Beijing Meishe Network Technology Co., Ltd. v. TikTok Inc.

Background

Meishe alleged that defendants copied parts of its video- and audio-editing software into TikTok and other applications. It also alleged that a former Meishe engineer, Jing Xie, accessed and copied Meishe source code before joining ByteDance. Meishe asserted copyright infringement, misappropriation of trade secrets under the federal Defend Trade Secrets Act and Texas law, and Lanham Act claims for false designation of origin and false advertising. The motion concerned Meishe’s third amended complaint and was decided under Rule 12(b)(6), which requires dismissal when a complaint does not state a legally sufficient claim.

Copyright claims

The court dismissed the copyright claims concerning unregistered works because Meishe did not identify specifically what source code or software defendants allegedly copied. The court also dismissed claims concerning works completed after Xie left Meishe because the complaint did not plausibly allege that defendants had access to those works. For all asserted works, Meishe also failed to allege facts showing that the works were not “United States works,” which was relevant to whether registration with the U.S. Copyright Office was required. These dismissals were with leave to amend. The court found Meishe’s allegations of substantial similarity sufficient at the pleading stage once the complaint identifies the works more specifically. It denied the motion as to Meishe’s contributory and induced copyright-infringement theory, which alleged that defendants knowingly encouraged TikTok users’ infringement.

The court separately dismissed Meishe’s claim under section 1202 of the Digital Millennium Copyright Act, which concerns false, removed, or altered copyright-management information. The allegations merely repeated the legal requirements and did not identify the affected code, the information allegedly removed or altered, how information was distributed, or facts supporting the required mental state. The dismissal was with leave to amend.

Trade-secret claims

The court found sufficiently particular Meishe’s allegations that its trade secrets included independently developed source code for specified video- and audio-related functions, as well as information about which software features would likely be popular. But the court dismissed the claims with leave to amend to the extent they relied on unspecified “other confidential business information” or other trade-secret information allegedly provided by Xie. The court also dismissed the federal trade-secret claim against defendants not organized under U.S. law because Meishe did not allege what acts furthering the alleged offense occurred in the United States. The court allowed amendment to add those facts.

Lanham Act claims

The court dismissed without leave to amend the Lanham Act section 43(a)(1)(A) claim. It held that Meishe’s theory—that defendants copied its source code, incorporated it into TikTok, and presented TikTok as their own product—was a reverse-passing-off claim that was not cognizable under the cited case law. The court dismissed the section 43(a)(1)(B) false-advertising claim with leave to amend because Meishe had not adequately alleged that the cited statements appeared in commercial advertising or promotion or were likely to influence consumers’ purchasing decisions.

Disposition

Judge Susan Illston granted in part and denied in part defendants’ renewed motion to dismiss. The court granted the motion as to the specified copyright, Digital Millennium Copyright Act, trade-secret, and Lanham Act claims, generally with leave to amend, except that the section 43(a)(1)(A) Lanham Act claim was dismissed without leave to amend. The court denied the motion as to the contributory and induced copyright-infringement claim. Meishe was ordered to file a fourth amended complaint by May 14, 2024.