Case 1:16-cv-07585-ER Document 45 Filed 05/15/17 Page 1 of 18

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF NEW YORK

LAZAR LAKIC,
Case No. 16-cv-07585 (ER)
Plaintiff,

-against-

ANTON MATSULEVICH p/k/a TONY

FADD; WILLIE MAXWELL p/k/a FETTY
WAP; GOODFELLA4LIFE ENT LIMITED
LIABILITY COMPANY; BMG RIGHTS
MANAGEMENT (US) LLC; and THEORY
ENTERTAINMENT LLC a/k/a 300
ENTERTAINMENT; SONY/ATV MUSIC
PUBLISHING LLC; and ATLANTIC
RECORDING CORP.,

Defendants.

MEMORANDUM OF LAW IN SUPPORT OF DEFENDANT

ANTON MATSULEVICH P/K/A TONY FADDS
MOTION TO DISMISS PLAINTIFFS FIRST AMENDED COMPLAINT

ROBINS KAPLAN LLP

Paul V. LiCalsi, Esq.
Sherli M. Furst, Esq.
399 Park Avenue, Suite 3600
New York, NY 10022-4611
Tel.: (212) 980-7400
Fax: (212) 980-7499
PLiCalsi@RobinsKaplan.com
SFurst@RobinsKaplan.com

Attorneys for Defendant

Anton Matsulevich p/k/a Tony Fadd

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TABLE OF CONTENTS

PRELIMINARY STATEMENT .................................................................................................... 1

FACTUAL BACKGROUND ......................................................................................................... 2

ARGUMENT .................................................................................................................................. 5

I. This Court Lacks Subject Matter Jurisdiction Over Plaintiffs Copyright Infringement
Claim Because Plaintiff Does Not Have Standing to Sue for the Requested Relief .............5

II. Plaintiff Fails to Plead a Plausible Claim Pursuant to 205(e) of the Copyright Act .............9

III. Even if Plaintiffs Copyright Claim is Sustained, Plaintiffs Copyright Registration Should
Be Referred to the Register of Copyrights for Review of Potential Fraud on the Copyright
Office ...................................................................................................................................13

CONCLUSION ............................................................................................................................. 14

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TABLE OF AUTHORITIES

Page(s)

Cases

Allhusen v. Caristo Const. Corp.,

303 N.Y. 446 (1952) ..................................................................................................................7

Ashcroft v. Iqbal,
566 U.S. 662 (2009) .............................................................................................................9, 10

Bell Atlantic Corp. v. Twombly,

550 U.S. 544 (2007) ...................................................................................................................9

Care Travel Co. v. Pan AM World Airways, Inc.,

944 F.2d 983 (2d Cir. 1991).......................................................................................................8

CTI-Container Leasing Corp. v. Oceanic Operations Corp.,

682 F.2d 377 (2nd Cir. 1982).....................................................................................................8

Edgreen v. Learjet Corp.,

180 A.D.2d 562 ..........................................................................................................................9

FW/PBS, Inc. v. City of Dallas,

493 U.S. 215 (1990) ...................................................................................................................6

Gladstone, Realtors v. Village of Bellwood,

441 U.S. 91 (1979) .....................................................................................................................6

Gym Door Repairs, Inc. v. Young Equip. Sales, Inc.,

206 F. Supp. 3d 869 (S.D.N.Y. Sept. 9, 2016) ........................................................................10

International Customs Associates, Inc. v. Ford Motor Co.,

893 F. Supp. 1251 (S.D.N.Y. 1995)...........................................................................................8

John Wiley & Sons, Inc. v. DRK Photo,

998 F. Supp. 2d 262 (S.D.N.Y. 2014)........................................................................................6

Kelly v. L.L. Cool J.,

145 F.R.D. 32 (S.D.N.Y. 1992) ...............................................................................................10

Latin Am. Music Co. v. Archdiocese of San Juan of the Roman Catholic &
Apostolic Church,
194 F. Supp. 2d 30 (D.P.R. 2001), affd in part, revd on other grounds, 499
F.3d 32 (1st Cir. 2007) .......................................................................................................11, 12

Lujan v. Defenders of Wildlife,

504 U.S. 555 (1992) ...................................................................................................................6

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Makarova v. United States,

201 F.3d 110 (2d Cir. 2000).......................................................................................................5

Neuroaxis Neurological Assocs., PC v. Costco Wholesale Co.,

919 F. Supp. 2d 345 (S.D.N.Y. 2013)........................................................................................7

Palmer/Kane LLC v. Rosen Books Works LLC,

2016 U.S. Dist. LEXIS 117023 (S.D.N.Y. 2016) ..............................................................13, 14

Ruotolo v. City of New York,

514 F.3d 184 (2d Cir. 2008).....................................................................................................10

Spinex Lab. v. Empire Blue Cross Blue Shield,

622 N.Y.S.2d 154 (App. Div. 3d Dept 1995) ...........................................................................7

Streetwise Maps v. VanDam, Inc.,

159 F.3d 739 (2d Cir. 1998).....................................................................................................13

Tasini v. New York Times Co.,

184 F. Supp. 2d 350 (S.D.N.Y. 2002)........................................................................................6

Statutes

17 U.S.C. 205 ..........................................................................................................................2, 12

17 U.S.C. 205(c) ...........................................................................................................................5

17 U.S.C. 304(a)(1)(C)(ii) (2016) ...............................................................................................11

17 U.S.C. 411(b)(2) ....................................................................................................................13

17 U.S.C. 501(b) ...........................................................................................................................6

Copyright Act...............................................................................................................................5, 9

Copyright Act Section 205(e) ........................................................................................2, 10, 11, 12

Copyright Act Section 501(b) ..........................................................................................................6

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Defendant Anton Matsulevich p/k/a Tony Fadd (Defendant or Fadd) submits this

memorandum of law in support of his motion for an order under Federal Rules of Civil

Procedure 12(b)(1) and 12(b)(6), dismissing the first amended complaint (Amended

Complaint) for lack of subject matter jurisdiction and failure to state a claim.

PRELIMINARY STATEMENT

Plaintiff Lazar Lakic (Plaintiff) alleges that based upon the contract between third-

party Soren Mensberg and Fadd, dated February 9, 2014 (the Mensberg Agreement or the

Agreement), he is entitled to the rights afforded a copyright holder of the Hello Beat (the

Beat). Plaintiff propounds that defendants Fadd, Willie Maxwell p/k/a Fetty Wap (Maxwell),

Goodfella4life Ent Limited Liability Company (Goodfella), BMG Rights Management (US)

LLC (BMG), Theory Entertainment LLC a/k/a 300 Entertainment (300), Sony/ATV Music

Publishing (Sony/ATV), and Atlantic Recording Corp. (Atlantic) (collectively,

Defendants) infringed upon his rights by making unauthorized use of the Beat. See First

Amended Complaint (Dkt. 32) (Amended Compl.) at 3. As a result, Plaintiff seeks relief for

what he wrongfully claims to be an action for copyright infringement.

Plaintiffs claim fails for two fundamental reasons.

First, the Mensberg Agreement has a clear anti-assignment clause a point Plaintiff

omits in both the initial complaint and the Amended Complaint. See Mensberg Agreement at

2.2, attached as Exhibit B to the Declaration of Paul V. LiCalsi (LiCalsi Declaration).1 In clear

terms, the Mensberg Agreement bars Mensberg from transferring any of the rights granted

without Fadds written consent. In direct breach of that covenant, Mensberg unlawfully assigned

1
Remarkably, although Plaintiff attaches numerous extraneous e-mails to the Amended Complaint, he omits
attaching the Mensberg Agreement itself. As noted, the Mensberg Agreement, a written contract which is
dispositive of Plaintiffs claims, is submitted herewith as Exhibit B to the LiCalsi Declaration.

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his purported rights to Plaintiff. Consequently, any supposed assignment is null and void, and

cannot provide a basis for Plaintiffs copyright infringement claim.2

Second, Plaintiff fails to state a claim on which relief can be granted against Fadd. The

allegations in the Amended Complaint, taken at face value, are insufficient to plead the elements

of a copyright infringement claim. Specifically, prior to the Mensberg Agreement, Fadd issued a

non-exclusive license to an authorized representative for Maxwells production company for use

of the Beat in a derivative work. Pursuant to Section 205(e) of the Copyright Act, that non-

exclusive license takes priority over any later grant of rights to Mensberg, and thus bars any

claim by Plaintiff for copyright infringement. As a result, Plaintiff may not recover from Fadd

based upon the purported infringement claim.

Accordingly, Fadd respectfully requests the Court dismiss the Amended Complaint with

prejudice, as Plaintiff lacks standing and, in any event, the earlier non-exclusive license for

Maxwells derivative work takes priority over the Mensberg Agreement under the explicit

provisions of 17 U.S.C. 205. Should the Court decide against dismissing Plaintiffs claim,

Fadd requests that Plaintiffs copyright registration be referred to the Copyright Office for a

review of its validity, and all proceedings in this action stayed until a decision is rendered.

FACTUAL BACKGROUND

Defendant Fadd is a music producer and composer of original musical compositions. As

stated in the Amended Complaint, he is the author and original owner of the copyright in the

Beat (the Copyright). See Amended Compl. at 26. As is typical in contemporary music,

instrumental works such as the Beat are often created independently by third parties and licensed

2
The language of the Mensberg Agreement also clearly and unequivocally states, Buyer [Mensberg] has no
ownership of the Exclusive Producers [Fadd] copyrights. See LiCalsi Declaration, Exhibit B at 3.2. The Court
should look no further than the plain, unambiguous terms of the Agreement to confirm that the Copyright belongs to
Fadd, not Mensberg, and certainly not to Plaintiff.

2
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to allow performers to create derivative works which add the performers own vocal melodies

and spoken raps in synchronization with the beats. Amended Compl. at 6.

On January 13, 2014, Fadd granted a non-exclusive license (Maxwell Agreement) to a

principal of co-defendant Maxwells production company, Goodfella, for use of the Beat in a

derivative work, for a sum of $49.99 U.S. dollars. While the Maxwell Agreement confirmed

Goodfellas exclusive ownership of Maxwells derivative work, the license to use the Beat was

not exclusive, and Fadd retained the right to further license it. See Maxwell Agreement, attached

as Exhibit A to LiCalsi Declaration.

In his Amended Complaint, Plaintiff mischaracterizes the Maxwell Agreement as an

exclusive rights agreement (Am. Compl 36); in fact, the language of the agreement explicitly

provides,

Buyer does not have the right to master, mix, or re-engineer in whole or in part
the Beat. Buyer does have the worldwide, exclusive transferrable right for use of
the Music as long as additional audio/visual performances are recorded with our
musical compositions (hereinafter referred to as synchronization).

See LiCalsi Declaration, Exhibit A at 2.1. (Emphasis added).

The Music in the above provision to which the buyer has the worldwide exclusive

transferrable right is clearly the derivative work which the buyer creates not the underlying

Beat which is being licensed. Plain and simple, the Maxwell Agreement granted his production

company, Goodfella, a non-exclusive right to use the Beat to create and distribute a derivative

work which the licensee would own.3

3
While the Maxwell Agreement alludes to the scope of the distribution of the derivative work allowed under the
license, the language is not definite and does not provide for any limitation. Specifically, the language provides,
Buyer has the right to use the beat for 4 (four) commercial purposes: mixtape, album, mp3, iTunes, CD sales
(maximum sales total: 12000 copies), etc. See LiCalsi Declaration, Exhibit B at 2.2. As can be seen, the language
names at least five not four possible uses and adds the open ended term etc. to the list of permitted uses.

3
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Shortly thereafter, in a contract dated February 9, 2014, Fadd entered into the Mensberg

Agreement, granting Mensberg the right to use the Beat in a derivative work of his own, for $900

U.S. dollars. See LiCalsi Declaration, Exhibit B at 2.1.4 While the Mensberg Agreement

granted Mensberg exclusive ownership of his derivative work, it also unequivocally stated that

Fadd retained ownership of the Copyright, and, significantly, contained an explicit anti-

assignment provision with respect to the licensed rights prohibiting Mensberg from assigning or

otherwise transferring rights under the Agreement.

Fadd issued an amended agreement (Amended Maxwell Agreement) dated April 19,

2014, to Goodfella, clarifying that there was no limitation on release format and volume of sales

of Maxwells derivative work. See Amended Maxwell Agreement, attached as Exhibit C to

LiCalsi Declaration. Later in 2014, Defendant Fadd learned that Maxwell had incorporated the

Beat into a song, which was likely to have large-scale commercial success; he later came to learn

this song was entitled Trap Queen. As a result of this impending commercial success, Fadd

entered into a more formal producers agreement with Goodfella, on November 19, 2014 (RGF

Agreement). See RGF Agreement, attached as Exhibit D to LiCalsi Declaration.5 Notably, both

the Amended Maxwell Agreement and the RGF Agreement like the original Maxwell

Agreement are non-exclusive with respect to the Beat, with Fadd retaining the copyright and

the right to license the Beat independently of Trap Queen. See LiCalsi Declaration, Exhibit C at

2.1 and Exhibit D at 2 and 8(d).

Subsequent to the foregoing, Plaintiff recorded the Mensberg Agreement with the U.S.

Copyright Office, with an effective recordation date of April 13, 2015. See Amended Compl. at

4
Although dated February 9, 2014, it appears the Mensberg Agreement was not executed by Fadd until at least
subsequent to May 15, 2014. See email from Mensberg to Fadd, dated May 15, 2014 at 11:15, Amended Compl.,
Exhibit B; and email from Fadd to Mensberg, dated June 24, 2014 at 13:37, Amended Compl., Exhibit C.
5
Goodfella conducts business under the name RGF Productions.

4
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28. On August 27, 2015, without any authorization and in breach of the terms of the Mensberg

Agreement, Plaintiff registered the Copyright- i.e., not in his derivative work, but rather in the

Beat to which he had no rights. See Amended Compl. at 4. Apparently realizing the error in the

timing of his first recordation of the Mensberg Agreement, pursuant to 17 U.S.C. 205(c),6

Plaintiff recorded the Mensberg Agreement a second time on or around September 29, 2015 after

the registration of the Copyright. Finally, despite the Mensberg Agreements express prohibition

against third-party assignment and transfer, Mensberg assigned his purported rights under the

Mensberg Agreement to Plaintiff on December 1, 2015. See December 1, 2015 Assignment,

attached as Exhibit E to LiCalsi Declaration.

ARGUMENT

I. This Court Lacks Subject Matter Jurisdiction Over Plaintiffs Copyright Infringement
Claim Because Plaintiff Does Not Have Standing to Sue for the Requested Relief

Whether regarded as a matter of constitutional, Article III standing, or statutory standing

under the Copyright Act, Plaintiff does not have standing to bring his asserted claim based on the

Copyright Act.

A court properly dismisses a case for lack of subject matter jurisdiction pursuant to Rule

12(b)(1), when the district court lacks the statutory or constitutional power to adjudicate it.

Makarova v. United States, 201 F.3d 110, 113 (2d Cir. 2000); see Fed. R. Civ. P. 12(b)(1). The

6
17 U.S.C. 205(c) provides,
Recordation of a document in the Copyright Office gives all persons constructive notice
of the facts stated in the recorded document, but only if
(1) the document, or material attached to it, specifically identifies the work to
which it pertains so that, after the document is indexed by the Register of
Copyrights, it would be revealed by a reasonable search under the title or
registration number of the work; and
(2) registration has been made for the work.
Id.

Plaintiff recorded the Mensberg Agreement the first time (Apr. 13, 2015) prior to registering the Copyright
(August 27, 2015), thus failing to satisfy the statute in the first instance.

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burden is on the plaintiff asserting jurisdiction to prove by a preponderance of the evidence that

jurisdiction is proper. Tasini v. New York Times Co., 184 F. Supp. 2d 350, 353 (S.D.N.Y. 2002).

Further, a court has an independent obligation to consider a partys standing even if the parties

fail to raise the issue, because standing is perhaps the most important of the jurisdictional

doctrines. FW/PBS, Inc. v. City of Dallas, 493 U.S. 215, 230-31 (1990); John Wiley & Sons,

Inc. v. DRK Photo, 998 F. Supp. 2d 262, 275 (S.D.N.Y. 2014).

To pass constitutional muster under Article IIIs standing requirement, the plaintiff must

demonstrate that a case or controversy exists. Gladstone, Realtors v. Village of Bellwood, 441

U.S. 91, 99 (1979). At a minimum, the plaintiff must show three elements: (1) an injury in fact;

(2) a causal nexus between the complained-of conduct and the injury; and (3) redressability of

the injury. See Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992); see also Gladstone,

441 U.S. at 99 (In order to satisfy Art. III, the plaintiff must show that he personally has

suffered some actual or threatened injury as a result of the putatively illegal conduct of the

defendant.). Ultimately, the plaintiff must make some affirmative factual showing that he is

entitled to have the Court hear his case. See, e.g., Tasini v. N.Y. Times Co., 184 F. Supp. 2d 350,

355 (S.D.N.Y. 2002) ("It is the responsibility of the complainant clearly to allege facts

demonstrating that he is a proper party to invoke judicial resolution of the dispute and the

exercise of the court's remedial powers." [citation and internal quotation marks omitted]).

Moreover, Section 501(b) of the Copyright Act, makes clear that only [t]he legal or

beneficial owner of an exclusive right under a copyright is entitled to institute an action for

any infringement 17 U.S.C. 501(b). Plaintiff cannot satisfy either constitutional or

statutory requirement because he is neither the legal or beneficial owner of the rights he claims.

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The anti-assignment clause in the Mensberg Agreement explicitly forbids transfer of any

rights in the Beat absent Fadds written consent. See LiCalsi Declaration, Exhibit B at 2.2.

Indeed, the relevant provision provides:

You CANNOT sell, loan, rent, lease, assign, remix, rearrange, remove any
melodies, instruments, drum programming or transfer all or any of the products
sold or their rights under [sic] to another user (example - Record Label, another
production company, another producer), or for use in any competitive product
without written consent and or another license agreement.

Id. Exhibit B at 2.2.

Mensberg neither sought nor obtained any such consent or license agreement from Fadd,

before his alleged assignment to Plaintiff. See id. Exhibit E. Beyond the fact that Mensbergs

failure to obtain the consent or license not only rendered the purported assignment to Plaintiff a

nullity, it also caused the Mensberg Agreement to terminate pursuant to paragraph 3.3 which

states, Buyer must comply with every aspect of this agreement or this license will be

terminated. See Neuroaxis Neurological Assocs., PC, 919 F. Supp. 2d at 352 ([U]nambiguous

contract provisions that limit a partys ability to assign its rights under the contract render any

purported assignment void.). Indeed, under New York law, unambiguous contract provisions

that limit a partys ability to assign its rights under the contract render any purported assignment

void. Neuroaxis Neurological Assocs., PC v. Costco Wholesale Co., 919 F. Supp. 2d 345, 352

(S.D.N.Y. 2013); Spinex Lab. v. Empire Blue Cross Blue Shield, 622 N.Y.S.2d 154, 155 (App.

Div. 3d Dept 1995) ([S]o long as the language of a contract provision prohibiting assignments

is clear and definite, assignments made in contravention of its terms are void.). In fact, where

plain language unambiguously prohibits assignment, an attempted assignment will be

ineffectual. Neuroaxis Neurological Assocs., PC, 919 F. Supp. 2d at 350; Allhusen v. Caristo

Const. Corp., 303 N.Y. 446, 451 (1952) (When clear language is used, and the plainest words

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have been chosen, parties may limit the freedom of alienation of rights and prohibit the

assignment.).7

Although Plaintiff alleges that Mensberg acted as Plaintiffs agent and cites as support e-

mails that preceded the actual written contract (Amended Compl. at 26), such an

agent/principal relationship would contradict the clear provisions on the face of the Mensberg

Agreement that the buyer is Mensberg personally. Not only is Mensberg specifically

identified as the contracting party at the onset of the contract, but the following provision states

prominently and immediately above the signature lines:

Exclusive rights agreement is intended for user registered as soren@vuf-

empire.dk.

See LiCalsi Declaration, Exhibit B at 2.

Undeniably, soren@vuf-empire.dk is the personal e-mail registered to Soren Mensberg. See

Amended Compl. at 26 and Exhibit B.8

Pursuant to the parol evidence rule, if a contract is unambiguous on its face, the parties

rights under such a contract should be determined solely by the terms expressed in the instrument

itself, rather than extrinsic evidence. Care Travel Co. v. Pan AM World Airways, Inc., 944 F.2d

983, 987-88 (2d Cir. 1991). Where a written contract unambiguously provides that a party signs

in his or her personal capacity, parol evidence may not be used to prove agency. CTI-Container

Leasing Corp. v. Oceanic Operations Corp., 682 F.2d 377, 382 (2nd Cir. 1982); International

7
Additionally, review of the track that Plaintiff prepared using the Beat confirms that Mensberg violated other
provisions of the Mensberg Agreement, which also caused the Agreement to terminate. Specifically, in
contravention of the limitations in paragraph 2.2 of the Agreement that Mensberg CANNOT remix, rearrange,
remove any [of the Beats] melodies, instruments, [or] drum programming[,] the track contains numerous such
modifications, which each trigger the termination clause in paragraph 3.3 of the Mensberg Agreement. See
Mensberg Agreement 2.2, 3.3.
8
Moreover, as set out in greater detail in BMGs motion today, which Fadd incorporates by reference, the email
provided hardly suffices as notice of an agency relationship. While Mensberg simply comments at one point, It's
for one of my clients, a Danish rap artist, he repeatedly states that it is he Mensberg who is personally acquiring
the license for such purposes. See Exhibit B to Amended Compl.

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Customs Associates, Inc. v. Ford Motor Co., 893 F. Supp. 1251, 1256 (S.D.N.Y. 1995); Edgreen

v. Learjet Corp., 180 A.D.2d 562, 563; 580 N.Y. Supp. 2d 260, 261 (N.Y. Sup. Ct., 1st Dept.

1992).

Since the Mensberg Agreement is unambiguous as to be solely intended for Mensbergs

use, and further prohibits his assignment of rights, the parol evidence rule bars consideration of

any and all extrinsic evidence Plaintiff has submitted to date. Accordingly, Exhibits B, C, and E

to the Amended Complaint should not be relied upon in the Courts decision.

Thus, even if Mensberg believed he was assigned the Copyright, he would still be unable

to effectuate any transfer of rights to Plaintiff without Fadds written consent. Since Fadd never

gave such consent, any alleged transfer to Plaintiff is null and void; and, Plaintiff cannot

adequately plead standing to bring his claim.9

II. Plaintiff Fails to Plead a Plausible Claim Pursuant to 205(e) of the Copyright Act

In considering a motion brought under Fed. R. Civ. P. 12(b)(6), a court must accept the

material facts alleged in the Amended Complaint as true and determine whether they raise a

right to relief above the speculative level. Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555

(2007). However, the court is not required to accept as true a legal conclusion couched as a

factual allegation. Ashcroft v. Iqbal, 566 U.S. 662, 678 (2009).

9
As the Amended Complaint concedes, Mensbergs use rights were also limited to synchronization performances
incorporating additional audio/visual performances . . . recorded with [the Beat]. Amended Compl. at 30;
LiCalsi Declaration, Exhibit B at 2.1. Indeed, the Mensberg Agreement specifically notes, [U]se of the Exclusive
Producers [Fadd] composition in isolation (without synchronization of vocal performance) is not permitted without
obtaining a special Multimedia license directly from the Exclusive Producer [Fadd]. Id. Exhibit B at 2.6. Thus,
Mensberg was permitted to make use of the Beat solely for the purpose of incorporating it into his own derivative
work. He was granted an exclusive, transferrable right to this derivative work, but was required to seek permission
for any additional uses of the Beat. Id. Exhibit B at 2.6. The Mensberg Agreement plainly states, [b]uyer has no
ownership of Exclusive Producers [Fadd] copyrights, making clear that while Mensberg was granted an exclusive
right in the copyright of the derivative work incorporating the Beat [i.e. the music referred to in this agreement],
Fadd retained all rights in the Beat itself. See id. Exhibit B at 3.2.

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In order to avoid dismissal, a complaint must plead enough facts to state a claim to relief

that is plausible on its face. Ruotolo v. City of New York, 514 F.3d 184, 188 (2d Cir. 2008)

(quoting Twombly, 550 U.S. at 570). A claim is facially plausible only when the plaintiff

pleads factual content that allows the court to draw the reasonable inference that the defendant

is liable for the misconduct alleged. Iqbal, 556 U.S. at 678. Specifically, to withstand scrutiny,

courts have held that a copyright claim must allege (1) which specific original [work is] the

subject of the copyright claim, (2) that plaintiff owns the copyright in [that work], (3) that the

[copyright has] been registered in accordance with the statute, and (4) by what acts during what

time the defendant infringed the copyright. Kelly v. L.L. Cool J., 145 F.R.D. 32, 35-36

(S.D.N.Y. 1992). Failure to sufficiently allege these factors is fatal to any infringement claim,

and grounds for dismissal. See Gym Door Repairs, Inc. v. Young Equip. Sales, Inc., 206 F.

Supp. 3d 869, 893 (S.D.N.Y. Sept. 9, 2016) (To withstand a motion to dismiss, a complaint

based on copyright infringement must allege: (1) which original works are the subject of the

copyright claim; (2) that the plaintiff owns the copyrights in those works; (3) that the copyrights

have been registered in accordance with the statute; and (4) 'by what acts during what time' the

defendant infringed the copyright.).

Plaintiff cannot, and here has not, properly alleged the second and third requirements of

his copyright infringement claim.

Pursuant to Section 205(e) of the Copyright Act, a nonexclusive license will prevail over

a conflicting transfer provided the nonexclusive license is in writing, signed by the owner of the

rights licensed, or his duly authorized agent, and provided further the license was either taken

before execution of the transfer, or, if taken after execution of the transfer, provided the license

was taken in good faith and without notice of the transfer, and prior to the recordation of the

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transfer. See 17 U.S.C. 205(e) (2016); see Latin Am. Music Co. v. Archdiocese of San Juan of

the Roman Catholic & Apostolic Church, 194 F. Supp. 2d 30, 48 (D.P.R. 2001), affd in part,

revd on other grounds, 499 F.3d 32 (1st Cir. 2007). A non-exclusive license will prevail under

these circumstances whether recorded or not, and regardless of whether or not the licensee is

required to pay a valuable consideration or royalties. See id. (dismissing exclusive licensees

infringement claims as against non-exclusive licensee, on the basis that non-exclusive licensees

written instrument was executed first in time and thus had priority).

In Latin Am. Music Co. v. Archdiocese of San Juan of the Roman Catholic & Apostolic

Church, the author at issue wrote a song in 1963 and transferred exclusive rights to Southern

Music Co., Inc. (Southern). See id. at 46. Under the agreement, Southern had the right to

register the copyright in the song, and received an expectancy of renewal rights. See id.

Southern registered the copyright in 1964 with the Copyright Office. See id. The author,

however, died before the commencement of the renewal period for the songs copyright, and the

renewal right reverted to the authors heirs by statutory right. See id.; 17 U.S.C.

304(a)(1)(C)(ii) (2016). Nonetheless, in 1992, Southern went ahead and registered a renewal of

the songs copyright with the Copyright Office. See Latin Am. Music Co., 194 F. Supp. 2d at 48.

In 1994, the authors heirs granted the Latin American Music Company (LAMCO) a non-

exclusive license of the songs renewal copyright. See id. A few years later, the authors heirs

granted Southern a conflicting exclusive assignment of the renewal of the songs copyright. See

id. at 46. Southern recorded this renewal in 1997. See id. at 48.

The court held that although Southern registered a renewal in the copyright in 1992, the

registration was invalid because renewal rights had reverted to the authors heirs before

Southern obtained permission from the heirs. See id. at 48. Therefore, the non-exclusive license

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granted by the authors heirs to LAMCO was effectively first in time, relative to the heirs grant

of exclusive rights to Southern in 1997. See id. at 49. Thus, the case fell squarely under Section

205(e)(1), and under the clear terms of the statute, LAMCOs non-exclusive license took

priority over Southerns exclusive license, because it was first in time. See id. The court also

held that because LAMCOs license was non-exclusive, it did not have standing to sue, and

dismissed its copyright infringement claim as to that particular song. See id. at 52.

Here, Fadd granted the principal of Maxwells production company, Goodfella, a non-

exclusive license on January 13, 2014.10 Approximately a month later, Fadd signed the

Mensberg Agreement granting Mensberg permission to use the Beat. Finally, both the Amended

Maxwell Agreement and the RGF Agreement were entered into in 2014, many months before

Plaintiff recorded the Mensberg Agreement with the Copyright Office in April 2015. Even

taking Plaintiffs allegations as true, and assuming the Mensberg Agreement granted Mensberg

an exclusive license (which it did not), and putting aside the indisputable contract language and

non-transferability clause discussed above, the non-exclusive grant of rights to Goodfella

would still take priority over Mensbergs rights (in the Mensberg Agreement), pursuant to 17

U.S.C. 205(e).

Since any rights that Plaintiff now claims to own in the Beat (and he owns none) are

subject to those previously granted under the Maxwell Agreement, the Amended Complaint

fails to state a claim for infringement.

10
The Maxwell Agreement is a written instrument signed by Fadd and dated January 13, 2014. Thus, the
requirements for a writing pursuant to 17 U.S.C. 205 are satisfied, as: (1) the license agreement was executed in a
timely fashion; and (2) Fadd was the proper owner of the rights licensed. See Latin Am. Music Co., 194 F. Supp. 2d
at 52.

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III. Even if Plaintiffs Copyright Claim is Sustained, Plaintiffs Copyright Registration

Should Be Referred to the Register of Copyrights for Review of Potential Fraud on the
Copyright Office

If, despite the foregoing arguments, the Court decides against granting Defendants

motion to dismiss, at this time, Fadd asks the Court to refer the Copyright to the Copyright

Office, and stay all proceedings related to this action until a decision is rendered by the Register

of Copyrights.

As discussed herein,11 the Mensberg Agreement granted Mensberg exclusive ownership

only to Mensbergs derivative work, not the Beat. See Streetwise Maps v. VanDam, Inc., 159

F.3d 739, 747 (2d Cir. 1998) (noting that where a plaintiff only owns derivative work rights, but

not rights in the pre-existing work, it may not sue pursuant to infringement of the pre-existing

work). Further, the plain language of the Mensberg Agreement provided Mensberg, and Plaintiff,

with notice that Fadd maintained exclusive ownership of the Copyright. See Exhibit B at 3.2.

Essentially, Plaintiff does not have valid ownership over the Copyright, and any statement on the

copyright application to the contrary is simply untrue.

Pursuant to 17 U.S.C. 411(b)(2), in any case where inaccurate information on the

certificate of registration is alleged, the court shall request the Register of Copyrights to advise

the Court whether the inaccurate information, if known, would have caused the Register of

Copyrights to refuse Registration. 17 U.S.C. 411(b)(2) (2016). Since Plaintiff is not the lawful

owner of the Copyright but misrepresented as such on the copyright application- a fundamental

error- the Copyright is inaccurate, and should be referred to the Register of Copyrights for a

determination of its legitimacy. See Palmer/Kane LLC, 188 F. Supp. 3d at 348 ([C]ourts are in

agreement that the provision is mandatory in nature, requiring district courts to solicit the advice

of the Copyright Office when the statutory conditions are satisfied.).

11
See fn. 2 and 7, supra.

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Accordingly, if this case is not immediately dismissed on the pleadings, Fadd respectfully

requests that this action not be permitted to continue until the Copyright Office determines

whether, if known by the Register of Copyrights at the time of registration, the aforementioned

inaccuracy would have resulted in refusal of registration. See Palmer/Kane LLC v. Rosen Books

Works LLC, 2016 U.S. Dist. LEXIS 117023, at *17 (S.D.N.Y. 2016) (where errors go beyond

minor technical mis-descriptions and render the registration completely inaccurate, the

registration cannot be deemed valid.).

CONCLUSION

For the foregoing reasons, Defendant Fadd respectfully requests that the Court dismiss

the Amended Complaint against him, in its entirety, with prejudice. In the alternative, Fadd asks

that this Court stay proceedings until a determination as to the validity of Plaintiffs copyright

registration is rendered by the Copyright Office.

Dated: New York, New York

May 15, 2017 Respectfully submitted,
ROBINS KAPLAN LLP

By: /s/ Paul V. LiCalsi

Paul V. LiCalsi
Sherli M. Furst
399 Park Avenue, Suite 3600
New York, NY 10022-4611
Tel.: (212) 980-7400
Fax: (212) 980-7499
PLiCalsi@RobinsKaplan.com
SFurst@RobinsKaplan.com

Attorneys for Defendant

Anton Matsulevich p/k/a Tony Fadd

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