Rearden LLC v. The Walt Disney Company
- Jon Tigar
- 4:17-cv-04006
- U.S. District Court · Northern District of California
- 5
In Rearden LLC v. Disney, Judge Tigar granted reconsideration, allowing lost-profits testimony and denying Disney’s jury-demand motion as moot.
Rearden LLC and MOVA LLC may present Cindy Ievers’s testimony and pursue their actual-damages claim under Copyright Act Section 504(b). Disney’s motion to strike Rearden’s jury demand was denied as moot.
What happened
In Rearden LLC v. The Walt Disney Company, Rearden asked the court to reconsider its earlier order excluding Cindy Ievers’s testimony about actual damages. The earlier ruling also granted Disney summary judgment on Rearden’s claim for actual damages because, without Ievers’s testimony, Rearden had not identified supporting evidence.
The court concluded that its earlier ruling was legally incorrect. It held that Copyright Act Section 504(b) does not require every actual-damages calculation to use a willing-buyer-and-willing-seller analysis. Lost profits can be an acceptable measure of actual damages, and whether certain additional MOVA services were part of the technology’s value was a question for the jury.
Judge Jon S. Tigar granted Rearden’s motion for reconsideration, allowing Ievers to testify about Rearden’s lost-profits claim and allowing Rearden to pursue actual damages. The court denied Disney’s motion to strike Rearden’s jury demand as moot.
The detailed version
- Rearden LLC v. The Walt Disney Company · No. 4:17-cv-04006
- Jon Tigar
- Nov. 29, 2023
Background
Rearden LLC and MOVA LLC moved for reconsideration of the court’s October 20, 2023 order excluding Cindy Ievers’s testimony. Ievers was Rearden LLC’s Vice President of Finance and Rearden’s expert witness on actual damages. The earlier order also granted Disney summary judgment on Rearden’s actual-damages claim because, without Ievers’s testimony, Rearden had not identified evidence supporting its actual-damages demand.
Disney separately moved to strike Rearden’s demand for a jury trial on its remaining claim for disgorgement. The court had granted Rearden leave to file its reconsideration motion.
Legal standard
The court described reconsideration as an extraordinary remedy. Under Federal Rule of Civil Procedure 59(e), reconsideration may be appropriate when there is newly discovered evidence, clear error or manifest injustice, or an intervening change in controlling law. Rule 60(b) provides other limited grounds for relief, including mistake, newly discovered evidence, fraud, a void judgment, satisfaction of the judgment, or extraordinary circumstances.
Analysis
The court concluded that its earlier order was erroneous because it had treated the willing-buyer-and-willing-seller method as a requirement for every form of actual damages under Section 504(b) of the Copyright Act. The court explained that actual damages may include profits lost because of infringement or the value of the copyrighted work’s use to the infringer. Section 504(b) requires actual damages to result from the infringement and recoverable profits to be attributable to it, but it does not make fair-market-value analysis the only possible damages measure.
The court distinguished lost-profits damages from hypothetical-license damages. A hypothetical-license calculation may require asking what a willing buyer would have paid a willing seller, but that requirement does not apply to every actual-damages theory. The court also concluded that the earlier order was wrong to exclude Ievers’s testimony because her estimates included compensation for services that might have been non-infringing. Ievers derived the services and prices from evidence concerning MOVA services performed during production and from rate cards used by Rearden and DD3. Whether those services were an integral part of the value of the MOVA technology was for the jury to decide.
Ruling
Judge Jon S. Tigar granted Rearden’s motion for reconsideration. Because Ievers would be allowed to testify about Rearden’s lost-profits claim, the court stated that Rearden could pursue its legal claim for actual damages under Section 504(b). The court denied Disney’s motion to strike Rearden’s jury demand as moot.
Read the full 5-page opinion on CourtListener, the free public archive maintained by the Free Law Project.