Anderson v. Stephen C. Lavere, Delta Haze Corp.

• Decision Date: 20 February 2014
• Docket Number: No. 2012–CA–00601–SCT.,2012–CA–00601–SCT.
• Citation: 136 So.3d 404
• Parties: Annye C. ANDERSON, as Personal Representative and Legatee of the Estate of Carrie H. Thompson, Deceased; and Robert M. Harris, Legatee of the Estate of Carrie H. Thompson, Deceased v. Stephen C. LaVERE, Delta Haze Corporation, a Nevada Corporation; Sony Music Entertainment, Inc., a Delaware Corporation, and Claud L. Johnson.
• Court: Mississippi Supreme Court

136 So.3d 404

Annye C. ANDERSON, as Personal Representative and Legatee of the Estate of Carrie H. Thompson, Deceased; and Robert M. Harris, Legatee of the Estate of Carrie H. Thompson, Deceased

v.Stephen C. LaVERE, Delta Haze Corporation, a Nevada Corporation; Sony Music Entertainment, Inc., a Delaware Corporation, and Claud L. Johnson.

No. 2012–CA–00601–SCT.

Supreme Court of Mississippi.

Feb. 20, 2014.

James W. Shelson, Reuben V. Anderson, Jackson, Robert Gregg Mayer, Stephen E. Nevas, attorneys for appellant.

Richard A. Oakes, Greenwood, Anthony Kornarens, Anita K. Modak–Truran, John W. Kitchens, attorneys for appellee.

Before DICKINSON, P.J., CHANDLER and PIERCE, JJ.

DICKINSON, Presiding Justice, for the Court:

STATEMENT OF THE CASE

¶ 1. Legendary blues musician Robert Johnson died in 1938 without a will. The legatees of Johnson's deceased half-sister sought to recover royalties and fees from the use of two photographs of Johnson. Among the several reasons the trial court denied their claim was that the statute of limitations had expired. We affirm.

FACTS

¶ 2. When Johnson died intestate on August 16, 1938, he had no money and appeared to have left no assets to distribute to his heirs, so no estate was opened at that time. But the increasing popularity of Johnson's music over the years following his death led Steven LaVere, a music producer from Tennessee who owns Delta Haze Corporation, to contact Johnson's half-sister, Carrie Thompson, about previously unpublished photographs of Johnson. Believing Thompson to be Johnson's only heir, LaVere requested a meeting with Thompson to discuss possibly using the photographs to launch a new release of Johnson's music.

¶ 3. On June 12, 1973, Thompson met with LaVere and showed him a photo taken by Hooks Brothers Photography in Memphis, Tennessee, which depicted Johnson wearing a pin-striped suit, fedora hat, and polished dress shoes, while holding his Gibson guitar. Thompson allowed LaVere to take this photo—later to become known as the “Hooks Brothers” photograph—to have negatives made.

¶ 4. On LaVere's second visit, Thompson showed him a different photograph that depicted Johnson in front of a curtain with a cigarette in his mouth, holding a Gibson guitar. This photograph—which appears to be a self-portrait taken at a photo booth in the 1930s—later became known as the “dime store photo.”

¶ 5. Sony Music Entertainment, Inc. (“Sony”)—owner of the master of Johnson's recordings ¹—already had published albums of Johnson's music. Based on the discovery of the photographs and biographical information of Johnson's life, LaVere pitched the idea of rereleasing Johnson's music to John Hammond, then vice-president of Sony.² LaVere initiated these discussions with Sony in the summer of 1973.

¶ 6. LaVere's negotiations with Sony prompted negotiations between LaVere and Thompson, through counsel. On June 25, 1974, Thompson appointed LaVere as her agent, granting him the right

to do any and all things necessary, and to execute any and all documents, contracts, file copyrights, and institute litigation and any and all other things necessaryor proper to protect my rights or the rights of my deceased brother.

¶ 7. Thompson's attorney drafted this agreement to allow LaVere to continue negotiations with Sony pertaining to the rerelease of Johnson's recordings. Then, on November 20, 1974, LaVere and Thompson entered into a comprehensive agreement (“the 1974 Agreement”), which included a royalties and fees provision.

¶ 8. The 1974 Agreement stated that Thompson, as Johnson's known living heir, agreed to transfer to LaVere “all of her right, title and interest, including all common law and statutory copyrights, in and to the musical works and recordings of Robert L. Johnson, a photograph of Robert L. Johnson taken by Hooks Brothers Photography in Memphis, Tennessee ... [and] a small photograph of Johnson with a guitar....” But Thompson, her heirs and assigns, would retain ownership and possession of all original photographs.

¶ 9. In return, LaVere agreed to “use his best efforts to obtain commercial utilization of such photograph or photographs and memorandum in conjunction with the recordings of and or by Robert L. Johnson as well as in books, magazines or other media, and to take all steps necessary to register or protect the statutory copyright,” and he would pay Thompson fifty percent of all royalties collected by him.

¶ 10. This 1974 Agreement also stated that Thompson was “acting upon the representations to the effect that she is the nearest next of kin of Robert L. Johnson.... She understands and agrees that in the event that there are other heirs of Robert L. Johnson who would have a right to the payment of such sums, she shall be responsible for the payment....”

¶ 11. After Thompson and LaVere finalized the 1974 Agreement, Sony entered into a separate and independent contract with LaVere and Thompson dated November 21, 1974 (“the CBS agreement”). In this agreement, Thompson and LaVere agreed to assign their rights in Johnson's music, as well as their rights in two photographs, services, artwork, and biographical information to be used in conjunction with the release of the album Robert Johnson: The Complete Recordings (“ The Complete Recordings ”). Sony agreed to pay all royalties and fees to LaVere, but it never agreed to pay Thompson any royalties or fees directly. Instead, LaVere was responsible for paying to Thompson any money generated from the CBS agreement, in accordance with the terms of the 1974 agreement.

¶ 12. After that, the project stalled,³ but LaVere continued to push Sony to release The Complete Recordings, and the album finally debuted on August 28, 1990. The album sold more than one million copies and, as of 2009, Thompson's royalty agreement with LaVere had generated more than one and half million dollars. Sony paid all money due and owing under the CBS agreement to LaVere.

¶ 13. Thompson passed away in February 20, 1983, leaving her estate to her half-sister, Annye Anderson, and her grandson, Robert Harris. Then in 1989, her legatees—Anderson and Harris—opened Johnson's estate in Leflore County. When the estate was opened, Anderson and Harris believed they were the sole heirs to the Johnson estate. But in the years to follow, litigation ensued to determine the legal heirs of Johnson's estate and, in 1998, the chancery court entered a final judgment proclaiming Claud Johnson, Johnson's biological son, as the sole heir of the estate.

¶ 14. Prior to the chancery court naming Claud Johnson as Johnson's sole heir, Anderson, as the adminstratrix of Johnson's estate, swore under oath that the photographs and copyrights of the photographs belonged to the Johnson estate. Anderson also submitted accountings listing the photographs as assets of Johnson's estate, and she requested payment for her duties as adminstratrix based on a percentage of the estate's total assets, which included the photographs.

¶ 15. Then, in 1991 the chancellor appointed Willis B. Brumsfield administrator of Johnson's estate. Brumsfield entered into an agreement with LaVere, on behalf of the estate, ratifying both the 1974 agreement and the CBS agreement. LaVere then paid all royalties and fees due and owing under the agreements to the Johnson estate. As of March 22, 1999, the property of the Johnson estate was transferred to Claud Johnson.

¶ 16. Anderson and Harris now assert that the photographs belonged to Thompson, personally, and not to Johnson's estate. While Anderson and Harris do not dispute that the copyrights in Johnson's musical compositions belong to Claud Johnson, they argue that, as the heirs of Thompson, they are entitled to the fees generated from the Johnson photographs, as those were Thompson's personal property.

PROCEDURAL HISTORY

¶ 17. Anderson and Harris filed a complaint against Claud Johnson, Stephen LaVere, Delta Haze,⁴ and Sony, asserting claims of fraud, misrepresentation, concealment, conversion, unjust enrichment, unfair competition and business practice, and breach of fiduciary duty. They also asserted a breach-of-contract claim against LaVere.

¶ 18. The complaint was filed in Hinds County, but Claud Johnson moved the court for a change of venue, which it granted. The trial court allowed Anderson and Harris to continue the action in either Copiah County, where Claud Johnson lived, or Leflore County, where Johnson's estate was administered. Anderson and Harris filed an interlocutory appeal of the transfer order, which this Court denied on November 29, 2000. Anderson and Harris then chose to transfer to Leflore County.

¶ 19. On January 31, 2001, the LaVere defendants moved for a dismissal of the claims, or, in the alternative, for summary judgement. On August 8, 2001, Sony joined that motion. Without addressing three alternative arguments, the trial court granted the motion for summary judgment on the basis of res judicata. We reversed and remanded the case to the Leflore County Circuit Court.

¶ 20. On January 4, 2005, the LaVere defendants moved to dismiss or, in the alternative, for summary judgment on the defenses not originally adjudicated, and Sony joined this motion. This circuit court took no action on this motion for six years.

¶ 21. Then, on January 21, 2011, Sony awoke the lawsuit by moving for approval of a license to use the photographs of Johnson for a new compilation of Johnson's music called The Centennial Collection, which was to be a tribute to Johnson's 100th birthday. Sony sought permission among all parties to use the photographs in the packaging of this album, subject to a licensing fee which would be held by Sony until resolution of this dispute. LaVere and Claud Johnson agreed, but Anderson and Harris did not, so Sony filed an Emergency Motion for a License, which the trial court granted.

¶ 22. In April 2011, both Sony and the LaVere defendants filed separate supplemental motions for summary judgment. Claud Johnson joined...