The opinion of the court was delivered by: Miriam Goldman Cedarbaum, United States District Judge.
The sole heir of Martha Graham and his assignees sue the Martha Graham
Center of Contemporary Dance and the Martha Graham School of Contemporary
Dance to enjoin them from using the names under which they were
incorporated and have operated since 1948 and 1956, respectively, and to
enjoin them from calling what they teach the "Martha Graham technique."
Martha Graham, the great pioneer of modern dance, died in 1991 at the age
of 96. In 1993, Ronald Protas, her testamentary legatee, applied for
trademark registration of "Martha Graham" and "Martha Graham technique."
Plaintiffs assert claims of trademark infringement, unfair competition
and dilution against the Martha Graham School and the Martha Graham
Center. They also assert a variety of claims against these defendants and
a number of their directors, as well as a former employee.
Preliminary and final injunctive relief were consolidated with the
consent of the parties pursuant to Fed.R.Civ.P. 65(a)(2), and plaintiffs'
injunction claims were separated for trial pursuant to Fed.R.Civ.P.
42(b). After expedited discovery, a bench trial was held between March 21
and April 18, 2001.*fn1 After careful consideration of the evidence,
injunctive relief is denied for the reasons that follow.
Since there is no just reason for delay in entering judgment on
plaintiffs' claims for injunctive relief, the clerk is directed to enter
judgment for defendants dismissing Claims One, Two, Three and Four. The
other claims asserted in the complaint will be tried in the fall.
In determining the facts, I heard the testimony of thirteen witnesses
and read the deposition testimony of three witnesses. On the material
facts, I found Protas not to be a credible witness. I also found Michele
Etienne not to be credible, including with respect to an anonymous note
that she recalled having seen on a ledger page in 1973.
After observing the witnesses and evaluating their credibility and
weighing all of the evidence, I make the following findings of fact.
Martha Graham was one of the leading dancers and choreographers of the
twentieth century. Graham began dancing in the early 1920's and gave the
first public performance of her own works in 1926. Graham formed an
all-woman performance troupe under the name Martha Graham Group.
Subsequently, men joined the troupe and its name was changed to the
Martha Graham Dance Company. In the late 1920's and early 1930's, Graham
began developing her own system of dance exercises and movements that
focused on contracted muscles and energy release. After teaching her work
informally and as an instructor at various institutions, Graham opened
the Martha Graham School of Dance in approximately 1930.
In 1948, Graham and several of her supporters incorporated the Martha
Graham Foundation for Contemporary Dance, Inc. under the New York
Membership Corporation Law ("MCL"), the statutory predecessor of the
current Not-For-Profit Corporation Law. Pursuant to § 10 of the MCL,
the Foundation's Certificate of Incorporation included a sworn statement
by Graham that she "hereby consents to the use of her name in said
corporate title." In 1968, the Foundation's name was changed to its
current name, the Martha Graham Center of Contemporary Dance, Inc.
In 1956, on the advice of Rubin Gorewitz, her tax accountant, Graham
incorporated the Martha Graham School of Contemporary Dance, Inc. under
the MCL. The new institution was created to purchase the dance school
that Graham had been operating as a sole proprietorship since 1930. As
the proprietor of the school, Graham was subject to ordinary income tax
on all income from the school. The sale of the school to defendant The
Martha Graham School of Contemporary Dance enabled Graham to treat the
purchase price, which was to be paid in ten annual installments, as
long-term capital gain which was taxed at half the rate of ordinary
income. In addition, it transferred all of the expenses of the school,
including Social Security tax for its employees. There is clear and
convincing evidence that Graham sold her school, including the perpetual
right to use her name on the school, to the Martha Graham School of
Contemporary Dance, Inc. for $50,000, payable over ten years. In
addition, Graham entered into a ten-year employment agreement with the
School. A number of Graham's tax returns from the late 1950's and early
1960's reflect payments to Graham that were reported as long term capital
gain attributable to "Installment Sales Price Payment — Sale of
Protas first became acquainted with Graham in approximately 1967, when
after dropping out of law school, he was doing freelance photography.
Although Protas was 26 years old and had no training in dance, he and
Graham developed a very close friendship. By the mid-1970's, under
Graham's auspices, Protas became executive director of the Center and a
Board member of the Center and of the School, and was given the title of
Co-Associate Artistic Director of the Center in approximately 1980.
Graham's last will, executed on January 19, 1989, named Protas sole
executor and legatee and included the following provisions:
All personal and household effects, and other tangible
personal property . . . if owned by me at the time of
my death, I give and bequeath to my said friend, Ron
Protas, if he shall survive me. . . .
The residue of . . . all my property, real and
personal, of every kind and description and wherever
situated, including all property over which I may have
power of appointment at the time of my death . . . and
including all property not otherwise effectively
disposed of hereunder . . . I give, devise and
bequeath to my said friend, Ron Protas, if he shall
survive me, or, if he shall not survive me, to the
Martha Graham Center of Contemporary Dance, Inc.
In connection with any rights or interests in any
dance works, musical scores, scenery sets, my personal
papers and the use of my name, which may pass to my
said friend Ron Protas . . . I request, but do not
enjoin, that he consult with my friends, Linda Hodes,
Diane Gray, Halston, Ted Michaelson, Alex Racoli and
Lee Traub, regarding the use of such rights or
After Graham's death in 1991, Protas succeeded Graham as Artistic
Director of the Center and School and was responsible for managing the
daily activities of these two institutions. Although Protas had been
advised by Peter Stern, the attorney he retained to represent him as
executor of Graham's estate, to investigate what rights he actually had
acquired under the will, and was given the same advice by Danskin, a
manufacturer with which he sought to establish a business relationship,
Protas made no such investigation. Nevertheless, he represented to his
fellow directors at the Center and the School that he owned the exclusive
right to use Martha Graham's name.
In November 1993, Quinn, with the assistance of another associate,
Scott Martin, filed applications with the United States Patent and
Trademark Office ("PTO") on Protas' behalf for registration of the two
service marks on which Protas now sues: a) MARTHA GRAHAM; and b) MARTHA
GRAHAM TECHNIQUE. The applications, which were signed by Protas subject
to the penalty of perjury, stated that Protas owned these marks, that the
marks had first been used in commerce in 1926, and that they were used by
the Center and School pursuant to an oral license from Graham.
The only evidence submitted to the Trademark Office of continuous use
of the trademarks consisted of recent Center and School brochures. In
drafting the applications and responses to PTO office actions which
requested additional information about the alleged oral license from
Graham to the defendants, Quinn and Martin relied on unsupported
assertions made by Protas and Barbara Groves, a senior administrative
employee at the Center who reported to Protas.
On August 15, 1995, the PTO granted federal registration for MARTHA
GRAHAM TECHNIQUE in connection with "educational services; namely
providing instruction through classes and workshops in the field of
contemporary dance." On October 10, 1995, federal registration was
granted for use of the name MARTHA GRAHAM in connection with "educational
services; namely providing instruction through classes and workshops in
the field of contemporary dance, and entertainment services; namely,
organizing and producing performances of contemporary dance." No
affidavit of continuous use has been filed with regard to these marks
pursuant to 15 U.S.C. § 1065. Accordingly, the marks are not
Between 1995 and 1998, the Center and the School continued to operate
under the names by which they had been incorporated in 1948 and 1956
respectively and continued to describe the method of dance that they
taught as the "Martha Graham technique."
In 1998, Protas, with assistance from Quinn, created the Martha Graham
Trust, a revocable trust, which named Protas as its sole trustee and
beneficiary. The trust was created to serve as a repository to hold and
license all of the Martha Graham intellectual property that Protas
claimed he had inherited. After a strained relationship with Protas and
increased difficulty with fund-raising, in 1998, the Boards of the Center
and the School began discussions with Protas to diminish Protas' role at
the Center and School and to replace Protas as Artistic Director. In
furtherance of this effort, the Boards entered into negotiations with
Protas for a license agreement to use the Graham trademarks.
Initially, Protas was represented in these negotiations by Howell E.
Begle of the law firm of Verner, Liipfert, Bernhard, McPherson & Hand.
Begle was replaced by another attorney, Egon Dumler. Protas eventually
replaced Dumler with Quinn, who was no longer employed by Cahill, Gordon
and Reindel. Todd Dellinger, the Managing Director of the Center and the
School, handled the initial negotiations and drafting of the license
agreement on behalf of the Center and the School. Dellinger is not an
attorney, was hired by Protas, and reported to Protas as his supervisor.
Moreover, Protas had asked Dellinger to become the director of his Martha
Graham Trust. Dellinger, the initial drafter, remained the custodian and
recorder of all drafts.
Robert Solomon, a Board member and a tax partner at the law firm of
Frankfurt, Garbus, Kurnit, Klein & Selz, as well as William Prescott, the
financial advisor to Dolores Weaver, one of the members of the Board,*fn3
participated in reviewing the terms of the license agreement on behalf of
the Center and the School. Neither before nor during the negotiations for
the license agreement did any of ...