By John L. Geiger, co-author of Creativity and Copyright: Legal Essentials for Screenwriters and Creative Artists
A New York Federal District Court recently ruled in favor of comedian Jerry Seinfeld by rejecting a copyright lawsuit brought by writer-director Christian Charles, who claimed authorship and ownership of the wildly lucrative show “Comedians in Cars Getting Coffee.”[1] But the Court dismissed the copyright claim without reaching the underlying merits of authorship and ownership. Instead, the Court found that the lawsuit was simply filed too late, well after the three-year copyright statute of limitations had run.[2] An appeal seems highly unlikely and without merit. Has Seinfeld been completely vindicated, as his lawyers tout?[3]
Or, does Charles have an ace in the hole?
In 1949, Victor Desny telephoned Billy Wilder, a producer/director/writer for Paramount Pictures, and told Wilder’s secretary that he had an idea for a film. At the secretary’s request, Desny forwarded to Wilder a synopsis of the movie idea and stated that, if the idea were used, he expected to be paid. Wilder made the film, but Desny was not paid.
The California Supreme Court held, in Densy v. Wilder, that a contract claim based on an idea submission could succeed if:
- the claimant received “an express promise to pay” or
- “the circumstances preceding and attending disclosure, together with the conduct of the [potential buyer] acting with knowledge of the circumstances, show a promise of the type usually referred to as ‘implied’ or ‘implied-in-fact.'”[4]
Well, the second describes the context whenever production companies invite writers in to pitch!
For over sixty years now, California courts have continued to recognize implied-in-fact contract claims under the landmark authority of Desny. Likewise, most other states recognize a cause of action for implied-in-fact contracts in an idea pitching or development context, including, of particular relevance here, the State of New York.[5]
Along with his now-dismissed federal copyright claim, Charles also pled a cause of action under New York state law for breach of implied-in-fact contract. His allegations make a rather comprehensive narrative of authorship and ownership per his long-time collaborations with Seinfeld, and are set forth in my prior UC Press blog post, Comedians in Cars Getting Ideas, Ops. 1: Timing is Everything in Comedy, in Litigation, and in Litigation about Comedy.
The Strategic Approach:
- Idea submission and/or collaboration disputes often give rise to both federal copyright (ownership and/or infringement) and state breach of contract (Desny-type, express and implied-in-fact) claims, each with their own different statute of limitations.
- Copyright claims can only be brought in federal courts.[6]
- State breach-of-contract claims can only be brought in state court, except when the state contract claim and federal copyright claim are so closely related that they form the “same case or controversy.”[7] In that situation, the federal court takes jurisdiction over the state court claim also.
- Idea submission and/or collaboration disputes should be filed first in federal court, bringing pleading the full mix of federal and state claims. That’s the only court where you can raise all the claims together in one lawsuit.
- When the federal lawsuit is filed, the statute of limitations clock stops on all claims, both federal copyright and state contract.
- If the federal copyright claim is dismissed (as it was here, because time ran out on the copyright statute of limitations), then the state breach-of-contract claim(s) must be summarily dismissed “without prejudice.”[8] Without the federal copyright claim, there is no basis for the federal court to take jurisdiction over a state breach-of-contract claim.
- Thirty days after dismissal, the state clock starts running again on the state claims. You can re-file those in state court before the clock runs out.
What’s the status of Mr. Charles’ implied-in-fact contract claim under New York law? Unlike the three-year period for copyright claims, a claim for breach of contract under New York state law has a longer, six-year statute of limitations.[9] But is it long enough?
The clock stopped when the federal complaint was filed (2/9/2018), and now that the federal court lawsuit has been dismissed (9/30/19), thirty days afterwards (10/30/19) the clock will restart from the point at which it had stopped.[10] So how much time, if any, remains on Charles’ six-year statute of limitations once the clock restarts?
The federal court did not—and did not need to—give the precise accrual date. It was sufficient to opine that “Charles was on notice that his ownership claim had been repudiated since at least 2012,” several years outside the three-year copyright claim period.[11] But what about the six-year contract claim period? Charles’ pleadings seem to suggest that his claims accrued sometime in February 2012, so that’s when the clock would have started. Filing the federal lawsuit on February 9, 2018 stopped the clock. Days left or days too late? Too close for us to call from here in the stands. Or is there some theory that suggests a later accrual date? Mr. Charles and his counsel need to make that call. Seems, though, that when the clock does re-start on October 30, 2019, there might be time left for one last shot.
Yada, yada, yada. Stay tuned?
Or maybe not. Perhaps this dispute—like so many Biz disputes—actually ends with a private and confidential settlement between/amongst the parties.
By the way, trivia question — what was the title of the 1951 Paramount Pictures film that resulted from Mr. Desny’s 1949 pitch to Billy Wilder’s secretary?
Ace in the Hole.
© 2019 by John L. Geiger
[1] Christian Charles v. Jerry Seinfeld, et al., Case No. 18-CV-1196 (AJN), United States District Court, Southern District of New York (Filed: February 9, 2018, Complaint-Document 1 / Dismissed: September 30, 2019, Opinion & Order-Document 106)
[2] Title 17, United States Code § 507(b) — “No civil action shall be maintained under the provisions of [the Copyright Act] unless it is commenced within three years after the claim accrues.”
[3] See, <https:www.newsday.com/entertainment/celebrities/jerry-seinfeld-copyright-battle-1.37030153>
[4] Desny v. Wilder (1956) 46 Cal.2d 715, 738.
[5] Robbins v. Frank Cooper Assoc. (1964) 14 N.Y.2d 913, 915. Although the opinion is thin on facts, the context is clear — negotiations over sale of a television program reached an impasse, but producers allegedly used the program anyway, so the aggrieved creator sought to recovery under a breach of implied-in-fact contract theory, a lá Desny. For a more detailed discussion of implied-in-fact contracts and idea-submission cases under New York State law, see Nadel v. Play-By-Play Toys & Novelties (2nd Cir. 2000) 208 F.3d 368, 374-381. See also, West v. eBay, Inc., 2017 U.S. Dist. LEXIS 197786; and Werlin v. Reader’s Digest Assn. (S.D.N.Y. 1981) 528 F.Supp. 451, 465.
[6] Title 28, United States Code § 1338(a).
[7] Title 28, United States Code § 1367(b). Of note for procedural purists, the Section 1367 test for supplemental jurisdiction over state claims is likely broader than the same-transaction-and-occurrence test for compulsory counterclaims under Rule 13, Federal Rules of Civil Procedure. See, Global NAP, Inc. v. Verizon (1st Cir. 2010) 603 F.3d 71, 87-88.
[8] Title 28, United State Code § 1367(c)(3).
[9] New York Consolidated Laws and Rules, § 213(2)
[10] Artis v. District of Columbia (2018) 138 S.Ct. 594, 199 L.Ed.2d 473, 2018 U.S.LEXIS 762.
[11] Charles, supra. September 30, 2019, Opinion & Order, at page 8.