Estate of Graham v. Sotheby's, Inc.

Proceedings (In Chambers): ORDER RE MOTIONS TO DISMISS [No. 11-8604: 98, 99] [No. 11-8605: 106] [No. 11-8622: 92]

Before the Court are three Motions filed in these related actions:

Having considered the papers filed on the Motions and the parties’ arguments at the hearing held on March 21, 2016, the Court rules as follows:

The Joint and eBay Motions are GRANTED to the extent they argue that the California Resale Royalty Act (“CRRA”) is preempted under the Copyright Act of 1976. The CRRA stands in conflict with the first sale doctrine codified in 17 U.S.C. § 109 (a), which prohibits copyright holders from exercising downstream distribution control of their products. Because the CRRA regulates secondary transactions of fine art by permitting artists to recover unwaivable royalties from resellers, the state law frustrates the purpose of § 109(a) and disrupts the equilibrium of the Copyright Act. Plaintiffs’ claims, moreover, are in *980 dependently preempted under the express preemption clause of 17 U.S.C. § 301 (a) because they are not qualitatively different from garden-variety copyright claims.

The eBay Motion is also GRANTED to the extent it contends that Defendant eBay is…