In re Isbell Records, Inc.

• Decision Date: 22 October 2009
• Docket Number: No. 09-40343.,09-40343.
• Citation: 586 F.3d 334
• Parties: In the Matter of: ISBELL RECORDS, INC., Debtor. Alvertis Isbell, doing business as Alvert Music, Plaintiff-Appellant, v. DM Records, Inc., Defendant-Appellee.
• Court: U.S. Court of Appeals — Fifth Circuit

586 F.3d 334

In the Matter of: ISBELL RECORDS, INC., Debtor Alvertis Isbell, doing business as Alvert Music, Plaintiff-Appellant, v. DM Records, Inc., Defendant-Appellee.

No. 09-40343.

United States Court of Appeals, Fifth Circuit.

October 22, 2009.

Richard Steven Busch (argued), King & Ballow, Nashville, TN, William S. Helfand, Kevin D. Jewell, Chamberlain, Hrdlicka, White, Williams & Martin, Houston, TX, for Plaintiff-Appellant.

Karl M. Braun, Hall, Booth, Smith & Slover, P.C., Nashville, TN, Renee Forinash McElhaney, Ellen B. Mitchell (argued), Cox, Smith, Matthews, San Antonio, TX, Jay M. Vogelson, Stutzman, Bromberg, Esserman & Plifka, Dallas, TX, for Defendant-Appellee.

Appeal from the United States District Court for the Eastern District of Texas.

Before HIGGINBOTHAM and STEWART, Circuit Judges, and ENGELHARDT, District Judge.^*

ENGELHARDT, District Judge:

Alvert Music appeals the district court's dismissal of its complaint for copyright infringement against DM Records, Inc. (DM Records). The district court held that Alvert Music lacked standing and found that allowing Bridgeport Music, Inc. (Bridgeport) to join the action would not be justified. Because we hold that Alvert Music had standing to sue, we reverse the dismissal and remand for further proceedings.

I

Alvert Music is a publishing company that owns musical compositions. In 1997, Bellmark Records (Bellmark), a related company that owned certain sound recordings, filed bankruptcy. DM Records purchased the assets of Bellmark, including two sound recordings, "Dazzey Duks" and "Whoomp! (There It Is)." Alvert Music and DM Records dispute whether the assets purchased by DM Records included the composition copyrights to the two songs.

In 2002, Alvert Music brought this action in the United States District Court for the Northern District of Texas, seeking a declaratory judgment that it is the rightful owner of the relevant musical compositions and alleging that DM Records had infringed its copyright. The Northern District Court transferred venue to the Eastern District of Texas. The Eastern District Court referred the matter to the United States Bankruptcy Court for the Eastern District of Texas. The Bankruptcy Court recommended that the Eastern District Court withdraw its referral. The Eastern District Court agreed and withdrew the referral. Finally, Alvert Music's complaint was filed in the Eastern District Court in 2008.

In the meantime, due to financial constraints, Alvert Music had transferred a partial interest in the copyrights to Bridgeport. In 2004, Alvert Music executed a Short Form Copyright Assignment (Assignment), which provided:

In consideration of the sum of One Dollar ($1.00) and other good, valuable, and adequate consideration, the receipt and sufficiency of which is acknowledged, the undersigned does hereby sell, assign, transfer, and set over to Bridgeport Music, Inc., its respective successors and assigns, fifty percent (50%) of his interest now owned or subsequently procured in the universe-wide copyright in and to the following musical composition(s) set forth in Exhibit A attached hereto, and all of the universe-wide right, title, and interest of the undersigned, vested or contingent, therein and thereto, including all claims for infringement of the copyrights whether now or hereafter existing, for the maximum terms of copyright, including any extensions and/or renewals thereto, throughout the universe.

In its answer filed in 2008, DM Records asserted that Alvert Music did not own or hold valid rights to the copyright infringement claims because the Assignment transferred those rights to a third party. DM Records subsequently filed a motion to dismiss on these grounds, and the district court granted the motion. This appeal followed.

II

We review a district court's determination of whether a contract is ambiguous and its interpretation of the contract de novo.¹ Similarly, the question of whether a plaintiff is the real party in interest presents legal issues that the court reviews de novo.²

III

When construing a contract, the court's goal is to give effect to the intentions of the parties.³ A contract is ambiguous if its meaning is susceptible to multiple interpretations.⁴ When a contract is unambiguous, its terms will be given their plain meaning and will be enforced as written.⁵ "[A] contract should be interpreted as to give meaning to all of its terms — presuming that every provision was intended to accomplish some purpose, and that none are deemed superfluous."⁶

Both Alvert Music and DM Records argue that the Assignment is unambiguous in their respective favors. Alvert Music asserts that the Assignment did not divest it of all rights to pursue a cause of action for copyright infringement. According to Alvert Music, the parties to the Assignment intended to transfer to Bridgeport a 50% ownership share in the musical compositions, with Alvert Music retaining half of its original ownership share. This ownership share included the right to pursue copyright infringement claims. DM Records,...