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Amaretto Ranch Breedables vs. Ozimals
Court	United States District Court for the Northern District of California
Decided	December 21, 2010
Citation(s)	Amaretto Ranch Breedables v. Ozimals, Inc., 29 (N.D. Cal. December 21, 2010).
Holding
temporary restraining order GRANTED in favor of Amaretto
Court membership
Judge(s) sitting	Charles Breyer
Keywords
DMCA takedown

Amaretto Ranch Breedables v. Ozimals is a copyright case in the Ninth District involving a DMCA takedown notice dispute between companies that produce virtual animals on Second Life. Ozimals filed a DMCA takedown notice, claiming that Amaretto’s horse infringed on their bunnies. Consequently, Amaretto filed for a temporary restraining order against Linden Research, the makers of Second Life. This was granted and held in effect as the case proceeded.

Background

Second Life is an online website where users can live out their virtual lives. Users can make and sell their own virtual items. Ozimals is a company that creates virtual bunnies which can be purchased and raised in Second Life through feeding them virtual food. Amaretto Ranch Breedables sells virtual horses which can also be purchased and raised in a similar fashion.

The Digital Millenium Copyright Act permits content owners to prevent infringement by seeking a court order that requires an interactive service provider to block or remove access to content that allegedly infringes copyrighted content. In this case, Ozimals claimed that Amaretto Ranch Breedables’ horses infringed on their bunnies and filed a takedown notice for their horses and feed. Amaretto sued for a temporary restraining order and preliminary injunction barring Linden Research, the operator of Second Life, from removing their products.

Case

As established in Winter v. Natural Res. Defense Council (2008), a plaintiff seeking preliminary injunction must show:

1. Likely to succeed on the merits
2. Likely Irreparable Harm
3. Balance of Hardships
4. Public Interest

Since software copyright protection does not apply to functionality as in this case, the case was considered likely to succeed . Amaretto did not directly copy Ozimal’s source code, and the idea of a growing virtual animal that could be fed and raised is not copyrightable.

Likely irreparable harm is interesting in this case. Had the DMCA order gone through, it would have cut of Amaretto’s source of income before it could challenge Ozimal’s copyright claim .Their virtual horses would had died for lack of food, and though Ozimals stated that they would agree to Amaretto distributing their product for free, they understandably refused to do so. Furthermore, even if they were to litigate, had the takedown occurred, Amaretto would have lost a significant number of potential customers by missing out on the prime buying season. Judge Charles Breyer ruled that irreparable harm was likely in this case. For the same reason, he deemed that the balance of hardships would be in favor of the plaintiff.

Finally, there was no identifiable public interest in this case. Judge Breyer granted Amaretto the temporary restraining order against Linden Research from removing their horses.

Subsequent Motions to Dismiss

First Amended Complaint

In April of 2011, Ozimals was granted in part and denied in part their motion to dismiss Amaretto’s First Amended Complaint (FAC). They argued that

1. Section 512(f) Misrepresentation is not viable because no takedown had occurred. The judge agreed with Ozimals here, referring to Lenz v. Universal Music Corp, which stated that the damages incurred had to be from the DMCA removal of content.
2. Litigation privilege does not bar the tortious interference and unfair competition claims. The judge ruled in favor of Amaretto in this case, as the original DMCA notification was not a judicial proceeding.
3. Tortious interference claim wasn’t plausibly pleaded. The judge sided with Ozimals here, ruling that merely arguing that the defendants falsely disparaged their products on online forums was not enough to determine interference with contract.
4. The unfair business practices claim should be dismissed. Here, the judge ruled that Amaretto’s Unfair Business Practices Claim was viable here, as Ozimals didn’t have a valid copyright.

Ozimals’ motion to dismiss was granted in part and denied in part. In response, Amaretto filed a Second Amended Complaint.

Second Amended Complaint

Ozimals also moved to dismiss Amaretto’s Second Amended Complaint in July, which consisted of the following:

1. declaratory relief;
2. statutory and common law unfair competition;
3. copyright misuse;
4. defamation;
5. trade libel;
6. intentional interference with contract; and
7. tortious interference with prospective business advantage.

Ozimals moved to dismiss 2 and 6. Judge Breyer ruled against them on unfair competition, pointing out that it had already been decided in the previous case. However, he did dismiss the common law unfair competition claim, since that entails passing off one’s goods as those of another. State law claims based on DMCA takedowns are preempted here by the federal nature of the DMCA, as referenced in Lenz v. Universal Music Group as well as OPG v. Diebold. Ozimal’s motion to dismiss on this count is granted. Litigation has continued into 2012, with several changes of attorney.Meanwhile, Second Life has backed away from the dispute, stating, "We no longer have a horse in that race or a bunny in that pot."

Significance

• Temporary restraining order and preliminary injunction was filed against a third party, Second Life, and granted.
• Misrepresentation determined to be not viable in a case where no takedown has actually occurred.
• Upheld Lenz and Diebold on DMCA preemption of state laws.

Legal blogger Eric Goldman’s take on this is: “I generally like furry critters, but I'm beginning to hate the virtual horses and virtual bunnies for their deleterious effect on Internet law.”

See also

• DMCA takedown
• OPG v. Diebold
• Lenz v. Universal Music Corp.

Bibliography

Goldman, E. (2011, July 15). 17 USC 512(f) Preempts State Law Claims Over Bogus Copyright Takedown Notices--Amaretto v. Ozimals. [Web log entry]. Retrieved from http://blog.ericgoldman.org/archives/2011/07/17_usc_512f_pre.htm

Goldman, E. (2011, January 24). Second Life Gets Out of Dispute Between Virtual Bunnies & Virtual Horses. [Web log entry]. Retrieved from http://blog.ericgoldman.org/archives/virtual_worlds/

Goldman, E. (2011, January 3). Second Life Ordered to Stop Honoring a Copyright Owner's Takedown Notices--Amaretto Ranch Breedables v. Ozimals. [Web log entry]. Retrieved from http://blog.ericgoldman.org/archives/2011/01/second_life_ord.htm

Kwong, J. (2011, August 1). Feeding Virtual Horses Sparks an IP Battle in Second Life. [Web log entry]. Retrieved from https://virtualnavigator.wordpress.com/2011/08/01/feeding-virtual-horses-sparks-an-ip-battle-in-second-life/

Kwong, J. (2012, February 11). UPDATE: Virtual Horse Case, Amaretto Ranch v. Ozimals. [Web log entry]. Retrieved from http://virtualnavigator.wordpress.com/2012/02/11/update-virtual-horse-case-amaretto-ranch-v-ozimals/

Lay, Stacia. (2011, July 13). Virtual Horses and Bunnies Smackdown -- Court Concludes that DMCA Preempts State Law Claims Based on Alleged Misuse of DMCA Takedown Notification. [Web log entry]. Retrieved from http://iplaw.hllaw.com/2011/07/articles/dmca/virtual-horses-and-bunnies-smackdown-court-concludes-that-dmca-preempts-state-law-claims-based-on-alleged-misuse-of-dmca-takedown-notification/

Scheck, J. (2011, July 30). You Can Lead a Virtual Horse to Water, But You Might Get Sued Along the Way. The Wall Street Journal. Retrieved from http://online.wsj.com/article/SB10001424053111904772304576470722021477098.html?mod=ITP_AHED

International Airport Centers, LLC v. Citrin

Outline

Introduction

- CFAA and exceeding authorization

Background: Facts of Case

- Citrin employed by plaintiffs in real estate business.

- Record of findings on a company-distributed laptop.

- After breaching contract and quitting Citrin, deleted data from laptop

- Appeal for dismissal of plaintiff's suit for failture to state a claim based on word "transmission"

Ruling

- means of transmission didn't matter, via disk or otherwise

- "without authorization" - decision to terminate employment

- "confidential" - this issue is not resolved

- Reversed and remanded

Additional Cases

- US vs. Nosal

- LVRC Holdings LLC v. Brekka

Bibliography

“In the Court of Chancery of the State of Delaware in and for New Castle County: Citrin v. International Airport Centers .” Delaware State Courts. 7 Sep 2006. 6 Feb 2012. <http://courts.delaware.gov/opinions/%28jt4rny3ek1luzl45uhzj5a45%29/download.aspx?ID=81380>.

“United States Code: Title 18,1030. Fraud and related activity in connection with computers | LII / Legal Information Institute.” Legal Information Institute. 29 Jun 2010. Cornell University. 6 Feb 2012. <http://www.law.cornell.edu/uscode/18/1030.html>.

AJH. “International Airport Centers v. Citrin”. Cases of Interest. Risch, Michael. 23 Apr 2010. 6 Feb 2012. <http://www.casesofinterest.com/tiki/International+Airport+Centers+v.+Citrin>.

Chung, Cyrus Y. “The Computer Fraud and Abuse Act: How Computer Science Can Help With the Problem of Overbreadth.” Harvard Journal of Law & Technology. Vol 24 1 (Fall 2010).

Lawrence, Dan E. “Just Add Plaintiff: The Seventh Circuit’s Recipe for Instant Liability Under the Computer Fraud and Abuse Act [Int’l Airport Ctrs., L.L.C. v. Citrin, 440 F.3d 418 (7th Cir. 2006)]”. Washburn Law Journal. 28 Nov 2006. 6 Feb 2012. <http://washburnlaw.edu/wlj/46-1/articles/lawrence-dan.pdf>.

LVRC Holdings LLC v. Brekka. 581 F.3d 1127. Supreme Court of the US. 15 Sep 2009. Web. Pollaro, Greg. “Disloyal Computer Use and the Computer Fraud and Abuse Act: Narrowing the Scope.” Duke Law & Technology Review. 2010. 6 Feb 2012. <http://www.law.duke.edu/journals/dltr/articles/pdf/2010dltr012.pdf>.

Neuberger, Jeff. “Citing Plain Language of the Computer Fraud and Abuse Act, Ninth Circuit Rules Employee's Disloyal Act Does Not Terminate Authorization to Access Employer's Computer.” New Media and Technology Blog. 15 Sep 2009. 8 Feb 2012. <http://newmedialaw.proskauer.com/2009/09/articles/computer-fraud-and-abuse-act/citing-plain-language-of-the-computer-fraud-and-abuse-act-ninth-circuit-rules-employees-disloyal-act-does-not-terminate-authorization-to-access-employers-computer/>.

US v. Nosal. 642 F. 3d 781. Supreme Court of the US. 14 Feb 2011. Web.