LimeWire Antitrust Claims Against RIAA Dismissed

NewYorkCountryLawyer writes "The antitrust counterclaims imposed by Lime Wire against the RIAA record companies have been dismissed. In a 45-page decision (pdf), the Court relied principally upon the holding of the United States Supreme Court in Bell Atlantic v. Twombly that 'A party's obligation to provide the grounds of his entitlement to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.' Ironically, the Twombly decision was the authority upon which the RIAA's copyright infringement complaint was dismissed in Interscope v. Rodriguez."

Comments

Re:English Please.

[morgan_greywolf]

That means, basically, that the party that's suing or countersuing (LimeWire) has to show reasons why they should get relief (usually money) and that those reason need to be more than just name calling and saying "you owe me money, you owe me money!"

Re:English Please.

[Arnoud Engelfriet]

When you accuse someone of violating a law, you have to show where and how he did that. You usually do this by copy&pasting the text of the statute and explaining how each element applies to what your opponent did. For example, for the cause of action "copyright infringement" you need to prove three elements: (1) your copyright ownership to the work, (2) defendant's access to the work, and (3) similarity with your original. What the court here says is that you have to do more than say "I own the copyright in the work. Defendant had access to it, and what he has published is very similar to my work." That's a formulaic recitation of the elements of a cause of action. Arnoud

Re:Wait, what?

[The Only Druid]

Here's a basic legal summary of why Twombly is the active issue here:

Before Twombly, a case called Conley was the dominant SCOTUS case explaining exactly what standards a Plaintiff's court pleadings must satisfy in order to, in our parlance, "state a claim". In truth, Conley was extremely ambiguous, and for years the courts had decried it as a waste of time and money.

Twombly has now established that pleadings must, as a bare minimum, describe enough alleged facts so that - when the court assumes all of them to be true for the sake of a Motion to Dismiss - the pleadings allege a "plausible" claim. This means it has to be slightly more than "possible": for example, it's possible that I am in fact Bill Gates, but it's simply not plausible

Now, the most practical effect of Twombly in district courts around the country so far (it's an August 2007 decision) has been that it is no longer sufficient to simply say "The defendant did X to me", and then simply list the alleged components of X as defined by law. Instead, plaintiffs now have to allege sufficient facts that move it across that fine line.

Here, the Judge has simply stated that the Plaintiff has filed to properly allege his complaint; this is no different than if the Plaintiff had alleged rape but failed to allege forceful sexual assault.

Re:Wait, what?

[The Only Druid]

You're extremely mistaken: some "lawyer speak", i.e. jargon, is utterly required for the same reason that it's required in engineering, in medicine, etc.

Jargon allows for a specificity that colloquial language simply cannot possess: for example, by having specific meanings of words like "pleadings" or "plausibility", the Courts possess a uniformity across the nation that would be lost if each individual court were permitted to say "well, to me, 'plausible' means X".

Your intuition - that law is complicated - is correct, but you're firmly wrong in light of hundreds of years of debate in philosophy of language. It is firmly settled - with literally no dispute by any philosopher any more - that the specificity of a term is inversely related to the ease of understanding, because the more specific a term is the more collateral information is necessary in order to understand that term's definition. Put simpler, the more narrowly you define a term (e.g. "plausibility" here), the more information any reader must possess in order to understand what is meant by that term.

The side effect of this is that in fields that require a great deal of specificity - e.g. the professions (medicine, law) or the trade fields (engineering, masonry, etc.) - then there is a great deal of collateral information that readers need to understand in order to comprehend what is going on.

from the order

[nomadic]

The notion of "antitrust injury" grew from the recognition that a competitor may be injured not only by prohibited anticompetitive activity, but also by competition itself, and that the antitrust laws were not intended to afford the latter injuries a remedy. See Balaklaw v. Lovell, 14 F.3d 793, 797 (2d Cir. 1994). Antitrust injury, then, simply means "injury of the type the antitrust laws were intended to prevent and that flows from that which makes defendants' acts unlawful." Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc., 429 U.S. 477, 489 (1977); accord Paycom, 467 F.3d at 290. To demonstrate antitrust injury, "a plaintiff must show (1) an injury-in-fact; (2) that has been caused by the violation; and (3) that is the type of injury contemplated by the statute." Blue Tree Hotels Inv., Ltd. v. Starwood Hotels & Resorts Worldwide, Inc., 369 F.3d 212, 220 (2d Cir. 2004). The antitrust injury requirement thus ensures that a "plaintiff can recover only if the loss stems from a competition-reducing aspect or effect of the defendant's behavior." Atlantic Richfield Co. v. USA Petroleum Co., 495 U.S. 328, 344 (1990).
...
As described above, Lime Wire alleges a conspiracy among counter-defendants to fix prices for licenses at both the wholesale and retail levels. At the wholesale level, Lime Wire alleges that counter-defendants used their joint ventures, MusicNet and pressplay, "to effect a price-fixing arrangement among horizontal competitors" (FAC 36) -- i.e., among the record companies themselves.14 Although such a horizontal price-fixing arrangement is per se unlawful under 1 of the Sherman Act, see Leegin Creative Leather Prods. v. PSKS, Inc., ___ U.S. ___,Lime Wire has not established that it suffered injury-in-fact as a Case 1:06-cv-05936-GEL Document 51 Filed 12/03/2007 Page 14 of 45 omitted). "Restraints that are per se unlawful include horizontal agreements among competitors to fix prices or to divide markets." Id. (citations omitted). Although Lime Wire asserts in 16 its memorandum of law in opposition to the motion to dismiss that counter-defendants have "all refused to grant [Lime Wire] licenses to their catalogs of recorded music even at . . . artificially high prices" (Counter-P. Mem. 6), this allegation does not appear in the FAC itself, and thus cannot be considered by the Court in evaluating counterdefendants' motion to dismiss. See Brass v. Am. Film Techs., Inc., 987 F.2d 142, 150 (2d Cir. 1993) (noting that on motion to dismiss, consideration of factual allegations is limited to those allegations contained in complaint). 15 result of counter-defendants' purported arrangement. See Atlantic Richfield, 495 U.S. at 342 (noting that the "per se rule is a method of determining whether 1 of the Sherman Act has been violated, but it does not indicate whether a private plaintiff has suffered antitrust injury").

Although Lime Wire "actively solicited licensed content" from "independent labels and artists" and "independent retailers/distributors" (FAC 44), the FAC contains no allegation that Lime Wire ever attempted to obtain or purchase a license from any of the counter-defendants or their respective joint ventures.16 Lime Wire's retail competitors may have "faced excessive wholesale prices" for licenses as a result of the alleged price-fixing scheme (id. 36), but Lime Wire itself has not alleged any facts demonstrating that it suffered such harm. Although Lime Wire's attempt to obtain hashes from counter-defendants suggests that it intended eventually to obtain licenses from them, nothing in Lime Wire's pleading indicates that it has, in fact, sought (or imminently will seek) such licenses from counter-defendants. Accordingly, Lime Wire cannot claim that it has suffered injury-in-fact as a result of counter-defendants' wholesale pricefixing scheme.