Ultra International Music Publishing, LLC v. Sony Music Entertainment

Background

Ultra International Music Publishing, LLC and Ultra Music Publishing Europe AG sued Sony Music Entertainment, Ultra Records, LLC, and fourteen other corporate defendants. Plaintiffs alleged that the defendants continued to upload, sell, and synchronize copyrighted sound recordings without authorization after an audit allegedly uncovered royalty underpayments and nonpayments. The complaint asserted direct copyright infringement against all defendants, vicarious copyright infringement against Sony Music Entertainment, and tortious interference with contractual relations against Sony and two foreign defendants. Plaintiffs sought at least $20 million in damages.

Plaintiffs served Sony and Ultra Records but had not served the fourteen foreign defendants. They moved for permission to serve those defendants by email and/or messages to social-media accounts. The foreign defendants were alleged to be organized under the laws of the United Kingdom, Germany, Australia, Italy, France, Sweden, and Switzerland. Plaintiffs acknowledged that each of those countries is a party to the Hague Convention on service abroad.

Sony’s Opposition

The court held that Sony could not oppose the service motion on behalf of the foreign defendants because a co-defendant generally may not assert improper-service objections for another defendant. But the court exercised its discretion to consider Sony’s filing as a submission similar to a friend-of-the-court brief. The foreign defendants had not appeared or submitted briefing, so Sony’s filing provided arguments that were otherwise unavailable to the court. The court also considered declarations submitted by Sony’s counsel.

Legal Standard

Federal Rule of Civil Procedure 4(h)(2) allows a foreign corporation outside a federal judicial district to be served through methods available under Rule 4(f), subject to an exception not relevant here. Rule 4(f)(3) permits service by another method that is not prohibited by an international agreement and that the court orders. The court explained that Rule 4(f)(3) is not necessarily a last resort, but courts in the Southern District of New York generally require a plaintiff to show both that it reasonably attempted service through other means and that court intervention is necessary.

Any alternative method must also satisfy due process, meaning it must be reasonably calculated to inform the defendant about the lawsuit and give the defendant an opportunity to respond.

Reasons for Denial

The court found that plaintiffs had made no attempt to serve the foreign defendants through the Hague Convention or other conventional methods. Plaintiffs did not claim that they lacked service addresses, would have difficulty identifying the defendants, or expected the foreign countries to refuse cooperation. The court noted that physical addresses for most defendants appeared on websites that plaintiffs had used to obtain email addresses and other information.

The court rejected plaintiffs’ argument that Hague Convention service was “untenable” because it would be expensive, time-consuming, and slow. Plaintiffs later submitted information estimating that service would take between two months and one year, depending on the country, and would cost about $9,100 plus approximately $2,944 for translations. Even considering that information, the court found the estimates inadequately supported and not unusually long. It also found the approximately $12,000 total cost modest in the context of this commercial lawsuit.

The court further rejected plaintiffs’ claim that asking Sony’s lawyers to accept service for the foreign defendants was a reasonable attempt to serve them. Sony had no obligation to waive service or accept service for other defendants. The court also rejected plaintiffs’ argument that allegations involving counterfeiting or fraud automatically permit alternative service without a prior Hague Convention attempt; the cases plaintiffs cited involved businesses with no genuine or identifiable physical address or no other reliable service method, circumstances plaintiffs had not shown here.

Disposition

The court concluded that plaintiffs failed to satisfy the threshold requirements for alternative service under Rule 4(f)(3). It therefore denied plaintiffs’ motion for alternative means of service. The court did not decide whether email or social-media service was permitted under the Hague Convention, whether those methods would satisfy due process, or whether Sony had a sufficiently close relationship with the foreign defendants to accept service for them.