Vestron, Inc. v. Home Box Office Inc., and Hbo Video, Inc.

This case comes to us on appeal from the district court’s final order dismissing the action for lack of subject matter jurisdiction. The appeal was heard on an expedited basis. We concluded that jurisdiction existed under the Federal Copyright Act, 17 U.S.C. § 101 et seq. (1982), and therefore reversed and remanded to the district court. We issued an unpublished order to this effect immediately to expedite the district court’s consideration of Vestron’s request for a preliminary injunction, and indicated that an opinion would follow. This opinion provides the analysis for the earlier order. The question before us is whether a complaint that pleads a claim for copyright infringement properly invokes federal jurisdiction even though the defendant admits the allegedly infringing use and disputes only the issue of contractual ownership of the copyright. FACTS

Vestron, the plaintiff and appellant, alleges that it owns the exclusive American videocassette distribution rights to two films, Hoosiers and Platoon, and that HBO has infringed on these rights. Vestron obtained the videocassette rights to both films from their producer, Hemdale Film Corporation and Hemdale Video Corporation…