Case ID: ny-st-rep_45/html/0872-01.html
Source: Caselaw Access Project
Author: {"author": "Finch, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Edgar Saltus, Resp’t, v. The Belford Company, App’lt.
    
    
      (Court of Appeals,
    
    
      Filed June 17, 1892.)
    
    1. Contract—Breach—Copyright.
    ' Plaintiff entered into a contract with the defendant company hy which the latter was to publish his works and obtain a copyright upon one of them in his name. Defendant became insolvent and unable to pay the royalty agreed upon but continued to publish and sell the works. In an action for an accounting and to abrogate the contract, Held, that no question of copyright was involved, and that an injunction penitente lite was properly granted.
    2. Same.
    Where the defendant stands in the attitude of claiming full performance on its part and of denying the plaintiff’s right to an abrogation of the contract, it cannot also insist that the contract is already abrogated and the parties remitted to those original rights which were independent of it.
    Appeal from order of the supreme court, general term, first department, affirming order continuing injunction pendente lite.
    
    
      Frederic R. Kellogg, for app’lt; Augustus S. Hutchins, for resp’t.
    
      
       Affirming 45 St. Rep., 819.
    
   Finch, J.

The principal objection urged against the temporary injunction granted in this action and operative during its pendency is that the papers nowhere disclose the existence of a copyright covering and protecting the plaintiff’s right as author of the books specified in the contract. The drift of the argument is that, in the absence of a copyright, the defendant company was at liberty to publish the books, irrespective of the will of the author, without paying tribute to him, and whether he consented or not, and that the court could not interfere with that right tor take it away by injunction. So much might be true in a case where no contract covering the publication existed. But here the author’s right to control the publication is conceded by the contract itself. Its terms snow an admitted ownership in the plaintiff and a right to give or withhold authority in the defendant company to publish. His consent was bought and agreed to be paid for in the form of a royalty, and as to one of the books, and that apparently deemed to be the most valuable of all, the defendant agreed to procure for the plaintiff a copyright. As to that particular book, it may easily be assumed that the defendant could not publish it without the author’s consent and authority because it existed only in manuscript' and in his possession and could not be obtained without his permission. While it does not appear that the other works were copyrighted, it is not shown that they were not, and it is not necessary to speculate about the fact when the owner’s right is conceded by the contract and the authority to publish is bought of him. For aught that appears they also may have existed only in manuscript when first printed by the defendant, so that their publication could not have been accomplished except with his consent. It does not matter, however, what the source of the author’s control, in fact, was, or how strong or weak might have proved to be his authority and ownership. It is enough that the publisher by the contract made conceded the author’s right, and so published the works with his consent, and was not at liberty during the existence of the contract to publish them otherwise.

If, as a matter of business, the defendant chose to defy the right of the author whatever it might prove to be, the company was bound at least to put an end to the contract, to set itself free from both its protection and its obligation, when so situated that it could not defend the act, if assailed, by pleading the license of the contract and the author’s permission. The complaint against the defendant was that it was publishing under that permission and under the protection of the contract while steadily violating its terms; that it was insolvent and unable to pay, so that every copy sold was a total loss to the author; and the relief asked was that the defendant account and the contract be abrogated. It was entirely proper in that state of facts to restrain any further publication under the permission of the contract pending the litigation, and the question involved is not one of copyright, but simply of contract. A licensee under a patent cannot assail it as void while manufacturing under its protection. He cannot set it at defiance until his license has been surrendered or withdrawn and his act can be treated as an infringement Marston v. Swett, 66 N. Y., 206. In like manner the defendant company cannot question or deny the author’s right while publishing under his license and permission; and we are not at all concerned for the present with either the character or efficacy of that right. I think the injunction, properly construed, restrains only the publication under the contract, for the defendant can publish in no other way until that contract is abrogated; and until he is left free to indulge in a piracy of the author’s work unprotected by' the contract, and where his act may be assailed as an infringement of any right which may turn out to be in the author’s possession, he must remain subject to the restraint which the cburt has imposed. We are not required to consider what ultimate judgment may be awarded to the plaintiff. For the present the court has simply said that the defendant shall not continue to violate the contract while protected by its permission, and when it is unable to pay the compensation which would accrue.

The ground assumed by the defendant is that the plaintiff had rescinded the contract at or before the commencement of the action, and so both parties were remitted to their original rights. The pleadings show a different state of facts. The complaint asks as relief a judicial rescission or termination of the contract which will hind both parties, and makes that demand upon the ground of a violation of its terms; and the answer denies such violation, denies the asserted insolvency, and alleges payment in full of all the royalties which have accrued. And so the defendant stands in the attitude of claiming full performance on its part, and of denying the plaintiff’s right to an abrogation of the contract. While maintaining that position it cannot also insist that the contract is already abrogated and the parties remitted to those original rights which were independent of it. Hyatt v. Ingalls, 124 N. Y., 93; 35 St. Rep., 114, unon which the defendant relies, will illustrate the distinction. Tie injunction stricken out in that case was a part of the final decree which terminated and ended the license. Any future manufacture of the patented article could not be under the license judicially rescinded, and must of necessity be either lawful, or an infringement over which the court could have no jurisdiction. But here the license is not rescinded, and will not be until the final judgment, and may not be then if the defendant’s answer is true; and so the publication pending the litigation would be under the contract, and therefore within the equitable control of the court. In the exercise of its discretion it restrained conduct asserted to he in violation of plaintiff’s rights, and inflicting an injury for which there could be no redress on account of the insolvent condition of the company. We see no reason to question the propriety of the injunction.

The order should he affirmed, with costs.

All concur.