Court Opinion

ID: 5733615
Source: CourtListenerOpinion
Date Created: 2022-01-12 16:29:37.572611+00
Date Added: 2024-06-11T08:40:55.456990
License: Public Domain

McNally, J.
Defendants-appellants, Princess Production Corporation and Burt Balaban, appeal from the judgment entered December 20, 1960 enjoining them from producing and selling phonograph records of the vocalist Sarah Vaughan, reproduced from the sound track of the motion picture entitled “ Murder, Inc.”, and awarding plaintiff damages in the sum of $8,600.
The first cause of action is directed against defendant Sarah Vaughan and alleges that on July 24, 1959 a contract was made between plaintiff and said defendant providing for her recordings of phonograph records exclusively for the plaintiff during the term of three years commencing April 1, 1960, and further providing that during the period of five years after the expiration of the contract the said defendant will not “ perform ” any material recorded for the plaintiff.
The second cause of action is directed against the appellants and other defendants and alleges that the appellants licensed the manufacture and distribution of phonograph records of two *337musical numbers entitled “ The Awakening ’ ’ and “ Fan My Brow ” reproduced from the original sound track of the motion picture ‘‘ Murder, Inc.” rendered by the defendant Sarah Vaughan, with knowledge on the part of the appellants of plaintiff’s rights under its contract with Sarah Vaughan dated July 24, 1959.
In opposition to plaintiff’s motion for a preliminary injunction, defendant Sarah Vaughan alleged that her contract with the" appellants did not give them any right to said exploitation of the recordings of her performance in the production of ‘ ‘ Murder, Inc. ’ ’ By reason of said allegation plaintiff did not proceed with this action against Sarah Vaughan. The preliminary injunction granted as to the appellants was conditioned on a bond in the sum of $25,000. Plaintiff did not furnish the required bond and therefore did not avail itself of the injunction pendente lite.
On April 19,1960 defendant Princess Production Corporation by defendant Burt Balaban, its president, entered into a contract with defendant Sarah Vaughan for the rendition of the said two musical compositions in the production of the motion picture “ Murder, Inc.” There is no evidence that the appellants were informed prior to August 8, 1960 by either defendant Sarah Vaughan or the plaintiff of the contract between plaintiff and defendant Sarah Vaughan dated July 24, 1959. On August 8, 1960 plaintiff wrote to the appellants and informed them of the said contract. Plaintiff knew of the agreement dated April 19, 1960 between the appellants and defendant Sarah Vaughan on the day following the making of said agreement. The phonograph records which are the subject of this action were manufactured and distributed prior to August, 1960.
In support of plaintiff’s allegation of knowledge on the part of the appellants of the contract between plaintiff and defendant Sarah Vaughan dated July 24, 1959, plaintiff relies solely upon the publicity thereof reflected in various trade publications. Appellants deny knowledge of said contract on April 19, 1960 and prior to the receipt of the letter of August 8,1960.
The trial court was requested to find that on and after April 19, 1960 the appellants with full knowledge of plaintiff’s rights under its contract with defendant Sarah Vaughan entered into the licensing agreement resulting in the phonograph recordings of the said two musical compositions from the sound track of the motion picture “Murder, Inc.” The trial court did not make the finding requested. Instead the trial court found that the said licensing agreement was made by the appellants in violation of plaintiff’s rights under its contract with defendant *338Sarah Vaughan, ‘1 knowledge of which they could or should have had
On this record the sole basis for recovery against the appellants is the intentional interference with the contractual rights of the plaintiff under the agreement of July 24, 1959, without justification and with knowledge of the contract on the part of the appellants. Plaintiff was required to establish actual knowledge of the underlying agreement on the part of the appellants in order to support a recovery for intentional interference therewith. (Associated Flour Haulers & Warehousemen v. Hoffman, 282 N. Y. 173, 181; Reiner v. North Amer. Newspaper Alliance, 259 N. Y. 250, 254-255; Hornstein v. Podwitz, 254 N. Y. 443, 448; Campbell v. Gates, 236 N. Y. 457, 460; Lamb v. Cheney & Son, 227 N. Y. 418, 422; Thompson Co. v. Winchell, 244 App. Div. 195, 198; Goodman Bros. v. Ashton, 211 App. Div. 769, 771.)
The trial court did not find and on this record the evidence is insufficient to sustain a finding of actual knowledge on the part of the appellants of the plaintiff’s contract with defendant Sarah Vaughan dated July 24, 1959 prior to receipt of the plaintiff’s letter dated August 8,1960. Although proof of actual knowledge may be predicated upon circumstantial evidence, this record does not demonstrate it.
We are also of the opinion that the basis for damages relied on by the plaintiff is too speculative. Plaintiff claimed it was entitled to damages equal to such profits as it would have made if it had sold the quantity of sound track records sold by defendants. Plaintiff was required to prove by a preponderance of the evidence that profits resulted from the phonograph recordings of the sound track of “ Murder, Inc.” and was also required to advance a reasonable basis for estimating the amount. (Restatement, Torts, § 912, comment d, p. 581 et seq.)
The trial court found there were 7,667 of said records of which 1,273 were distributed for promotional purposes. Although the evidence is that the balance of 6,394 was distributed largely on a consignment basis, the award of damages is based upon final sales thereof. The award docs not reflect a deduction for payment of $4,800 made by or for the appellants to the musicians’ union for the privilege of reproducing the sound track of the instrumentalists who supported the performance of defendant Sarah Vaughan, nor does the award take into consideration that the phonograph records here involved include the recordings of other artists. Moreover, the testimony of plaintiff’s witness is that the sale of 7,500 records does not normally serve to return the production costs. The sale of 6,394 records here involved *339would not appear to serve to recoup the expenses incident to their production.
The judgment should be reversed, on the law and on the facts, and a new trial directed, with costs to abide the event.