Steinbeck v. Steinbeck Heritage Found.
| Decision Date | 13 October 2010 |
| Docket Number | No. 09-1836-cv,09-1836-cv |
| Court | U.S. Court of Appeals — Second Circuit |
| Parties | THOMAS STEINBECK and BLAKE SMYLE, Plaintiffs-Counter-Defendants-Appellants, NANCY STEINBECK, Intervenor-Plaintiff, v. STEINBECK HERITAGE FOUNDATION, STEVEN FRUSHTICK, SCOTT KAFFAGA, individually and as executor of the Estate of Elaine Anderson Steinbeck, THE ESTATE OF ELAINE ANDERSON STEINBECK, Defendants-Counter-Claimants-Appellees, DOES 1-10, Defendants-Appellees, DAVID SCOTT FARBER, BAHAR KAFFAGA, JEAN ANDERSON BOONE, and JEBEL KAFFAGA, Defendants-Counter-Claimants-Intervenors-Defendants-Appellees, FRANCIS ANDERSON ATKINSON, SCOTT KAFFAGA, individually and as executor of the Estate of Elaine Anderson Steinbeck, MCINTOSH & OTIS, INC., SAMUEL PINKUS, ANDERSON FARBER RUNKLE, and EUGENE H. WINICK, Defendants-Intervenors-Defendants-Appellees. |
RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT'S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION "SUMMARY ORDER"). A PARTY CITING TO A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.
At a stated term of the United States Court of Appeals for the Second Circuit, held at the Daniel Patrick Moynihan United States Courthouse, 500 Pearl Street, in the City of New York, on the 13th day of October, two thousand ten.
District Judge*
ELIZABETH A. MCNAMARA (Lacy H. Koonce, III, on the brief), Davis Wright Tremaine LLP, New York, New York, for Mcintosh & Otis, inc., Eugene H. Winick, and Samuel Pinkus.
Appeal from a judgment of the United States District Court for the Southern District of New York (George B. Daniels, Judge).
UPON DUE CONSIDERATION IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that the December 4, 2009 judgment of the district court is AFFIRMED.
This court is already well familiar with the longstanding dispute among the heirs of author John Steinbeck about copyright interests in his works. See Penguin Group (USA) Inc. v. Steinbeck, 537 F.3d 193, 204 (2d Cir. 2008). On this appeal, plaintiffs Thomas Steinbeck and Blake Smyle, the author's son and grandaughter (by Steinbeck's deceased son, John IV), challenge an award of summary judgment in favor of defendants the estate of Elaine Steinbeck, the author's third wife and widow, and McIntosh & Otis, Inc. ("M & O"), a literary agency administering the relevant Steinbeck copyrights, on claims of (1) breach of fiduciary duty, (2) promissory estoppel, and (3) unjust enrichment (with an accompanying request for imposition of a constructive trust). See Steinbeck v. McIntosh & Otis, Inc., No. 04 Civ. 5497, 2009 WL 928189 (S.D.N.Y. Mar. 31, 2009).1 Plaintiffs further appeal a
judgment on the pleadings in favor of M & O on its counter-claim challenging the validity of Thomas Steinbeck's purported termination of defendant as literary agent for the estate. See Steinbeck v. McIntosh & Otis, Inc., No. 04 Civ. 5497, 2009 WL 928171 (S.D.N.Y. Mar. 31, 2009).
We review an award of summary judgment de novo, "resolving all ambiguities and drawing all permissible factual inferences in favor of the party against whom summary judgment is sought." Burg v. Gosselin, 591 F.3d 95, 97 (2d Cir. 2010) (internal quotation marks omitted). We will uphold such an award only if the record reveals no genuine issues of material fact and the moving party is entitled to judgment as a matter of law. See Fed. R. Civ. P. 56(c)(2). We review a judgment on the pleadings de novo, accepting the pleaded allegations as true and drawing all reasonable inferences in favor of the opposing party, see, e.g., LaFaro v. N.Y. Cardiothoracic Grp., PLLC, 570 F.3d 471, 475-76 (2d Cir. 2009) (), consistent with the pleading standards articulated in Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009), and Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007). In applying these standards here, we assume the parties' familiarity with the facts and procedural history of this case, which we reference only as necessary to explain our decision to affirm.
Thomas Steinbeck contends that the district court erred in concluding as a matter of law that the 1983 settlement agreement among himself, his brother John IV, and Elaine Steinbeck (the "1983 Agreement"), as well as powers of attorney in favor of Elaine Steinbeck executed by the sons in connection with that agreement, did not create an agency relationship with Elaine Steinbeck assuming fiduciary obligations to the sons and their successors in interest. We disagree.
Under New York law, an agency relationship "results from a manifestation of consent by one person to another that the other shall act on his behalf and subject to his control, and the consent by the other to act." New York Marine & Gen. Ins. Co. v. Tradeline (L.L.C.), 266 F.3d 112, 122 (2d Cir. 2001) (internal quotation marks omitted). A principal's ability to exercise control over its agent is an essential element of agency. See generally Restatement (Third) of Agency § 1.01, cmt. f; accord Mazart v. State, 109 Misc. 2d 1092, 1099, 441 N.Y.S.2d 600, 605 (N.Y. Ct. Cl. 1981) (). Where, as here, parties contend that an agency relationship is established by contract, see, e.g., Pyramid Champlain Co. v. R.P. Brosseau & Co., 267 A.D.2d 539, 544, 699 N.Y.S.2d 516, 522 (3d Dep't 1999), a court will look to the language of that agreement to ascertain the relationship created between the parties, see EBC I, Inc. v. Goldman Sachs & Co., 5 N.Y.3d
11, 19-20, 799 N.Y.S.2d 170, 175 (2005); Northeast Gen. Corp. v. Wellington Adver., Inc., 82 N.Y.2d 158, 162, 604 N.Y.S.2d 1, 3 (1993). When we do so here, we conclude that the 1983 Agreement did not create an agency relationship.
The 1983 Agreement increased the Steinbeck sons' shares in certain copyright revenue, from one-quarter to one-third each, and, in return, conferred upon Elaine Steinbeck "the complete power and authority to negotiate, authorize and take action with respect to the exploitation and/or termination of rights in the works of John Steinbeck in which [John IV] and [Thomas] have or will have renewal or termination rights." 1983 Agreement ¶ 5. This language is unambiguous and forecloses any argument that the parties intended the Steinbeck sons to retain control over Elaine Steinbeck's exercise of the authority conferred upon her, as would be necessary to create an agency relationship. See, e.g., Meese v. Miller, 79 A.D.2d 237, 241, 436 N.Y.S.2d 496, 499-500 (4th Dep't 1981); Garcia v. Herald Tribune Fresh Air Fund, Inc., 51 A.D.2d 897, 897, 380 N.Y.S.2d 676, 678 (1st Dep't 1976); Krom v. Sharp & Dohme, Inc., 7 A.D.2d 761, 761, 180 N.Y.S.2d 99, 101 (3d Dep't 1958). The conclusion is reinforced by the fact that the 1983 Agreement imposed only specific circumscribed reporting obligations on Elaine Steinbeck, not the full reporting obligations associated with a fiduciary appointment. See generally Restatement (Third) of Agency ch. 8.
The powers of attorney executed in favor of Elaine Steinbeck support no different conclusion. In urging otherwise, plaintiffs point to the words "attorney-in-fact" used in those documents, which they submit New York recognizes to create an agency relationship and
attendant fiduciary obligations. See In re Estate of Ferrara, 7 N.Y.3d 244, 254, 819 N.Y.S.2d 215, 221 (2006). While reference to an attorney-in-fact can certainly constitute evidence of agency, we do not understand New York law to depart from the general principle that labels are not dispositive of the question. See generally Restatement (Third) of Agency § 1.02 (). The 1983 Agreement makes clear that the powers of attorney were executed solely to effectuate the authority conferred upon Elaine Steinbeck under that Agreement. That authority was "complete" with no control retained by the Steinbeck sons. Thus, because the 1983 Agreement did not create an agency relationship between Elaine Steinbeck and the Steinbeck sons, or otherwise impose fiduciary obligations on her, nor did the powers of attorneys intended to effectuate it. See Keyes v. Metro. Trust Co. of N.Y.C., 220 N.Y. 237, 242, 115 N.E. 455, 456 (1917) (); accord In re Anyon's Estate, 137 Misc. 582, 585, 244 N.Y.S. 244, 248 (N.Y. Sur. Ct. 1930); see also Villanueva v. Brown, 103 F.3d 1128, 1136 (3d Cir. 1997) (). Rather, the powers of attorney here at issue conferred upon Elaine Steinbeck power coupled with an interest in the very copyrights that...
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