The opinion of the court was delivered by: PIERCE
Plaintiff herein, CBS, Inc. (CBS Records Division, hereinafter "CBS"), has brought this action against Tanya Denise Tucker (hereinafter "Tucker" or "the infant"), a minor formerly under contract to plaintiff as a recording artist, Tanya, Inc., and Jessie Melvin Tucker and Alma Juanita Tucker, both individually and as guardians of Tanya Tucker. The complaint seeks a declaratory judgment, pursuant to 28 U.S.C. §§ 2201-02, first, as to the defendants' right to disaffirm the recording contract formerly in effect between Miss Tucker and CBS, and second, as to the rights of the plaintiff to the master recordings, copyrights and stock of records of Miss Tucker's performances.
The defendants have counterclaimed seeking a declaratory judgment as to Miss Tucker's right to disaffirm the contract and her right to the aforementioned recordings, copyrights, and records, an accounting by the plaintiff for all gross receipts received by the plaintiff from sales of records containing Miss Tucker's performances (less costs and royalties already paid), and both preliminary and permanent injunctive relief. It is the application for preliminary injunctive relief which is now before the Court.
brought on her application for preliminary relief by order to show cause dated October 30, 1975. That application seeks a preliminary injunction prohibiting the plaintiff, in essence, from manufacturing, selling, distributing, or otherwise exploiting at prices or in packages not previously utilized, those phonograph records or other reproductions of the performances of the infant which have previously been released for sale or distribution, and from manufacturing, selling, distributing or otherwise exploiting at all, those phonograph records or other reproductions of the infant's performances which have not previously been released for sale and distribution.
The Court signed the order to show cause, issued a temporary restraining order on consent of the parties, and set the matter down for a hearing on November 20, 1975. On that date, defendant was unable to proceed with witnesses. Accordingly, the hearing was adjourned to the following week, and again, at the request of counsel, to December 3, 1975. In each instance, the restraining order was extended by consent.
On December 3, 1975, the Court heard evidence for the better part of the day concerning the defendant's application, and reserved decision on the motion. Again, with the consent of the parties, the restraining order was extended pending the Court's decision on the motion for preliminary relief.
The facts which are relevant to the issues before the Court on this motion are not complex and are largely undisputed. CBS and Tanya Tucker, who is now seventeen years of age (Tr. 62),
entered into a recording artist agreement (agreement) dated February 24, 1972. (Defendant's Ex. A.) The agreement was executed by Miss Tucker on March 3, 1972 when she was thirteen years of age. At the time the agreement was executed Miss Tucker was represented by Dolores Fuller with whom she had a contract for services as an agent, but she was not represented by an attorney. (Tr. 66-69.)
The agreement provided for a one year contract with two one year options, each of which CBS exercised. (Ex. A.) During the contract period, which ran until on or about March 15, 1975, Miss Tucker recorded approximately forty-eight master recordings for CBS. (Tr. 69.) Seven or eight of these recordings, which were made in January, 1975, remain unreleased at the present time. (Tr. 140.) During the contract period, CBS expended considerable sums and substantial effort in promoting the infant's career as a recording artist, including merchandising, marketing, and publicity efforts which were directed from CBS headquarters in New York and implemented on a nationwide basis. (Tr. 170-75, 180-182, 191-93.)
There is no dispute that both parties have benefitted from this agreement. Miss Tucker, who had been unknown before entering into the agreement, became a star in the recording industry and has earned approximately $110,000 in royalties from CBS since entering the agreement. (Tr. 62-63, 70.) According to the terms of the agreement, she will continue to be entitled to royalties from the sales of her CBS recordings as long as her recordings are sold by CBS. (Ex. A.) CBS has also profited from the arrangement, having recouped certain of its recording expenses from Miss Tucker's royalties, pursuant to the agreement, and having earned a profit as well. (Tr. 170, 182-84.)
On or about October 10, 1974, prior to the expiration of the CBS agreement, Miss Tucker signed a recording artist agreement with Music Corporation of America (MCA), the company with which she now records. (Tr. 62, 73.) However, although she had signed with MCA, she performed all of the remaining recording obligations under her CBS contract and did not record at all for MCA until after March 15, 1975 when the final option of the CBS agreement expired. (Tr. 73-74, 127.)
Since Miss Tucker's departure from CBS, MCA has released two single recordings which Miss Tucker had recorded for her new company. In each instance, according to Miss Tucker's testimony, CBS released one of the previously unreleased Tucker recordings in its stock at approximately the same time. (Tr. 83, 98-99.) It was after these occurrences that Miss Tucker sent to CBS a letter dated July 15, 1975, which proved to be the genesis of this lawsuit. (Ex. B.) In that letter, Miss Tucker purported to assert her right as an infant to disaffirm a contract made during infancy, and demanded the return and/or assignment to her of all master recordings, copyrights, and stocks of records, as well as an accounting for profits and a cessation of distribution of her records by CBS. On September 24, 1975, CBS filed its complaint in the instant action.
The issuance of a preliminary injunction constitutes the award of extraordinary relief. Sanders v. Air Line Pilots Assn., Int'l, 473 F.2d 244, 248 (2d Cir. 1972); Heldman v. United States Lawn Tennis Assn., 354 F. Supp. 1241, 1249 (S.D.N.Y. 1973). Its purpose is to preserve the status quo between the parties pending final determination of the merits of the action. Hamilton Watch Co. v. Benrus Watch Co., 206 F.2d 738, 742 (2d Cir. 1953); Columbia Broad, Sys., Inc. v. American Soc. of Comp., Auth. and Pub., 320 F. Supp. 389, 392 (S.D.N.Y.1970).
It is well-settled in this Circuit that "a preliminary injunction should issue only upon a clear showing of either (1) probable success on the merits and possible irreparable injury, or (2) sufficiently serious questions going to the merits to make them a fair ground for litigation and a balance of hardships tipping decidedly toward the party requesting preliminary relief." Sonesta Int'l Hotels Corp. v. Wellington Associates, 483 F.2d 247, 250 (2d Cir. 1973). See Columbia Pictures Indus., Inc. v. American Broad. Cos., Inc., 501 F.2d 894, 897 (2d Cir. 1974); Gulf & Western Industries, Inc. v. The Great Atlantic & Pacific Tea Co., 476 F.2d 687, 692-93 (2d Cir. 1973); Checker Motors Corp. v. Chrysler Corp., 405 F.2d 319 (2d Cir.), cert. denied, 394 U.S. 999, 89 S. Ct. 1595, 22 L. Ed. 2d 777 (1969). For the reasons stated hereinbelow, the Court has concluded that on the present record the moving party has failed to demonstrate either possible irreparable injury or a balance of hardships tipping decidedly in her favor. Accordingly, the preliminary relief sought must be denied.
Because the Court has concluded that defendant has failed to satisfy the second prong of either of the alternative formulations of the test for a preliminary injunction, it is not necessary to examine the merits of the action in detail on this motion. It suffices to note that, having first determined that New York law applies,
the Court concludes that the right of the infant to disaffirm the contract is virtually certain.
See, Joseph v. Schatzkin, 259 N.Y. 241, 243, 181 N.E. 464 (1932); Casey v. Kastel, 237 N.Y. 305, 142 N.E. 671 (1924); Career Placement of White Plains, Inc. v. Vaus, 77 Misc.2d 788, 354 N.Y.S.2d 764 (Sup.Ct.Westchester Co. 1974); General Motors Acceptance Corp. v. Stotsky, 60 Misc.2d 451, 303 N.Y.S.2d 463 (Sup.Ct.Suff.Co.1969); In re Ferguson's Guardianship, 41 N.Y.S.2d 862 (Surr.Ct.West.Co.), affirmed, 266 App. Div. 1016, 46 ...