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HBO-Opposition To Arbitration June 04
HBO-Opposition To Arbitration June 04
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1 Pursuant to the Court’s May 24, 2019 order, Home Box Office, Inc. (“HBO”)
2 hereby submits this supplemental memorandum of points and authorities in
3 opposition to Plaintiffs’ motion to compel arbitration (the “Motion,” Dkt. 18).
4 I. THE COURT SHOULD DENY PLAINTIFFS’ MOTION TO COMPEL
BECAUSE THERE IS NO VALID AGREEMENT TO ARBITRATE
5 THE CONFIDENTIALITY PROVISIONS.
6 To compel arbitration, Plaintiffs must first demonstrate that “a valid
7 agreement to arbitrate exists.” Cox v. Ocean View Hotel Corp., 533 F.3d 1114,
8 1119 (9th Cir. 2008); Henry Schein v. Archer and White Sales, Inc., 139 S. Ct. 524,
9 530 (2019) (“before referring a dispute to an arbitrator, the court determines
10 whether a valid arbitration agreement exists”). “As the party moving to compel
11 arbitration,” Plaintiffs bear the burden of “proving by a preponderance of the
12 evidence the existence of a valid arbitration agreement.” See Christensen v. CLP
13 Res., Inc., 2015 WL 13762936, at *3 (C.D. Cal. June 22, 2015) (Wu, J.). To
14 determine whether a valid arbitration agreement exists, the Court “resort[s] to state
15 contract law.” ISTA Pharm., Inc. v. Senju Pharm. Co., 2010 WL 11601183, at *3
16 (C.D. Cal. Aug. 26, 2010) (Wu, J.). Contrary to Plaintiffs’ assertion, there is no
17 federal policy “favoring” arbitration on the issue of validity (Dkt. 18 at 6-7), as that
18 policy is “inapposite” to determining “whether … a valid agreement to arbitrate”
19 exists. Comer v. Micor, Inc., 436 F.3d 1098, 1104 n.11 (9th Cir. 2006).
20 In this case, Plaintiffs cannot satisfy their burden of proving that a valid
21 agreement to arbitrate exists because the very provision on which their Motion rests
22 makes clear that any disputes must be resolved by “the court,” not an arbitrator.
23 Plaintiffs allege that HBO’s 2019 exhibition of Leaving Neverland violates a non-
24 disparagement sentence in an exhibit to an agreement (the “1992 Agreement”)
25 concerning the 1992 concert special Michael Jackson: Live in Bucharest (“Live in
26 Bucharest”). Dkt. 18 at 5. While the body of the 1992 Agreement contains an
27 arbitration provision, the document that contains the non-disparagement sentence
28 contains a different, more specific clause requiring judicial resolution of disputes:
1 agreements “so as to give effect to every part,” Cal. Civ. Code § 1641. See also
2 MacDonald & Kruse, Inc. v. San Jose Steel Co., 29 Cal. App. 3d 413, 421 (1972)
3 (acknowledging “well recognized rule … that where a general and a particular
4 provision … are inconsistent, the particular controls the general”); United Farmers
5 Agents Assn., Inc. v. Farmers Grp., Inc., 32 Cal. App. 5th 478, 495 (2019) (courts
6 must “give effect to all of a contract’s terms, and to avoid interpretations that render
7 any portion superfluous, void or inexplicable”); Katz v. Feinberg, 290 F.3d 95, 97–
8 98 (2d Cir. 2002) (“[U]nder normal circumstances, when an agreement includes
9 two dispute resolution provisions, one specific … and one general … the specific
10 provision will govern those claims that fall within it.”); Cf. Lamps Plus, Inc. v.
11 Varela, 139 S. Ct. 1407, 1415 (2019) (refusing to order class arbitration where
12 arbitration agreement was ambiguous because “arbitration is a matter of consent,
13 not coercion”) (internal quotations omitted).
14 Plaintiffs’ failure to demonstrate the existence of a valid agreement to
15 arbitrate disputes regarding the Confidentiality Provisions dooms their Motion. See
16 Knutson v. Sirius XM Radio Inc., 771 F.3d 559, 564 (9th Cir. 2014) (denying
17 motion to compel arbitration where “no valid agreement to arbitrate exist[ed]”).
18 II. THE COURT SHOULD DENY PLAINTIFFS’ MOTION TO COMPEL
BECAUSE THE ARBITRATION PROVISION DOES NOT
19 ENCOMPASS THIS DISPUTE.
20 Plaintiffs’ Motion must be denied for a second, independent reason: even
21 assuming the 1992 Agreement’s arbitration provision controls (and it does not), that
22 provision does not “encompass[] the dispute at issue.” Cox, 533 F.3d at 1119.
23 A. The Arbitration Provision Does Not Encompass This Dispute
Because Leaving Neverland Has Nothing to Do with Live in
24 Bucharest.
25 The subject of the 1992 Agreement was a live concert performance by
26 Michael Jackson in Bucharest, Romania, on October 1, 1992, as part of the
27 worldwide tour for Mr. Jackson’s 1991 Dangerous album. See Dkt. 22-1 (Abrutyn
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1 Decl.) ¶¶ 2, 5; Breuder Decl. ¶¶ 4-5.1 Under the 1992 Agreement, TTC (on behalf
2 of Mr. Jackson) granted a one-time license to HBO to exhibit Live in Bucharest on
3 October 10, 1992. Dkt. 22-1 (Abrutyn Decl.) ¶ 5; Dkt. 18, Ex. B at 26. The 2019
4 Leaving Neverland documentary—the subject of Plaintiffs’ complaints—simply
5 has nothing whatsoever to do with Live in Bucharest—the subject of the 1992
6 Agreement. For example, Leaving Neverland:
7 • does not mention or discuss Live In Bucharest, the Bucharest concert
8 itself, or HBO’s exhibition of the Live in Bucharest concert special;
9 • contains no concert footage or other content from Live in Bucharest;
10 • contains no “confidential information” (as that term is defined in the
11 Confidentiality Provisions (Dkt. 18, Ex. B at 38)) that may have been
12 disclosed to HBO in connection with Live in Bucharest; and
13 • neither mentions nor discusses the 1992 Agreement.
14 Breuder Decl. ¶¶ 4-5; see also HBO’s Notice of Lodging, Exs. A-B (copies of Live
15 in Bucharest and Leaving Neverland, respectively).
16 In fact, the only connection Plaintiffs identify between the 1992 Agreement
17 and Live in Bucharest, on the one hand, and Leaving Neverland, on the other hand,
18 is their assertion that Leaving Neverland “alleges that Jackson was abusing children
19 in connection with and on the Dangerous World Tour.” Dkt. 1-1 at 13, ¶ 40
20 (emphasis in original); see also Dkt. 17 at 6. But the Bucharest concert was only
21 one of nearly 70 concerts that took place between June 1992 and November 1993
22 on the Dangerous tour. Breuder Decl. ¶ 4. And the Dangerous tour is only
23 mentioned once in Leaving Neverland, in the following excerpt:
24 Joy Robson: “During that Dangerous tour when Michael [Jackson]
25 took Brett Barnes on the tour with him, Wade [Robson] had asked to
go on the tour. And Michael had told him no, he couldn’t go because
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he wasn’t allowed to take children on this tour. And then he saw Brett
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In deciding a motion to compel arbitration, the Court “may consider the pleadings,
28 documents of uncontested validity, and affidavits submitted by either party.” QED
Hold., LLC v. Block, 2015 WL 12659935, at *3 (C.D. Cal. June 11, 2015) (Wu, J.).
4 HBO’S SUPP. BRIEFING RE: MOT. TO COMPEL
CASE NO. 2:19-CV-01862-GW-PJW
Case 2:19-cv-01862-GW-PJW Document 30 Filed 06/04/19 Page 6 of 9 Page ID #:529
20 The arbitration clause also does not “encompass” this dispute, even if it could
21 be read to apply to an unrelated documentary, because the 1992 Agreement has
22 been fully performed and is expired. Under California law, where, as here, a
23 contract has been fully performed by both parties, it is deemed to be expired. Cal.
24 Civ. Code § 1473 (“Full performance of an obligation, by the party whose duty it is
25 to perform it . . . extinguishes it.”); Giles v. Horn, 100 Cal. App. 4th 206, 228
26 (2002) (holding plaintiffs’ claim that county breached contracts was moot because
27 “the contracts [had] been fully performed and [had] expired”). The parties to the
28 1992 Agreement (who are not the same parties to this action), fully performed their
1 obligations more than 25 years ago, after the conclusion of the Holdback Period
2 ended, on or about October 10, 1993 (one year after exhibition of the concert
3 special). See Dkt. 22 at 3; Dkt. 18, Ex. B at 26, 29-30; Dkt. 22-1 ¶ 5. HBO
4 exhibited the concert special just one time, on October 10, 1992, and paid TTC a
5 license fee. See Dkt. 18, Ex. B at 26; Dkt. 22-1 ¶ 5. The parties’ obligations have
6 thus long been fulfilled, and the 1992 Agreement is expired.
7 The law is clear that where the complained-of conduct occurs after the
8 expiration of the contract containing an arbitration clause, the dispute is not
9 encompassed by that arbitration clause unless the right has vested or survived
10 expiration. See Just Film, Inc. v. Merchant Servs., Inc., 2011 WL 2433044, at *4
11 (N.D. Cal. June 13, 2011), quoting Operating Eng’rs Local Union No. 3 v.
12 Newmont Mining Corp., 476 F.3d 690, 693-94 (9th Cir. 2007) (holding that an
13 arbitration clause encompasses a dispute when the “facts and occurrences”
14 underlying the dispute “arose before expiration”). A contrary rule would allow
15 “[t]he dead hand of a long-expired arbitration clause [to] govern forever.” Id., 2011
16 WL 2433044, at *4; see also Litton Fin. Printing Div. v. N.L.R.B., 501 U.S. 190,
17 209 (1991) (courts must “refuse” to apply any presumption in favor of arbitration to
18 an expired … agreement, for to do so would make limitless the contractual duty to
19 arbitrate”). Here, the complained-of conduct—HBO’s exhibition of Leaving
20 Neverland—occurred more than 25 years after the termination of the 1992
21 Agreement and long past any reasonable period of time thereafter. Dkt. 22 at 3;
22 Dkt. 18, Ex. B at 26, 29-30; Dkt. 22-1 ¶ 5. Plaintiffs’ claims are thus not
23 encompassed by the 1992 Agreement’s arbitration clause. See Just Film, 2011 WL
24 2433044, at *5 (denying a motion to compel arbitration because the claims “do not
25 arise under [defendant’s] lease agreement, which has expired”).
26 III. THE FIRST AMENDMENT AND CALIFORNIA PUBLIC POLICY
MANDATE DENIAL OF THE MOTION TO COMPEL.
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