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FUNimation Sues CA Retail Sites over Alleged Bootlegs

The North American anime distributor FUNimation Productions is suing a group of related companies in Southern California for allegedly selling counterfeit DVDs of its licensed anime on a website. FUNimation is alleging that a California resident named Hae Yong Ro and four affiliated businesses — N Trading, Inc, Discount Anime DVD, BuyDVD.com, and DOES — infringed on FUNimation and its licensers' copyrights and trademarks by selling unauthorized copies of Fruits Basket, Dragon Ball, Dragon Ball Z, Dragon Ball GT, and Fullmetal Alchemist. Some of the DVDs are said to have included English dubbing.

FUNimation stated that it first became aware of the defendants' activities around 2006, and it sent a cease-and-desist letter to the defendants in February 2008. The lawsuit alleges that the defendants received the letter "but failed and refused to respond or to cease the advertising and distribution of the works." After FUNimation informed the defendants' website hosting company, the hosting company suspended the defendants' website in April. The defendants allegedly promised to remove the infringing content to have their website restored, but "instead failed and refused to remove all of the infringing DVDs." Once notified of this, the hosting company shut down the website. "Within 36 hours, [the] defendants' website was posted again with a new website host based in Korea," and the new website "continued to advertise, offer for sale, distribute, and sell the works." The lawsuit further alleges that the defendants have been manufacturing and selling unauthorized DVD copies since March of 2002.

Funimation's legal representative filed the lawsuit in August. The suit is still active, pending a scheduling conference between all parties that is set for November 17 in a Los Angeles courtroom. The lawsuit is requesting the seizure or destruction of all DVD copies, as well as "all plates, molds, matrices, masters, tapes, film negatives, or other articles" used in the copying under the United States copyright law. The suit further asserts damages in the range of US$23.7 million, not including US$80,000 in legal fees. FUNimation is also requesting that the defendants "notify all customers who purchased [an infringing] DVD" … "that said DVD is an unlawful copy, and may be returned for a full refund, including shipping" to be paid by the defendants. FUNimation is asking for an additional US$5,005,000, and compensation for more legal fees, for the infringement of TV Tokyo, Square Enix, and Shueisha's trademarks.

According to Exhibit A of the lawsuit, the defendants sold "Fruits Basket Perfect Collection DVD (English Dubbed)" with 26 episodes, "Fullmetal Alchemist" with 24 episodes, and "Dragon Ball GT Prologue (DVD Box Set, English Dubbed)" with 16 episodes. Exhibit A also lists "Dragon Ball Z DVD Part 03" with episodes 55-81, "Dragon Ball Z DVD Part 06" with episodes 136-148, "Dragon Ball DVD Part 4" with episodes 79-104, and "Dragon Ball DVD Part 5" with episodes 105-130. In all, the DVDs included 158 episodes. (Under the United States copyright law, each episode is considered a separate work.)

BuyDVD.com was officially affiliated with Anime Nuts, a brick-and-mortar store that operated in the Southern California city of Anaheim until October 12. Ro, who also goes by the name Richard Ro, is the administrative contact for both BuyDVD.com and DiscountAnimeDVD.com. BuyDVD.com is listed under the company name of N Trading. N Trading, DiscountAnimeDVD.com, and BuyDVD.com all operated out of the Los Angeles suburb of Santa Fe Springs. The websites of both DiscountAnimeDVD.com and BuyDVD.com have been down this week.

Anime Nuts' brick-and-mortar store did not carry unauthorized DVDs on its shelves during its store-closing sale, in which all items were marked 50% off and eventually 60% off. Items that sold out in the physical store were immediately listed as sold out on both BuyDVD.com and DiscountAnimeDVD.com. An employee told customers that the store owner had said that the store's closing was due to the worsening outlook for the anime retail field.

Ro and the other defendants have denied the allegations in their answer to the legal complaint. The defendants also gave ten lines of defense, including the claim of "the doctrine of fair use," their "good faith belief that such products were authentic and authorized by [the] plaintiff for resale," and the statute of limitations.

FUNimation gave the following statement to ANN: "We can confirm that we have discovered the unauthorized sale of counterfeit DVDs of FUNimation titles through DiscountAnimeDVD.com. As a result of this discovery, we did file a complaint in Federal District Court against N Trading, Inc., the owners/operators of the site. We feel that exercising our rights in this manner is sometimes the best way to protect the creative contributions of everyone involved in such collaborative endeavors." Ro, BuyDVD.com, and Anime Nuts did not respond to multiple requests for comment via email and telephone.

Image © 2001 Natsuki Takaya/HAKUSENSHA • TV TOKYO • NAS • Furuba Project.