The opinion of the court was delivered by: TENNEY
Plaintiffs have moved this Court for a preliminary injunction pursuant to Rule 65 of the Federal Rules of Civil Procedure ("Rules") to restrain defendant Creative Card Company from the manufacture, distribution and sale of any poster or other commercially exploitive souvenir merchandise bearing the likeness of the late entertainer Elvis Presley. Plaintiffs claim possession of an exclusive right to that activity, based on a "right of publicity" assigned by Elvis Presley in life. Defendant Creative Card Company, an Illinois corporation, disputes the existence and assignment of this right, and has also moved for dismissal under Rule 12(b) on the grounds of lack of personal jurisdiction and/or improper venue in the Southern District of New York. The Court has determined that it has jurisdiction over defendant Creative Card Company and that venue is properly laid here. Accordingly, the motion to dismiss under Rule 12(b) is denied. In addition, by the tests for preliminary relief articulated in this circuit, I conclude that plaintiffs have made "a clear showing of . . . probable success on the merits and possible irreparable injury." Sonesta International Hotels Corp. v. Wellington Associates, 483 F.2d 247, 250 (2d Cir. 1973) (emphasis in the original). Therefore, plaintiffs' motion under Rule 65 is granted. The reasons for the Court's conclusions are set forth below.
On August 16, 1977, Elvis Presley, without doubt a world famous celebrity-entertainer, died at the age of forty-two. During life his professional career and the commercial exploitation of his person were managed exclusively by "Colonel" Tom Parker,
as demonstrated by the deposition of Col. Parker begun on September 30, 1977 and continued on October 1, 1977, and the documents appended thereto. On March 26, 1956, Presley and Parker entered into a written management contract which, although it does not specifically allude to souvenir merchandise, authorizes Parker to act exclusively for Presley "in any and all fields of public and private entertainment . . . embracing any and all branches thereof now known or hereafter coming into existence. . . ." Plaintiffs' Supplemental Memorandum, Exhibit C. However, that items of merchandise were clearly contemplated by the parties becomes apparent in later agreements including, inter alia, one concluded a few months later among Parker, Presley and a Mr. Saperstein of Special Projects, Inc., a merchandising company. Id., Exhibit D. The Special Projects organization was made "exclusive agent" for a period of time to license other firms "in connection with the sale, marketing and exploitation of consumer items." Id.
All manner of merchandise was thereafter covered by numerous licensing agreements with sub-licensees. E.g., id., Exhibits E, F & G. Although these and the Special Projects agreement, supra, refer to the late 1950's, an early period in the Presley career, a subsequent merchandising agreement between Presley and Parker, the latter doing business as "All Star Shows," dated May 25, 1963, id., Exhibit H, refers to the production of and distribution of profits from "Merchandising -- Special Souvenir Folios and Pictures." Later signed agreements between Parker and Presley specifically allude to "merchandising [agreements]." The last of these is dated January 22, 1976. Id., Exhibits I & J.
Plaintiff Boxcar Enterprises, Inc. ("Boxcar") entered into the Presley-Parker relationship as a corporation formed in January 1974. The Court does not have before it the certificate of incorporation, but Col. Parker has testified that he owned 56% of the shares and that Presley and one Tom Diskin, President of Boxcar, each owned 22%. Parker Depos. at 49, lines 21-26. There is, from this point on, some confusion as to which entity -- Boxcar or Col. Parker doing business as All Star -- handled merchandising, but there are numerous exhibits of checks issued from Boxcar to Elvis Presley bearing such notations as "For Royalty Earnings From Sales of Elvis Presley Souvenir Material On Tour June 25th through July 5th, 1976 as per contractual agreement." Plaintiffs' Supp. Mem. Exhibit L. (Further checks and royalty statements from Boxcar to the Elvis Presley Estate have also been submitted. Id. Exhibit L.) On August 18, 1977, two days after the entertainer's death, plaintiff Boxcar entered into an agreement with plaintiff Factors Etc., Inc. ("Factors") which purported to afford the latter an exclusive license to use the Presley likeness in connection with all souvenir merchandise. Complaint, Exhibit A. On August 24, 1977, Vernon Presley, father of the deceased and executor of his estate, agreed to a royalty arrangement with Boxcar as "Merchandising Representatives for the Elvis Presley Estate." Plaintiffs' Supp. Mem. Exhibit N. Vernon Presley also wrote to Col. Parker on August 23, 1977 asking Col. Parker to "carry on according to the same terms and conditions as stated in the contractual agreement you had with Elvis dated January 22, 1976." Id., Exhibit M.
Defendant argues along several lines, the most germane of which are: (1) that plaintiff Boxcar never acquired the exclusive right to merchandise the Presley name and image; (2) that even if Boxcar did have such a right in Presley's lifetime, that right died with the entertainer; (3) that this Court has no jurisdiction of defendant and/or venue is improperly laid here. Although the Court would normally dispose of the procedural questions of jurisdiction and venue before moving to the substantive issues, in this particular case the latter must be considered first because the procedural issues depend on a clear definition of the applicable substantive rights.
The Presley/Parker/Boxcar/Factors Relationship
It is hornbook law that where there is ambiguity in a contract the intent of the parties may be ascertained by reference to their subsequent course of conduct. Gordon v. Vincent Youmans, Inc., 358 F.2d 261 (2d Cir. 1965); Portsmouth Baseball Corp. v. Frick, 278 F.2d 395 (2d Cir.), cert. denied, 364 U.S. 831, 5 L. Ed. 2d 58, 81 S. Ct. 71 (1960); 1 Corbin, Contracts § 101 (1964). For more than twenty years, Elvis Presley and Col. Parker had a working relationship where the division of labor was apparent: one performed, the other promoted. If some of the documents memorializing this activity are less artful than those which some professional counsel can draft, they are no less valid. Defendant points to inconsistencies in the statements of Col. Parker and others as to who held the right to "merchandise" the Presley image during his lifetime -- Presley himself, Parker, or, eventually, Boxcar. In view of the Parker-Presley agreements, the uncontested allegation that Presley himself was a 22% shareholder of Boxcar and the fact that Boxcar paid royalties to Elvis Presley for souvenir merchandise sold, it seems clear enough, at least for purposes of a preliminary injunction, that Presley gave Parker leave to exploit his image through merchandise and that Boxcar was, in recent years, the vehicle through which such merchandising was carried on. Defendant's allusions to defective links in the chain of title in Boxcar, Defendant's Mem. in Oppos. 15-18, lose sight of the true facts: these entities involved the same people. With the exception of Diskin they had been doing business together for twenty years.
None of the parties to the Presley-Parker business relationship appears to have been dissatisfied. Vernon Presley stated on CBS television on October 3, 1977: "Colonel Parker is an honest man. And I think that's where the big organization and the big togetherness comes, you know. Once you find out you don't have to worry about a guy being your manager, what he can do for you, he handles it. You do the show. Everything works fine." Plaintiffs' Supp. Mem. at 4. The Court takes note of the fact that these remarks were represented as having been recorded prior to Presley's death.
By far the most interesting issue in this case is whether Boxcar had anything to transfer to Factors when it entered into the August 18, 1977 "exclusive licensing" contract. After consulting the case law and certain commentaries in this field, e.g., Gordon, Right of Property in Name, Likeness, Personality and History, 55 Nw. U.L. Rev. 553 (1960); Nimmer, The Right of Publicity, 19 Law & Contemp. Probl. 203 (1954); Note, The Right of Publicity -- Protection for Public Figures and Celebrities, 42 Brooklyn L. Rev. 527 (1976), I have concluded that it did. It appears that a recognized property right, the "right of publicity," inhered in and was exercised by Elvis Presley in his lifetime, that it was assignable by him and was so assigned, that it survived his death and was capable of further assignment.
The "right of publicity" is not a new concept, but to the detriment of legal clarity, it has often been discussed only under the rubric "right of privacy." It is said that the right of privacy embraces "four distinct kinds of invasion of four different interests of the plaintiff, which are tied together by the common name, but otherwise have almost nothing in common except that each represents an interference with the right of the plaintiff 'to be let alone.'" W. Prosser, Torts 804 (4th ed. 1971) (emphasis added). It is this language which is at the root of the conceptual difficulty in the "right of publicity" area. Dean Prosser recognized that the fourth species of right of privacy tort, i.e., the appropriation of plaintiff's name or likeness for defendant's benefit, is distinct from "intrusion upon the plaintiff's physical solitude or seclusion," "public disclosure of private facts," or "false light in the public eye," id. at 807, 809, 812, in that "appropriation" is the only one which "involves a use for the defendant's advantage," id. at 814. However, Prosser has failed to discuss the fact that appropriation of plaintiff's name and likeness for defendant's financial advantage has different consequences in a case where the celebrity himself has attempted to commercialize his own name and face. It is evident that courts address intrusions on feelings, reputation and privacy only when an individual has elected not to engage in personal commercialization. By contrast, when a "persona" is ...