Defendants Motion to Dismiss (Filed June 1, 2010)

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Lewis and Roca LLP3993 Howard Hughes Parkway

Suite 600Las Vegas, Nevada 89169

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Michael J. McCue (NV Bar No. 6055)Jonathan W. Fountain (NV Bar No. 10351)LEWIS AND ROCA LLP3993 Howard Hughes Pkwy., Suite 600Las Vegas, Nevada 89169Telephone: (702) 949-8200Facsimile: (702) 949-8298

Attorneys for DefendantMAJORWAGER.COM, INC.

UNITED STATES DISTRICT COURT

DISTRICT OF NEVADA

RIGHTHAVEN, LLC, a Nevada limited liability company,

Plaintiff,

vs.

MAJORWAGER.COM, INC., a Canadian corporation,

Defendant.

Case No. 2:10-cv-00484-RCJ-LRL

DEFENDANT’S MOTION TO DISMISS

Pursuant to Federal Rule of Civil Procedure 12(b)(1), 12(b)(2), and 12(b)(6), Defendant

MAJORWAGER.COM, INC., (“Defendant” and/or “MajorWager”), hereby moves the Court to

dismiss this action for lack of subject matter jurisdiction, lack of personal jurisdiction, and for

failure to state a claim upon which relief can be granted. This motion is supported by the

accompanying declarations of Russ Hawkins (the “Hawkins Decl.”) and Jonathan W. Fountain

(the “Fountain Decl.”), the exhibits attached thereto, and any oral argument the Court may allow.

PRELIMINARY STATEMENT

MajorWager operates an Internet website devoted to providing information of general

interest to a worldwide audience of persons interested in sports, sports betting, and a variety of

both related and unrelated topics. This case is based upon nothing more than the posting of a

single1 article from the Las Vegas Review Journal within the “forums” section of MajorWager’s

1 While Plaintiff has attached several articles to the Complaint that it claims were posted on Defendant’s website, the Complaint only alleges that a single article (the “Work”) has been infringed. The Work is entitled “March to book begins,” and is attached to the Complaint as Exhibit 14.

Case 2:10-cv-00484-GMN-LRL Document 8 Filed 06/01/10 Page 1 of 18

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website. While this case masquerades as a legitimate copyright dispute, in reality, it is arguably

frivolous and nothing more than a thinly disguised shakedown. Plaintiff Righthaven, LLC

(“Plaintiff” and/or “Righthaven”) knows that the costs of defending this action will far outweigh

the value of this case, and is seeking to extract a settlement under the threat of protracted litigation

and expense.

Neither the federal courts nor the Federal Rules of Civil Procedure were established for

this purpose. That being said, the Court need not facilitate Plaintiff’s scheme. As set forth more

fully below, this action should be dismissed for three very legitimate reasons. First, Plaintiff has

not alleged that it owned the copyrights at issue at the time of the alleged infringement. Absent

any such allegation or showing, Plaintiff lacks standing to sue and the Court lacks subject matter

jurisdiction. Second, Plaintiff’s conclusory allegations fail to allege a plausible case for the

exercise of personal jurisdiction over MajorWager -- a Canadian corporation located in Canada --

that has not had any significant contact with Nevada or purposefully directed any tortious conduct

at Nevada or its residents. Third, the Complaint fails to state a claim upon which relief can be

granted because the copyright laws do not apply extraterritorially and the Complaint does not

allege any act of infringement occurring in the United States.

LEGAL STANDARD

When ruling on a motion to dismiss, it is well established that the Court need only accept as

true uncontroverted allegations of fact. See Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949-50, 173 L. Ed.

2d 868 (2009); Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555-57, 127 S. Ct. 1955, 167 L. Ed.

2d 929 (2007). Thus, courts considering a motion to dismiss should “begin by identifying

pleadings that, because they are no more than conclusions, are not entitled to the assumption of

truth[;] [w]hile legal conclusions can provide the framework of a complaint, they must be supported

by factual allegations.” Iqbal, 129 S. Ct. at 1940. These pleading standards govern jurisdictional

allegations as well. See, e.g., Watkins v. Kajima Int’l, No. 3:08-0426, 2009 WL 3053856, at *6

(M.D. Tenn. Sept. 18, 2009) (conclusory pleading of personal jurisdiction was deficient under

Twombly). Thus, on a motion to dismiss for lack of personal jurisdiction, the plaintiff must make a

prima facie showing of facts, through its pleadings and affidavits, that demonstrate it would be


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plausible for the court to constitutionally exercise personal jurisdiction over the defendant. See id.;

Myers v. Bennett Law Offices, 238 F.3d 1068, 1071 (9th Cir. 2001). In ruling on the motion, only

uncontroverted allegations must be accepted as true. See AT&T v. Compagnie Bruxelles Lambert,

94 F.3d 586, 588 (9th Cir. 1996). Thus, the court need not assume the truth of allegations

contradicted by affidavit. Data Disc, Inc. v. Systems Tech. Assocs., Inc., 557 F.2d 1280, 1284 (9th

Cir. 1977). However, in the absence of an evidentiary hearing, conflicts in the parties’ affidavits

are resolved in the plaintiff’s favor. AT&T, 94 F.3d at 588-89.

ARGUMENT

I. RIGHTHAVEN DOES NOT HAVE STANDING TO SUE (AND THE COURT LACKS SUBJECT MATTER JURISDICTION) BECAUSE RIGHTHAVEN HAS FAILED TO ALLEGE THAT IT OWNED THE COPYRIGHTS AT ISSUE AT THE TIME OF THE ALLEGED INFRINGEMENT.

While “[t]he legal or beneficial owner of an exclusive right under a copyright is entitled to

bring actions for infringements of that right occurring during the period of its ownership,”

ABKCO Music, Inc. v. Harrisongs Music, Ltd., 944 F.2d 971, 980 (2d Cir. 1991), a plaintiff who

fails to show ownership of a valid copyright at the time of infringement lacks standing to sue

for any infringement that occurred prior to its ownership of those rights. See Silvers v. Sony

Pictures Entm’t, Inc., 402 F.3d 881, 885 (9th Cir. 2005) (“in order for a plaintiff to be ‘entitled . . .

to institute an action’ for infringement, the infringement must be ‘committed while he or she is the

owner of’ the particular exclusive right allegedly infringed.”). “Standing to assert a copyright

claim is a jurisdictional requirement, and the Court must dismiss an action for lack of subject

matter jurisdiction if it determines the plaintiff lacks standing.” Giddings v. Vision House

Production, Inc., 584 F. Supp. 2d 1222, 1229 (D. Ariz. 2008) (citing Lewis v. Casey, 518 U.S.

343, 349 n.1 (1996)). Here, the Court lacks subject matter jurisdiction and should dismiss this

case because Righthaven has failed to allege or otherwise demonstrate that it was the owner of the

copyrights at issue at the time of the alleged infringement.

The Complaint alleges that Righthaven is the owner of the copyrights in “March to book

begins” (the “Work”). (Compl. ¶ 54.) The Complaint further alleges that: “No later than March

18, 2010, MajorWager reproduced an unauthorized copy of the Work . . . on MajorWager’s


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Website.” (Compl. ¶ 60.) (Emphasis added.) The Complaint, however, does not allege that

Righthaven was the owner of the copyrights at the time of the alleged infringement.

Even worse, it appears that Righhaven was not, in fact, the copyright owner at the time of

the alleged infringement. Each of the articles attached to the Complaint (including the Work) bear

a copyright notice. In every case, the notice states: “Copyright © Las Vegas Review-Journal.”

The Las Vegas Review-Journal is the most widely published newspaper in Clark County, Nevada.

It is owned and operated by Stephens Media, LLC, who has registered the name “Las Vegas

Review-Journal” as a fictitious firm name in Clark County, Nevada. (See Ex. A to Fountain Decl.,

LVRJ FFN Filing.) Copyrights vest in the author of a work when the work is first fixed into

tangible form. See Community for Creative Non-Violence v. Reid, 490 U.S. 730, 737, 109 S. Ct.

2166, 2171, 104 L. Ed. 2d 811, 822 (1989); 17 U.S.C. § 201(a). If the author is an employee, the

employer will own the work under the “work for hire” doctrine. Id. Here, the Work is dated

March 18, 2010, and contains the statement “By Matt Youmans” underneath the title. Thus, it

appears that the Work was written by Mr. Youmans as an employee of Stephens Media LLC.

Under the “work for hire” doctrine Stephens Media LLC was the author of the work, and,

therefore, was the initial owner of all copyrights in the Work. This analysis is consistent with

Righthaven’s Exhibit 15. It states that, at the time the copyright application was filed, Stephens

Media LLC was the author of the Work. It also states that Righthaven succeeded to the copyrights

in the Work as a result of “Transfer: By written agreement,” but does not give a date when the

alleged transfer occurred. While copyrights may be assigned, and while Stephens Media LLC

may have, in fact, assigned its copyrights to Righthaven, there is no allegation that Stephens

Media LLC did so on or prior to March 18, 2010, the date of the alleged infringement.

Because Righthaven was not the owner of the copyrights in the Work on the date of the

alleged infringement, March 18, 2010, it does not have standing to sue, the Court lacks subject

matter jurisdiction, and the Complaint must be dismissed.

///

///

///


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II. PLAINTIFF’S CONCLUSORY ALLEGATIONS CANNOT BE AFFORDED THE PRESUMPTION OF TRUTH; PLAINTIFF HAS FAILED TO ALLEGE A PRIMA FACIE CASE FOR THE EXERCISE OF PERSONAL JURISDICTION.

A. The Law of Personal Jurisdiction.

When a case involves a federal question and out-of-state defendants, federal courts apply

the personal jurisdiction law of the forum state if the applicable federal statute does not provide for

national service of process. See, e.g., Seltzer Sister Bottling Co. v. Source Perrier S.A., No. C-90-

1468 MHP, 1991 WL 279273, at *2 (N.D. Cal. May 1, 1991). In this case, the Complaint purports

to allege a cause of action for copyright infringement against a Canadian defendant. Because the

Copyright Act does not provide for nationwide service of process, Nevada’s law of personal

jurisdiction (i.e., Nevada’s long arm statute) applies. Nevada’s long arm statute is coextensive

with the due process principles of the United States Constitution. See Kumarelas v. Kumarelas,

16 F. Supp. 2d 1249, 1253 (D. Nev. 1998); Nev. Rev. Stat. § 14.065(1) (“A court of this state may

exercise jurisdiction over a party to a civil action on any basis not inconsistent with the

constitution of this state or the Constitution of the United States”). Thus, a non-resident party is

only subject to personal jurisdiction in Nevada if exercising jurisdiction comports with federal

Constitutional due process requirements. See Cybersell, Inc. v. Cybersell, Inc., 130 F.3d 414, 416

(9th Cir. 1997).

Under federal due process requirements, a court may exercise personal jurisdiction over a

defendant where the defendant has “minimum contacts” with the forum such that the maintenance

of the suit “would not offend traditional notions of fair play and substantial justice.” Int’l Shoe

Co. v. Washington, 326 U.S. 310, 316, 66 S. Ct. 154, 158, 90 L. Ed. 95, 102 (1945). The

requirement of minimum contacts means that “there [must] be some act by which the defendant

purposefully avails itself of the privilege of conducting activities within the forum state, thus

invoking the benefits and protections of its laws,” Hanson v. Denckla, 357 U.S. 235, 253, 78 S. Ct.

1228, 1240, 2 L. Ed. 2d 1283, 1298 (1958) (emphasis added), such that the defendant “should

reasonably anticipate being haled into court” there. World-Wide Volkswagen Corp. v. Woodson,

444 U.S. 286, 295-96, 100 S. Ct. 559, 566-67, 62 L. Ed. 2d 490, 500-01 (1980).

In International Shoe Company v. Washington, the United States Supreme Court


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established a two-prong test to determine whether the exercise of personal jurisdiction over a

particular defendant comports with due process. Under the first prong of the test, the defendant

must have “minimum contacts” with the forum state. 326 U.S. at 316, 66 S. Ct. at 158, 90 L. Ed.

at 102. A defendant’s forum contacts can be either “general” or “specific,” giving rise to either

“general” personal jurisdiction or “specific” personal jurisdiction. See Helicopteros Nacionales de

Colombia, S.A. v. Hall, 466 U.S. 408, 414-16, 104 S. Ct. 1868, 1872-73, 80 L. Ed. 2d 404, 411-12

(1984). A court may have “general” personal jurisdiction over any cause of action alleged against

the defendant -- even causes of action unrelated to the defendant’s forum contacts -- so long as the

defendant has maintained “continuous and systematic” contacts with the forum state that

“approximate [a] physical presence” there. See id., 466 U.S. at 415-16, 104 S. Ct. at 1872-73, 80

L. Ed. 2d at 411-12; Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 801 (9th Cir.

2004). In contrast, a court may have “specific” personal jurisdiction over only those causes of

action that “arise” from the defendant’s contacts with the forum state. See id. at 414 n.8, 104 S.

Ct. at 1872 n.8, 80 L. Ed. 2d at 411 n.8.

Under the second prong of the International Shoe due process test, once the plaintiff has

established that the defendant has “minimum contacts” with the forum, the defendant may defeat

the Court’s assertion of personal jurisdiction by demonstrating that other considerations render the

exercise of jurisdiction so unreasonable as to violate constitutional notions of “fair play and

substantial justice.” See Burger King Corp. v. Rudzewicz, 471 U.S. 462, 476-77, 105 S. Ct. 2174,

2184-85, 85 L. Ed. 2d 528, 543 (1985) (“[o]nce it has been decided that a defendant purposefully

established minimum contacts within the forum State, these contacts may be considered in light of

other factors to determine whether the assertion of personal jurisdiction would comport with ‘fair

play and substantial justice’”). Those considerations include: (1) “the burden on the defendant;”

(2) “the forum State’s interest in adjudicating the dispute;” (3) “the plaintiff’s interest in obtaining

convenient and effective relief;” (4) “the interstate judicial system’s interest in obtaining the most

efficient resolution of controversies;” and (5) the “shared interest of the several States in furthering

fundamental substantive social policies.” Burger King Corp., 471 U.S. at 477, 105 S. Ct. at 2184,

85 L. Ed. 2d at 543 (quoting World-Wide Volkswagen Corp., 444 U.S. at 292, 105 S. Ct. at 564, 62


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L. Ed. 2d at 498)).

B. The Complaint Fails to Allege a Plausible, Prima Facie, Case for the Exercise of General Personal Jurisdiction Over MajorWager.

The standard for exercising general personal jurisdiction is an exacting one. It is “fairly

high.” Brand v. Menlove Dodge, 796 F.2d 1070, 7073 (9th Cir. 1986). This is so “because a

finding of general jurisdiction permits a defendant to be haled into court in the forum state to

answer for any of its activities [occurring] anywhere in the world.” Schwarzenegger, 374 F.3d at

801. (Emphasis added.) In determining whether to exercise general personal jurisdiction, Courts

in the Ninth Circuit consider the following factors: “whether the defendant makes sales, solicits or

engages in business in the state, serves the state’s markets, designates an agent for service of

process, holds a license, or is incorporated there.” Bancroft & Masters, Inc. v. Augusta Nat’l Inc.,

223 F.3d 1082, 1086 (9th Cir. 2000). Here, MajorWager has had no contact with the State of

Nevada, let alone “continuous and systematic” contacts and none of the Bancroft factors are

satisfied.

The first Bancroft factor considers whether the defendant makes sales or solicits or

engages in business in the state; the second considers whether the defendant “serves the state’s

markets.” Bancroft, 223 F.3d at 1086. Neither of these factors are satisfied. MajorWager has

never conducted any business activity in Nevada. (See Hawkins Decl. ¶ 6a.) It has never sold any

good or service from a location within Nevada to any person or entity. (Id.) It has never sold any

good or service from a location outside of Nevada to any person or entity located inside of

Nevada. (Id.) It has never solicited Nevada residents for the sale of any good or service. (Id.) It

has never entered into any partnership or joint ventures with any person or entity located in

Nevada. (Id.) It has never entered into any contract with any person or entity located in the State

of Nevada. (Id.) It has never served any Nevada market. (Id.) And it has never purchased any

good or service from any person or entity located in Nevada. (Id.) In addition, MajorWager has

never directed any advertising or other conduct at or into Nevada. (See Hawkins Decl. ¶ 6b.) It

has never advertised on billboards located in Nevada. (Id.) It has never run ads in publications

circulated in Nevada. (Id.) And it has not broadcast advertisements via television or radio into


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Nevada. (Id.) It has never sent any marketing materials, such as email ads or direct mail ads into

Nevada. (Id.) Nor has it ever advertised any employment opportunity in Nevada. (Id.) While

MajorWager does obtain some revenue from third parties who advertise on its website, these

advertisements are, and have at all times been, directed to a worldwide audience. (Id.) None of

them have been directed specifically at Nevada residents. (Id.) The third Bancroft factor

considers whether the defendant has appointed a registered agent to receive service of process in

the forum. Bancroft, 223 F.3d at 1086. MajorWager has never sought or received authorization to

conduct business in Nevada and has never appointed a registered agent to accept service of

process for it in Nevada. (See Hawkins Decl. ¶ 6c.) The fourth Bancroft considers whether the

defendant holds a license in the forum. Bancroft, 223 F.3d at 1086. MajorWager has never

owned or possessed any license issued by the State or Nevada or by any political subdivision of

the State of Nevada, including, but not limited to, any business license, trademark, or fictitious

firm name. (See Hawkins Decl. ¶ 6c.) The fifth Bancroft factor considers whether the defendant

is incorporated in the forum state. Bancroft, 223 F.3d at 1086. MajorWager has never existed as a

Nevada corporation or any other form of business entity organized under Nevada law. (See

Hawkins Decl. ¶ 6c.) None of the Bancroft factors are satisfied.

Moreover, in addition to the Bancroft factors, other facts weigh heavily against a

conclusion that MajorWager has “continuous and systematic” contacts with Nevada tantamount to

a physical presence. MajorWager has never had a physical presence in the State of Nevada. (See

Hawkins Decl. ¶ 6d.) It has never had any directors, officers, or employees located in Nevada.

(Id.) It has never owned, leased, possessed, operated, or occupied any office, storefront, or other

real estate located in Nevada. (Id.) It has never owned, leased, or possessed any personal property

located in Nevada. (Id.) It does not own or maintain any bank accounts at any bank located in the

State of Nevada. (Id.) Its sole director, officer, and employee, Russ Hawkins has never travelled

to Nevada to conduct business on its behalf and has never travelled to Nevada to attend a trade

show on its behalf or in connection with its business. (Id.)

Furthermore, Plaintiff’s allegations of “continuous and systematic” contacts with Nevada

are insufficient for the Court to constitutionally exercise general personal jurisdiction over


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MajorWager. The Complaint alleges that: “MajorWager’s contacts with Nevada are continuous

and systematic because MajorWager continually publishes, on a near-daily basis, content

emanating from Nevada, originally published in daily newspapers published in Las Vegas.”

(Compl. ¶ 49.) MajorWager disputes the truth of this allegation. (See Hawkins Decl. ¶ 7.)

Because MajorWager disputes this allegation its truth cannot be assumed. See AT&T, 94 F.3d at

588 (only uncontroverted allegations must be accepted as true); Data Disc, Inc., 557 F.2d at 1284

(the court need not assume the truth of allegations contradicted by affidavit). However, even

assuming the truth of this allegation (solely for purposes of argument) posting articles on a website

-- even on a near-daily basis -- does not amount to the extensive degree of contact required to

allow a Nevada court to constitutionally exercise jurisdiction over MajorWager for any cause of

action whatsoever, even those unrelated to contact with Nevada.

MajorWager’s website is informational in nature and is, at best, only minimally interactive.

(See Hawkins Decl. ¶ 4.) It provides information of general interest to a worldwide audience of

persons interested in sports and sports wagering. (Id.) It allows visitors who complete a

registration process to post messages within a variety of discussion forums. (Id.) However,

MajorWager does not sell any goods or services through the website. (Id.) It is by far much less

interactive than the highly interactive websites operated by Las Vegas hotel-casinos that allow

visitors to make hotel reservations. The operation of these highly interactive websites has been

held insufficient to justify the exercise of general personal jurisdiction. See, e.g., Nelson v. MGM

Grand Hotel LLC, No. Civ. A. H-05-294, 2005 WL 1949536 (S.D. Tex. Aug. 12, 2005) (evidence

that MGM Grand Hotel had sent representatives to make sales visits to Texas, operated a website

that allowed reservations, solicited Texas residents by telephone, and obtained revenue from Texas

residents for services and goods provided to those residents in Nevada was insufficient to subject

the MGM Grand Hotel to general personal jurisdiction in Texas); Bell v. Imperial Palace

Hotel/Casino, Inc., 200 F. Supp. 2d 1082, 1085 (E.D. Mo. 2001) (holding defendant hotel’s

operation of website that allowed Missouri residents to make room reservations was insufficient

contact with Missouri to subject the defendant to general personal jurisdiction for a tort that

occurred in Nevada); Snyder v. Dolphin Encounters Ltd., 235 F. Supp. 2d 433 (E.D. Pa. 2002)


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(websites for booking reservations, providing information, and ordering souvenirs, not specifically

directed to the forum state, did not establish general personal jurisdiction; a different result would

mean that virtually any corporation with a website would be subject to general jurisdiction in

every state).

In sum, none of the Bancroft factors are satisfied and other facts demonstrate that

MajorWager does not have “continuous and systematic” contacts with Nevada. MajorWager

denies that it has posted articles from Las Vegas newspapers on a “near-daily” basis. Yet, even

assuming the truth of this allegation, the alleged conduct does not rise to the level required for the

Court to constitutionally exercise general personal jurisdiction over MajorWager. Nor does

MajorWager’s operation (from Canada) of a minimally interactive website. There is simply no

basis for the Court to constitutionally exercise general personal jurisdiction over MajorWager.

C. The Complaint Fails to Sufficiently Allege a Plausible, Prima Facie, Case for the Exercise of Specific Personal Jurisdiction.

The Ninth Circuit applies the following three-part test to determine if the exercise of

specific jurisdiction is proper over a defendant:

1) The nonresident defendant must purposefully direct his activities or consummate some transaction with the forum or residents thereof; or perform some act by which he purposefully avails himself of the privilege of conducting activities in the forum, thereby invoking the benefits and protections of its laws;

2) The claim must be one which arises out of or relates to the defendant’s forum-related activities; and

3) The exercise of jurisdiction must comport with fair play and substantial justice, i.e., it must be reasonable.

Lake v. Lake, 817 F.2d 1416, 1421 (9th Cir. 1987) (citation omitted). A plaintiff need only satisfy

the first two prongs of the test. Schwarzenegger, 374 F.3d at 802 (citation omitted). “If the

plaintiff fails to satisfy either of these prongs, personal jurisdiction is not established in the forum

state.” Id. If “the plaintiff succeeds in satisfying both of the first two prongs, the burden then

shifts to the defendant to ‘present a compelling case’ that the exercise of jurisdiction would not be

reasonable.” Schwarzenegger, 374 F.3d at 802 (quoting Burger King Corp., 471 U.S. at 476-78,

105 S. Ct. at 2184-85, 85 L. Ed. 2d at 544)).


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1. MajorWager Has not “Purposefully Directed” an Intentional Tort at Plaintiff or Nevada Residents.

Under the first prong of the test, Plaintiff must establish that MajorWager either

purposefully availed itself of the privilege of conducting activities in Nevada, or purposefully

directed its activities toward Nevada. “This focus upon the affirmative conduct of the defendant is

designed to ensure that the defendant is not haled into court as the result of random, fortuitous or

attenuated contacts, or on account of the unilateral activities of third parties.” Shute v. Carnival

Cruise Lines, 897 F.2d 377, 381 (9th Cir. 1990); Pebble Beach Co. v. Caddy, 453 F.3d 1151, 1155

(9th Cir. 2006). “A purposeful availment analysis is most often used in suits sounding in contract.

A purposeful direction analysis, on the other hand, is most often used in suits sounding in tort.”

Schwarzenegger, 374 F.3d at 802 (citations omitted). Plaintiff is alleging copyright infringement -

- a claim sounding in tort. See Zuffa, LLC v. Showtime Networks, Inc., No. 2:07-cv-00369-RLH-

PAL, 2007 U.S. Dist. LEXIS 60711 (D. Nev. Aug. 15, 2007) (“Plaintiff’s claim for copyright

infringement sounds in tort, therefore a purposeful direction analysis is appropriate”).

Accordingly, MajorWager’s alleged conduct must be evaluated under the purposeful direction

standard.

To evaluate purposeful direction, the Ninth Circuit applies the three-part “Calder-effects

test,” articulated by the United States Supreme Court in Calder v. Jones, 465 U.S. 783, 104 S. Ct.

1482, 79 L. Ed. 2d 804 (1984); Schwarzenegger, 374 F.3d at 803. Under the effects test, “the

defendant allegedly must have: (a) committed an intentional act; (b) expressly aimed at the forum

state; and (c) causing harm that the defendant knows is likely to be suffered in the forum state.”

Yahoo! Inc. v. La Ligue Contre Le Racisme Et L’Antisemitisme, 433 F.3d 1199, 1206 (9th Cir.

2006) (internal quotes omitted).

a. The Complaint Does Not Allege Facts that Show the Alleged Infringement was Intentional.

First, with respect to the intentional tort element of the Calder effects test, the Complaint

alleges that MajorWager “willfully” infringed upon its alleged copyrights. (Compl. ¶ 72.) This

allegation cannot be accepted as true because it is not a factual allegation, but merely an

unsupported conclusion. See Iqbal, 129 S. Ct. at 1940. Nor can this allegation be accepted as true


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because MajorWager has denied engaging in any willful or intentional acts of copyright

infringement. (See Hawkins Decl. ¶ 5.) Indeed, the Complaint alleges no facts permitting the

conclusion that MajorWager willfully posted Plaintiff’s allegedly copyrighted materials on its

website. Rather, as set forth in the Declaration of Russell Hawkins, the articles at issue were

posted by “Clevfan,” a third party unrelated to MajorWager, and not by MajorWager. (See id.)

Because the first element of the effects test has not been satisfied, Plaintiff cannot satisfy the

Calder effects test.

b. The Complaint Does Not Allege Facts that Show MajorWager “Expressly Aimed” or “Targeted” Nevada or Nevada Residents.

Second, with respect to the “express aiming at the forum state” element of the Calder

effects test, in Bancroft & Masters, Inc. v. Augusta National, Inc., 223 F.3d 1082 (9th Cir. 2000),

the Ninth Circuit explained that the “express aiming” requirement is met when “the defendant is

alleged to have engaged in wrongful conduct targeted at a plaintiff whom the defendant knows to

be a resident of the forum state.” Bancroft & Masters, 223 F.3d at 1087 (emphasis in original).

However, express aiming requires “something more” than the commission of an intentional tort

and foreseeable harm to the plaintiff in the forum. See Schwarzenegger, 374 F.3d at 805 (“Calder

‘cannot stand for the broad proposition that a foreign act with foreseeable effects in the forum state

always gives rise to specific [personal] jurisdiction’”).

Here, the Complaint makes three principal allegations concerning MajorWager’s allegedly

purposeful direction of activity at Nevada:

• MajorWager purposefully directs activities at Nevada residents, which activities have resulted in the copyright infringement alleged herein.

• MajorWager purposefully directs and effectuates the unauthorized reproduction of Righthaven-owned copyrighted works at www.majorwager.com (“MajorWager’s Website”).

• MajorWager’s unauthorized reproduction of Righthaven-owned copyrighted works found on MajorWager’s Website is purposefully targeted to Nevada residents.

(Compl. ¶¶ 7-9.)

The Complaint also alleges that MajorWager posted articles on its website and that each

posting was somehow “purposefully directed” at Nevada residents. (See Compl. ¶¶ 10-12 (Ex. 1,


www.majorwager.com

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Tiger Article); ¶¶ 13-15 (Ex. 2, Longhorns Article); ¶¶ 16-18 (Ex. 3, Pryor Article); ¶¶ 19-21 (Ex.

4, Oddsmakers Article); ¶¶ 22-24 (Ex. 5, Tournament Article); ¶¶ 25-27 (Ex. 6, Cinderellas

Article); ¶¶ 28-30 (Ex. 7, Smart Team Article); ¶¶ 31-33 (Ex. 8, Bowl Stumble Article); ¶¶ 34-36

(Ex. 9, Disinterested Favorites Article); ¶¶ 37-39 (Ex. 10, Saints Article); 40-42 (Ex. 11, London

Gambling Article); ¶¶ 43-45 (Ex. 12, Contenders Article); ¶¶ 46-48 (Ex. 13, Belichick Article).)2

However, none of these allegations can be accepted as true because they are conclusory and do not

contain sufficient facts to demonstrate how the alleged posting of “copyrighted works” on

MajorWager’s website -- a process that would occur in Canada where MajorWager maintains its

website -- is conduct directed to Nevada. See Iqbal, 129 S. Ct. at 1940. Nor can these allegations

be accepted as true because MajorWager has denied that it purposefully directed any activity into

Nevada. (See Hawkins Decl. ¶ 5.)

In fact, the Complaint does not say how the alleged posting of articles from a location in

Canada onto an Internet website with a worldwide audience results in conduct directed at Nevada

or Nevada residents. Moreover, the Ninth Circuit has held that the posting of information on a

website, visible from anywhere, is insufficient to establish express aiming at the forum state. See,

e.g., Pharmastem Therapeutics, Inc. v. Cord Blood Registry Inc., No. C 04-03072 JSW, 2005 U.S.

Dist. LEXIS 39456, at *11 (N.D. Cal. Jan. 14, 2005) (citing Cybersell, Inc. v. Cybersell, Inc., 130

F.3d 414, 420 (9th Cir. 1997)); see also Pavlovich v. Superior Court, 29 Cal. 4th 262 (2002)

(holding that defendant’s posting of computer source code that formed basis of plaintiff’s

misappropriation of trade secrets claim was insufficient to demonstrate “express aiming” at

California).

c. The Complaint Does Not Allege Facts that Show MajorWager Knew About Plaintiff or that the Effects of the Alleged Infringement Would be Felt in Nevada.

Third, with respect to the knowledge element of the Calder effects test (i.e., whether the

defendant knew that its conduct would result in harm to the plaintiff in the forum state), the

Complaint fails to allege that MajorWager knew the identity of Plaintiff or that the alleged

2 Interestingly, none of these articles is the “Work” at issue in the Complaint that forms the basis for

Plaintiff’s copyright infringement claim. (See Compl. ¶¶ 54-62.)


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infringement would result in harm occurring to Plaintiff in Nevada. Indeed, prior to receiving

notice of this lawsuit, MajorWager had never heard of a company called Righthaven and had no

knowledge that Righthaven is a company located in Las Vegas, Nevada. (See Hawkins Decl. ¶ 8.)

Because the Complaint fails to allege MajorWager’s knowledge of foreseeable harm occurring to

Plaintiff in Nevada, Plaintiff cannot satisfy the third element of the Calder effects test.

Because Plaintiff has not alleged facts demonstrating the commission of an intentional tort,

Plaintiff has failed to satisfy the first element of the Calder effects test. Because Plaintiff has

failed to allege facts demonstrating that MajorWager’s conduct was expressly aimed at Nevada or

its residents, Plaintiff has failed to satisfy the second element of the Calder effects test. And

because the Complaint fails to allege that MajorWager knew of Plaintiff or that its conduct would

cause harm to Plaintiff in Nevada, Plaintiff has failed to satisfy the third element of the Calder

effects test. Because none of the elements of the Calder effects test are satisfied MajorWager has

not “purposefully directed” its activities into Nevada and the first elements of the Ninth Circuit’s

three-part test for specific personal jurisdiction is not satisfied.

2. Because the Complaint Fails to Allege Any Contact Between MajorWager and Nevada, Plaintiff’s Claim Cannot Arise Out ofa Contact Between MajorWager and Nevada.

The second prong of the Ninth Circuit’s three-part test for specific personal jurisdiction

requires that the Plaintiffs’ claims “arise” from the defendant’s forum-related activities. See

Panavision Int’l, L.P. v. Toeppen, 141 F.3d 1316, 1322 (9th Cir. 1998). This requirement is

satisfied if the plaintiff would not have been injured “but for” the defendant’s forum-related

conduct. See id; Myers v. Bennett Law Offices, 238 F.3d 1068, 1075 (9th Cir. 2000). Here,

Plaintiff’s claim of copyright infringement is not based upon any contact of MajorWager with

Nevada. The Complaint does not allege where MajorWager was when it allegedly obtained the

infringing Work. It simply says, “from a source emanating from Nevada.” The Court, however,

can take judicial notice of the fact that each of the articles at issue were posted by the Las Vegas

Review-Journal on the Internet. Assuming MajorWager obtained the articles from the Internet, it

would have done so from its principal place of business, which is located in Canada, not from a

location in Nevada. Nor does the Complaint allege that MajorWager posted the articles from a


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location in Nevada. Indeed, the Complaint does not contain any non-conclusory allegations

demonstrating any real contact between MajorWager and Nevada at all. Nevertheless, even

assuming that MajorWager posted the articles on its website -- a fact MajorWager denies -- such

conduct would have occurred in Canada, where the website is maintained, not in Nevada.

Accordingly, the “but-for” test is not satisfied. Since Plaintiff’s claim is not based upon any

contact of MajorWager with Nevada it cannot be said that Plaintiff would not have been injured

“but for” MajorWager’s contact with Nevada. Because Plaintiff’s claim of copyright infringement

does not “arise” out of any contact of MajorWager with Nevada, Plaintiff cannot satisfy the

second element of the Ninth Circuit’s three-part test for specific personal jurisdiction.

3. Because Plaintiff Has Failed to Satisfy the First Two Elements of the Specific Jurisdiction Test, the Burden of Demonstrating the Unreasonableness of Exercising Personal Jurisdiction Has Not Shifted to Major Wager.

As set forth above, if, and only if, a plaintiff establishes that the defendant has “minimum

contacts” with the forum, the defendant may still defeat the assertion of specific personal

jurisdiction by demonstrating that other considerations render the exercise of jurisdiction so

unreasonable as to violate constitutional notions of “fair play and substantial justice.” See Burger

King Corp., 471 U.S. at 476-77, 105 S. Ct. at 2184-85, 85 L. Ed. 2d at 543. Here, Plaintiff has not

met its initial burden of demonstrating that MajorWager has sufficient minimum contacts with

Nevada. Plaintiff must do so before the burden shifts to MajorWager to demonstrate that the

exercise of personal jurisdiction would be unreasonable under the five-factor test articulated by the

United States Supreme Court in Burger King. See Part II.A., supra. Because MajorWager has

submitted affidavits which dispute the jurisdictional facts, Plaintiff “[is] obligated to come forward

with facts, by affidavit or otherwise, supporting jurisdiction.” Ambar Mktg. Sys., Inc. v. Jobar

Int’l, 551 F.2d 784, 787 (9th Cir. 1987). In the unlikely event that Plaintiff’s opposition papers

establish the first two elements of the specific jurisdiction test, MajorWager will address the

reasonableness factors in its reply brief. As an initial statement, however, it would be

unreasonable on its face for the Court to exercise specific personal jurisdiction over MajorWager

where, as here, MajorWager is a Canadian company with no ties to Nevada, the Complaint does


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not contain facts indicating that the alleged infringement was intentional, or that MajorWager

targeted Nevada with its alleged conduct, or that MajorWager knew Plaintiff was located in

Nevada or would suffer harm in Nevada.

IV. THE COMPLAINT ALLEGES THAT THE MAJORWAGER’S PRINCIPAL PLACE OF BUSINESS IS LOCATED IN CANADA BUT FAILS TO ALLEGE THAT ANY INFRINGING CONDUCT OCCURRED IN THE UNITED STATES.

In Twombly, the United States Supreme Court rejected the notion that “a wholly

conclusory claim would survive a motion to dismiss whenever the pleadings left open the

possibility that a plaintiff might later establish some set of undisclosed facts to support recovery.”

Id. at 561, Id. at 1968, 167 L. Ed. 2d 929 (internal quotation omitted). Instead, the Court adopted

a “plausibility standard,” in which the complaint must “raise a reasonable expectation that

discovery will reveal evidence of [the alleged infraction].” Id. at 556, Id. at 1965, 167 L. Ed. 2d

929. For a complaint to meet this standard, the “[f]actual allegations must be enough to raise a

right to relief above the speculative level . . .” Id. (citing 5 C. Wright Miller, Federal Practice and

Procedure § 1216, pp. 235-36 (3d ed. 2004) (“[T]he pleading must contain something more . . .

than . . . a statement of facts that merely creates a suspicion [of] a legally cognizable right of

action”)). “[A] plaintiff’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.” Id. at 555, Id. at 1964-65, 167 L. Ed. 2d 929 (internal quotations omitted).

The Complaint alleges that “MajorWager is, and has been at all times relevant to this

lawsuit, an Ontario, Canada corporation with its principal place of business in Ontario, Canada.”

(Compl. ¶ 4.) It alleges that: “MajorWager owns the domain name MajorWager.com (the

‘Domain’).” (Id. ¶ 58.) It alleges that, “MajorWager is the registrant, administrator, and technical

contact for MajorWager’s Website.” (Id. ¶ 59.) And it alleges that: “No later than March 18,

2010, MajorWager reproduced an unauthorized copy of the Work . . . on MajorWager’s Website.”

(Id. ¶ 60.) The Complaint, however, fails to allege any infringing activity occurring in the United

States. The Copyright Act does not have extraterritorial effect; infringing actions that take place

outside of the United States are not actionable. See Subafilms, Ltd. v. MGM-Pathe

Communications Co., 24 F.3d 1088, 1091 n.6 (9th Cir. 1994). Because the Complaint fails to


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allege any infringing conduct occurring in the Unites States, Plaintiff has failed to state a claim

upon which relief may be granted. See, e.g, Kolbe v. Trudel, 945 F. Supp. 1268, 1270 (D. Ariz.

1996) (“[p]laintiff can only state a claim fully cognizable under the copyright laws by alleging an

act of infringement in the United States”); ITSI T.V. Prods., Inc. v. California Auth. of Racing

Fairs, 785 F. Supp. 854, 863-64 (E.D. Cal. 1992) rev’d on other grounds, 3 F.3d 1289 (9th Cir.

1993).

CONCLUSION

For the foregoing reasons, the Court should dismiss the Complaint and put an end to this

meritless case.

Dated: this 1st day of June, 2010.

Respectfully submitted,

LEWIS AND ROCA LLP

By: /s/

Michael J. McCue (NV Bar No. 6055)Jonathan W. Fountain (NV Bar No. 10351)3993 Howard Hughes Parkway, Suite 600Las Vegas, NV 89169(702) 949-8200 (Tel.)(702) 949-8398 (Fax)

Attorneys for DefendantMAJORWAGER.COM, INC.


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CERTIFICATE OF SERVICE

Pursuant to Federal Rule of Civil Procedure 5(b), I hereby certify that I am an employee of

Lewis and Roca LLP and that on this 1st day of June, 2010, I caused documents entitled:

• DEFENDANT’S MOTION TO DISMISS;

• DECLARATION OF RUSS HAWKINS IN SUPPORT OF DEFENDANT’S MOTION TO DISMISS; and

• DECLARATION OF JONATHAN W. FOUNTAIN IN SUPPORT OF DEFENDANT’S MOTION TO DISMISS.

to be served as follows:

[ ] by depositing same for mailing in the United States Mail, in a sealed envelopeaddressed to Steven A. Gibson, Esq., Righthaven, LLC, 9960 West Cheyenne Avenue, Suite 210, Las Vegas, Nevada, 89129-7701, upon which first class postage was fully prepaid; and/or

[ ] Pursuant to Fed. R. Civ. P. 5(b)(2)(D), to be sent via facsimile as indicated; and/or

[ ] to be hand-delivered;

[ X ] by the Court’s CM/ECF system.

/s/ Jonathan W. Fountain Jonathan W. FountainAn employee of Lewis and Roca LLP


Documents

Defendants Motion to Dismiss (Filed June 1, 2010)