United States District Court, D. New Jersey
LAW OFFICE OF JASON
RABINOVICH, PLLC, Jason L. Rabinovich, Esq., Philadelphia, PA, Counsel for
BAKOS & KRITZER, Noam J.
Kritzer, Esq., Florham Park, NJ, Counsel for Defendant.
JOSEPH E. IRENAS, Senior District Judge.
Pending before the Court is Defendant Emerson Cleaners, Inc.'s ("Emerson") Motion to Require Plaintiff Live Face on Web, LLC ("LFOW") to Post Bond for Costs and Expenses, in the amount of $50, 000. For the reasons set forth below, the Motion will be denied without prejudice.
Plaintiff LFOW is a Pennsylvania limited liability company that owns and develops software and video technology, which it licenses to individuals and businesses for use in online advertising. (First Am. Compl. ¶ 11-12) LFOW's customers use the software to customize a "live spokesperson" to direct a website visitor's attention to particular products or aspects of the website. (First Am. Compl. ¶ 12) LFOW allegedly is a "leading developer" of this technology. (First Am. Compl. ¶ 11)
On January 10, 2014, LFOW filed a Complaint for copyright infringement pursuant to the U.S. Copyright Act, 15 U.S.C. § 501 et. seq., against four defendants: 1) Emerson Cleaners, Inc.; 2) Green Technology Services; 3) Innovative Pain Management, LLC; and 4) Sunrise Go Go Club. (Dkt. No. 1) LFOW seeks actual damages and any profits of the defendants' alleged use of its software, or to recover statutory damages of $150, 000 for each work infringed. (First Am. Compl. ¶ 90) LFOW also seeks reasonable attorney's fees and costs, pursuant to 17 U.S.C. § 505. (First Am. Compl. ¶ 91)
The same day, LFOW also initiated a copyright infringement action in the Middle District of Florida against Tweople, Inc., a Florida corporation. Live Face on Web, LLC v. Tweople, Inc. No. 14-CV-00044 (M.D. Fl. Jan. 10, 2014). The Florida complaint also listed as defendants twenty of Tweople's allegedly infringing customers. Id.
Defendant Emerson filed the current motion requiring Plaintiff LFOW to post security in the amount of $50, 000. LFOW timely opposed the motion, and Emerson filed a reply brief.
The Federal Rules of Civil Procedure do not address a plaintiff's obligations to post a bond for costs and expenses before proceeding with an action.
Absent a local rule or statute expressly requiring the posting of security, "the federal district courts have inherent power to require plaintiffs to post security for costs." Simulnet East Assocs. v. Ramada Hotel Operating Co., 37 F.3d 572, 574 (9th Cir. 1994). See also Hawes v. Club Ecuestre El Comandante, 535 F.2d 140, 143 (1st Cir. 1976) (stating that it is within the court's inherent power to require a plaintiff to post security "when warranted by the circumstances of the case"). A District Court may, in its discretion, require a plaintiff to post security for costs in "certain exceptional cases." McClure v. Borne Chem. Co., 292 F.2d 824, 835 (3d Cir. 1961).
The District of New Jersey does not have a local rule governing posting security for costs and expenses, nor does the statute under which LFOW seeks to recover, 17 U.S.C. § 501 et seq., expressly require it. Thus, Emerson's motion to ...