again contacted Flora about unauthorized use of her work, and she proposed a licensing agreement for continued use of her illustrations. Flora declined. Since obtaining her copyrights, Sullivan alleges that Flora (1) has reused her protected artwork on several occasions and (2) continues to do so, all without her consent.

         On May 20, 2015, Amy Sullivan filed her original complaint against three defendants: Flora, Inc., Designomotion, Inc., and Eva Kao. This complaint claimed damages for federal copyright infringement, contributory copyright infringement, breach of license agreement, breach of covenant of good faith and fair dealing, trade dress infringement, and false designation of origin under the Lanham Act. (Dkt. #1.) It also sought declaratory judgment for ownership of the copyrighted material in dispute.

         On August 4, 2015, plaintiff voluntarily dismissed both Designomotion, Inc. and Kao from her complaint. In response, Flora both answered the complaint and filed a motion to dismiss for failure to join a necessary or indispensable party under Rule 19. (Dkt. ##15, 18.) While plaintiff later filed an amended complaint, she again listed Flora as the sole remaining defendant. (Dkt. #17.) The amended complaint did, however, only claim damages for federal copyright infringement against Flora, and it also did not include any claim for a declaratory judgment as to the ownership of the materials at issue. In response, Flora renewed her original objection by filing a second motion to dismiss for failure to join a necessary or indispensable party under Rule 19, which remains pending before the court.

         OPINION

         I. Motion to Dismiss Pursuant to Rule 12(b)(7)

         Under Rule 19(a)(1), a so-called “required party” is “subject to service of process and whose joinder will not deprive the court of subject-matter ...


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