Yan's Video, Inc. v. Hong Kong TV Video Programs, Inc.

133 A.D.2d 575, 520 N.Y.S.2d 143, 1987 N.Y. App. Div. LEXIS 51605
CourtAppellate Division of the Supreme Court of the State of New York
DecidedOctober 20, 1987
StatusPublished
Cited by11 cases

This text of 133 A.D.2d 575 (Yan's Video, Inc. v. Hong Kong TV Video Programs, Inc.) is published on Counsel Stack Legal Research, covering Appellate Division of the Supreme Court of the State of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Yan's Video, Inc. v. Hong Kong TV Video Programs, Inc., 133 A.D.2d 575, 520 N.Y.S.2d 143, 1987 N.Y. App. Div. LEXIS 51605 (N.Y. Ct. App. 1987).

Opinion

Appeal from order of the Supreme Court, New York County (Irma Vidal Santaella, J.), entered on or about March 18, 1987, which granted plaintiffs’ motion for a preliminary injunction on the condition that each plaintiff post an undertaking in the amount of $100,000, is dismissed as superseded by the appeal from the order of April 16, 1987, without costs or disbursements.

Order of the Supreme Court, New York County (Irma Vidal [576]*576Santaella, J.), entered on April 16, 1987, which denied the motion by defendant United East Enterprises of New York to vacate the order of March 18, 1987 and granted plaintiffs’ cross motion to modify said order to the extent of reducing the undertaking to $20,000 for each plaintiff, is reversed on the law, the facts and in the exercise of discretion, defendant’s motion to vacate the order of March 18, 1987 is granted and plaintiffs’ cross motion to continue in effect the preliminary injunction, but at a lower bond, is denied, with costs and disbursements.

Appeal from the order of the Supreme Court, New York County (Irma Vidal Santaella, J.), entered on May 28, 1987, is dismissed as academic in view of this court’s determination that the preliminary injunction was improperly granted, without costs or disbursements.

Each of the plaintiffs herein is a retail establishment dealing in the sale and rental of Chinese-language videotapes. Defendant Hong Kong TV Video Programs, Inc. (HK-TVP) is a San Francisco-based company which holds the exclusive American rights to the sublicensing of a certain popular brand of tapes produced in Hong Kong by Television Broadcast Ltd. and licensed for international distribution by Hong Kong Television Broadcast International, Ltd. Beginning in 1981, plaintiffs contracted with defendant HK-TVP to distribute the tapes in question. The practice in the past had been that each year, after HK-TVP learned that its bid for the licensing rights had been renewed by Hong Kong Television Broadcast International, it would, in turn, offer to renew plaintiffs’ sublicensing rights. For a number of years, the agreements proffered by HK-TVP have not contained automatic renewal provisions but have, instead, simply set forth HK-TVP’s intention to negotiate in good faith a renewal "upon terms and conditions to be negotiated.” The sublicenses that expired in November of 1986 were individually negotiated and signed by each of the store owners. However, prior thereto, the retailers involved in this case had retained one Po Yuen, Esq., who had previously represented some of them and was thoroughly familiar with the Chinatown videotape business, for the purpose of arranging a single sublicense for them. The endeavor failed, and plaintiffs were compelled to settle for separate, although substantially similar, contracts.

A number of the businessmen who had abortively attempted to work together in 1985 encountered greater success the following year when, again assisted by Po Yuen, they contacted Hong Kong Television Broadcast International directly [577]*577in an effort to supplant HK-TVP as exclusive American licensee. Although they did not achieve their objective, they thereafter formed defendant United East Enterprises, with Po Yuen invited to become a shareholder and president, and managed to gain the New York licensing rights by contractual transfer from HK-TVP to United East Enterprises. Consequently, when plaintiffs’ agreements with HK-TVP expired in late 1986, they were forced to bargain with United East. In that regard, they found United East’s price demands unacceptable and were offended by the fact that Po Yuen, their former attorney, now represented United East. Plaintiffs declined to enter into sublicensing agreements with United East, and the instant action ensued.

In their complaint, plaintiffs allege that defendant HK-TVP breached the 1985-1986 sublicensing agreements by failing and refusing to negotiate renewals for the period beginning December 1, 1986 and that defendant United East induced this breach of contract. They also claim that defendants’ conduct was in violation of the Donnelly Act (General Business Law § 340). Accordingly, plaintiffs sought and obtained a temporary order restraining and enjoining defendants, pending the hearing and determination of the motion, from "interfering with plaintiffs’ peaceful possession, quiet enjoyment and beneficial use of their business and premises, including the public rental of Hong Kong TVP programs” and from "taking any steps, including but not limited to the seizure or erasure of video tapes, which interfere with plaintiffs’ continued possession, use and control over Hong Kong TVP programs, catalogues, advertising materials and all other materials previously delivered to plaintiffs by defendant HKTVP”. The order did not mandate that HK-TVP continue to supply plaintiffs with new tapes.

Plaintiffs subsequently moved for a preliminary injunction which was granted by the Supreme Court following extensive hearings in February of 1987. In addition to directing that HK-TVP refrain from repossessing old tapes for erasure as permitted by virtue of the expiration of the sublicensing agreements, the injunction ordered HK-TVP to furnish plaintiffs with new tapes pursuant to the terms and conditions of their expired sublicenses. The relief was conditioned on the posting of an undertaking by each plaintiff in the amount of $100,000, which bond was later reduced to $20,000 when plaintiffs complained that the initial amount was too high for them to meet. Defendants have appealed the grant of the preliminary injunction.

[578]*578The law is well settled that in order to procure the drastic remedy of a preliminary injunction, a party must establish a clear likelihood of success on the merits, irreparable injury absent the injunction and a balancing of the equities in its favor (Chester Civic Improvement Assn. v New York City Tr. Auth., 122 AD2d 715, 717; Bizar v Ohrenstein, 119 AD2d 445; Faberge Intl. v Di Pino, 109 AD2d 235; Little India Stores v Singh, 101 AD2d 727). An examination of the record herein reveals that plaintiffs have not made the requisite showing, and, therefore, the preliminary injunction was improperly granted.

Plaintiffs’ assertion that they would suffer irreparable injury without injunctive relief is supported merely by the conclusory allegation that they will be out of business within a week if the expired sublicenses are not continued in effect. However, in view of the fact that considerable time has now elapsed since plaintiffs made this assertion and also since any new product was last received from HK-TVP, and there is no indication that plaintiffs’ stores are in imminent danger of closing, it appears that any injury suffered by plaintiffs can be adequately compensated by monetary damages.

Even more significantly, plaintiffs have failed to demonstrate that they are likely ultimately to prevail on the merits as they have not shown that they possess an enforceable contractual right. Certainly, the statement in the sublicensing agreements that HK-TVP intends to "negotiate in good faith to renew this agreement for an additional year upon terms and conditions to be negotiated” does not constitute anything more than the sort of "agreement to agree” held to be unenforceable by the Court of Appeals in Martin Delicatessen v Schumacher (52 NY2d 105). As the court declared therein, "before the power of law can be invoked to enforce a promise, it must be sufficiently certain and specific so that what was promised can be ascertained” (supra, at 109).

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Bluebook (online)
133 A.D.2d 575, 520 N.Y.S.2d 143, 1987 N.Y. App. Div. LEXIS 51605, Counsel Stack Legal Research, https://law.counselstack.com/opinion/yans-video-inc-v-hong-kong-tv-video-programs-inc-nyappdiv-1987.