Court Opinion

ID: 1055769
Source: CourtListenerOpinion
Date Created: 2013-10-08 21:00:14.726144+00
Date Added: 2024-06-11T15:39:00.991520
License: Public Domain

IN THE COURT OF APPEALS OF TENNESSEE
                             AT NASHVILLE
                                    January 8, 2004 Session

                 CHILD BRIDE MUSIC, INC. v. JACKSON, ET AL.

                      Appeal from the Chancery Court for Davidson County
                      No. 00-1208-II Irvin H. Kilcrease, Jr., Chancellor

                     No. M2002-02789-COA-R3-CV - Filed April 28, 2004

Assignee appeals the judgment of the trial court holding it to be bound to a reclamation of rights
provision in the contract between its assignor and a grantor of copyright interests. We affirm the
judgment of the trial court.

          Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court
                                Affirmed and Remanded

WILLIAM B. CAIN , J., delivered the opinion of the court, in which PATRICIA J. COTTRELL, and FRANK
G. CLEMENT , JR., JJ., joined.

James E. Zwickel, Nashville, Tennessee, for the appellant, Carl Jackson, d/b/a Lonesome Dove
Music.

Jay Scott Bowen, Joshua E. Perry, Nashville, Tennessee, for the appellees, Child Bride Music, Inc.
and Bobbie Cryner, d/b/a Bobbie Cryner Music.

                                             OPINION

        Bobbie Cryner was a waitress at Cooker’s Restaurant in Goodlettsville, Tennessee in 1990
and 1991. Carl Jackson was a performing artist, songwriter and music publisher, d/b/a Lonesome
Dove Music. Jackson frequented the restaurant and became acquainted with Cryner. At the urging
of certain of Cryner’s co-workers at the restaurant, Jackson listened to Cryner perform certain of her
own compositions of country music songs and was impressed by her song writing skills. Jackson
was, at that time, under contract himself with Famous Music Corporation, a publisher of country
music compositions. Jackson took Cryner “under his wing” and negotiated for her a very favorable
publication contract with Famous Music Corporation. Jackson was neither a party nor a third-party
beneficiary to the ensuing contract between Cryner, d/b/a Bobbie Cryner Music, and Famous Music
Corporation. With the knowledge and consent of Bobbie Cryner, Famous Music entered into a
separate contract with Carl Jackson, d/b/a Lonesome Dove Music, whereby Jackson was to become
co-producer of Cryner’s compositions and owner of fifty percent of the copyrights transferred by
Cryner to Famous Music Corporation pursuant to the terms of the Cryner-Famous Music contract.

         Certain provisions of the Cryner-Famous Music contract control the outcome of this
litigation. These provisions are:

                9.      Anytime after three (3) years after expiration of the Term, upon fifteen
       (15) days written notice from Writer, accompanied by payment to Publisher of one
       hundred percent (100%) of any sums still unrecouped hereunder, if any, Publisher
       shall re-assign to Writer all Compositions that have not been commercially exploited
       prior to receipt of such notice by Publisher. Commercial exploitation, for the
       foregoing purposes, shall be satisfied for any Composition that has been:

                        (i)     released for sale to the public on phonograph records,
               tapes, compact discs or any other “phonorecord” or “sound recording”
               (as such terms are defined under U.S. Copyright Law) on a “major
               label,” which shall be defined as any record label which either: (A)
               is distributed by or through one of the major distribution groups now
               constituted by MCA, CEMA, WEA, Polygram, Sony and BMG, or
               any subsequently established distribution group of relatively equal
               stature to the foregoing; or (B) has had a single or album listed in the
               top ten (10) chart positions on any chart published by Billboard
               Magazine during the two (2) period[s] prior to release of the recorded
               product embodying the Composition;

                       (ii)   synchronized in the soundtrack of either: (A) a
               theatrical motion picture exhibited to the public; (B) a television
               program broadcast to the public; or (C) a home video program (as the
               state of such devices is now known or hereafter devised and
               developed) offered for sale to the public.

               ....

              26.      One (1) year after expiration of the Term of this Agreement, or upon
       the Co-Publishing Participation Date, whichever occurs later, and after thirty (30)
       days written notice from Writer to Publisher (“Notice Period”), Publisher shall assign
       to Writer and Co-Publisher co-administration rights to all Compositions under this
       Agreement, but only to the extent that such rights are possessed by Publisher at such
       time. Notwithstanding the foregoing, as to Post-Term Album Compositions, the
       foregoing assignment as to each such composition shall occur two (2) years after the
       date that the album first embodying such composition was released for sale to the
       public. During the Notice Period described above, Publisher, Writer and Co-
       Publisher shall compile a schedule of such Compositions, as well as the income share

                                                 -2-
       collectible by Writer and Co-Publisher for each, computed in accordance with this
       Agreement (“Notice Schedule”). Thereafter, Writer and Co-Publisher shall possess
       the separate and independent right to collect Writer’s and Co-Publisher’s otherwise
       payable shares of each such Composition directly, but only in accordance with the
       mutually agreed upon Notice Schedule, and Writer, Co-Publisher and Publisher shall
       then have the joint, exclusive and universal right to administer and exploit the
       Compositions in any manner whatsoever without the approval of the other, subject
       to the following restrictions and provisions:

                      (a)     with respect to each other, Writer, Co-Publisher and
               Publisher shall each possess only the rights accorded to joint
               copyright owners under U.S. Copyright law, as well as any other
               applicable law, other governmental regulation or judicial decision;

                      (b)    Writer and Co-Publisher may only collect Writer’s and
               Co-Publisher’s shares of income specifically identified in the Notice
               Schedule, and Publisher shall collect all other income generated by
               the Compositions in accordance with this Agreement and Publisher’s
               Co-Publishing Agreement with Carl Jackson.

       Both the Cryner-Famous Music contract and the Famous Music-Jackson contract were
executed on October 11, 1991, and certain provisions of the Famous Music-Jackson contract are also
important to this controversy.

       Such provisions are:

                               CO-PUBLISHING AGREEMENT

              This agreement (“Agreement”) is made and entered into this 11th day of
       October, 1991, by and between FAMOUS MUSIC CORPORATION (“Publisher”),
       3500 W. Olive Avenue, Suite 1000, Burbank, California 91505, and CARL
       JACKSON, doing business as _____________ (“Co-Publisher”), 1720 Hickory
       Trace Drive, Gallatin, Tennessee 37066, shall be deemed effective September 1,
       1991.

              WHEREAS, PHYLLIS CRYNER MAFFETT, professionally known as
       BOBBIE CRYNER (“Cryner”) doing business as BOBBIE CRYNER MUSIC
       (“Cryner Music”) has entered into an Exclusive Songwriting and Co-Publishing
       Agreement with Publisher dated October _____, 1991 (the “Cryner Agreement”),
       which is attached hereto as Exhibit “A”; and

                                               -3-
              WHEREAS, Co-Publisher is directly responsible for introducing Cryner and
       Cryner Music to Publisher, and Publisher desires to compensate Co-Publisher for Co-
       Publisher’s role in facilitating the Cryner Agreement;

              THEREFORE, the parties hereby agree as follows:

              1.      Famous hereby assigns to Co-Publisher fifty percent (50%) of the
       copyright ownership, throughout the universe, that is assigned to Famous by Cryner
       and Cryner Music under the Cryner Agreement. Notwithstanding such joint
       copyright ownership between Famous and Co-Publisher, however, the only rights
       possessed by Co-Publisher respecting such ownership shall be those specified
       hereunder, although Publisher shall include Co-Publisher’s name as a copyright
       claimant when registering copyrights for the “Compositions” under the Cryner
       Agreement, and shall exert best efforts to include Co-Publisher’s name in all places
       where Publisher is credited as publisher of the Compositions.

        The only other document executed by Bobbie Cryner is an assignment dated December 8,
1993, which was executed at the request of Famous Music Corporation in order to document the
transfer of copyright ownership with the Library of Congress. This instrument provided:

              For good and valuable consideration, the undersigned BOBBIE CRYNER
       (“Assignor”) hereby assigns, conveys, grants and transfers exclusively to FAMOUS
       MUSIC CORPORATION (“Assignee”) and LONESOME DOVE MUSIC (“Co-
       Publisher”) their successors and assigns, joint ownership in equal shares of the
       copyright in and to the musical composition presently entitled:
       SEE ATTACHED SCHEDULE________________________________________
       (the “Composition”), which was written and composed in the following percentages:

                   Songwriter:                           Creative Percentage:

                 SEE ATTACHED SCHEDULE

       Said assignment is for the maximum term of copyright throughout the world
       (including any renewals or extensions thereof) available now or in the future under
       any law, other governmental regulation or judicial decision, but is subject to the
       terms of the agreement between Assignee and Assignor dated October 11, 1991, and
       the agreement between Assignee and Co-Publisher dated October 11, 1991.

              Executed as of the 8TH day of DECEMBER, 1993.

       Among the songs listed in the schedule attached to this assignment was “Real Live Woman,”
which is at the heart of this litigation.

                                               -4-
       Neither publisher, Famous Music Corporation, nor co-publisher, Lonesome Dove Music,
made any effort to commercially exploit the song “Real Live Woman” during the term of the Cryner-
Famous Music contract, and, more than three years after the expiration of the Cryner-Famous Music
contract, Cryner entered into a publication agreement with the co-plaintiff in this case, Child Bride
Music, Inc. Through the efforts of Child Bride Music, the composition “Real Live Woman” was
recorded by Trisha Yearwood and became a commercial success. The Cryner-Famous Music
contract having expired by more than three years, Bobbie Cryner exercised her rights under
paragraph nine of the agreement to re-claim all compositions from Famous Music Corporation that
had not been commercially exploited. Among these compositions was “Real Live Woman.”

        On September 28, 1999, Famous Music Corporation re-assigned to Cryner the fifty percent
interest in all unexploited composition copyrights remaining in its possession following the October
11, 1991 Famous Music-Jackson contract, reflecting the assignment to Jackson of the remaining fifty
percent copyright interest in all Cryner compositions. Jackson, believing himself free of the
obligations of his assignor under paragraph nine of the Cryner-Famous Music contract, declined to
re-assign the remaining fifty percent of copyright interest in these unexploited compositions,
including the rights to “Real Live Woman.” Child Bride Music and Bobbie Cryner then sued Carl
Jackson, d/b/a Lonesome Dove Music for declaratory judgment.1

         The general rule of the common law as stated in American Jurisprudence is:

                  As a general rule, an assignee takes the subject of the assignment with all the
         rights and remedies possessed by or available to the assignor. However, an assignee
         of a nonnegotiable chose in action generally acquires no greater right than was
         possessed by the assignor, and simply stands in the shoes of the assignor. Thus, the
         assignee is subject to any defense that would have been good against the assignee
         (sic); the assignee cannot recover more than the assignor could recover, and the
         assignee never stands in a better position than the assignor.

6 Am. Jur. 2D Assignments, § 144 (1999).

       This rule in Tennessee dates at least from 1817 as established by Kennedy v. Woolfolk, 4
Tenn. (3 Hayw) 195 (1817), wherein Woolfolk, assignee of Bryant, was sued by Kennedy on the
purchase money debt originally owed by Bryant. Said the supreme court:

         Neither can it be urged successfully that Woolfolk is not liable to the demand of
         Kennedy, in the same manner as Bryant was. He has taken the place of Bryant by
         purchasing his equity. What is that? To be liable to a specific execution as well as
         to be entitled to one. Kennedy had a right to say take your land and pay me the

         1
           Jackson counter-claimed for a declaratory judgment relative to alleged Lanham Act violations and tortious
interference with contract and requested an accounting, but unless he is successful in avoiding the applicability to him
of paragraph nine of the Cryner-Famous Music contract, the issues presented by his counter-claim are moot.

                                                          -5-
       purchase-money. Bryant could not say, convey me the land and wait for the
       purchase-money till it suits my convenience to pay you, or run the risk of my
       insolvency and that of my surety. Can Bryant, by assignment, place Woolfolk in a
       situation which he himself could not occupy? Can he and Woolfolk . . . in the
       absence of Kennedy, make an agreement which could, in any degree, abridge the
       existing right of Kennedy? . . . Here, most clearly, Woolfolk knew of all the
       material circumstances relating to this transaction, and that undoubtedly subjects him
       to all of the equity that Bryant was subject to.

Kennedy, 4 Tenn. (3 Hayw) at 199.

        In Third National Bank v. Capitol Records, Inc., 445 S.W.2d 471 (Tenn.Ct.App.1969), the
bank, in order to secure a $4,000 loan to a country and western singer using the stage name “Bobby
Edwards,” took an assignment from Capitol Records, Inc. of all royalties due from Capitol to
Edwards under a recording and royalty contract. Capitol agreed to the assignment and agreed, under
the provisions of the assignment, to make royalty payments directly to the bank. In the contract
between Capitol and Edwards, however, Capitol was entitled to deduct recording costs before paying
royalties. As it happened, these recording costs exceeded the royalties due Edwards, and there was
nothing left for Capitol to pay the bank. In the ensuing suit by the bank against Capitol Records, the
court applied the time honored rule and held: “The complainant, bank, took the assignment of such
contract subject to all of the provisions thereof including provision four which authorized the
defendant to deduct such recording cost from royalties earned by [Edwards].” Third Nat’l Bank,
445 S.W.2d at 477; see also Pac. E. Corp. v. Gulf Life Holding Co., 902 S.W.2d 946 (Tenn.Ct.App.
1995); Binswanger S. (N.C.), Inc. v. Textron, Inc., 860 S.W.2d 862 (Tenn.Ct.App. 1993).

        It is of little significance that California law controls the outcome of this case, since
California has long followed the same common law rule. W. Oil and Ref. Co. v. Venago Oil Corp.,
24 P.2d 971 (Cal. 1933); Childs Real Estate Co. v. Shelburne Realty, 143 P.2d 697 (Cal. 1943);
Prof’l Collection Consultants v. Hanada, 62 Cal. Rptr. 2d 182 (Cal.Ct.App. 1997); Johnson v. County
of Fresno, 4 Cal. Rptr. 3d 475 (Cal.Ct.App. 2003).

       In enforcing a statutory declaration of the common law rule relative to a non-negotiable
contract, the Court of Appeal of California held:

               The question in this case is not whether there has been an effective transfer
       or assignment of the debt instruments from E.R.S. to Bank or whether Bank’s title
       to the papers has priority over other claims of title. Rather the issue in this case is
       whether the title transferred to Bank is subject to defenses Bestways has against the
       transferor. This latter question is answered by Civil Code section 1459 which states
       that “[a] non-negotiable written contract for the payment of money or personal
       property may be transferred by indorsement, in like manner with negotiable
       instruments. Such indorsement shall transfer all the rights of the assignor under the
       instrument to the assignee, subject to all equities and defenses existing in favor of the

                                                 -6-
       maker at the time of the indorsement.” (Emphasis added.) “The assignment merely
       transfers the interest of the assignor. The assignee ‘stands in the shoes’ of the
       assignor, taking his rights and remedies, subject to any defenses which the obligor
       has against the assignor prior to notice of assignment.” (1 Witkin, Summary of Cal.
       Law (9th ed. 1987) Contracts, § 948, p. 844.) Accordingly, Bank acquired the right
       to payment from Bestways subject to any defenses Bestways had against E.R.S.

Royal Bank Exp. Fin. Co. v. Bestways Distrib. Co., 280 Cal. Rptr. 355, 357 (Cal.Ct.App. 1991).

       Bestways is a California carbon copy of the same rule that applies in Tennessee.

               The claim asserted by Southern is founded solely upon its rights as an
       assignee under the Sales Listing Agreement. Southern concedes that it was not a
       party to the Agreement but asserts the right to recover under the Agreement as the
       Binswanger Company’s assignee.

                The trial court held, and we agree, that Southern’s right to recover under the
       Sales Listing Agreement is entirely derivative from and dependent upon the rights
       of its assignor, the Binswanger Company. An assignee of a non-negotiable chose in
       action, such as a contract, steps into the shoes of his assignor and takes his assignor’s
       rights subject to all defenses which may be asserted against the assignor in an action
       to enforce the right. Third Nat’l Bank v. Capitol Records, Inc., 60 Tenn. App. 189,
       445 S.W.2d 471 (1969). Southern’s right to recover under the Agreement in this case
       is determined by the rights of the Binswanger Company. If the Binswanger Company
       is barred from recovery, so too is Southern. In other words, if the Binswanger
       Company does not have shoes, Southern has nothing to step into. We have, after our
       review of this record, determined that Binswanger was shoeless.

Binswanger Southern, 860 S.W.2d at 865-66.

       In factual synopsis:

1.     By contract, Bobby Cryner d/b/a Bobby Cryner Music, on October 11, 1991, conveyed to
       Famous Music Corporation two-thirds of the copyright ownership in all musical
       compositions written or composed by her, in whole or in part, prior to the date of the
       contract. She also conveyed to Famous Music Corporation one hundred percent of the
       copyright ownership of all of her compositions written during the term of the contract.
2.     In paragraph nine of this contract, Famous Music was required, on fifteen days notice any
       time after three years following the expiration of the contract, to “re-assign to Writer all
       Compositions that have not been commercially exploited prior to the receipt of such notice
       by [Famous Music Corporation.]”
3.     By contract of the same date, October 11, 1991, Famous Music Corporation conveyed to Carl
       Jackson a one-half undivided interest in the copyright ownership vested in it under the

                                                 -7-
       Cryner contract. The Cryner contract was attached as “A” to the Famous Music-Jackson
       contract.
4.     In order to document the transfer of copyright ownership with the Library of Congress,
       Cryner, on December 8, 1993, executed an assignment of copyright in equal shares to
       Famous Music Corporation (“assignee”) and Lonesome Dove Music (“co-publisher”) their
       successors and assigns, joint ownership in equal shares of the copyright to certain musical
       compositions including “Real Live Woman.” This assignment further provided, “Said
       assignment is for the maximum term of copyright throughout the world (including any
       renewals or extensions thereof) available now or in the future under any law, other
       governmental regulation or judicial decision, but is subject to the terms of the agreement
       between Assignee and Assignor dated October 11, 1991, and the agreement between
       Assignee and Co-Publisher dated October 11, 1991.”
5.     By letter to Famous Music Corporation dated September 15, 1999, Cryner requested,
       pursuant to the terms of the 1991 Cryner agreement, that Famous Music re-assign to her the
       copyrights of all of her musical compositions assigned to Famous, which had not been
       commercially exploited. With this letter, she made payment of all advances paid to Cryner
       by Famous Music during the term of the 1991 Cryner agreement thereby triggering Cryner’s
       reclamation rights pursuant to paragraph nine of the Cryner contract.
6.     On September 28, 1999, Famous Music re-assigned to Cryner the fifty percent of the
       copyrights on unexploited compositions still retained by Famous Music after the Jackson
       agreement.
7.     Jackson refused to re-assign the remaining fifty percent interest to Cryner.
8.     One of these unexploited compositions was “Real Live Woman,” which had been recorded
       by Trisha Yearwood and had attained commercial success.

On these facts, the court is requested to declare the rights of the parties.

        The reclamation rights of Cryner under paragraph nine of the Cryner-Famous Music contract
are unconditional and are written in unambiguous terms. Jackson was thoroughly familiar with the
Cryner contract and, indeed, was responsible for the reclamation language that appears in paragraph
nine. Jackson is not a party to the Cryner contract and has no rights thereunder and no obligations
thereunder, except the rights and obligations of an assignee “standing in the shoes of” his assignor.
The rights of Jackson emanate from the Famous Music-Jackson contract alone as assignee of Famous
Music Corporation. His rights can rise to no greater dignity than the rights of his assignor, Famous
Music Corporation. As Famous Music Corporation is bound by paragraph nine of the Cryner
agreement, so Jackson, as assignee of Famous Music, can acquire from his assignor no greater rights
than his assignor has acquired under the contract with Cryner.

       Jackson asserts two bases for escaping the common law rule. First, he asserts the
applicability of paragraph twenty-six of the Cryner-Famous Music contract. It is clear, however,
from the language of paragraph twenty-six of that contract, that only commercially exploited
compositions are contemplated. This paragraph provides in part: “During the Notice Period
described above, Publisher, Writer and Co-Publisher shall compile a schedule of such Compositions,

                                                  -8-
as well as the income share collectible by Writer and Co-Publisher for each, computed in accordance
with this Agreement.” No such schedule appears in the proof, and there can be no “co-
administration” or income from compositions that have not been commercially exploited. The proof
is clear that, at the time Cryner exercised her reclamation rights under paragraph nine of the Cryner
agreement, no effort had been made to commercially exploit “Real Live Woman.”

       Next Appellant places heavy reliance on Recorded Picture Company Productions, Ltd. v.
Nelson Entertainment, Inc., 61 Cal. Rptr. 2d 742 (Cal.Ct.App. 1997). This California Court of Appeal
decision is less than persuasive and has been isolated by subsequent California decisions. See
Pajaro Dunes Rental Agency, Inc. v. Pajaro Dunes Ass’n, No. 97CV2516, 2001 WL 1743285
(N.D.Cal. Nov. 1, 2001); Melchior v. New Line Productions, Inc., 131 Cal. Rptr. 2d 347 (Cal.Ct.App.
2003).

         The facts in Recorded Picture Company are intriguing, and it is not difficult to understand
the desire of the court to favor the sub-distributor. The plaintiffs in that case were the producers of
a motion picture entitled “The Last Emperor.” These producers entered into a written agreement
with Hemdale Film Corporation granting to the latter theatrical, television and home video domestic
distribution rights to the picture, in perpetuity. This contract further provided that, upon delivery of
“The Last Emperor” to Hemdale, the worldwide copyright of the picture would be owned by
Hemdale or its designee. It was contemplated by the producers that Hemdale would appoint sub-
distributors to accomplish the actual distribution. The contract further provided that, after costs and
expenses, “[a]ny additional Gross Receipts from Videogram Exploitation shall be divided Thirty
Percent (30%) to Hemdale and Seventy Percent (70%) to Producer.” It was clear from the proof,
however, that producers did not “trust” Hemdale because it was a company that had a reputation of
being difficult to collect from and of, forcing those whom it dealt with to engage in costly and time-
consuming litigation. For this reason, the agreement further provided that “Hemdale shall instruct
the applicable videogram distributor to account directly to Producer for the amounts payable to
Producer [i.e., 70% of the gross receipts].” Hemdale then contracted with Nelson Entertainment,
Inc. for home distribution of “The Last Emperor” without disclosing to Nelson the producer-Nelson
contract provision whereby Hemdale was to require sub-distributors to bypass Hemdale and pay
directly to the producers. The reluctance of the producers to trust Hemdale proved prophetic when
Hemdale bankrupted and producers then called upon Nelson to pay them seventy percent of gross
receipts. Explaining its holding in favor of Nelson, the California Court of Appeal held:

               Here, Nelson was not an assignee of the producer-Hemdale agreement, nor
       did it accept or receive all of the benefits of that agreement. The producers
       transferred to Hemdale all domestic distribution rights in “The Last Emperor” - -
       theatrical, television, and home video - - in perpetuity. The producers also assigned
       the copyright in the picture to Hemdale. In contrast, the Hemdale-Nelson contract
       authorized Nelson to distribute the picture in the home video market only; Nelson did
       not receive the distribution rights for theatrical or television release. Further,
       Nelson’s distribution rights terminated after seven years (and reverted to Hemdale),
       while Hemdale received the distribution rights in perpetuity. Moreover, Hemdale

                                                  -9-
       retained the copyright in the picture. Under these circumstances, Nelson was a
       licensee, not an assignee. “A transfer of anything less than a totality of a work is a
       license and not an assignment.” (International Film Exchange, Ltd. v. Corinth Films,
       Inc. (S.D.N.Y. 1985) 621 F. Supp. 631, 635; accord, Key Maps, Inc. v. Pruitt (S.D.
       Tex. 1978) 470 F. Supp. 33, 38-39; Webster’s Third New Internat. Dict. (1993) p.
       1304, col. 2 [defining “license” as “the grant of some but not all of the rights
       embraced in a copyright”].)

               We decline to adopt the rule proposed by the producers - - that a company
       must comply with a contract to which it is not a party if it has accepted even a portion
       of the benefits of that contract through a subsequent, separate agreement with one of
       the original contracting parties. Such a rule would lead to absurd consequences. For
       instance, if Nelson had entered into an additional agreement with a different
       distributor for each state, then those 50 distributors (or, more accurately, sub-
       distributors) would be separately liable to the producers for the full 70 percent of
       gross receipts from home video release although each one would have received only
       a small fraction of that sum. We reject this illogical and unjust result. (See Stone v.
       Owens (1894) 105 Cal. 292, 297-298, 38 P. 726 [creditors who are paid by contractor
       from proceeds received for work done under construction contract have not received
       a “benefit” of that contract within the meaning of Civil Code section 1589; to hold
       otherwise would give section 1589 “an outrageously unjust [ ] effect.”].)

Recorded Picture, 61 Cal. Rptr. 2d at 749-50.

        In the United States District Court for the Northern District of California, a defendant sought
to escape obligations under an assignment agreement by relying on Recorded Picture. In rejecting
the assertions of the defendant, the court held:

                PDRA argues that it did not receive all the benefits of the agreement and,
       thus, is not bound by any of its obligations. In Recorded Picture Co., the court held
       that the subdistributor of a film was not bound by the terms of a contract between the
       distributor and the film’s producer because the subdistributor did not receive all the
       benefits of the contract. 53 Cal. App. 4th at 365, 61 Cal.Rptr.2d at 750. The court
       found that the subdistributor was not even aware of the contract between the
       distributor and the producer, and that it was merely a licensee, not an assignee, of the
       copyright in the film. Id. at 364, 61 Cal.Rptr.2d at 749. Thus, the court held, it
       would be unjust to bind the subdistributor to the terms of the contract. Id.
                Here, in contrast, PDRA was aware of the 1982 Agreement from the
       beginning, and knowingly operated according to its terms for over ten years.
       Moreover, PDRA did receive the primary benefit of the 1982 Agreement, the right
       to operate a rental business at Pajaro Dunes.

Pajaro Dunes, 2001 WL 1743285, at *8.

                                                 -10-
       In the case at bar, not only was Jackson thoroughly familiar with the provisions of the
Cryner-Famous Music Corporation agreement, he, in fact, negotiated them.

        In Melchior v. New Line Productions, Inc., the same division of the California Court of
Appeal that had decided Recorded Picture was heard again.2 The issue involved efforts of an
assignee to avoid obligations under his assignor’s contract by relying on Recorded Picture. In
rejecting the position of the defendant, the court held:

                The case of Recorded Picture Company [Productions] Ltd. v. Nelson
        Entertainment, Inc. (1997) 53 Cal. App. 4th 350, 61 Cal. Rptr. 2d 742, in which this
        court reached a contrary result, is distinguishable and not controlling. In Recorded
        Picture Company, the defendant was not provided with a copy of the plaintiff’s
        original contract. (At p. 358.) While it knew of the existence of the contract, it had
        no knowledge of the terms of the contract. (Id. at p. 365, 61 Cal. Rptr. 2d 742.) In
        addition, this court held the defendant was a licensee, not an assignee. (Id. at p. 363,
        61 Cal. Rptr. 2d 742.) Here, by contrast, New Line was an assignee of the Release
        Agreement and had knowledge of its terms, making application of Civil code section
        1589 appropriate. New Line was well aware of the burdens of the Release
        Agreement when it accepted the benefits of that agreement.

Melchior, 131 Cal. Rptr. 2d at 355.

       Recorded Picture is clearly distinguishable from the case at bar and, as tacitly acknowledged
by subsequent California decisions, is an aberration that should be confined to its peculiar and
appealing facts.

        Paragraph nine of the Cryner-Famous Music agreement is clear and unambiguous, and, as
the assignee of Famous Music, Carl Jackson d/b/a Lonesome Dove Music is bound by it.

        Certain matters not necessary to a decision in the case, but which permeated the three-day
trial of this case and the dozen-year relationship between the parties, deserve attention. In its
findings at the conclusion of the trial, the Chancellor observed:

                Mr. Jackson, I want to state that throughout these proceedings I’ve been very
        impressed with you. I think your initial contact with Ms. Cryner was one of
        friendship and you did her a great favor. I think she recognizes that and I think she’s
        in a very awkward position right now. Money does a lot of strange things to people.
                You did her a very good job because it worked to your detriment. And had
        you had a lawyer looking solely out for you, you might have been able to include
        language that would have protected the interests you thought you were getting. But

        2
           Recorded Picture was authored by Masterson, Judge, with Presiding Judge Spencer and Judge Ortego
concurring. Melchior was authored by Presiding Judge Spencer and concurred in by Judges Ortego and Mallano.

                                                   -11-
       after having listened to everything that was testified to and reading the documents
       and learning a little bit more on my behalf about copyright, I find that I am not able
       to declare that you have any interest given her right to this reassignment. It may not
       be fair, but it is the law.
                And it is with regret that I issue this opinion. I think that you benefitted Ms.
       Cryner and it may be that she will recognize that in some fashion in the future. But
       it is not within the province of this Court to declare otherwise having read the clear
       terms of the agreement and terms as they were set forth and to which the parties
       signed.

       The record does indeed reflect that Carl Jackson “discovered” a waitress in a restaurant
whom he correctly determined to be a talented song writer. As Bobbie Cryner acknowledges, she
knew nothing about the marketing of musical compositions, and it was Jackson who took her by the
hand and led her through the intricacies of contract negotiations, insisted upon her reclamation rights
and marketed her talents in a manner most beneficial to her.

        There is an obverse side to this coin, however. Bobbie Cryner had transferred to the producer
and co-producer 37 compositions in existence at the time of the October 11, 1991 contract and more
than 60 such compositions during the life of the contract. Neither producer or co-producer were
under any obligation under the contracts to commercially exploit each of Bobbie Cryner’s
compositions. The parties must use their best judgments to try to estimate what songs may catch on
with the public and what songs may have no commercial value. In their search, a diamond in the
rough entitled “Real Live Woman” slipped through the cracks. Producer and co-producer Jackson
had every opportunity during the life of the Cryner-Famous Music contract to commercially exploit
“Real Live Woman” but declined to do so. In their search for a commercial hit, they might
collectively lament their missed opportunity. In the opening lines of a country music commercial
success of many years ago, “I Overlooked an Orchid While Searching for a Rose.”

        The second “whereas” paragraph of the Famous Music-Jackson contract indicates that it is
Famous Music, and not Bobbie Cryner, who desires to “compensate” Jackson by the fifty percent
copyright assignments. Jackson vigorously asserted in oral testimony that it was always the mutual
intent of Bobbie Cryner and Carl Jackson that the Jackson fifty percent interest in the Cryner
composition copyrights be unconditional and not subject to the reclamation clause of the Cryner-
Famous Music contract. If such were the case, it would have been a simple matter to insert such
language in the Cryner-Famous Music contract instead of leaving a completely unambiguous
reclamation provision in the contract that allows no exception.

        “The court, [in] arriving at the intention of the parties to a contract, does not attempt to
ascertain the party’s state of mind at the time the contract was executed, but rather their intentions
as actually embodied and expressed in the contract as written.” Rainey v. Stansell, 836 S.W.2d 117,
119 (Tenn.Ct.App.1992). While Jackson was not a party to the Cryner-Famous Music contract, he
was thoroughly familiar with it and, in fact, negotiated the very provision embodied in paragraph
nine which brings him to grief in this case.

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        The judgment of the trial court is in all respects affirmed, and the case is remanded for such
further consideration as may be necessary. Costs of the cause are assessed against Carl Jackson.

                                                       ___________________________________
                                                       WILLIAM B. CAIN, JUDGE

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