Decisions of Note

Suit over Santa Song Filed in Wrong Court

“Santa Claus is Coming to Town” is a big money-maker for the heirs of the songwriters and the EMI Feist Catalogue Inc., the London-based music company that obtained ownership rights to the song in 1981. A federal judge in West Palm Beach, FL, ruled that a lawsuit by the heirs seeking to break that agreement, though ripe, was filed in the wrong jurisdiction. Baldwin v. EMI Feist Catalog, 9:2011cv81354.

“The activities of the affiliated entities [of the defendants] that plaintiffs have uncovered are either unrelated to defendant, do not take place in Florida or fall well short of the level of activity required to establish general personal jurisdiction,” U.S. District Judge Kenneth Marra wrote in a 10-page decision. (The lead plaintiff in the case, Gloria Coots Baldwin, lives in Florida's Palm Beach County, said Attorney David P. Milian, a partner at Carey Rodriguez Greenberg & O'Keefe in Miami who represents the heirs.)

But the fight over one of the most iconic holiday songs in Americana is far from over. Milian said he planned to re-file the complaint in New York to try to break the agreement.

The song was written in 1934 by John Frederick Coots and Haven Gillespie. Their heirs get royalties from EMI every time it's recorded or used in any capacity. An amended complaint filed in April asserted that the heirs have a right to break the agreement under the Copyright Act amended in 1976 and 1998. “They feel they would be in a better position to exploit the work and derive greater economic value,” Milian said. “It is one of the top 10 songs of all time. Every major artist recorded it if it's on a Christmas album.”

The only substantive part of District Judge Marra's ruling is that he found the heirs were within their rights to try to break the 1981 agreement. The song's copyright was renewed in 1976 for 47 years and extended again in 1998 to 67 years. “As a threshold matter, the court finds that the controversy between plaintiffs and defendant is sufficiently ripe,” Judge Marra wrote.

Donald S. Zakarin, a partner in New York at Pryor Cashman who represented EMI, said the music publisher's 1981 agreement with the authors and heirs barred them from terminating EMI's U.S. ownership of the copyright. Plaintiffs claimed the right to terminate in either 2016 or 2021. “The song makes hundreds of thousands of dollars a year, and it remains copyrighted until at least 2029 under current law,” he said. “The composition is incredibly valuable for the plaintiffs, who earn significant royalties from the song, as well as for EMI, which owns copyright.”

Both sides in the lawsuit, though, couldn't help but wonder about the timeliness of Judge Marra's decision, which came a few days before Christmas.

' John Pacenti, Daily Business Review

$320M Affirmance in Millionaire Case

Despite bringing in former U.S. solicitor general Seth Waxman to plead its case on appeal, The Walt Disney Co. failed to win a reversal of a jury's finding that it duped the creator of the TV series Who Wants to Be a Millionaire? out of $320 million in royalties.

In a unanimous opinion, the U.S. Court of Appeals for the Ninth Circuit upheld a 2010 jury verdict that Disney subsidiaries ABC Television, Buena Vista Television and Valleycrest Productions breached a contract to share the show's U.S. profits with its creator, the British production company Celador International. Celador International Inc. v. American Broadcasting Companies Inc., 11-55104. The ruling was a win for Celador's lawyers at the Los Angeles offices of Robins, Kaplan, Miller & Ciresi and Grienes, Martin, Stein & Richland.

Who Wants to be a Millionaire? originated in Britain in 1998. A year later, ABC bought the licensing rights from Celador and adapted the show for a U.S. audience. In its prime the program helped make ABC the top-ranked network, yet the network claimed that Millionaire ran a $73 million deficit. Celador brought suit in U.S. District Court in Riverside, CA, in 2004, alleging that the Disney subsidiaries were hiding the show's profits through some dodgy accounting. The British company said it was owed as much as $380 million.

After hearing testimony from Disney higher-ups, including CEO Robert Iger, a jury returned a $269 million verdict in Celador's favor in July 2010.

Disney's lawyers at Sheppard, Mullin, Richter & Hampton offered a slew of arguments to try to persuade U.S. District Judge Virginia Phillips to set aside the verdict. For one thing, they said Disney should have prevailed as a matter of law, because the licensing contract at issue precluded Celador's claims. They also attacked Celador's expert's damages calculation.

District Judge Phillips not only denied Disney's post-trial motions, but also later tacked on $50 million in pre-judgment interest.

For its Ninth Circuit appeal, Disney turned to Waxman of Wilmer Cutler Pickering Hale and Door to try to undo the damage. Robin Meadow of Greines Martin represented Celador at the appeals court. The Ninth Circuit panel had sent strong signals at oral argument in October that it would affirm the verdict.

In its unpublished ruling, the appeals court ruled that District Judge Phillips didn't commit clear error in affirming the jury verdict and denying the Disney affiliates' motion for judgment as a matter of law. “Although the Disney affiliates advanced a persuasive case at oral argument for their interpretation of the contract, Celador's reading is also plausible,” the three-judge appellate panel ruled. It added that Celador's expert evidence on the fee for a fair market license and Celador's compensation from that was “not inherently improbable.”

' Jan Wolfe, The American Lawyer

Suit over Santa Song Filed in Wrong Court

“Santa Claus is Coming to Town” is a big money-maker for the heirs of the songwriters and the EMI Feist Catalogue Inc., the London-based music company that obtained ownership rights to the song in 1981. A federal judge in West Palm Beach, FL, ruled that a lawsuit by the heirs seeking to break that agreement, though ripe, was filed in the wrong jurisdiction. Baldwin v. EMI Feist Catalog, 9:2011cv81354.

“The activities of the affiliated entities [of the defendants] that plaintiffs have uncovered are either unrelated to defendant, do not take place in Florida or fall well short of the level of activity required to establish general personal jurisdiction,” U.S. District Judge Kenneth Marra wrote in a 10-page decision. (The lead plaintiff in the case, Gloria Coots Baldwin, lives in Florida's Palm Beach County, said Attorney David P. Milian, a partner at Carey Rodriguez Greenberg & O'Keefe in Miami who represents the heirs.)

But the fight over one of the most iconic holiday songs in Americana is far from over. Milian said he planned to re-file the complaint in New York to try to break the agreement.

The song was written in 1934 by John Frederick Coots and Haven Gillespie. Their heirs get royalties from EMI every time it's recorded or used in any capacity. An amended complaint filed in April asserted that the heirs have a right to break the agreement under the Copyright Act amended in 1976 and 1998. “They feel they would be in a better position to exploit the work and derive greater economic value,” Milian said. “It is one of the top 10 songs of all time. Every major artist recorded it if it's on a Christmas album.”

The only substantive part of District Judge Marra's ruling is that he found the heirs were within their rights to try to break the 1981 agreement. The song's copyright was renewed in 1976 for 47 years and extended again in 1998 to 67 years. “As a threshold matter, the court finds that the controversy between plaintiffs and defendant is sufficiently ripe,” Judge Marra wrote.

Donald S. Zakarin, a partner in New York at Pryor Cashman who represented EMI, said the music publisher's 1981 agreement with the authors and heirs barred them from terminating EMI's U.S. ownership of the copyright. Plaintiffs claimed the right to terminate in either 2016 or 2021. “The song makes hundreds of thousands of dollars a year, and it remains copyrighted until at least 2029 under current law,” he said. “The composition is incredibly valuable for the plaintiffs, who earn significant royalties from the song, as well as for EMI, which owns copyright.”

Both sides in the lawsuit, though, couldn't help but wonder about the timeliness of Judge Marra's decision, which came a few days before Christmas.

' John Pacenti, Daily Business Review

$320M Affirmance in Millionaire Case

Despite bringing in former U.S. solicitor general Seth Waxman to plead its case on appeal, The Walt Disney Co. failed to win a reversal of a jury's finding that it duped the creator of the TV series Who Wants to Be a Millionaire? out of $320 million in royalties.

In a unanimous opinion, the U.S. Court of Appeals for the Ninth Circuit upheld a 2010 jury verdict that Disney subsidiaries ABC Television, Buena Vista Television and Valleycrest Productions breached a contract to share the show's U.S. profits with its creator, the British production company Celador International. Celador International Inc. v. American Broadcasting Companies Inc., 11-55104. The ruling was a win for Celador's lawyers at the Los Angeles offices of Robins, Kaplan, Miller & Ciresi and Grienes, Martin, Stein & Richland.

Who Wants to be a Millionaire? originated in Britain in 1998. A year later, ABC bought the licensing rights from Celador and adapted the show for a U.S. audience. In its prime the program helped make ABC the top-ranked network, yet the network claimed that Millionaire ran a $73 million deficit. Celador brought suit in U.S. District Court in Riverside, CA, in 2004, alleging that the Disney subsidiaries were hiding the show's profits through some dodgy accounting. The British company said it was owed as much as $380 million.

After hearing testimony from Disney higher-ups, including CEO Robert Iger, a jury returned a $269 million verdict in Celador's favor in July 2010.

Disney's lawyers at Sheppard, Mullin, Richter & Hampton offered a slew of arguments to try to persuade U.S. District Judge Virginia Phillips to set aside the verdict. For one thing, they said Disney should have prevailed as a matter of law, because the licensing contract at issue precluded Celador's claims. They also attacked Celador's expert's damages calculation.

District Judge Phillips not only denied Disney's post-trial motions, but also later tacked on $50 million in pre-judgment interest.

For its Ninth Circuit appeal, Disney turned to Waxman of Wilmer Cutler Pickering Hale and Door to try to undo the damage. Robin Meadow of Greines Martin represented Celador at the appeals court. The Ninth Circuit panel had sent strong signals at oral argument in October that it would affirm the verdict.

In its unpublished ruling, the appeals court ruled that District Judge Phillips didn't commit clear error in affirming the jury verdict and denying the Disney affiliates' motion for judgment as a matter of law. “Although the Disney affiliates advanced a persuasive case at oral argument for their interpretation of the contract, Celador's reading is also plausible,” the three-judge appellate panel ruled. It added that Celador's expert evidence on the fee for a fair market license and Celador's compensation from that was “not inherently improbable.”

' Jan Wolfe, The American Lawyer