Einhorn v. Mergatroyd Productions

• Decision Date: 12 April 2006
• Docket Number: No. 05 Civ.8600 (LAK).,05 Civ.8600 (LAK).
• Citation: 426 F.Supp.2d 189
• Parties: Edward EINHORN, Plaintiff, v. MERGATROYD PRODUCTIONS, et al., Defendants.
• Court: U.S. District Court — Southern District of New York

426 F.Supp.2d 189 Edward EINHORN, Plaintiff,
v.
MERGATROYD PRODUCTIONS, et al., Defendants. No. 05 Civ.8600 (LAK). United States District Court, S.D. New York. April 12, 2006.

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COPYRIGHT MATERIAL OMITTED

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David A. Einhorn, Anderson, Kill & Olick, P.C., New York City, for Plaintiff.

Toby M.J. Butterfield, Cowan, DeBaets, Abrahams & Sheppard LLP, New York City, for Defendants.

MEMORANDUM OPINION

KAPLAN, District Judge.

We speak of "making a federal case" out of something to express the sentiment that someone is blowing something out of proportion. Plaintiff Edward Einhorn, represented by his attorney brother, has made this federal case out of a dispute over $1,000.

Facts

The parties to this case all aspire to success in the theater. Plaintiff Einhorn hopes to direct. Defendant Nancy McLernan is the author of the play Tam Lin, a work that was performed approximately eight times "Off Off Broadway" and that is at the core of this dispute. Defendant Jonathan X. Flagg was its producer.¹

According to the second amended complaint, the allegations of which are taken as true for purposes of this motion to

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dismiss,² defendants in August 2004 asked Einhorn to direct and "to create blocking and choreography" for the play, which was scheduled to run on eight days in October.³ McLernan conveyed Flagg's offer to pay him $1,000 to do so, and defendants told him that a written contract would be forthcoming.⁴ Einhorn claims that he accepted the offer "by proceeding to coach the cast, work with the set designers and create the choreography and blocking script"⁵ but there is no suggestion that a written contract ever was signed.

Einhorn claims that he "authored an original blocking script for stage performance of the Play" and that it "included elements of choreography for dance, fight and black-light puppetry."⁶ Prior to the opening, defendants posted videos on their web site showing the blocking and choreography.⁷

On October 20, 2004, the day before the scheduled opening, Einhorn was terminated.⁸ His demand for payment of the $1,000 was spurned.⁹ Curiously, he claims on the one hand that his work had been completed by the time he was let go and, on the other hand, that his termination was an anticipatory breach of the contract,¹⁰ the latter allegation presupposing that his work had not been completed.

In any case, the show opened and ran through the eight scheduled performances in October, using the blocking and choreography script that Einhorn claims to have prepared.¹¹ Further, defendants allegedly posted a full-length performance of the show on their web site¹² and placed metatags¹³ containing Einhorn's name on their web sites, a practice called "metastuffing" which results in Internet search engines directing web surfers who entered Einhorn's name in search requests to defendants' web sites.¹⁴

On December 10, 2004, Einhorn obtained a certificate of registration of copyright. The registration form described the nature of the work as "blocking and choreography" and the title as "blocking and choreography script for Tam Lin."¹⁵ The certificate includes a copy of McClernan's script for the play which contains both stage directions enclosed in parentheses and italicized interlineations, the latter of

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which are the sole focus of Einhorn's claim.¹⁶

Einhorn then brought this action. The second amended complaint contains claims for copyright infringement, breach of contract and violation of Sections 43(a)(1) of the Lanham Act¹⁷ and 349 of the New York General Business Law.¹⁸ The theory of the copyright Infringement claim is that the use of the blocking and choreography script infringed Einhorn's copyright. The contract claim relates to the failure to pay the $1,000, although plaintiff cannot seem to decide whether the alleged breach was anticipatory. The remaining two claims are based on the metastuffing — the use of Einhorn's name in metatags on defendants' web sites.

In addition, plaintiffs amended complaint, asserted a claim for common law misappropriation, which the Court initially dismissed as preempted by the Copyright Act. On reconsideration, however, it reinstated the claim, without prejudice to the preemption argument, only to the extent that it is asserted as an alternative to the copyright infringement claim.

Defendants move to dismiss.

Discussion

A. The Contract Claim

Einhorn claims that the following portion of McLernan's e-mail to him was an offer that he accepted by subsequent performance:

"I spoke with Jonathan [Flagg] and he feels that our budget can handle the additional director's fee, so we're OK with paying you $1000. I hope this will sway you to commit to this project. Please let me know as soon as possible if you'll do it."¹⁹

Defendants seek dismissal on the theory that this communication was insufficiently specific to give rise to a contract and, in any case, that evidence that the parties contemplated the execution of a written contract demonstrates that there was no intention to be bound absent a writing subscribed by both sides.

Defendants' arguments are different ways of saying much the same thing — that the e-mail did not create in plaintiff the power to form a contract either by acceptance or by performance. And the answer, for purposes of this motion, is the same regardless of how the issue is framed.

No particular form is necessary to make an offer. All that is required is "[c]onduct that would lead a reasonable person in the other party's position to infer a promise in return for performance . . ."²⁰ Defendants surely may argue that a communication of a willingness to pay a directorial fee of $1,000, standing alone, was so far from a comprehensive statement of the terms of the proposed relationship as to make Einhorn's alleged inference of a promise unreasonable, thus defeating any conclusion that there was an offer. But the Court certainly cannot say, as it would be obliged to do in order to grant the motion on this basis, that no reasonable trier of fact could find otherwise.²¹

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The defendants' other argument yields to a similar analysis. Our Circuit divides putative agreements made in circumstances in which the parties contemplate a later writing into two types. So-called Type I preliminary agreements are regarded as complete and "reflecting a meeting of the minds on `all the issues perceived to require negotiation.'"<sup>22</sup> "`Type II' preliminary agreements, by contrast, are `binding only to a certain degree,' reflecting agreement on `certain major terms, but leave other terms open for further negotiation.'"²³ While "there is a strong presumption against finding binding obligations in agreements which include open terms, call for future approvals and expressly anticipate future preparation and execution of contract documents,"²⁴ discrimination between binding and non-binding preliminary agreements depends upon the parties' intent and requires consideration of:

"(1) whether there is an expressed reservation of the right not to be bound in the absence of a writing;

"(2) whether there has been partial performance of the contract;

"(3) whether all of the terms of the alleged contract have been agreed upon; and

"(4) whether the agreement at issue is the type of contract that is usually committed to writing."²⁵

In this case, notwithstanding the alleged reference to a later written contract, there was no express reservation of the right not to be bound in the absence of a writing. It is undisputed that there was at least part performance. It is unclear whether all of the terms were agreed upon, and this record does not permit determination as a matter of law of whether an agreement to direct eight performances of an Off Off Broadway play for $1,000 is the type of contract that usually is committed to writing. Accordingly, the Court is unable to say that plaintiff could prove no facts that would entitle him to relief on the contract claim.

B. Metastuffing

Einhorn claims that defendants' use of Einhorn's name on metatags associated with their web sites violated Section 43(a) of the Lanham Act²⁶ and Section 349 of the New York General Business Law.²⁷

To succeed on his Lanham Act claim, Einhorn must prove that he "`has a valid mark entitled to protection and that the defendant's use of it is likely to cause confusion.'"²⁸ The claim fails at the outset.

In determining the protectability of a putative mark, courts employ the classic typology articulated by Judge Friendly: putative marks are classified as (1) arbitrary or fanciful, (2) suggestive, (3) descriptive, and (4) generic.²⁹ Arbitrary,

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fanciful and suggestive marks are inherently distinctive and thus subject to immediate protection upon commercial use.³⁰ Descriptive marks are protected only if they are shown to have acquired secondary meaning to consumers³¹ Generic terms never are protected.³²

"Personal names used as trademarks are generally regarded as descriptive terms,...