Opinion ID: 699542
Heading Depth: 2
Heading Rank: 2

Heading: Post-Agreement Events

Text: 11 After execution of the Agreement, TOR commenced publication of the books based on the initial six titles--Thumbelina, Aladdin, Noozles, Littl' Bits, The Nutcracker, and Heidi. The format for each book is 8 X 8, and the text of each of the six books amounts to approximately 1000 words. (Although the Agreement specifies approximately 2,500 words, this is not a subject of dispute among the parties.) 12 Like most parties to a commercial contract, Saban and TOR had substantial mutual interests that bound the relationship. Saban was a moderately successful children's television programmer that saw a chance for expansion in forming a relationship with a publisher. TOR saw such a relationship as a means of becoming a major publisher of children's books, particularly if Saban characters increased in popularity. As often happens, an unexpected event altered the mutual interests that bound the relationship. That event was the conception and development of the Mighty Morphin Power Rangers (the Power Rangers). 13 After execution of the Agreement, the Power Rangers, a Saban property introduced in a Saturday morning television program, became a huge success--almost an obsession--with children. According to the record (there is no danger of this panel resorting to personal experience), an entire generation is caught up in the Power Rangers' unique ability to morph--to transform themselves from normal teenagers into superheroes who fight evil aliens. Saban's ownership of the Power Rangers clearly ended any need it had for TOR's publication and promotion of books based on its characters. Moreover, the exclusive rights provisions were now an albatross rather than a necessary inducement to get TOR to publish books based on Saban characters. Saban now had a property that was urgently sought after by companies in all fields of children's merchandising, including children's book publishing. 14 Before licensing any publishing rights to the Power Rangers, Saban's director of licensing, Debi Young, reviewed Saban's existing agreements, including the Agreement with TOR. Young discussed the TOR Agreement with Josey. They claim to have interpreted the Agreement to cover only children's books in the same format as those TOR was already publishing under the Agreement, namely 8 X 8. Saban never gave TOR an opportunity to publish Power Rangers books pursuant to the Rider, an act that would have triggered the exclusive rights provisions of the Agreement. 15 Saban thereafter entered into a number of licensing agreements relating to Power Rangers books with other publishing houses. Today, children's books licensed by Saban and featuring the Power Rangers are available in a variety of formats, including: a board book (consisting of rigid cardboard pages with illustrations and very little text), a fold-out book, a scrap book, a hardcover book, a book and tape (consisting of an 8 X 8 packaged with an audio cassette), a junior novelization (consisting of text with pictures interpaginated), a maze book, an interactive electronic book, educational work books, personalized books, and a number of coloring and activity books. 16 The parties dispute the amount of time that TOR delayed in asserting its alleged rights under the Agreement. According to the record, only Doherty, who is not a lawyer, first learned of Saban's property in the Power Rangers and of others publishing books featuring them. She appears not to have alerted counsel or others at TOR. In January of 1994, Doherty learned about the Power Rangers and their popularity from a news account. She claims not to have known specifically that Saban had licensed another publisher for the Power Rangers until April, when she learned that Grosset & Dunlap was preparing to publish a Power Rangers book. It was two to three weeks after this, in mid-May, that she began attempting to contact Saban about licensing the Power Rangers under TOR's Agreement. For several weeks after that, Doherty claims, although she contacted Saban repeatedly, her calls were not returned and her inquiries were left unanswered. In July, Saban contacted St. Martin's, TOR's parent company, seeking to renegotiate the Agreement. 17 Thus, from the record, the exact length of the TOR's delay in asserting its rights depends upon how it is characterized: it could arguably be approximately four months (from the time Doherty first heard of the Power Rangers) or two to three weeks (from the time Doherty learned another publisher had created a Power Rangers book). In any event, TOR eventually claimed that Saban had violated the Agreement, and negotiations failed to resolve the escalating dispute.