Stern Response to motion to dismiss 8-20-10

4:08-cv-02753-TLW -TER Date Filed 08/20/10 Entry Number 141 Page 1 of 11

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF SOUTH CAROLINA
FLORENCE DIVISION

HOWARD K. STERN, as Executor of the )
Estate of Vickie Lynn Marshall, )
a/k/a Vickie Lynn Smith, ) Civil Action No. 4:08-cv-2753-TLW-TER
a/k/a Vickie Lynn Hogan, )
a/k/a Anna Nicole Smith, )
)
Plaintiff, )
)
vs. )
)
STANCIL SHELLEY, )
a/k/a Ford Shelley, )
G. BEN THOMPSON, )
GAITHER BENGENE THOMPSON, II, )
MELANIE THOMPSON, )
GINA THOMPSON SHELLEY, )
SUSAN M. BROWN, and )
THE LAW OFFICES OF )
SUSAN M. BROWN, P.C. )
)
Defendants. )
/

THE EXECUTOR’S RESPONSE IN OPPOSITION TO DEFENDANTS
SUSAN M. BROWN & THE LAW OFFICES OF SUSAN M. BROWN, P.C.’S
MOTION TO DISMISS THE AMENDED COMPLAINT
AND THE EXECUTOR’S INCORPORATED MOTION FOR ATTORNEYS’ FEES

COMES NOW Plaintiff Howard K. Stern, as Executor of the Estate of Vickie Lynn

Marshall a/k/a Anna Nicole Smith (the “Executor”) and files this Response in Opposition to

Defendants Susan M. Brown and The Law Offices of Susan M. Brown’s (collectively, “Brown”)

Motion to Dismiss the Amended Complaint showing this Court as follows:

INTRODUCTION

Brown has inexplicably filed a Motion to Dismiss realleging the same grounds for

dismissal that this Court rejected when Brown raised them in her “Memorandum in Opposition

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to Plaintiff’s Motion to Amend” (Document # 87). The standard of review before the Court on

the Executor’s motion for leave to amend the complaint is the same Rule 12(b)(6) standard that

the Court must use when examining a motion to dismiss. Brown has no good faith basis for

believing that a mere three months after this Court rejected her arguments (Document # 120), the

Court would suddenly reverse itself while applying the very same standard under which it

dismissed her arguments the first time.

Brown’s history in this litigation warrants some repeating. Brown has engaged in a

documented pattern of disregard for the authority of the Federal District Courts. Brown has

knowingly disobeyed an order of this Court. (See Document # 79). After being commanded to

appear for a deposition by the United States District Court for the Northern District of Georgia,

Brown unsuccessfully fled to this Court to seek a “last hour” stay of her court-ordered

deposition. (See Document # 72.) Now, Brown wants to rehash arguments expressly rejected by

this Court in its order granting the Executor leave to file his amended complaint. (See Document

# 120). Not only are Brown’s arguments as meritless today as they were three months ago and

require this Court to deny her motion to dismiss, her sheer bravado in realleging these arguments

and forcing the Executor to expend valuable Estate resources rearguing these issues1 supports an

award of sanctions under 28 U.S.C. § 1927, the Court’s inherent authority to sanction litigants

who pursue frivolous positions with no basis in law or fact, and any applicable South Carolina

statute.

Moreover, Brown’s Motion to Dismiss is really a misnomer. It is a partial motion to

dismiss. Brown’s Motion is primarily a challenge of the causes of action alleged against her

1
The sole heir of the Estate is Dannielynn Hope Marshall Birkhead, a three-year old child. The
practical effect of Brown’s frivolous filing is that Brown is taking money out of a child’s pocket
by litigating matters that have no basis in law or fact after the Court’s order granting the
Executor leave to file the amended complaint.

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based on California statutes. Brown does not – and certainly cannot – challenge the causes of

action alleged against her based on the common law: conversion (Count One); common law

commercial appropriation of right of publicity (Count Three); unjust enrichment/restitution

(Count Four); unfair competition (Count Five); and civil conspiracy (Count Seven).

Furthermore, Brown does not – and once again cannot – challenge the federal statutory-based

claim against her: violation of the Computer Fraud and Abuse Act (Count Six). Therefore, even

if Brown is successful on her Motion to Dismiss, six valid and separate causes of action alleged

against her keep her in this case.

ARGUMENT AND CITATION OF AUTHORITIES

I. LEGAL STANDARD FOR MOTION TO DISMISS IS THE SAME STANDARD
APPLIED BY THE COURT ON THE EXECUTOR’S MOTION FOR LEAVE TO
AMEND.

The legal standard that the Court must apply to Brown’s Motion to Dismiss is the same

legal standard the Court has previously applied when determining whether to grant the

Executor’s motion for leave to amend the complaint. See Perkins v. U.S., 55 F.3d 910, 917 (4th

Cir. 1995); R.E. Goodson Constr. Co., Inc. v. International Paper Co., No. C/A 4:02-4184, 2005

WL 2614927, *6 (D.S.C. Oct. 13, 2005). The standard on a motion to dismiss is that a complaint

must be dismissed if it does not allege enough facts to state a claim to relief that is plausible on

its face. Monroe v. City of Charlottesville, 579 F.3d 380, 386 (4th Cir. 2009). A court should

not grant a motion to dismiss for failure to state a claim unless it appears certain that the plaintiff

can prove no set of facts which would support its claim and would entitle it to relief. In

considering a motion to dismiss, the court should accept as true all well-pleaded allegations and

should view the complaint in a light most favorable to the plaintiff. Mylan Laboratories, Inc. v.

Matkari, 7 F.3d 1130, 1134 (4th Cir. 1993). The Court has already applied this standard to the

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Executor’s Amended Complaint and has found that it is capable of surviving a motion to dismiss.

(Document #120, at 5-6.) Applying that same standard to Brown’s motion to dismiss, this Court

must deny Brown’s motion to dismiss.

II. THE EXECUTOR HAS STATED A CAUSE OF ACTION FOR
‘MISAPPROPRIATION OF PUBLICITY RIGHTS.’

Brown complains that California Civil Code § 3344.1 does not apply to actions outside of

California. While the Executor and Brown can debate whether the tort alleged in Count Three of

the Amended Complaint occurred in California, Georgia, South Carolina, or somewhere else, it

does not matter. Count Three of the Amended Complaint against Brown is for “Statutory &

Common Law Commercial Appropriation of Right of Publicity.” This Court has already held

that the Executor has properly pleaded a common law claim for misappropriation of publicity

rights under either California or South Carolina law. (Document #120, at 6.)

Although the Executor has properly pleaded a claim for relief under the common law, he

has also properly pleaded a claim for relief under California Civil Code § 3344.1. Brown argues

that a claim under California Civil Code § 3344.1 cannot be brought in South Carolina. Brown

is wrong because in this diversity action a claim under California Civil Code § 3344.1 can be

brought in South Carolina.2 The tort alleged in Count Three of the Amended Complaint is one

2
Brown has misrepresented to the Court that “no courts outside of South Carolina” have
interpreted or relied on the statute thus “proving” that the statute has no force outside of
California. Plaintiffs have relied on the statute in federal courts outside of those situated in
California. See Hofheinz v. AMC Productions, Inc., No. CV-00-5827, 2003 WL 25293919, *7
(E.D.N.Y. Apr. 23, 2003) (granting summary judgment on California Civil Code § 3344.1
because it exempts television programs like the one at issue). Likewise, right of publicity
statutes similar to California’s statute are litigated outside of the state that enacted the statute.
See, e.g., Shaw Family Archives v. CMG Worldwide, Inc., No. 05-CIV-3939, 2008 WL 412830
(S.D.N.Y. Sept. 2, 2008) (litigating Indiana statute); Fox v. Encounters Int’l, Nos. 05-1139, 05-
1404, 2006 WL 952317 (D. Md. Apr. 13, 2006) (litigating Virginia statute); Weber v. National
R.R. Passenger Corp., No. B-84-564, 1986 WL 10333 (D. Conn. May 7, 1986) (litigating New
York statute).

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affecting property rights, albeit intangible property rights. See KNB Enters. v. Matthews, 92

Cal. Rptr. 2d 713, 715 n.2 (Cal. App. 2d 2000) The Supreme Court of South Carolina has

specifically recognized the right of publicity as a property right. Gignilliat v. Gignilliat, Savitz,

& Bettis, LLP, 684 S.E.2d 756, 760 (S.C. 2009) (“We further hold the right to control the use of

one’s identity is a property right that is transferable, assignable, and survives the death of the

named individual”). Personal property rights are governed by the law of the state in which the

property is located. See Humble Oil & Refining Co. v. Copeland, 398 F.2d 364, 366 (4th Cir.

1968). The general rule is that intangible property is considered to be located in the owner’s

domicile. See GP Credit Co., LLC v. Orlando Residence, Ltd., 349 F.3d 976, 979 (7th Cir.

2003); In re Lambert, 179 F.3d 281, 285 (5th Cir. 1999); Gordon v. Holly Woods Acres, Inc. 328

F.2d 253, 255 (6th Cir. 1964). Applying the doctrine of lex loci delicti specifically to a right of

publicity tort, the United States Court of Appeals for the Eleventh Circuit determined that the

substantive law of the state in which the plaintiff resides likely applies to right of publicity torts.

Allison v. Vintage Sports Plaques, 136 F.3d 1443, 1445 n.6 (11th Cir. 1998) (“Because Allison

resides in Alabama, treatment of right of publicity claims as property actions likely would result

in application of Alabama substantive law.”). Ms. Smith’s Estate is a California Estate.

(Document #122, at ¶¶ 1, 12.) Accordingly, California law – including California Civil Code

§ 3344.1 – applies to Brown’s tortious acts.3

3
For these same reasons California Probate Code § 850 et seq. applies. Moreover, because both
California Civil Code § 3344.1 and California Probate Code § 850 provide rights to certain
damages, South Carolina courts consider that aspect of the statutes to be substantive law rather
than procedural law. Lister v. NationsBank of Delaware, N.A., 494 S.E.2d 449, 460 (S.C. Ct.
App. 1997). In her Motion to Dismiss, Brown does not seek to dismiss the Executor’s unfair
competition claim to the extent that it has been brought pursuant to California Business and
Professions Code § 17200, et seq., so apparently Brown concedes that this Court may apply
some California statutes to her conduct.

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Brown next argues that even if a claim can be brought under California Civil Code

§ 3344.1, she did not do anything that would trigger liability under the statute. Again, Brown is

wrong. In order to avoid liability under California Civil Code § 3344.1, Brown falsely alleges

that the Executor has “neither alleged nor provided any evidence that Brown used Smith’s

likeness for the purpose of advertising or selling goods or services.”4 (Document 136-1, at 6.)

The Executor, of course, does not have to “provide evidence” in his Amended Complaint that

Brown used Smith’s likeness for a commercial purpose. Already, however, the record is full of

sufficient evidence to support this element. As the Executor explained in his reply in support of

his motion for leave to amend, Brown has attempted to limit the scope of the statute. (Document

#95, at 10.) Brown can be liable to the Estate if she used Ms. Smith’s name, voice, signature,

photograph, or likeness, in any manner, for soliciting services. See Cal. Civ. Code § 3344.1.

The Executor has properly alleged that Brown used Smith’s right of publicity for commercial

purposes under the applicable statute:

Brown purportedly transferred the two (2) hard drives to Clark based on a
Common Interest and Confidentiality Agreement purportedly entered into
between Arthur, Ford, and Gaither. The Common Interest and Confidentiality
Agreement is executed by McCabe on his own behalf and on Brown’s behalf. (A
true and correct copy of the purported Common Interest and Confidentiality
Agreement is attached hereto as Exhibit E.)

At the time that Brown transferred the two (2) hard drives to The O’Quinn
Law Firm, Brown believed that Ford was in discussions with McCabe for The
O’Quinn Law Firm to represent Ford in (i) litigation against CBS Studios, Inc.;
(ii) litigation against Stern, individually and as Executor of the Estate, purportedly
for slander; and/or (iii) litigation against Stern as Executor concerning ownership
of Horizons.

4
Notably, the common law tort of misappropriation of the right of publicity does not contain this
additional element that Brown claims is contained in California Civil Code § 3344.1. See
Gignilliat, 684 S.E. 2d at 759.

6


Brown transferred the two (2) hard drives to The O’Quinn Law Firm in an
attempt to gain the benefit of The O’Quinn Law Firm’s representation of Ford in
various litigation matters adverse to, among others, the Estate and Stern.

(Document #122, at ¶¶ 119-21.) Through this passage, the Executor clearly alleges that Brown

used Ms. Smith’s name, voice, photograph and likeness in an attempt to sell her own legal

services or to solicit legal services from The O’Quinn Law Firm. Moreover, the Executor has

further alleged that:

Ford, Brown, and the Law Firm used Ms. Smith’s name, voice,
photograph, and likeness contained in the Clown video, Christmas video,
Horizons video, Wedding video, Gibson photographs, Gibson messages,
Certificate of Permanent Residence, Western Union receipts, and photographs and
videos contained on the Estate’s computers without consent.

Ford, Brown, and the Law Firm’s conduct in using, displaying,
transferring, and selling or attempting to sell the Clown video, Christmas video,
and photographs and videos contained on the Estate’s computers, as set forth
above, constitutes “use” of Ms. Smith’s name, voice, likeness and photograph
within the meaning of California Civil Code § 3344.1.

(Document #122, at ¶¶ 229-30.) Thus, the Executor has sufficiently pleaded a cause of action for

violation of California Civil Code § 3344.1, and this Court should deny Brown’s motion to

dismiss Count Three of the Amended Complaint.

III. THE EXECUTOR’S CLAIMS AGAINST BROWN HAVE NOT “ALREADY
BEEN ADJUDICATED BY ANOTHER COURT.”

Brown claims she cannot be sued for the numerous torts she committed with respect to

the two hard drives containing property belonging to the Estate because her actions with respect

to that Estate property is also the subject of a currently pending motion for sanctions.

(Document #136-1, at 7.) Brown raised this exact same argument in her opposition to the

Executor’s motion to amend. (Document #87, at 10-11.) Indeed, this argument is a nearly

verbatim regurgitation of the argument in her opposition brief. (Compare Document #136-1, at 7

with Document #87, at 10-11.) Though the Court did not explicitly address this specific

7


argument in its Order granting the Executor leave to amend the complaint, by granting the relief

requested by the Executor, the Court implicitly rejected Brown’s faulty argument. (See

Document #120.)

Nevertheless, because Brown has again raised this frivolous argument, the Executor will

again refute it. Brown’s tortious acts concerning Estate property (which form the basis of the

allegations against her in the Amended Complaint) are separate and distinct from whether Brown

violated an order of this Court (which forms the basis of the pending motion for sanctions).

Brown’s acts can damage the Estate without violating this Court’s orders. Likewise, Brown’s

violation of a Court Order does not necessarily cause actionable damage to the Estate. In his

reply in support of his motion for leave to amend the complaint, the Executor succinctly

explained the difference between the claims against Brown alleged in the Amended Complaint

and the relief sought through the motion for sanctions:

A cursory comparison of the Amended Complaint and Motion for Contempt and
Sanctions [DE 79] reveals that the two are separate and distinct. Brown’s
contention that “most of the allegations” against Brown in the Amended
Complaint are based upon Brown’s violation of the Consent Order Entering
Preliminary Injunction is factually incorrect. (See Resp. Br., at 10.) Indeed, a
small portion of the conduct upon which the Executor seeks relief against Brown
occurred after entry of the Injunction. (See e.g., Am. Compl., ¶¶ 201-02.)

Moreover, Brown ignores that there are different elements for a finding of civil
contempt and the causes of action alleged against Brown. Surely, one can commit
tortious acts without simultaneously violating a court order. The issues before the
Court on the Motion for Contempt and Sanctions are different from those before
the Court in the Amended Complaint and, therefore, collateral estoppel would not
apply.

(Document #95, at 14-15.) The Executor’s logic today is as true as it was on December 7, 2009,

when he first rebutted this argument by Brown. This Court should deny Brown’s motion to

dismiss for the same reasons it rejected her opposition to the Executor’s motion for leave to

amend the complaint.

8


IV. THE EXECUTOR IS ENTITLED TO ATTORNEYS’ FEES.

Brown’s attempt to relitigate issues already ruled upon by the Court warrants the

imposition of an award of attorneys’ fees to the Executor for expending valuable resources in

responding to matters already resolved by this Court. This Court has the authority to award the

Executor his attorneys’ fees under 28 U.S.C. § 1927 and the Court’s inherent authority to

sanction litigants who pursue frivolous positions with no basis in law or fact.

CONCLUSION

Based on the foregoing, the Court should DENY Defendants Susan M. Brown and The

Law Offices of Susan M. Brown, P.C.’s Motion to Dismiss the Amended Complaint and further

AWARD the Executor his reasonable and necessary attorney’s fees incurred in responding to

this frivolous motion.

Respectfully submitted this 20th day of August, 2010.

/s/ L. Lin Wood
L. Lin Wood
(Georgia Bar No. 774588) (Pro hac vice)
Lin.Wood@BryanCave.com
Nicole Jennings Wade
Nicole.Wade@BryanCave.com
Luke A. Lantta
Luke.Lantta@BryanCave.com

BRYAN CAVE LLP
One Atlantic Center
Fourteenth Floor
1201 West Peachtree Street, N.W.
Atlanta, Georgia 30309
Telephone: (404) 572-6600
Facsimile: (404) 572-6999

9


/s/ Louis Nettles
Karl A. Folkens
(District Court ID No. 854)
Karl@folkenslaw.com
Louis Nettles
Louis@folkenslaw.com

FOLKENS LAW FIRM, P.A.
3326 West Palmetto Street
Florence, South Carolina 29501
Telephone: (843) 665-0100
Facsimile: (843) 665-0500

Attorneys for the Executor

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CERTIFICATE OF SERVICE

I hereby certify that on August 20, 2010, I electronically filed the foregoing document

with the Clerk of Court, which will automatically send notification of such filing to the following

attorneys of record:

Susan P. MacDonald Benjamin A. Baroody
Nelson Mullins Riley & Scarborough LLP David B. Miller
Beach First Center, 3rd Floor Bellamy, Rutenberg, Copeland, Epps,
3751 Robert M. Grissom Parkway Gravely & Bowers, P.A.
Myrtle Beach, SC 29577 Post Office Box 357
Myrtle Beach, SC 29578-0357
Attorneys for Defendants
Stancil Shelley and Gina Shelley Attorneys for Defendants
Gaither Bengene Thompson, II and
Melanie Thompson

Carl E. Pierce, II
Joseph C. Wilson, IV
Pierce, Herns, Sloan & McLeod, LLC
P.O. Box 22437
Charleston, SC 29413

Attorneys for Defendants
Susan M. Brown and
The Law Offices of Susan M. Brown, P.C.

I further certify that this same day, the foregoing document was served upon the

following by first class mail addressed as follows:

G. Ben Thompson
3760 Waterford Drive
Myrtle Beach, SC 29577

Pro Se

This 20th day of August, 2010.

/s/ Louis Nettles
Louis Nettles
Louis@folkenslaw.com

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Stern Response to motion to dismiss 8-20-10

Stern Response to motion to dismiss 8-20-10

Stern Response to motion to dismiss 8-20-10

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