84 A.3d 237
Md. Ct. Spec. App.2014Background
- Stern (author) contracted with Publish America on Feb. 13, 2008 to publish her manuscript; the agreement allowed Publisher to edit, require revisions, and discontinue manufacture if public demand warranted, with an obligation to offer transfer of rights if publication ceased.
- Publisher repeatedly warned Stern to obtain permissions or "fictionalize" the manuscript so characters would not be identifiable; Stern agreed she would fictionalize and submitted revisions stating the characters were fictitious.
- The Library Diaries was published; publicity followed, Stern was suspended and then fired from her library job, and third parties accused the book of being defamatory.
- Publish America stopped distribution, pulled the book from its printer, and informed Stern it would investigate and might not fully terminate the contract or return rights because of indemnity concerns; the book was cancelled and rights were not returned.
- Stern sued for breach of contract alleging Publish America improperly ceased publication and failed to offer transfer of rights as required by paragraph 24; the trial court granted Stern judgment as to liability (finding Publish America terminated under paragraph 24 and failed to offer rights back) and submitted damages to the jury ($10,880).
- On appeal, the Court of Special Appeals reversed, holding there was sufficient evidence for a jury to decide whether Stern materially breached the fictionalization requirement (excusing Publisher) and whether Publisher waived that defense; thus the grant of judgment on liability in Stern’s favor was erroneous and the damages award was reversed.
Issues
| Issue | Plaintiff's Argument (Stern) | Defendant's Argument (Publish America) | Held |
|---|---|---|---|
| Whether trial court erred in granting judgment as to liability | Stern argued Publisher breached paragraph 24 by ceasing publication without finding lack of market demand and failing to offer transfer of rights | Publisher argued Stern materially breached the Agreement by failing to adequately fictionalize, making the defense to returning rights available; factual question for jury | Reversed: court erred to grant judgment for Stern; suffiecient evidence existed to send material-breach/waiver issues to a jury |
| Whether characters were reasonably identifiable (defamation/fictionalization issue) | Stern argued she fictionalized and Publisher waived insistence on fictionalization by advising revisions and publishing | Publisher argued distinct, recognizable traits and local details made characters identifiable; evidence could show Stern did not fictionalize | Held: Whether characters were identifiable is a fact question for the jury; trial court improperly precluded relevant lay testimony and resolved the issue as matter of law |
| Whether Publisher’s stopping publication and retaining rights was excused by Stern’s breach | Stern said Publisher’s withdrawal triggered paragraph 24 obligations regardless | Publisher said common-law remedies applied for author’s material breach and it could refuse to return rights; indemnity concerns justified its actions | Held: Whether breach was material and whether Publisher’s conduct was excused are fact issues for the jury; not resolved as matter of law in Stern’s favor |
| Whether costs and other pretrial rulings require reversal | Stern challenged denial of amendments, exclusion of expert, and costs award | Publish America sought judgment notwithstanding verdict and new trial; both parties disputed evidentiary rulings | Held: Because liability ruling reversed and new trial likely, appellate court reversed damages and declined to address most collateral issues; denial of costs was not an abuse of discretion |
Key Cases Cited
- Thomas v. Panco Mgmt. of Md., 423 Md. 387 (discusses de novo review of motions for judgment and standard of legal sufficiency)
- Hardy v. Winnebago Indus., Inc., 120 Md. App. 261 (treatment of motions for judgment in jury trials; view evidence in light most favorable to non-movant)
- Tate v. Bd. of Educ., Prince George's Cnty., 155 Md. App. 536 (legal-sufficiency principle: any legally sufficient evidence creates jury question)
- Great Atl. & Pac. Tea Co. v. Paul, 256 Md. 643 (defamation requires reference to an ascertained person)
- Mercantile-Safe Deposit & Trust Co. v. Delp & Chapel Concrete & Constr. Co., 44 Md. App. 34 (waiver/modification by subsequent conduct is question for factfinder)
- Massachusetts Indem. & Life Ins. Co. v. Dresser, 269 Md. 364 (contract-specified remedies do not necessarily preclude other common-law remedies)
- Starke v. Starke, 134 Md. App. 663 (test for legal sufficiency of evidence)
- Speed v. Bailey, 153 Md. 655 (when breach is material versus partial; guide for rescission and right to abandon contract)
- Plitt v. McMillan, 244 Md. 450 (material breach and rescission principles)
- Barufaldi v. Ocean City, 196 Md. App. 1 (distinguishing partial failures and when rescission is warranted)