Actava TV, Inc. v. Joint Stock Company "Channel One Russia Worldwide"

Background

Actava TV, Inc., Master Call Communications, Inc., Master Call Corporation, and Rouslan Tsoutiev sued Joint Stock Company "Channel One Russia Worldwide," several other entities identified in the opinion as the Channels, and Kartina Digital GmbH. The claims included malicious prosecution, tortious interference, breach of contract, and unfair competition under New York law. The Defendants also asserted counterclaims, including breach of contract.

The opinion addressed the Defendants’ remaining amended counterclaim. That counterclaim alleged that Plaintiffs breached Paragraph 4 of an April 2016 settlement agreement by failing to disclose every source of the signal or other data used to copy and stream television broadcasts through the Actava Website. Paragraph 4 required disclosure of the Source within 24 hours after entry of specified orders. The agreement stated that failing to provide the information would allow Plaintiffs to declare the agreement void, retain the settlement amount as liquidated damages, and seek to reinstate the earlier actions.

Plaintiffs’ counsel sent the Channels information identifying MHCOM GmbH as the source, including sample invoices and contact information. The Channels’ counsel later responded that the information was satisfactory. In February 2021, Channel One sent a “Third Notice of Breach,” asserting that Plaintiffs had failed to identify other sources. Defendants later relied on discovery testimony to argue that Plaintiffs had used multiple sources.

Legal Issue and Analysis

The parties cross-moved for summary judgment. Summary judgment is a decision entered when the evidence shows that no genuine dispute over an important fact requires a trial and one party is entitled to judgment under the law.

The court held that the amended counterclaim was governed by New York’s six-year statute of limitations for breach-of-contract claims. Because Plaintiffs were required to identify the sources by April 26, 2016, the court concluded that Defendants needed to bring the claim by April 26, 2022.

Defendants argued that the February 17, 2021 Third Notice of Breach preserved or extended the limitations period because it put Plaintiffs on notice of the alleged failure to identify additional sources. The court rejected that argument. It explained that the cases Defendants cited concerned proposed amended complaints and notice of new claims through the filing of a motion to amend or an attached proposed pleading. The Third Notice of Breach was not a proposed amended counterclaim, did not provide equivalent notice that Defendants would bring this particular counterclaim, and referred to additional claims that were not ultimately asserted. The court therefore ruled that the amended counterclaim was untimely.

Disposition

Plaintiffs’ motion for summary judgment was GRANTED, and Defendants’ motion for summary judgment was DENIED. The opinion states that the remaining claims in the action shall proceed. It also directed the Clerk of Court to vacate the March 31, 2025 judgment after entry of the amended opinion and order. The amended opinion superseded the court’s earlier opinion and order because that earlier order had inadvertently directed entry of judgment and closure of the case.