Croce v. Kurnit

737 F.2d 229
Court of Appeals for the Second Circuit·Decided June 14, 1984·No. No. 241, Docket 83-7402·Published·Cited by 22 cases

Opinion

KEARSE, Circuit Judge:

Defendants Blendingwell Music, Inc. (“Blendingwell”), and Cashwest Productions, Inc. (“Cashwest”), appeal from so much of a judgment of the United States District Court for the Southern District of [231] New York, Robert W. Sweet, Judge, as granted certain claims asserted by plaintiff Ingrid Croce as the heir of the popular singer and songwriter Jim Croce who died in 1973 (collectively “Croce”) for royalties due Croce, and dismissed a counterclaim asserted by Blendingwell to recover alleged overpayments of royalties to Croce. Following a jury trial as to certain issues and a bench trial as to others, the court entered judgment in favor of plaintiff in the total amounts of $348,359.93 against Blending-well and $359,008.81 against Cashwest; the court dismissed Blendingwell’s counterclaim for $334,024 in royalty overpayments to Croce. On appeal, Blendingwell and Cashwest attack so much of the judgment as awarded plaintiff a total of $102,543 against Blendingwell and $181,161 against Cashwest, on the grounds that the court erred in not submitting certain questions to the jury and in not upholding Blending-well’s counterclaim as a matter of law. Finding no merit in these contentions, we affirm the judgment. 565 F.Supp. 884.

I. BACKGROUND

Blendingwell is a corporation of which defendant Philip S. Kurnit was president and defendants Thomas R. Picardo, Jr., a/k/a Tommy West (“West”), and Dennis Minogue, a/k/a Terry Cashman (“Cash-man”), were officers. Cashwest is a corporation of which Kurnit, Cashman, and West were also officers. The pertinent events and controversies are summarized below.

A. The Agreements and the Events

In 1968 Jim Croce entered into contracts with Blendingwell pursuant to which Blendingwell became the exclusive publisher of his compositions and his personal manager, and a contract with a corporate predecessor of Cashwest (hereinafter also “Cashwest”) for the recording of his compositions. Jim Croce and Blendingwell executed a document entitled “Standard Songwriters Contract” (hereinafter “Songwriting Agreement”), paragraph 3 of which provided that Blendingwell would pay Croce royalties in the amount of, inter alia, three cents per copy of pianoforte copy (more commonly called “sheet music”) sold by Blendingwell, “50% of the net sums actually received” by Blendingwell from mechanical licenses, and 50% of the net amounts received by Blendingwell from any sources or rights not specifically provided for:

3. In consideration of this agreement, and conditioned upon the compliance by the WRITER with each and every of the terms, conditions and warranties of this agreement to be performed and observed, the COMPANY agrees to pay, during the term of the copyright owned by it, to the WRITER ..., and the WRITER will accept in full payment the following:
A. 03$ per copy for each and every complete pianoforte copy of the composition sold by the COMPANY, and paid for in the United States of America and Canada.
E. 50% of the net sums actually received by the COMPANY from mechanical, transcription and synchronization licenses.
G. 50% of the net sums actually received from any other sources or rights now known or which may hereafter come into existence not specifically provided for herein----

New York law was to govern matters of interpretation, performance, and breach.

In 1969, Blendingwell entered into an agreement with Robbins Music Corp. (“Robbins”) granting Robbins a license to sell Croce compositions in sheet music form. Until 1976 Blendingwell paid Croce 50% of the amounts it received from Robbins under this agreement. In 1976, Blend-ingwell commenced to pay Croce instead three cents per copy of sheet music sold by Robbins. In addition, Blendingwell claimed that prior amounts paid to Croce for sheet music sales by Robbins were overpayments to the extent that they exceeded three cents per copy, and it accordingly deducted [232] $70,992 from Croce’s then-current royalties in order to recoup the alleged overpay-ments.

Jim Croce’s career had begun to flourish in 1972. In that year Cashwest and Blendingwell entered into agreements with ABC Records, Inc. (“ABC”), and ABC’s affiliate, Wingate Music Corp. (“Wingate”), giving ABC a mechanical license, i.e., the right to manufacture, distribute, and sell Croce’s recordings, and requiring ABC to pay royalties to Cashwest and Blendingwell. Under these agreements (collectively the “ABC Agreements”), Blendingwell “assigned to [Wingate] 50% of Blendingwell’s share in publishing income generated by the Croce compositions under the Songwriting Agreement.” (Appellants’ brief on appeal at 7.)1 Thus, if Blendingwell received royalties for Croce compositions from a record company other than ABC, it would pay 50% to Croce, keep 25%, and pay 25% to Wingate. As to the royalties payable to Blendingwell by ABC, Blendingwell agreed that ABC could pay 25% of the gross amount directly to Wingate and simply remit to Blendingwell the 75% remainder.

Thereafter, until 1980, Blendingwell paid Croce as royalties under the Songwriting Agreement 50% of the gross amounts ABC was required to pay to Blendingwell. In 1980, however, Blendingwell decided to pay plaintiff instead only 50% of ABC’s 75% cash payments made to Blendingwell and to exclude from consideration the amounts paid by ABC to Wingate for Blendingwell’s account.

In the meantime, in the mid 1970’s a controversy had arisen between Cashwest and Blendingwell on the one hand and ABC on the other, and Cashwest engaged accountants to audit ABC’s royalty payments through December 31, 1975. The auditors’ reports stated' that ABC owed Cashwest more than $4.5 million and owed Blending-well some $223,000. The audits also revealed that Blendingwell owed Wingate’s corporate successor (hereinafter also “Win-gate”) approximately $326,000 under the ABC Agreements. In 1979, Cashwest, Blendingwell, ABC, and Wingate entered into a settlement agreement pursuant to which, inter alia, ABC paid Cashwest some $1,920,000 for past royalties, and both ABC’s debt of $223,000 to Blending-well and Blendingwell’s debt of $326,000 to Wingate were extinguished.

B. The Present Lawsuit and the Decision Below

Ingrid Croce commenced the present lawsuit in 1978 against, inter alia, Blending-well, Cashwest, Kurnit, West, and Cash-man, claiming principally that the defendants had acted unconscionably and had breached their fiduciary duties to Croce. Jurisdiction was based on diversity of citizenship.

Free access — add to your briefcase to read the full text and ask questions with AI

Croce v. Kurnit, 737 F.2d 229 (2d Cir. 1984).

737 F.2d 229 (Croce v. Kurnit) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

Related

Miller v. Mercuria Energy Trading, Inc.
291 F. Supp. 3d 509 (S.D. Illinois, 2018)
Utica Mutual Insurance v. Munich Reinsurance America, Inc.
976 F. Supp. 2d 254 (N.D. New York, 2013)
TVT Records v. Island Def Jam Music Group
250 F. Supp. 2d 341 (S.D. New York, 2003)
Pryor v. USX Corp.
806 F. Supp. 460 (S.D. New York, 1992)
Greenblatt v. Prescription Plan Services Corp.
783 F. Supp. 814 (S.D. New York, 1992)
Vista Co. v. Columbia Pictures Industries, Inc.
725 F. Supp. 1286 (S.D. New York, 1989)
Utley-James, Inc. v. United States
34 Cont. Cas. Fed. 75,478 (Court of Claims, 1988)
A.I. Credit Corp. v. Government of Jamaica
666 F. Supp. 629 (S.D. New York, 1987)
Harden v. Warner Amex Cable Communications Inc.
642 F. Supp. 1080 (S.D. New York, 1986)
Sector Refining, Inc. v. Enterprise Refining Co.
771 F.2d 496 (Temporary Emergency Court of Appeals, 1985)
Wells Fargo Asia Ltd. v. Citibank, N.A.
612 F. Supp. 351 (S.D. New York, 1985)
Stissi v. Interstate and Ocean Transport Co.
590 F. Supp. 1043 (E.D. New York, 1984)