Case 2:25-cv-08768-SB-E Document 61 Filed 06/26/26 Page 1 of 16 Page ID #:1375 1 JENNER & BLOCK LLP David R. Singer (SBN 204699) 2 dsinger@jenner.com 3 Julie A. Shepard (SBN 175538) jshepard@jenner.com 4 Lauren M. Greene (SBN 271397) 5 lgreene@jenner.com 515 South Flower Street, Suite 3300 6 Los Angeles, CA 90071-2246 7 Telephone:(213) 239-5100 Facsimile: (213) 239-5199 8 Attorneys for Plaintiffs and 9 Counterclaim-Defendants 10 UNITED STATES DISTRICT COURT 11 CENTRAL DISTRICT OF CALIFORNIA 12 13 DISNEY ENTERPRISES, INC.; UNIVERSAL Case No. 2:25-cv-08768-SB-E CITY STUDIOS PRODUCTIONS LLLP; 14 WARNER BROS. ENTERTAINMENT INC., et PLAINTIFFS AND COUNTER- DEFENDANTS’ ANSWER TO 15 al., DEFENDANT AND COUNTERCLAIMANT 16 Plaintiffs, NANONOBLE PTE. LTD.’S 17 v. COUNTERCLAIMS 18 MINIMAX, et al., Defendants. Complaint Filed: September 16, 2025 19 Trial Date: July 12, 2027 20 NANONOBLE PTE. LTD., 21 Counterclaimant, 22 v. 23 DISNEY ENTERPRISES, INC., UNIVERSAL 24 CITY STUDIOS PRODUCTIONS LLLP, 25 WARNER BROS. ENTERTAINMENT INC., et al., 26 Counterclaim-Defendants. 27 28 ANSWER Case 2:25-cv-08768-SB-E Document 61 Filed 06/26/26 Page 2 of 16 Page ID #:1376 1 Plaintiffs and Counter-Defendants Disney Enterprises, Inc., Marvel Characters, Inc., 2 MVL Film Finance LLC, Lucasfilm Ltd. LLC, and Twentieth Century Fox Film 3 Corporation, (collectively, “Disney”), Universal City Studios Productions LLLP and 4 DreamWorks Animation L.L.C. (collectively “Universal”), and Warner Bros. 5 Entertainment Inc., DC Comics, The Cartoon Network, Inc., Turner Entertainment Co., 6 Hanna-Barbera Productions, Inc. (collectively “Warner Bros. Discovery”) (Disney, 7 Universal, and Warner Bros. Discovery are referred to collectively as “Plaintiffs” or 8 “Counter-Defendants”), by and through their attorneys at Jenner & Block LLP, hereby 9 answer the Counterclaims For Contractual Indemnification, Breach Of Contract, And 10 Declaratory Relief; Demand For Jury Trial (“Counterclaims”) filed by Defendant and 11 Counterclaimant Nanonoble Pte. Ltd.’s (“Nanonoble” or “Counterclaimant”)1 as follows: 12 Except as otherwise expressly stated herein, Plaintiffs deny each and every 13 allegation contained in the Counterclaims. Plaintiffs expressly reserve the right to amend 14 or supplement their answer as may be necessary. 15 NATURE OF THE COUNTERCLAIMS 2 16 1. Plaintiffs admit that they investigated Defendants’ copyright infringement, 17 collected examples for purposes of filing this lawsuit, and included examples of such 18 infringement in paragraphs 118 through 159 of their Complaint to enforce their rights under 19 the U.S. Copyright Act. Plaintiffs further admit that Hailuo AI unlawfully generated the 20 52 video outputs identified in paragraphs 118 through 159 of their Complaint (the 21 “Accused Outputs”) and this lawsuit is now pending. Plaintiffs deny the remaining 22 allegations of this paragraph. 23 2. Plaintiffs admit that Hailuo AI service’s unlawfully generated infringing 24 outputs and that examples of Defendants’ copyright infringement are included in the 25 Complaint. Plaintiffs admit that Nanonoble’s counterclaims purport to state claims for 26 1 Plaintiffs have brought claims against both Nanonoble and Shanghai Xiyu Jizhi 27 Technology Ltd (collectively “Defendants”). Only Nanonoble has brought counterclaims. 2 Plaintiffs neither admit nor deny the contents of the various headings and subheadings 28 in Defendants’ Counterclaims, which are reproduced solely for convenience. 2 ANSWER Case 2:25-cv-08768-SB-E Document 61 Filed 06/26/26 Page 3 of 16 Page ID #:1377 1 indemnification. Plaintiffs deny that they violated Nanonoble’s Terms of Use and that the 2 Terms of Use are enforceable here. To the extent the other allegations in this paragraph 3 state legal conclusions, they do not require a response. To the extent a response is required, 4 Plaintiffs deny the remaining allegations of this paragraph. 5 3. Plaintiffs deny that they or their agents accepted and became bound by 6 Nanonoble’s Terms of Use and further deny that the Terms of Use are enforceable here. 7 Plaintiffs are without knowledge or information sufficient to form a belief about the truth 8 of the remaining allegations of this paragraph and, on that basis, deny them. 9 4. To the extent this paragraph purports to quote selectively from Nanonoble’s 10 alleged Terms of Use attached as Exhibit A, the document speaks for itself. Plaintiffs deny 11 that the Terms of Use are enforceable here. Plaintiffs deny the remaining allegations of this 12 paragraph. 13 5. Plaintiffs admit that their agents investigated copyright infringement by and 14 through the Hailuo AI platform and that Hailuo AI generated the infringing outputs 15 included in paragraphs 118 through 159 of Plaintiffs’ Complaint during that investigation. 16 Plaintiffs deny that the Terms of Use are enforceable here. To the extent the allegations in 17 this paragraph state legal conclusions, they do not require a response. To the extent a 18 response is required, Plaintiffs deny any remaining allegations in this paragraph. 19 6. Plaintiffs allege that their claims arise out of Defendants’ unlawful copyright 20 infringement. Plaintiffs deny that the outputs were created by their agents and allege that 21 the outputs were unlawfully generated by Defendants’ Hailuo AI. Plaintiffs further deny 22 that the Terms of Use are enforceable here. To the extent the allegations in this paragraph 23 state legal conclusions, they do not require a response. To the extent a response is required, 24 Plaintiffs deny any remaining allegations in this paragraph. 25 The Parties 26 7. Plaintiffs are informed and believe that Nanonoble is a Singaporean private 27 limited company and that it purports to be the “Company” as defined by the Terms of Use. 28 Plaintiffs are without knowledge or information sufficient to form a belief about the truth 3 ANSWER Case 2:25-cv-08768-SB-E Document 61 Filed 06/26/26 Page 4 of 16 Page ID #:1378 1 of the remaining allegations of this paragraph and, on that basis, deny them. 2 8. Plaintiffs admit that Disney Enterprises, Inc. is a corporation duly 3 incorporated under the laws of the State of Delaware with its principal place of business in 4 Burbank, California. 5 9. Admitted. 6 10. Plaintiffs admit that Warner Bros. Entertainment Inc. is a corporation duly 7 incorporated under the laws of the State of Delaware with its principal place of business in 8 Burbank, California. 9 11. Plaintiffs admit that Marvel Characters, Inc. is a corporation duly incorporated 10 under the laws of the State of Delaware with its principal place of business in Burbank, 11 California. 12 12. Admitted. 13 13. Admitted. 14 14. Plaintiffs admit that Twentieth Century Fox Film Corporation (also known as 15 “20th Century Studios”) is a corporation duly incorporated under the laws of the State of 16 Delaware with its principal place of business in Burbank, California. 17 15. Admitted. 18 16. Plaintiffs admit that The Cartoon Network, Inc. is a corporation duly 19 incorporated under the laws of the State of Delaware with its principal place of business in 20 Atlanta, Georgia. 21 17. Plaintiffs admit that Turner Entertainment Co. is a corporation duly organized 22 under the laws of the State of Delaware with its principal place of business in Burbank, 23 California. 24 18. Plaintiffs admit that Hanna-Barbera Productions, Inc. is a corporation duly 25 organized under the laws of the State of Delaware with its principal place of business in 26 Burbank, California. 27 19. Admitted. 28 20. Plaintiffs admit they are represented in this action by Jenner & Block LLP. 4 ANSWER Case 2:25-cv-08768-SB-E Document 61 Filed 06/26/26 Page 5 of 16 Page ID #:1379 1 To the extent the allegations in this paragraph state legal conclusions, they do not require 2 a response. To the extent a response is required, Plaintiffs deny any remaining allegations 3 in this paragraph. 4 Jurisdiction and Venue 5 21. To the extent the allegations in this paragraph state legal conclusions, they do 6 not require a response. To the extent a response is required, Plaintiffs deny any remaining 7 allegations in this paragraph. 8 22. To the extent the allegations in this paragraph state legal conclusions, they do 9 not require a response. To the extent a response is required, Plaintiffs deny any remaining 10 allegations in this paragraph. 11 23. Solely for purposes of this action, Plaintiffs admit that they are subject to 12 personal jurisdiction in this District in this lawsuit and that venue is proper in this District. 13 To the extent the allegations in this paragraph state legal conclusions, they do not require 14 a response. To the extent a response is required, Plaintiffs deny any remaining allegations 15 in this paragraph. 16 24. Plaintiffs admit that this Court is a federal court in the United States, that they 17 are subject to personal jurisdiction in this District in this lawsuit, and that venue is proper 18 in this District. Plaintiffs deny that the Terms of Use are enforceable here. To the extent 19 the allegations in this paragraph state legal conclusions, they do not require a response. To 20 the extent this paragraph purports to quote selectively from Nanonoble’s alleged Terms of 21 Use attached as Exhibit A, the document speaks for itself. Plaintiffs deny any remaining 22 allegations in this paragraph. 23 25. Plaintiffs deny that the Terms of Use are enforceable here. To the extent the 24 allegations in this paragraph state legal conclusions, they do not require a response. To the 25 extent a response is required, Plaintiffs deny any remaining allegations in this paragraph. 26 Factual Allegations Common to Both Counterclaims 27 26. Plaintiffs admit that Hailuo AI is an AI service owned and operated by 28 Defendants that generates images and videos in the United States. Plaintiffs further admit 5 ANSWER Case 2:25-cv-08768-SB-E Document 61 Filed 06/26/26 Page 6 of 16 Page ID #:1380 1 that if Hailuo AI subscribers submit text prompts, Defendants’ service generates, publicly 2 displays, publicly performs, and distributes images and videos including ones that infringe 3 Plaintiffs’ copyrighted works. Plaintiffs are without knowledge or information sufficient 4 to form a belief about the truth of the other allegations of this paragraph and, on that basis, 5 deny them. 6 27. Plaintiffs deny that Hailuo AI is like video-editing software or a photocopier. 7 Plaintiffs are without knowledge or information sufficient to form a belief about the truth 8 of the allegations of this paragraph and, on that basis, deny them. 9 28. To the extent the allegations in this paragraph state legal conclusions, they do 10 not require a response. To the extent this paragraph purports to characterize Nanonoble’s 11 alleged Terms of Use attached as Exhibit A, the document speaks for itself. Plaintiffs deny 12 that the Terms of Use are enforceable here. Plaintiffs deny any remaining allegations in 13 this paragraph. 14 29. Plaintiffs deny that the Terms of Use are enforceable here. To the extent the 15 allegations in this paragraph state legal conclusions, they do not require a response. To the 16 extent this paragraph purports to characterize Nanonoble’s alleged Terms of Use attached 17 as Exhibit A, the document speaks for itself. Plaintiffs deny any remaining allegations in 18 this paragraph. 19 30. Plaintiffs deny that the Terms of Use are enforceable here. To the extent the 20 allegations in this paragraph state legal conclusions, they do not require a response. To the 21 extent this paragraph purports to characterize Nanonoble’s alleged Terms of Use attached 22 as Exhibit A or the screenshot attached as Exhibit B, the documents speak for themselves. 23 Plaintiffs deny any remaining allegations in this paragraph. 24 31. Plaintiffs deny that the Terms of Use are enforceable here. To the extent the 25 allegations in this paragraph state legal conclusions, they do not require a response. To the 26 extent this paragraph purports to characterize Nanonoble’s alleged Terms of Use attached 27 as Exhibit A, the document speaks for itself. Plaintiffs deny any remaining allegations in 28 6 ANSWER Case 2:25-cv-08768-SB-E Document 61 Filed 06/26/26 Page 7 of 16 Page ID #:1381 1 this paragraph. 2 32. Plaintiffs deny that the Terms of Use are enforceable here. To the extent the 3 allegations in this paragraph state legal conclusions, they do not require a response. To the 4 extent this paragraph purports to characterize Nanonoble’s alleged Terms of Use attached 5 as Exhibit A, the document speaks for itself. Plaintiffs deny any remaining allegations in 6 this paragraph. 7 33. Plaintiffs deny that the Terms of Use are enforceable here. To the extent the 8 allegations in this paragraph state legal conclusions, they do not require a response. To the 9 extent this paragraph purports to characterize Nanonoble’s alleged Terms of Use attached 10 as Exhibit A, the document speaks for itself. Plaintiffs deny any remaining allegations in 11 this paragraph. 12 34. Plaintiffs deny that the Terms of Use are enforceable here. To the extent the 13 allegations in this paragraph state legal conclusions, they do not require a response. To the 14 extent this paragraph purports to characterize Nanonoble’s alleged Terms of Use attached 15 as Exhibit A, the document speaks for itself. Plaintiffs deny any remaining allegations in 16 this paragraph. 17 35. Plaintiffs deny that the Terms of Use are enforceable here. To the extent the 18 allegations in this paragraph state legal conclusions, they do not require a response. To the 19 extent this paragraph purports to characterize Nanonoble’s alleged Terms of Use attached 20 as Exhibit A, the document speaks for itself. Plaintiffs deny any remaining allegations in 21 this paragraph. 22 36. Plaintiffs deny that the Terms of Use are enforceable here. To the extent the 23 allegations in this paragraph state legal conclusions, they do not require a response. To the 24 extent this paragraph purports to characterize Nanonoble’s alleged Terms of Use attached 25 as Exhibit A, the document speaks for itself. Plaintiffs deny any remaining allegations in 26 this paragraph. 27 37. Plaintiffs deny that the Terms of Use are enforceable here. To the extent the 28 allegations in this paragraph state legal conclusions, they do not require a response. To the 7 ANSWER Case 2:25-cv-08768-SB-E Document 61 Filed 06/26/26 Page 8 of 16 Page ID #:1382 1 extent this paragraph purports to characterize Nanonoble’s alleged Terms of Use attached 2 as Exhibit A, the document speaks for itself. Plaintiffs deny any remaining allegations in 3 this paragraph. 4 38. Denied. 5 39. Denied. 6 40. The Studios deny that the Accused Outputs were created by their agents and 7 allege that they were unlawfully generated by Defendants’ Hailuo AI. Plaintiffs admit that 8 their Complaint depicts dozens of infringing image and video outputs created by 9 Defendants. Plaintiffs deny the remaining allegations in this paragraph. 10 41. Denied. 11 42. Plaintiffs admit that in order to investigate Defendants’ infringing activity, 12 their agents investigated Defendants’ Hailuo AI service through both free and paid 13 accounts. Plaintiffs deny the remaining allegations in this paragraph. 14 43. Denied. 15 44. The Studios deny that the Accused Outputs were created by their agents and 16 allege that they were generated by Defendants. Plaintiffs admit that the outputs in 17 paragraphs 118 through 159 of Plaintiffs’ Complaint are part of Plaintiffs publicly filed 18 Complaint. Plaintiffs deny the remaining allegations in this paragraph. 19 45. Denied. 20 46. Plaintiffs admit they are represented in this action by Jenner & Block LLP. 21 Plaintiffs admit that they investigated Defendants’ copyright infringement. The Studios 22 deny that the Accused Outputs were created by their agents and allege that they were 23 generated by Defendants. Plaintiffs deny the remaining allegations in this paragraph. 24 47. Plaintiffs deny that the Terms of Use are enforceable here. To the extent the 25 allegations in this paragraph state legal conclusions, they do not require a response. To the 26 extent a response is required, Plaintiffs deny any remaining allegations in this paragraph. 27 48. Plaintiffs deny that the Terms of Use are enforceable here. The Studios deny 28 that the Accused Outputs were created by their agents and allege that they were generated 8 ANSWER Case 2:25-cv-08768-SB-E Document 61 Filed 06/26/26 Page 9 of 16 Page ID #:1383 1 by Defendants. To the extent the allegations in this paragraph state legal conclusions, they 2 do not require a response. To the extent a response is required, Plaintiffs deny any 3 remaining allegations in this paragraph. 4 First Counterclaim for Relief 5 For Contractual Indemnification 6 (Against All Counterclaim Defendants) 7 49. This paragraph does not contain any allegations of fact and, therefore, no 8 answer is required. To the extent an answer is necessary, Plaintiffs incorporate by reference 9 their responses contained in paragraph 1 through 48 as if fully set forth at length herein. 10 50. Plaintiffs deny that the Terms of Use are enforceable here. To the extent the 11 allegations in this paragraph state legal conclusions, they do not require a response. To the 12 extent a response is required, Plaintiffs deny any remaining allegations in this paragraph. 13 51. Plaintiffs deny that the Terms of Use are enforceable here. To the extent the 14 allegations in this paragraph state legal conclusions, they do not require a response. To the 15 extent this paragraph purports to characterize Nanonoble’s alleged Terms of Use attached 16 as Exhibit A, the document speaks for itself. Plaintiffs deny the remaining allegations of 17 this paragraph. 18 52. Plaintiffs deny that the Terms of Use are enforceable here. To the extent the 19 allegations in this paragraph state legal conclusions, they do not require a response. To the 20 extent a response is required, Plaintiffs deny any remaining allegations in this paragraph. 21 53. Plaintiffs allege that their claims arise out of Defendants’ unlawful copyright 22 infringement. Plaintiffs deny that the Terms of Use are enforceable here. To the extent the 23 allegations in this paragraph state legal conclusions, they do not require a response. 24 Plaintiffs specifically deny Nanonoble is entitled to its defense costs, reasonable attorneys’ 25 fees, or indemnity. Plaintiffs deny any remaining allegations in this paragraph. 26 54. Plaintiffs deny that they are required to pay or reimburse Nanonoble’s defense 27 costs or attorneys’ fees and that they are required to indemnify Nanonoble. Plaintiffs admit 28 they have not paid or reimbursed Nanonoble for its defense costs or attorneys’ fees, nor 9 ANSWER Case 2:25-cv-08768-SB-E Document 61 Filed 06/26/26 Page 10 of 16 Page ID #:1384 1 indemnified Nanonoble for its own copyright infringement. Plaintiffs deny the remaining 2 allegations in this paragraph. 3 55. Denied. 4 Second Counterclaim for Relief 5 For Breach of Contract 6 (Against All Counterclaim Defendants) 7 56. This paragraph does not contain any allegations of fact and, therefore, no 8 answer is required. To the extent an answer is necessary, Plaintiffs incorporate by reference 9 their responses contained in paragraph 1 through 55 as if fully set forth at length herein. 10 57. Denied. 11 58. Plaintiffs deny that the Terms of Use are enforceable here. To the extent the 12 allegations in this paragraph state legal conclusions, they do not require a response. To the 13 extent this paragraph purports to quote selectively from Nanonoble’s alleged Terms of Use 14 attached as Exhibit A, the document speaks for itself. Plaintiffs specifically deny they 15 breached any alleged contract and deny the remaining allegations of this paragraph. 16 59. Plaintiffs deny that the Terms of Use are enforceable here. To the extent the 17 allegations in this paragraph state legal conclusions, they do not require a response. To the 18 extent this paragraph purports to quote selectively from Nanonoble’s alleged Terms of Use 19 attached as Exhibit A, the document speaks for itself. Plaintiffs specifically deny they 20 breached any alleged contract and deny the remaining allegations of this paragraph. 21 60. Denied. 22 61. Denied. 23 62. Denied. 24 Third Counterclaim for Relief 25 For Declaratory Relief 26 (Against All Counterclaim Defendants) 27 63. This paragraph does not contain any allegations of fact and, therefore, no 28 answer is required. To the extent an answer is necessary, Plaintiffs incorporate by reference 10 ANSWER Case 2:25-cv-08768-SB-E Document 61 Filed 06/26/26 Page 11 of 16 Page ID #:1385 1 their responses contained in paragraph1 through 62 as if fully set forth at length herein. 2 64. Denied. 3 65. Plaintiffs deny that the Terms of Use are enforceable here. To the extent the 4 allegations in this paragraph state legal conclusions, they do not require a response. To the 5 extent the complaint purports to characterize Nanonoble’s alleged Terms of Use attached 6 as Exhibit A, the document speaks for itself. Plaintiffs deny any remaining allegations in 7 this paragraph. 8 66. Denied. 9 67. Denied. 10 NANONOBLE’S PRAYER FOR RELIEF 11 Plaintiffs deny that Nanonoble is entitled to any of the relief requested in 12 Nanonoble’s prayer for relief, or to any relief in any form from either the Court or Plaintiffs. 13 Plaintiffs respectfully request that the Court enter judgment in their favor and against 14 Nanonoble on all of Nanonoble’s counterclaims, deny each of Nanonoble’s prayers for 15 relief, and award Plaintiffs their costs, attorneys’ fees, and any other further relief deemed 16 appropriate by the Court. 17 DEMAND FOR JURY TRIAL 18 Nanonoble’s request for a jury trial includes no allegations and, therefore, requires 19 no response. To the extent a response is required, Plaintiffs demand a trial by jury on all 20 issues so triable. 21 AFFIRMATIVE AND ADDITIONAL DEFENSES 22 In response to Defendants’ counterclaim, Plaintiffs incorporate each and every 23 allegations set forth in their Complaint, filed September 16, 2025, ECF No. 1. 24 Plaintiffs assert the following defenses. Plaintiffs do not concede that they bear the 25 burden of proof as to any of the defenses asserted. Discovery recently began and, therefore, 26 Plaintiffs have not yet collected and reviewed all the information and materials that may 27 be relevant to the matters and issues herein. Accordingly, Plaintiffs reserve the right to 28 amend, modify, or expand these defenses and to take further positions as discovery 11 ANSWER Case 2:25-cv-08768-SB-E Document 61 Filed 06/26/26 Page 12 of 16 Page ID #:1386 1 proceeds in this case. 2 First Defense 3 (Failure to State a Claim) 4 The counterclaims fail to state a claim on which relief can be granted. 5 Second Defense 6 (California Civil Code § 1668) 7 The counterclaims fail, in whole or in part, because the Terms of Use, as applied by 8 Nanonoble in its counterclaims, violate California Civil Code § 1668, which states that 9 “[a]ll contracts which have for their object, directly or indirectly, to exempt any one from 10 responsibility for its own fraud, or willful injury to the person or property of another, or 11 violation of law, whether willful or negligent, are against the policy of the law,” because, 12 among other reasons, Nanonoble seeks to exculpate itself from its own direct and indirect 13 copyright infringement—including willful infringement—through its interpretation of its 14 Terms of Use. 15 Third Defense 16 (Public Policy) 17 The counterclaims fail, in whole or in part, because the Term so Use, as applied by 18 Nanonoble in its counterclaims, violate public policy of California and the United States 19 because, among other reasons, Nanonoble’s interpretation of its Terms of Use is contrary 20 to the public policies behind Federal Rules of Civil Procedure Rule 11 for pre-lawsuit 21 investigations and the Copyright Act’s policy against copyright infringement and internet 22 service providers interfering with standard technical measures to police infringement 23 online. 24 Fourth Defense 25 (Waiver) 26 The counterclaims fail, in whole or in part, because Nanonoble has waived any right 27 to enforce the Terms of Use as interpreted, including but not limited to, through its actions 28 directly infringing Plaintiffs’ copyrighted works and through promoting and encouraging 12 ANSWER Case 2:25-cv-08768-SB-E Document 61 Filed 06/26/26 Page 13 of 16 Page ID #:1387 1 use of its Hailou AI service for infringing purposes. 2 Fifth Defense 3 (Formation) 4 The counterclaims fail, in whole or in part, because no proper legally binding 5 contract was formed between the parties. 6 Sixth Defense 7 (Estoppel) 8 The counterclaims fail, in whole or in part, by the doctrine of estoppel, as a result of, 9 among other things, Nanonoble’s advertisements and promotions of its services, its Prompt 10 Optimizer or other tools that refine and rewrite subscriber prompts, and its encouragement 11 of its subscribers to engage in infringing activity using the Hailuo AI service. 12 Seventh Defense 13 (No Harm/Damages) 14 The counterclaims fail, in whole or in part, because Nanonoble has suffered no harm 15 or damages causally related to or the result of any alleged breach of contract. 16 Eighth Defense 17 (Unconscionability) 18 The counterclaims fail, in whole or in part, because the Terms of Use, as applied by 19 Nanonoble in its counterclaims, are procedurally and/or substantively unconscionable. 20 Ninth Defense 21 (Unclean Hands) 22 Nanonoble brings its counterclaims with unclean hands with respect to Defendants’ 23 Hailuo AI service because it seeks to use Hailuo AI’s services’ Terms of Use to exculpate 24 Nanonoble’s wrongdoing, including through an overly broad reading of the Terms of Use. 25 Defendants operate Hailuo AI, a Chinese artificial intelligence image and video generating 26 service that pirates and plunders Plaintiffs’ copyright works on a massive scale. 27 Defendants generate, and offer their subscribers, an endless supply of infringing images 28 and videos featuring Plaintiffs’ famous copyrighted characters. In order to investigate 13 ANSWER Case 2:25-cv-08768-SB-E Document 61 Filed 06/26/26 Page 14 of 16 Page ID #:1388 1 whether the Hailuo AI service infringes copyrights to seek to stop such infringement, it is 2 necessary to investigate the service. Nanonoble’s position regarding its Terms of Use 3 would preclude a copyright holder from investigating infringement of its copyrights. 4 Because Defendants’ inequitable conduct relates directly to Nanonoble’s counterclaims in 5 its action and harms Plaintiffs, Nanonoble is not entitled to any equitable relief. 6 Tenth Defense 7 (No Breach) 8 The counterclaims fail, in whole or in part, because the alleged conduct of Plaintiffs 9 does not violate Nanonoble’s Terms of Use and therefore there is no breach of any alleged 10 agreement, due to, among other things, Plaintiffs’ alleged conduct was not for commercial 11 purposes, did not violate the intellectual property or other rights of third parties, did not 12 expose Defendants to any third-party liability, and/or did not create any independent 13 liability of Defendants. 14 Eleventh Defense 15 (No Third-Party Claim/Injury) 16 The counterclaims fail, in whole or in part, because there are no third-party claims 17 or injury such that any indemnification is necessary. Nanonoble only seeks 18 indemnification for first party claims that are by law not covered by the alleged 19 indemnification provisions. 20 Twelfth Defense 21 (Inapplicable Choice of Law Provision) 22 To the extent that Nanonoble relies upon an alleged Singapore choice of law 23 provision, such provision is unenforceable because the chosen jurisdiction has no 24 substantial relationship to the parties or the transaction and there is no other reasonable 25 basis for the parties choice and/or application of the law of the chosen jurisdiction would 26 be contrary to a fundamental policy of a state which has a materially greater interest than 27 the chosen state in the determination of the particular issue and which would be the state 28 14 ANSWER Case 2:25-cv-08768-SB-E Document 61 Filed 06/26/26 Page 15 of 16 Page ID #:1389 1 of the applicable law in the absence of an effective choice of law by the parties. 2 Thirteenth Defense 3 (Lack of Standing) 4 The counterclaims fail, in whole or in part, because Nanonoble lacks standing to 5 bring such counterclaims. 6 Other Defenses 7 Plaintiffs reserve the right to assert any additional or affirmative defenses under Rule 8 8(c) of the Federal Rules of Civil Procedure, and any other defense, at law or equity, that 9 may now exist or that may become available through information developed in discovery, 10 at trial, or otherwise. 11 PLAINTIFFS’ PRAYER FOR RELIEF 12 WHEREFORE, in addition to the relief sought in their Complaint (ECF No. 1), 13 Plaintiffs pray for judgment against Defendants as follows in regard to Nanonoble’s 14 counterclaims: 15 1. That Nanonoble takes nothing and that judgment be entered in favor of 16 Plaintiffs and against Nanonoble; 17 2. Awarding Plaintiffs their attorneys’ fees and costs incurred in responding to 18 Nanonoble’s meritless allegations of breach of contract and indemnity; 19 3. Awarding Plaintiffs such further relief as the Court deems fair and proper. 20 21 22 23 24 25 26 27 28 15 ANSWER Case 2:25-cv-08768-SB-E Document 61 Filed 06/26/26 Page 16 of 16 Page ID #:1390 1 Dated: June 26, 2026 JENNER & BLOCK LLP 2 3 By: /s/ David Singer 4 David Singer Julie A. Shepard 5 Lauren M. Greene 6 Attorneys for Plaintiffs and Counterclaim- Defendants 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 16 ANSWER