M2 Software Inc. v. M2 Communications, L.L.C.

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

M2 SOFTWARE INC., a Delaware  corporation, Plaintiff-Appellant, No. 03-55957 v. D.C. No.

CV-00-02853-AHM

MADACY ENTERTAINMENT, a corporation e/s/a Madacy  Central District Entertainment Group, Inc.; of California, HANDLEMAN COMPANY, a Los Angeles corporation; SFX ENTERTAINMENT, ORDER a corporation, Defendants-Appellees.  Filed August 21, 2006

Before: Harry Pregerson, William C. Canby, Jr., and Robert R. Beezer, Circuit Judges.

Order; Concurrence by Judge Pregerson; Concurrence by Judge Beezer

ORDER

Appellant M2 Software’s motion to recall the mandate and vacate the opinion in the above case is DENIED. M2 Soft- ware’s request that the recusal motion be assigned to a new panel is DENIED. Madacy Entertainment’s motion for sanc- tions against M2 Software is also DENIED.

10233 10234 M2 SOFTWARE INC. v. MADACY ENTERTAINMENT PREGERSON, Circuit Judge, specially concurring:

I concur in the court’s order.

To set the matter straight, at the time this case was assigned to this panel…

ORDER

Appellant M2 Software’s motion to recall the mandate and vacate the opinion in the above case is DENIED. M2 Software’s request that the recusal motion be assigned to a new panel is DENIED. M2 Communications’ request for sanctions against M2 Software is also DENIED.

specially concurring:

I concur in the court’s order.

To set the matter straight, at the time this case was assigned to this panel and at the time we decided it, I owned an equitable interest in Time Warner. Time Warner was not a party to the suit. Unbeknownst to me, Time Warner had an option (never exercised) to purchase up to 19.9% of Warner Music — also not a party to this suit. See David A. Vise, Time Warner Sells Music Unit to Bronfman for $2.6B, Wash. Post, Nov. 24, 2003. Warner Music owned Word Entertainment, not a party to this suit either. See 10-Q filing for Warner Music Group, at 7 (June 13, 2005), available at http://www.sec.gov/Archives/ edgar/data/ 1319161/000104746905017103/0001047 469-05-017103-index.htm. Word Entertainment had an exclusive distribution contract with M2 Communications, a small Christian music label and a party to this suit. See Word Entertainment, available at http://www.wmg.com/recordedmu-sic/ ?promo=24020007.

In sum, then, I had no interest “however small” in the subject matter in controversy. Instead, I had an interest in a company (a) that had an option to purchase 19.9% of a company (b) that owned a company (c) that contracted with a party…

specially concurring:

I concur in the court’s order denying the motion to recall the mandate and the denial of the motion for sanctions. Because the mandate is not recalled, I believe we have no jurisdiction to address the challenge to Judge Pregerson’s participation in this appeal.

M2 Software, Inc. moves the court for an order recalling the mandate and vacating the opinion. Appellant’s counsel asserts that Judge Pregerson owns stock in Time Warner, Inc. and that such ownership required his recusal from participation in the decision of the case pursuant to 28 U.S.C. § 455 .

Our authority to recall a mandate is to be “exercised only in extraordinary circumstances” and the “sparing use of the power demonstrates that it is one of last resort, to be held in reserve against grave, unforeseen contingencies.” Calderon v. Thompson, 523 U.S. 538, 550 , 118 S.Ct. 1489 , 140 L.Ed.2d 728 (1998). When a motion to recall a mandate is based on allegations of fraud on the court or allegations of misconduct affecting the integrity of the judicial process, the harm must be “gross” and enforcement of the judgment “manifestly unconscionable.” Hazel-Atlas Glass Co. v. Hartford-Empire Co., 322 U.S.…