DINO de LAURENTIIS CINEMATOGRAFICA, SpA v. D-150, INC.

• Decision Date: 16 September 1966
• Docket Number: No. 474,Docket 30746.,474
• Parties: DINO DeLAURENTIIS CINEMATOGRAFICA, S.p.A., Plaintiff-Appellee, v. D-150, INC., Defendant-Appellant.
• Court: U.S. Court of Appeals — Second Circuit

366 F.2d 373 (1966)

DINO DeLAURENTIIS CINEMATOGRAFICA, S.p.A., Plaintiff-Appellee, v. D-150, INC., Defendant-Appellant.

No. 474, Docket 30746.

United States Court of Appeals Second Circuit.

Argued August 30, 1966.

Decided September 16, 1966.

Sidney A. Florea, New York City (Anthony G. DiFalco, Irving Brown, Norman S. Freiberger, New York City, on the brief), for plaintiff-appellee.

Herbert M. Wachtell, New York City (George A. Katz, Theodore Gewertz, Bernard W. Nussbaum, Elizabeth Holtzman and Wachtell, Lipton, Rosen, Katz, & Kern, New York City, on the brief), for defendant-appellant.

Before WATERMAN, SMITH and FEINBERG, Circuit Judges.

J. JOSEPH SMITH, Circuit Judge:

In this declaratory judgment action on a contract to use appellant's equipment in production of motion picture, appellant counterclaimed seeking inter alia to enjoin roadshow exhibition of a motion picture except in appellant's D-150 process, and moved for injunction pendente lite, which the District Court for the Southern District of New York, Harold R. Tyler, Jr., District Judge, denied. The appeal is before us under 28 U.S.C. § 1292(a) (1). We hold that a sufficient showing was made to require issuance of an injunction pendente lite on posting of an adequate bond to indemnify plaintiff-appellee from loss.

Appellant, owner of a process for filming and showing motion pictures with the use of a single projector on a deeply curved wide theatre screen, furnished its filming equipment to plaintiff, a producer, for the filming of "The Bible," under an agreement which the appellant contends requires the roadshow showing of the picture in the major United States and European theatres only in the D-150 process, with limited stated exceptions, the producer to pay rental plus royalties. For reasons which are in dispute, the producer fell behind on the equipment rental payments and brought this action in the state court for interpretation of the contract to forestall repossession of the equipment before completion of the picture. Appellant counterclaimed for performance of the agreement and injunction against showing other than in the D-150 process. A codefendant, Todd-AO Corp., a New York citizen for jurisdictional purposes, was dropped as a party, and appellant promptly removed to the District Court for the Southern District of New York. The picture has been completed and is scheduled to open September 28 in New York, in ordinary 70 mm. projection. (The filming equipment used is "compatible" — that is, the picture may be projected either in D-150 or ordinary 70 mm.). Because of a shortage of judicial manpower in the Southern District of New York it has been impossible to schedule the case for trial as yet, although a pre-trial order was entered on March 30, 1966, and three successive motions for preference were made by appellant.

With the case in this posture, the District Court denied preliminary injunction for several reasons, first, that plaintiff had divested itself of ownership of the film before the contract with appellant, which the court assumed arguendo was effective, was entered into, second, that the chronology of the litigation places a heavier burden than usual upon the movant, third and principally, failure of the movant to establish irreparable harm, fourth, doubt of success on trial on the principal issue, duty to release in D-150, fifth, that the contract itself estalishes a sufficient basis for ultimate relief in damages, sixth, that the temporary relief sought would in effect alter rather than preserve the status quo and would give the movant all the eventual relief sought, and finally, doubt as to the efficacy of the relief if given.

In order to reverse the trial judge's denial of the motion for a preliminary injunction, a clear abuse of discretion must be shown. Ideal Toy Corp. v. Fab-Lu Ltd., 360 F.2d 1021 (2d Cir. 1966). The District Court must have erred in its decision that the moving party had not made "a clear showing of probable success and possible irreparable injury." Societe Comptoir de L'Indus. v. Alexander's Dept. Store, Inc., 299 F.2d 33, 35 (2d Cir. 1962). However, the weight to be given the probability of success is not precisely the same where other factors differ. While the party seeking a preliminary injunction has a burden of convincing with a reasonable certainty that it must succeed at final hearing where it appears that a lack of showing of irreparable damage also exists, the burden is less where the balance of hardships tips decidedly toward the party requesting the temporary relief. The likelihood of success is "merely one strong factor to be weighed along with the comparative injuries of the parties." Unicon Management Corp. v. Koppers Company, Inc., 366 F.2d 199, 2d Cir., September 7, 1966, quoting from 3 Barron & Holtzoff, Federal Practice and Procedure, § 1433 at 493.

We do not here pass upon the ultimate questions which are for trial on the merits. We do, however, hold that movant's showing was a sufficiently clear showing of probable success and possible irreparable injury, with no consequent irreparable injury to plaintiff if the preliminary injunction is granted, to require the exercise of the court's discretion to preserve the status quo by preventing the exhibition of the picture in violation of the claimed contract pending the resolution of the issues on trial.

Appellant has submitted sufficient material to show probable success of proving a contract with appellee which would require the exhibition of "The Bible" by the D-150 process. The parties started early in 1964 to negotiate about financing, licensing and distributing the film. The financing and distribution negotiations not having succeeded, on May 8 the parties agreed to some sort of a licensing arrangement. (* * * "Naify drafting D-150 licensing contract independent from Bible financing distribution deal * * * if Bible financing and distribution agreements concluded, licensing contract to be modified to add * * *." Appellant's Exh. A, A¹ 210-214.) On May 11, appellee started to photograph with appellant's equipment and soon added

Only D-150 the new dimension in motion pictures, is great enough for The Bible —

to the Times Square billboard which for a long period has been advertising the picture. Appellee's American publicity director had been instructed not to mention D-150 until the "deal is made." (Appellant's Exh. F, A 235.) Also, there are documents which show that appellee considered the May 8 cable an agreement. (Appellant's Exh. O, A 254, Exh. P, A 255.) Thus, it is clear that appellee contracted for and used appellant's equipment. That much is admitted by the institution of suit by appellee to declare the existence of a contract. Also, it is clear that the key element of the D-150 process is the screening and not the filming. (Appellant's Exh. Q, A 258-265.) From this, it may be found that the parties intended plaint...