Contracts

Brief

Greenfield v. Philles Records, Inc.

Procedural History:

• Supreme Court ruled in favor of the Plaintiffs.
• Appealed.
• Affirmed.
• Appealed.
• The order of the Appellate Division should be modified, without costs, and the case remitted to Supreme Court for further proceedings in accordance with this opinion and, as so modified, affirmed.

Facts:

• The contract in dispute is between a singing group and their record producer.
• In the early 1960’s, Bennett (Now known as Ronnie Greenfield), her sister and cousin formed a singing group called “The Ronettes.”
• In 1963 they signed a five year personal services music recording contract with the defendant.
• Plaintiffs agreed to exclusively perform for Philles Records.
• The agreement set forth a royalty schedule to compensate Plaintiffs for their services.
• However, they disbanded in 1967 and other than an initial $15,000 advance; they receive no royalty payment from Philles Records after a successful 4 year career.
• There was also personal relationship which developed between Greenfield and Spector (The music producer).
  • They were married in 1968 but separated after a few years.
  • As part of the agreement the two executed mutual general releases that purported to resolve all past and future claims and obligations that existed between them, as well as between Greenfield and Spectors companies.
• Defendant eventually began to capitalize on a resurgence of public interest in 1960’s music by make use of new recording tech and licensing master recordings of the Ronettes vocal performances for use in movie and TV productions.
• No royalties were paid to plaintiffs.
• Defendants argue that the agreement granted them absolute ownership rights.

Issue:

• Whether defendants, as the owners of the master recordings of plaintiff’s vocal performances, acquired the contractual right to issue licenses to third parties to use the recordings in connection with television, movies and domestic audio distribution?

Holding:

• No. Affirmed for plaintiffs.

Reasoning:

• The court reasons that extrinsic evidence of the parties intent may be considered only if the agreement is ambiguous, which is an issue of law for the courts to decide.
• A contract is unambiguous if the language it uses has a definite and precise meaning, unattended by danger of misconception in the purport of the agreement itself, and concerning which there is no reasonable basis for a difference of opinion.
• The court does not think there is an ambiguity in the terms of the Ronettes agreement.
• NY law says that the court must look at the four corners of the writing and a written agreement that is complete, clear and unambiguous on its face must be enforced according to the plain meaning of its terms.
• Therefore, the defendant is subject to royalty payments to the plaintiffs.