Opinion ID: 6986474
Heading Depth: 2
Heading Rank: 2

Heading: The Credit Dispute

Text: Beginning in 1984, a dispute arose between Kling and DIC regarding card credit. Kling believed-that he was due “Developed by” credit in episodes of Rainbow Brite and Robotman that, although not written by him, featured characters that he had developed in his earlier scripts. He expressed this belief in a letter to. DIC on November 15, 1984, and thereafter retained attorney Leo Fenster to handle the matter. On May 28, 1985, Fenster sent DIC a letter on Kling’s behalf demanding proper credit and other relief. Fenster’s letter was forwarded to George Downing, counsel for United Feature, who expressed concern to another attorney about Fen-ster’s statement that HKP retained “certain rights in ‘characters’ developed by Mr. Kling.” On July 17, 1985, Jeffrey Wer-nick, counsel for DIC, sent a three-page letter to Fenster, stating in part: .... Your client sought the “Developed by” credit in future adaptations of Robotman and Rainbow Brite. He is not entitled contractually to any credit on any adaptations of either property that he does not provide specific services on. Moreover, DIC is not the copyright owner of either property and could not in any event grant Mr. Kling credit on adaptations for which he provides no work.... I would suggest that you research into the copyrightability of characters contained within a literary work. Characters are not separate copyrightable elements and no protectible interest has been created therein in favor of Mr. Kling. I would further remind you that as is standard in the entertainment industry, the work performed by Mr. Kling was done as a work-for-hire for copyright purposes, and that DIC Enterprises is the rightful owner of all results and proceeds of his work. .... We absolutely reject your request for compensation in any future publications of the two properties. DIC Enterprises itself has no such profit participation and collectively this company has developed these properties far more than your client has. As there- is no contractual basis for your claim I must assume that you are basing same on a misinterpretation of paragraph 4 of the respective agreements. This misinterpretation is clearly evidenced by paragraph 8 of your letter dated May 28, 1985 in which you stated that we were to renegotiate terms for Mr. Kling on “any future adaptations, specials, or network series based on characters developed by Woody Kling ”. The underlined portion represents language which you have unilaterally inserted into the language of paragraph 4 of the two agreements without any basis whatsoever. That paragraph was intended to provide further compensation to Mr. Kling, if and in the event the actual shows he worked on were exploited in a fashion other than syndicated broadcast, [emphasis in original] On July 25, 1985, Fenster informed Wernick that based on his response “there is'no point in continuing‘any further negotiations” and listed Kling’s demands regarding appropriate crediting. Fenster also notified Hallmark and United Feature in writing of the dispute. On August 19, 1985, Downing sent Wer-nick a copy of Fenster’s .letter to United Feature. Downing stated that “it is imperative that this problem with Heywood Kling be worked out immediately so that we are not in danger of having a court interfere with United Media’s [United Feature] rights to exploit the ROBOTMAN television shows.” On October 21, 1985, Wernick sent Fenster a draft agreement settling their dispute. This draft agreement stated in part that HKP “hereby irrevocably transfers and assigns to Re-leasee [DIC] all of Releasor’s [HKP’s] right, title and interest in and to any element of the Rainbow Brite and Robotman properties arising out of the Agreements.” On October 23[ Downing wrote Wernick to say that while the draft was satisfactory, he would have preferred “to see the phrase ‘(including any copyrights)’ inserted after the word ‘interest’ ” in this part. Following discussions with Wernick, Fen-ster returned to him a revised agreement that completely deleted the provision addressing transfer of ownership. The parties ultimately entered into an agreement that settled the credit dispute but omitted all discussion of the issue of copyright ownership.