Court Opinion

ID: 1082217
Source: CourtListenerOpinion
Date Created: 2013-10-09 20:56:54.963017+00
Date Added: 2024-06-11T15:45:31.575232
License: Public Domain

FILED
                                                   Dec. 15, 1995
SHASTA MEAD MOREY,                        )      Cecil Crowson, Jr.
                                          )       Appellate Court Clerk
      Plaintiff/Counter-Defendant/        )
      Appellee,                           )
                                          )    Davidson Fourth Circuit
                                          )    No. 93D-4168
VS.                                       )
                                          )    Appeal No.
                                          )    01-A-01-9506-CV-00243
LESLIE CHARLES MOREY,                     )
                                          )
      Defendant/Counter-Plaintiff/        )
      Appellant.                          )

                   IN THE COURT OF APPEALS OF TENNESSEE

                         MIDDLE SECTION AT NASHVILLE

      APPEAL FROM THE FOURTH CIRCUIT COURT OF DAVIDSON COUNTY

                            AT NASHVILLE, TENNESSEE

                    HONORABLE MURIEL ROBINSON, JUDGE

Carol L. McCoy
DAVIES, CANTRELL, HUMPHREYS & McCOY
150 Second Avenue, North, Suite 225
Nashville, Tennessee 37201
ATTORNEY FOR PLAINTIFF/APPELLEE

THOMAS K. BOWERS
P.O. Box 140256
2821 Lebanon Road, Suite 204
Nashville, Tennessee 37214
ATTORNEY FOR DEFENDANT/APPELLANT

AFFIRMED IN PART,
VACATED IN PART AND
REMANDED.

                                     HENRY F. TODD
                                     PRESIDING JUDGE, MIDDLE SECTION

CONCUR:
SAMUEL L. LEWIS, JUDGE
BEN H. CANTRELL, JUDGE
SHASTA MEAD MOREY,                              )
                                                )
       Plaintiff/Counter-Defendant/             )
       Appellee,                                )
                                                )     Davidson Fourth Circuit
                                                )     No. 93D-4168
VS.                                             )
                                                )     Appeal No.
                                                )     01-A-01-9506-CV-00243
LESLIE CHARLES MOREY,                           )
                                                )
       Defendant/Counter-Plaintiff/             )
       Appellant.                               )

                                         OPINION

       The defendant, Leslie Charles Morey, has appealed from the judgment of the Trial

Court awarding to the plaintiff, Shasta Mead Morey, an absolute divorce, custody of a minor

child, child support, a share of marital property, and $3,000.00 attorneys' fees.

       The sole issue on appeal is:

               Whether post divorce income received by the appellant from a
               work for hire employment contract in which appellant
               transferred ALL copyright and ownership interest therein to the
               employer can be properly classified as martial property and
               ordered by the trial court to be split equally between the
               appellant and the appellee.

       The judgment contains the following provision:

               11. All royalties generated from the Publication Agreement
               with PAR (Psychological Assessment Resources) are declared
               marital property and all royalties from and after January 1,
               1995 shall be equally divided between the parties for as long as
               said royalties are paid, each party to be responsible for the taxes
               due on their one-half share. The division shall begin in 1995
               immediately upon the next payment coming in. Each party
               shall be and is hereby restrained and enjoined from interfering
               with the payment of these royalties or attempting to divert
               payment of these royalties to avoid this obligation or
               attempting to stop the royalties in any fashion. If payment of
               the royalties are stopped or any interference occurs and the
               Court determines that there has been any such interference or
               cancellation in order to defeat this order by Leslie Morey, he
               shall have to pay the same amount to the wife that she should
               have received. Nothing in this Restraining Order prevents
               Leslie Morey from entering into additional contracts that do not
               defeat the purpose of the existing Publication Agreement.

                                               -2-
        Both parties are degreed psychologists. In addition to his other professional activities,

defendant writes articles on psychology for publication. On May 1, 1989, defendant executed

an agreement with Psychological Assessment Resources, Inc., a publisher of psychological

literature.

        The six-page, single spaced typed document contains the following relevant

provisions:

               The Publisher desires the Author to create and produce in
               consultation with and for and on behalf of the Publisher, and
               the Author is willing to create and produce for and on behalf of
               the Publisher, the assessment materials now referred to as the
               NNS Project--an Adult Psychopathology Test consisting of up
               to 25 scales and validity indicators and 320-340 items (the test
               and accessories as currently proposed and as in the future
               revised, including the items, scales, scoring keys, profiles,
               standard-score conversion tables, reference-sampling norming
               tables, item weights and related materials for administration,
               scoring, reporting, and analysis of the test are collectively
               referred to as the "Work") on a work for hire basis as set forth
               herein. The Publisher desires to acquire from the Author, and
               the Author hereby assigns and transfers to the Publisher, the
               Author's entire title, right and interest in and to the Work and
               the copyright therein; and Author hereby agrees to create and
               produce the Work for and on behalf of the Publisher on a work
               for hire basis in accordance with the provisions set forth in this
               agreement.

               ....

               (5) Author will, with all reasonable diligence, perform the
               usual duties of authors in the production of all editions of said
               Work.

               (6) Author will cooperate in preparing research reports and
               other articles for publication or presentation to those
               professional groups which contain potential users of the Work.

               (7) Author will promptly respond to all appropriate
               correspondence directed to him concerning the Work.

               (8) Author will consult with the Publisher and use his best
               efforts to work together toward promoting sales of the Work.

               ....

               (13) If, in the opinion of the Publisher in consultation with the
               Author, the Work needs revision during the term of this
               Agreement, the Author agrees to revise the Work and supply
               the new matter required. Author hereby assigns to Publisher all

                                               -3-
               right, title and interest in and to the new matter and revisions,
               and any derivative work and the copyright therein, and such
               materials, when created, shall also be deemed part of the Work.
               If, for any reason, the Author does not revise the Work within a
               reasonable amount of time, as reasonably determined by the
               Publisher, the Publisher may cause such revision to be made,
               and may deduct the expense thereof from the first royalties
               accruing from the sales of such revised edition.

               ....

               (17) Publisher will pay the Author royalties according to the
               following schedule: twelve percent (12%) on the first
               $200,000 of Net Sales Receipts (Gross Sales Receipts less
               returns) during any fiscal year; and fifteen percent (15%) on
               Net Sales Receipts in excess of $200,000 in any fiscal year.
               Royalties will be paid quarterly within 60 days following the
               end of each calendar quarter. Sales through domestic and
               foreign distributors in any year will earn 10% of the Net Sales
               Receipts of the Work.

               ....

       Both Author and Publisher mutually agree as follows:

               (22) This agreement shall be valid and shall continue in full
               force and effect from the effective date for the duration of the
               copyright and any renewals thereof.

               (23) All subsidiary rights to the Work, including reprint and
               translation rights, are granted to the Publisher and all royalty
               fees from any such rights will be divided 70% to the Publisher
               and 30% to the Author.

       Attached to the agreement was a document entitled "Draft and Timetable for NNS

Project Draft of April 19, 1989," which concluded: "Total time - 38 months."

       The book contemplated by the agreement was completed and published in 1991.

Royalties were paid to defendant in 1991, 1992, 1993 and 1994. No evidence is cited or

found as to any revision performed or anticipated. Defendant's argument is based upon the

phrase, "on a work for hire basis" as used in the quoted agreement.

       In Community for Creative Non-Violence v. Reid, 109 S. Ct. 1989, 490 U.S. 730, 104
L. Ed. 2d 811 (1989), an association sued a sculptor of a statue to establish copyright

                                              -4-
ownership of the statue. The Supreme Court held that the sculptor was not an "employee" of

the association, but was an independent contractor and therefore owned the copyright.

           Defendant seeks to use this holding to support his insistence that, since his work was

designated by the contract as "work for hire," the future rewards of that work are not

communal property subject to division by a divorce decree.

           Defendant cites 17 U.S.C. §101, which is the "definition" section of the federal

copyright law, and which defines "work for hire," but nothing is cited or found in the

copyright law which would prevent a divorce court from dividing rights to future

compensation for work performed during coverture.

           Defendant cites Murray v. Gelderman, (5th Cir. 1978), 566 F.2d 1307, which was a

suit for copyright infringement and did not relate to inclusion of future royalties in marital

estates.

           Defendant cites T.C.A. §36-4-121(b)(1)(A) which defines marital property as "all real

and personal property, both tangible and intangible, acquired by either or both spouses during

the course of the marriage." The following subsection (B) of said statute states:

                  "Marital Property" includes income from and any increase in
                  value during marriage, of property determined to be separate
                  property in accordance with subdivision (b)(2) if each party
                  substantially contributed to its preservation and appreciation
                  and the value of vested pension, retirement or other fringe
                  benefits accrued during the period of the marriage. (Emphasis
                  supplied.)

           Pension benefits earned by a spouse during the marriage are marital property even

though the other spouse did not contribute directly to their preservation or creation. Batson v.

Batson, Tenn. App. 1988, 769 S.W.2d 849.

                                                 -5-
        Unquestionably, quasi-pension rights, such as deferred compensation and tax-deferred

savings accrued during coverture are marital property. Indeed, a bank account or investments

acquired with earnings during coverture would be martial property.

        In the present case, the ownership of the copyright to the book produced by defendant

is immaterial. The material fact is that, by his labors during the marriage, defendant acquired

a contract right to a percentage of the profits on all future sales of the book. This right was

vested during the marriage, and is therefore just as much a part of the marital estate as a

salary collected and accumulated in a bank account or other investment during marriage. The

only difference is that the amount depends upon the volume of sales of the book.

        The contract, quoted above, does provide for certain continuing duties of defendant

aimed at maintaining the acceptance and currency of the text of the book. Any part of future

royalty payments attributable to such future efforts of defendant should not be included in the

marital estate; but that part of the future royalties attributable to his efforts during the

marriage are included in the marital estate and divided as such.

        Admittedly, the foregoing rule or formula presents difficulty in application; but no

other just resolution of the issue occurs to this Court.

        Since evidence is not included in this record to enable this Court to make a just

determination of the issue, it is necessary that the cause be remanded to the Trial Court for

presentation and consideration of further evidence as to nature and extent of probable future

activities of defendant affecting the amount of royalties and the percentage of future royalties

attributable to such future activities of defendant.

        The portion of the judgment of the Trial Court fixing the division of future royalties

between the parties is vacated and the cause is remanded to the Trial Court for hearing further

                                                 -6-
evidence and entry of a further judgment as to the division of royalties. All other portions of

the judgment of the Trial Court are affirmed. Costs of this appeal are taxed equally. That is,

each party shall pay one-half of the costs of this appeal.

       Affirmed in Part,
       Vacated in Part and
       Remanded.

                                               _______________________________________
                                               HENRY F. TODD
                                               PRESIDING JUDGE, MIDDLE SECTION

CONCUR:

_____________________________________
SAMUEL L. LEWIS, JUDGE

_____________________________________
BEN H. CANTRELL, JUDGE

                                               -7-