Moonbug Entertainment Limited v. Babybus Network Technology Co., Ltd

Background

On July 27, 2023, a jury found that Babybus infringed Moonbug’s registered copyrights involving Cocomelon’s JJ character, family characters, and animal characters in 36 of 39 works at issue. The jury also found Babybus liable for copyright infringement and misrepresentation under Section 512(f) of the Digital Millennium Copyright Act. On October 30, 2023, the court entered judgment for Moonbug for $17,718,114. The court later issued a writ of execution for $17,908,246.35, with daily interest of $2,640.72. The court denied Babybus’s motion for a new trial and for judgment as a matter of law.

Moonbug previously sought an assignment of assets and a restraining order, but the court denied that motion without prejudice. Moonbug then filed the emergency motion decided here.

Assignment of payments

Federal Rule of Civil Procedure 69(a)(1) requires federal courts to follow state procedures for enforcing judgments. The court applied California Code of Civil Procedure section 708.510, which permits a judgment creditor to ask for an order requiring a judgment debtor to assign all or part of a right to payment that is due or may become due.

The court explained that an assignment is available when the creditor identifies a person or entity obligated to pay the judgment debtor and shows that the payment right is assignable. The creditor must describe the payment source sufficiently for the debtor to oppose the request, but detailed evidence is not required. Future payments must have some concrete basis rather than being merely hypothetical.

The court found sufficient evidence concerning Babybus content on YouTube, Apple, Google, Spotify, Amazon, Pandora, and The Roku Channel. It also found sufficient evidence concerning PayPal because Babybus’s website directed VIP payments for Baby Panda World through PayPal. Financial records showed prior payments or accounts receivable involving Japan Babybus Co., Ltd., Beijing Baidu Netcom Science and Technology Co., Ltd., Shenzhen Tencent Computer System Co., Ltd., IRONSOURCE, Beijing Yulotong Network Technology Co., Ltd., and other identified entities. The court found that this history provided enough concreteness to support an assignment of possible continuing revenues.

The court also found sufficient evidence concerning licensing or platform relationships involving iQiyi, Toutiao Pangolin, Youku, Himalaya, Sohu, MangoTV, Wasu TV, LeTV, and PPTV. It concluded that the evidence reasonably supported expected payments for the use or distribution of Babybus’s intellectual property.

The court did not order assignments involving Instagram or Facebook because evidence that Babybus maintained accounts on those services did not by itself show that either service owed money to Babybus. It also did not extend the assignment to Singapore Babybus Pte. Ltd. because identifying that entity as a Babybus subsidiary did not establish an assignable payment owed to Babybus. Finally, the information concerning Fuzhou Zhi Yong Information Technology Co., Ltd. did not clearly show a source of revenue owed to Babybus.

The court ordered an assignment to Moonbug of Babybus’s rights to payments from Japan Babybus Co., Ltd., YouTube, Apple, Google, PayPal, Spotify, Amazon, Pandora, Baidu, The Roku Channel, Tencent, iQiyi, Toutiao Pangolin, Youku, Himalaya, Sohu, MangoTV, Wasu TV, LeTV, PPTV, ironSource Ltd., and Beijing Youletong Network Technology Co.

Restraining order

Because the court ordered the assignment and found that Babybus had not paid the judgment, the court concluded that a restraining order was appropriate. The order prevents Babybus from further assigning rights to payments from Japan Babybus Co., Ltd., Apple, Google, PayPal, Spotify, Amazon, Pandora, Baidu, The Roku Channel, Tencent, iQiyi, Toutiao Pangolin, Youku, Himalaya, Sohu, MangoTV, Wasu TV, LeTV, PPTV, ironSource Ltd., and Beijing Youletong Network Technology Co. The court also ordered that Babybus not change the account names or reassign the rights connected with the accounts or platforms covered by the order.

Disposition

Judge Edward M. Chen ordered the assignment and restraining order. The conclusion states that Moonbug’s motion for assignment and a restraining order was granted as to the third-party obligors identified in the order.