ORDER re: Reach Out WorldWide, Inc.'s Motion to Dismiss Pursuant to Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6) [7]

RONALD S.W. LEW, Senior District Judge.

Currently before the Court is Defendant Reach Out Worldwide, Inc.'s ("ROWW") Motion to Dismiss ("Motion" or "Motion to Dismiss") Plaintiff Lucas Wimer's ("Plaintiff") Complaint pursuant to Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). Having reviewed all papers submitted pertaining to this Motion, the Court NOW FINDS AND RULES AS FOLLOWS: the Court DENIES AS MOOT ROWW's Motion [7] and REMANDS this Action for lack of subject matter jurisdiction to the Los Angeles County Superior Court, Case No. BC648794.

I. BACKGROUND

A. Factual Background

Plaintiff is purportedly a lifelong friend of Paul Walker ("Walker"), a well-known actor who passed away in 2013. Compl. ¶¶ 6, 7, ECF No. 1. In 2010, Walker founded ROWW, a section 501(c)(3) charitable California corporation, to provide humanitarian aid to victims of natural disasters. Id. at ¶ 6. Plaintiff accompanied Walker on numerous humanitarian trips, where he took photographs and video recordings of Walker (the "Works").1 Id. at ¶ 7. Plaintiff and Walker apparently discussed Plaintiff's future compensation for his work with ROWW. Id. at ¶ 8.

Plaintiff avers that the Works were removed from various storage devices without his authorization or consent. Id. at ¶ 15. ROWW then sold Plaintiff's Works via its website and incorporated the Works onto clothing and other merchandise. Id. at ¶¶ 9, 11. Defendant Represent Holdings, LLC ("Represent") is a Delaware limited liability company that creates custom merchandise and purportedly helped ROWW design and sell the merchandise at issue.2 Id. at ¶¶ 13, 14.

B. Procedural Background

Plaintiff filed his Complaint in Los Angeles Superior Court on January 31, 2017 [1]. The Complaint included causes of action for (1) conversion; (2) unjust enrichment; (3) unlawful, unfair, and fraudulent business acts and practices in violation of California Business and Professions Code § 17200 ("Section 17200"); and (4) receiving and/or concealing stolen property in violation of California Penal Code § 496 ("Section 496"). On March 9, 2017, the Action was removed to federal court on the basis of federal question jurisdiction, on the grounds that the Copyright Act preempts the state law claims in the Complaint.

ROWW filed a Motion to Dismiss the Complaint on March 16, 2017 [7] pursuant to Federal Rule of Civil Procedure 12(b)(1) for lack of subject matter jurisdiction and 12(b)(6) for failure to state a claim on which relief can be granted. Plaintiff filed his Opposition on May 9, 2017 [10].3 ROWW filed a Reply on May 16, 2017 [11].

II. DISCUSSION

A. Legal Standard

1. Subject Matter Jurisdiction

Removal to federal court is governed by 28 U.S.C. § 1441, which in relevant part states that "any civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant or defendants." Original jurisdiction may be based on diversity or the existence of a federal question, as set forth in 28 U.S.C. §§ 1331 and 1332. District courts have diversity jurisdiction over all civil actions between citizens of different states where the amount in controversy exceeds $75,000, exclusive of interest and costs. 28 U.S.C. § 1332.

The Court has an independent obligation to determine whether it has subject matter jurisdiction over this Action. Arbaugh v. Y&H Corp., 546 U.S. 500, 514 (2006)(stating that because subject matter jurisdiction "`can never be forfeited or waived,'" courts "have an independent obligation to determine whether subject-matter jurisdiction exists, even in the absence of a challenge from any party"); 28 U.S.C. § 1447(c) ("[i]f at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded.").

B. Discussion

1. The Court Does Not Have Subject Matter Jurisdiction

Before considering the Motion to Dismiss, the Court must confirm that it has subject matter jurisdiction over the Action. If not, the Court must remand the case. 28 U.S.C. § 1447(c).

The Court has reservations as to whether it has subject matter jurisdiction over the exclusively state law claims involving the alleged theft and misappropriation of the Works. Diversity jurisdiction is lacking, as Plaintiff is a California resident, ROWW is a California corporation, Represent is a California LLC, and the Complaint-initially filed in state court—lacks allegations as to an amount-in-controversy exceeding $75,000. Compl. ¶¶ 1-3.

The only other option is federal question jurisdiction. Federal question jurisdiction could be conferred through a copyright infringement or other claim asserted under the Copyright Act. 28 U.S.C. § 1338(a)("[t]he district courts shall have original jurisdiction of any civil action arising under any Act of Congress relating to . . . copyrights.") But even if Plaintiff did have a viable copyright infringement claim to confer federal question jurisdiction and the Court could potentially assert supplemental jurisdiction over the remaining state law claims, 28 U.S.C. § 1367(a), Plaintiff has not alleged or advised the Court that he has registered any potential copyright with the Copyright Office. Pursuant to 17 U.S.C. § 411(a), "no civil action for infringement of the copyright in any United States Work shall be instituted until preregistration or registration of the copyright claim." Because neither the Complaint nor the current record show that Plaintiff has preregistered or registered a copyright claim, it is doubtful at best that Plaintiff could even raise a copyright infringement claim to confer federal question jurisdiction. Dielsi v. Falk, 916 F.Supp. 985, 994 (C.D. Cal. 1996)("[p]laintiff's failure to plead that he has applied for a copyright registration deprives this court of subject matter jurisdiction over his copyright claim."). Thus, without even reaching the issue of whether the Copyright Act preempts the state law claims, the Court could conclude it lacks diversity jurisdiction or federal question jurisdiction and remand on these grounds alone.

Nevertheless, ROWW contends that removal was appropriate and the Court has subject matter jurisdiction because the Copyright Act "completely preempts" all of Plaintiff's state law claims. See Ntc. of Removal ¶ 17, ECF No. 1. Typically, federal preemption as a defense to a state law claim does not confer federal question jurisdiction to permit removal. Firoozye v. Earthlink Network, 153 F.Supp.2d 1115, 1120 (N.D. Cal. 2001). However, the complete-preemption doctrine "confers exclusive federal jurisdiction in certain instances where Congress intended the scope of a federal law to be so broad as to entirely replace any state-law claim." Dennis v. Hart, 724 F.3d 1249, 1254 (9th Cir. 2013). Courts in this district have concluded that the Copyright Act completely preempts equivalent state law claims and those claims can be removed to federal court. See, e.g., Firoozye, 153 F. Supp. 2d at 1119 (emphasis added).

To further verify if it has subject matter jurisdiction, the Court now turns to whether the Copyright Act preempts the four state law claims in the Complaint.

a. Plaintiff's State Law Claims are not Preempted by the Copyright Act

A state law claim is preempted by the Copyright Act if (1) the work at issue comes within the subject matter of copyright, as defined by Sections 102 and 103 of the Copyright Act; and (2) the state law rights are equivalent to rights within the general scope of copyright, as specified in Section 106 of the Copyright Act. Del Madera Props. v. Rhodes & Gardner, Inc., 820 F.2d 973, 976 (9th Cir. 1987), overruled on other grounds by, Montz v. Pilgrim Films & Television, Inc., 649 F.3d 975 (9th Cir. 2011); 17 U.S.C. § 301. "To survive preemption, the state cause of action must protect rights that are qualitatively different from the rights protected by copyright: the complaint must allege an `extra element' that changes the nature of the action." Grosso v. Miramax Film Corp., 383 F.3d 965, 968 (9th Cir. 2004)(emphasis added).

As to the first prong, Plaintiff's Works are feasibly within the subject matter of copyright because they are explicitly listed in the Copyright Act. In the Complaint, Plaintiff describes the Works as photographs and video recordings. Compl. ¶ 9. Section 102 of the Copyright Act protects "pictorial, graphic, and sculptural works" and "motion pictures and other audiovisual works." This includes both photographs and videos. 17 U.S.C. § 101. And to the extent that the Works are electronically stored, at least one court has recognized that electronically stored photographs and videos enjoy copyright protection. See Shade v. Gorman, No. C 08-3471 SI, 2009 WL 196400, at *2 (N.D. Jan. 28, 2009)(assessing copyright infringement claim for computer files containing still photographs and video footage).

The next issue is whether the rights afforded by Plaintiff's state law claims are equivalent to rights outlined by Section 106 of the Copyright Act. The Court discusses each claim.

i. Conversion

To state a claim for conversion, the plaintiff must show: (1) ownership or right to possession of certain property; (2) defendant's conversion via a wrongful act; and (3) damages. Ryoo Dental, Inc. v. Han, No. SACV 15-308-JLS (RNBx), 2015 WL 4208580, at *2 (C.D. Cal. July 9, 2015).

A conversion claim is preempted by the Copyright Act when it accuses a defendant of wrongfully using and distributing or reproducing a work. See Dielsi, 916 F. Supp. at 992. By contrast, to the extent the plaintiff alleges conversion of tangible property and seeks retrieval of the tangible property, the conversion claim "adds an `extra element' beyond those elements required to state a claim for copyright infringement." Oddo v. Ries, 743 F.2d 630, 635 (9th Cir. 1984)(conversion claim not preempted where plaintiff alleged conversion of the physical papers for his book manuscript); 220 Labs., Inc. v. Babaii, No. CV 08-6125 PSG (Ssx), 2008 WL 5158863, at *7 (C.D. Cal. Dec. 8, 2008)(conversion claim not preempted where defendant used plaintiff's video and photograph footage to promote its products because of extra element that defendants wrongfully obtained possession over property). A conversion claim is preempted, however, "where a plaintiff is only seeking damages from a defendant's reproduction of a work-and not the actual return of a physical piece of property." Firoozye, 153 F. Supp. 2d at 1130.

First, the conversion claim is not preempted because Plaintiff aptly alleges conversion of tangible property. Here, Plaintiff alleges that Defendants removed the Works from "various storage devices without his authorization or consent." Compl. ¶ 15. See Lattie v. Murdach, No. C-96-2524 MHP, 1997 WL 33803, at *1, *5 (N.D. Cal. Jan. 9, 1997)(remanding non-preempted conversion claim where plaintiff alleged interference with his physical dominion over price lists, photographs, and drawings alleged); but see Firoozye, 153 F. Supp. 2d at 1130(concluding conversion claim was preempted because defendant could not wrongfully possess property that plaintiff authorized them to use). Here, unlike Firoozye, Plaintiff apparently did not willingly turn over the Works to Defendants; rather, he alleges that Defendants took storage devices containing the Works without his permission. The overall gist of Plaintiff's conversion claim is not that Defendants used and distributed Plaintiff's work of authorship—and even that would be a stretch, as it is speculative whether Plaintiff even has a copyright for the Works—but rather Plaintiff alleges the "extra element" that Defendants unlawfully retained the tangible object embodying the Works when they pilfered the Works from Plaintiff's storage devices without his permission.

Second, the conversion claim is not preempted as Plaintiff seeks return of the physical property, not copyright-like damages. Plaintiff seeks "an order that Defendants return to Plaintiff all Plaintiff's images that may be in Defendants' possession, custody or control," compl. ¶ G, not damages associated with Defendants' use of the Works or damages based on Defendants' profits from allegedly merchandising the Works. Because the conversion claim asserts rights "qualitatively distinguishable" from rights flowing from the Copyright Act, it is not preempted.

ii. Unjust Enrichment

Unjust enrichment claims are preempted to the extent that they arise from a defendant's unauthorized use of a copyrighted work. Zito v. Steeplechase Films, Inc., 267 F.Supp.2d 1022 (N.D. Cal. 2003). For instance, "an implied promise not to use or copy materials within the subject matter of copyright" is preempted, as it "is equivalent to the protection provided by section 106 of the Copyright Act." Del Madera, 820 F.2d at 977.

ROWW argues that the unjust enrichment claim is preempted to the extent that Plaintiff seeks damages for Defendants' profits from reproducing, distributing, and selling merchandise containing the Works. Mot. 7:23-28. But a closer reading of Plaintiff's unjust enrichment claim shows that Plaintiff is not claiming violation of an implied promise not to use or copy the Works; rather, Plaintiff alleges Defendants benefitted from the Works without compensating him. Compl. ¶ 21. In other parts of the Complaint, Plaintiff alleges that Walker indicated that he would be compensated for his role in ROWW and would work "formally and informally" with the charitable corporation. Id. at ¶ 8. Coupling these allegations together, it is plausible that the unjust enrichment claim seeks to recover the value of creative services that Plaintiff provided Defendants through his Works and other efforts. This "extra element"—of an implied promise to compensate Plaintiff—"transforms the action from one arising under the ambit of the federal statute to one sounding in contract." Grosso, 383 F.3d at 968; see also NW Home Designing Inc. v. Sound Built Homes Inc., 776 F.Supp.2d 1210, 1216-17 (W.D. Wash. 2011)(concluding that the unjust enrichment claim was not preempted because plaintiff alleged the implied promise that he would be compensated with royalty payments for use of his home designs); Cadkin v. Loose, SACV 08-1580 JVS (Shx), 2008 WL 11336390, at *3 (C.D. Cal. Apr. 24, 2008)(unjust enrichment claim not preempted because it was based on violation of the parties' contract and alleged an "extra element" of the parties' "expectation of compensation," rather than relied on defendant's unauthorized use of copyright-protected materials).

It is true that the Complaint also alleges that Defendants were unjustly enriched by profiting from the Works without Plaintiff's consent and without legal rights to the works. Id. At first, this allegation seems equivalent to the Copyright Act's exclusive right to reproduce the work or distribute copies, 17 U.S. § 106(1),(2). Were the Court to subscribe to this reasoning—particularly in a case like this where it is unclear whether the plaintiff even has a valid copyright registered—any time a party mentioned that the other party "benefitted" from a potentially copyrightable work, preemption would be the only result and would invariably swallow up viable state law claims. Thus, the Court concludes that the Copyright Act does not preempt the unjust enrichment claim.

iii. Section 17200 Claim

"California unfair competition law, [California Business & Professions Code § 17200 et seq.,] prohibits any `unlawful, unfair or fraudulent business practice.'" Kodadek v. MTV Networks, Inc., 152 F.3d 1209, 1212 (9th Cir. 1998). Where the unfair competition claim rests on rights guaranteed by the Copyright Act, the unfair competition claim is preempted. Id. at 1212.

Plaintiff alleges that Defendants' "conversion, constructive fraud, and other violations of law" constitute unlawful, unfair, and fraudulent business practices. Compl. ¶¶ 25-29. Plaintiff further adds that he "would not have created the Works or performed the services he provided (or would have taken steps to. . . prevent . . . their conversion)" absent Defendants' unlawful practices. Id. at ¶ 31. In Kodadek, the overlap between the alleged unfair business practices and rights guaranteed by the Copyright Act was clear: plaintiff alleged that defendants were "publishing and placing on the market for sale products bearing the images subject to the copyright ownership of the plaintiff."4 152 F.3d at 1212-13. The unfair business practices were effectively interchangeable with the unauthorized publishing and sale of products bearing the copyright image; in that case, a cartoon. Unlike the claim in Kodadek, the unfair competition claim here does not clearly rest on rights the Copyright Act guarantees. Here, the allegations regarding unfair competition are based on conversion and fraud, not use of copyrighted material or violations of the Copyright Act. See Valente-Kritzer Video v. Pinckney, 881 F.2d 772, 776 (9th Cir. 1989)(fraud claim was not substantially equivalent to copyright infringement claim because it alleged additional element of misrepresentation); Oddo, 743 F.2d at 635 (conversion claim not preempted by Copyright Act because of "retaining physical property" element). Considering the Complaint as a whole, it is feasible that the unfair competition claim strikes more at Defendants' alleged conversion of the storage devices and ROWW's alleged fraud in promising Plaintiff—through Walker—compensation and a role in ROWW. Compl. ¶¶ 8, 15. The Section 17200 claim—and its incorporated allegations—do not clearly show that "unfair business practices" is subtext for "violations of the Copyright Act's exclusive rights." Accordingly, the Section 17200 claim is not preempted.

iv. Section 496 Claim

The elements of a receipt of stolen property claim, California Penal Code § 496, are: (1) the property must be stolen property; (2) defendant must receive, conceal, or withhold it or aid in receiving, concealing or withholding it from its owner; and (3) defendant must have knowledge that property is stolen property. People v. Stuart, 272 Cal.App.2d 653, 656 (Ct. App. 1969). ROWW argues that the alleged conversion underpinning the Section 496 claim is akin to the wrongful appropriation of the Works; that is, a copyright claim. Mot. 8:8-11. Plaintiff counters that "specific allegations of physical thefts" render the section 496 claim qualitatively distinguishable from the copyright claims. Opp'n 9:13-15.

For largely the same reasons in the conversion claim, the Section 496 claim is also not preempted by the Copyright Act. First, the claim contains the "extra element" of receiving and concealing stolen property. ROWW stretches the application of copyright preemption to its breaking point by insisting that the Section 496 claim is more properly framed as a copyright issue. From the Complaint, it is apparent that the Section 496 claim—like the conversion claim—flows from the allegation that Defendants stole storage devices containing Plaintiff's Works.

ROWW appears to believe that Plaintiff should have raised a copyright infringement claim. But because Plaintiff has not yet alleged whether he has registered any copyright, ROWW can conveniently argue that even the copyright claim would fail or, that any of the accompanying state law claims would be preempted. At this juncture, the Court does not speculate as to Plaintiff's strategy or the most appropriate claims he could have raised. The Court similarly will not facilitate ROWW's preemption analysis by reading a nonexistent copyright infringement claim into the Complaint. Plaintiff's purely state law claims are plausible on their own given the allegations that Defendants pilfered Plaintiff's storage devices and that Plaintiff and ROWW may have had preliminary discussions about his compensation with ROWW or possibly agreed to provide the Works. In light of this, the Court will not mechanically apply the rules surrounding Copyright Act preemption of state law claims. Because the state law claims are independently supportable and not preempted by the Copyright Act, the Court lacks subject matter jurisdiction over the Action and thus remands the claims to the state court which can more appropriately resolve them.

III. CONCLUSION

Because the Court lacks both diversity jurisdiction and federal question jurisdiction and the Copyright Act does not preempt the entirely state law claims, the Court DENIES AS MOOT ROWW's Motion to Dismiss [7] and REMANDS this Action to the Los Angeles Superior Court, Case No. BC648794 for lack of subject matter jurisdiction.

IT IS SO ORDERED.