Andrews v. Sony/ATV Music Publishing LLC, 1:15-cv-07544

Background

Plaintiffs Mark Andrews ("Sisqo"), James Green ("Woody"), and Larry Anthony, Jr. ("Jazz") are songwriters who originally contracted with Art of War for publishing/administration of their compositions; Art of War later entered an administration agreement with EMI.
Plaintiffs allege EMI (and Sony, which later acquired EMI publishing interests) continued administering the Art of War catalog after the EMI Administration Agreement ended and paid royalties to 27 Red/Rhondo Robinson (and affiliates) rather than to Plaintiffs.
Plaintiffs filed suit alleging breach of contract and related claims; after two prior complaints and motions to dismiss, the operative Second Amended Complaint (SAC) asserts (1) an implied-in-fact contract between Plaintiffs and EMI/Sony following the alleged termination of the EMI Administration Agreement and (2) a declaratory judgment that the EMI Agreement is terminated and EMI/Sony lack administration rights.
Defendants moved to dismiss the SAC for failure to state a claim, statute of frauds bar, and lack of standing to seek declaratory relief; Art of War later moved to intervene.
The Court dismissed the implied contract claim (insufficient factual allegations; statute of frauds) and dismissed the declaratory judgment claim for lack of standing; Art of War’s intervention motion was denied as moot/untimely.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Existence of an implied-in-fact contract between Plaintiffs and EMI/Sony after termination of the EMI Administration Agreement	SAC alleges EMI/Sony continued to administer the catalog and collect/hold royalties for Plaintiffs, implying a post-Agreement contract obligating payment to Plaintiffs	No plausible allegation of mutual assent, formation circumstances, essential terms, or Plaintiffs' performance; pleadings fail to state essential contract terms	Dismissed — SAC fails to plead essential terms, formation, or consideration for an implied contract
Statute of Frauds applicability to the alleged implied royalties agreement	Plaintiffs do not meaningfully address statute of frauds	An unwritten, open-ended promise to pay royalties is incapable of performance within one year and thus must be in writing under New York GOL § 5-701(a)(1)	Dismissed — implied agreement, as pleaded, is indefinite in duration and barred by statute of frauds
Declaratory judgment entitling Plaintiffs to a declaration that the EMI Agreement is terminated and EMI/Sony lack administration rights	Plaintiffs seek a judicial declaration resolving administration rights to their compositions	Plaintiffs are not parties to the EMI Administration Agreement and the Agreement disclaims writers as third-party beneficiaries; thus Plaintiffs lack standing to enforce or obtain declaration under it	Dismissed — Plaintiffs lack standing to seek declaratory relief under the Agreement
Leave to amend / Art of War intervention	Plaintiffs request leave to amend to plead with more particularity; Art of War seeks to intervene asserting interests in the Agreement	Defendants argue amendment is futile and Art of War’s motion is untimely given prior pleadings and public filings	Leave to amend denied as futile; Art of War intervention denied as moot and untimely

Key Cases Cited

Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading must state a plausible claim)
Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (pleading standard and plausibility)
Rajamin v. Deutsche Bank Nat. Trust Co., 757 F.3d 79 (2d Cir. 2014) (nonparties lack standing to enforce contract; no third-party beneficiary)
Wilton v. Seven Falls Co., 515 U.S. 277 (1995) (district court discretion under Declaratory Judgment Act)
Duane Reade, Inc. v. St. Paul Fire & Marine Ins. Co., 411 F.3d 384 (2d Cir. 2005) (considerations for exercising declaratory judgment jurisdiction)
Murray v. Northrop Grumman Info. Tech., Inc., 444 F.3d 169 (2d Cir. 2006) (elements required for implied-in-fact contract)
Nicosia v. Amazon.com, Inc., 834 F.3d 220 (2d Cir. 2016) (incorporation by reference of integral contract documents at pleading stage)