Factors Etc., Inc. And Boxcar Enterprises, Inc. v. Pro Arts, Inc. And Stop and Shop Companies, Inc.

ETC., INC. Boxcar Enter FACTORS Inc.,

prises, Plaintiffs-Appellees, ARTS, Stop Shop

PRO INC. and

Companies, Inc.,

Defendants-Appellants.

No. Docket 80-7692.

United States Appeals, Court of

Second Circuit.

Argued Dec.

Decided June Mansfield, Judge, Davis, dissented and City (Char- William J. New York opinion. Pfahl, filed lotte A. W. Alice B. Newman and

279 Davis, P.C., assigned ownership rights exclusive all of & New York Schulman Berlin for brief), purposes use commercial his name City, appellants. for on August and likeness.2 On two Silberberg, City New York Michael C. death, days Presley’s granted Boxcar (Donald F. and Golenbock & Ba- Schneider Etc., Inc., to plaintiff-appellee Factors a reli, City, Arthur Fields and Er- New York corporation, Delaware an exclusive license vin, Hills, Cal., Jessup, Beverly & on Cohen months, for 18 at the renewable licensee’s brief), for appellees. up option for four years, Presley’s use NEWMAN, name and likeness in connection Before and MANSFIELD manufacture and sale of kind of mer- CARTER,* Judges, Circuit and District agreed pay chandise. The licensee Judge. sales, subject royalty of of to a mini- 5% NEWMAN, Judge: royalty mum for the first months of 18 $150,000, subject and also to certain mini- appeal The merits of this concern the items, royalties specified mum exam- interesting whether a ple poster. for each $.08 person publiciz- protected has a interest death, ing name his his and likeness after August defendant-appellant On or, put, as the matter been is there a Arts, Inc., corporation, publish- Pro an Ohio Despite publicity?1 poster displaying photograph ed of Pres- what question, fascination of this di- ley and the dates 1935-1977. Pro Arts had panel vides the members of this and forms purchased copyright photograph majority’s disposition the basis for the newspaper photographer who had from the this appeal question, is the more esoteric poster it. Arts taken Pro marketed apparently impression, concerning retailers, of first including through various co-de- exercising fendant-appellant the deference a federal court di- Stop Shop Compa- Inc., versity jurisdiction give nies, through poster should to a which sold the by a appeals deciding court of Bradlee Stores Division the Southern of New York. After communica- Believing state within its circuit. District con- Boxcar, Factors, Arts, and Pro tion between given, except clusive deference brought this suit in the here, Factors Southern applicable certain situations not a pre- York and obtained District New judgment reverse the this case. injunction restraining defendants liminary selling, distributing manufacturing, from FACTS making any Presley poster and from The facts set forth in this Court’s name like- commercial use litigation, first encounter with this Factors Arts, Inc., Etc., v. ness. Factors Inc. Pro Etc., Arts, Inc., (2d v. 579 215 Inc. Pro We F.Supp. (S.D.N.Y.1977). af- 444 288 denied, cert. 440 99 I. firmed that in Factors (1979) (Factors I), S.Ct. 59 L.Ed.2d 455 only briefly and need be Contemporaneously recounted here. with the initiation of life, suit, During Presley, litigation well- Factors found itself in popular singer, Develop- known formed on another front. The Inc., Foundation, corporation, Enterprises, organization an formed Boxcar and ment * Privacy’s Stepchild, Progeny Dracula’s The 22 Honorable Robert L. of the United Carter Lugosi v. (1975); States District for the Southern District Note, Court L. Rev. U.C.L.A. Right sitting designation. Universal Pictures: Descent York, New Publicity, Hastings L.J. 751 Descendi- The 1. Rubin, & Felcher Publicity: Right bility Is There Com- assign surrounding 2. Thecircumstances Death?, 89 Yale L.J. 1125 Life Añer mercial of some Boxcar, matter ment Publicity Privacy, (1980); Rubin, Felcher & to this confusion, not of concern ap happily Media, Portrayal People of Real Etc., Inc. Cre are discussed peal, Right (1979); Nimmer, Yale L.J. 1577 Co., (S.D.N.Y.1977). ative Card Publicity, (1954); Law & Prob. Contemp. Right Publicity: Transfer Comment, obliged Tennessee, the substantive law of the Memphis, to construct Presley state, York, in downtown Mem bronze statue of state to which the forum New District phis, sued Factors in the Court been filed would have turned had the suit pre Tennessee to the Western District of Elec in state court. Klaxon Co. v. Stentor interfering with the vent Factors 487, 61 Manufacturing tric to raise funds sell Foundation’s efforts (1941). Curiously, L.Ed. 1477 ing eight-inch pewter replicas pro the choice of law issue had received posed Presley priced statue Fac $25. parties litigation from the in this attention injunction tors counterclaimed for an to reversal in Mem prior to the Sixth Circuit’s restrain the Foundation’s distribution of the assuming phis Development. Perhaps that preliminary injunc statuettes and secured governing infringement action the law this tion, Memphis Development Foundation v. wrong, place was the law of the of the Factors, Etc., Inc., (W.D. 441 1323 explicitly ap contend on this appellees now Tenn.1977), opinion aff’d without 578 F.2d peal, parties did not refer to choice of (6th summary 1381 Cir. On motion for prior appeal, and this law rules on the judgment litigation, in the Tennessee Fac Court, discussion, simply observed permanent tors obtained a without However, District Court. Sixth Circuit that the of the of the duration reversed, holding Presley’s right publicity specifi more is “one of state publicity did not survive his death. Mem York,” cally the of New law of the State phis Development Foundation v. Factors ruling, 579 F.2d at 220. That choice of law Etc., Inc., (6th Cir.), 616 F.2d 956 cert. de affirming prelimi made in the course of 358, nied, 953, 101 66 injunction, preclude our reex nary does not L.Ed.2d 217 point appeal on this amination of the case, adjudication see Diversi Thereafter a final Factors moved for summary judgment in the New litigation. York v. Life Title Ap- Mortgage fied Investors pellants (hereafter collectively Arts”) “Pro 571, (2d Cir. Insurance brought to the District Court’s attention parties especially now the Sixth Circuit’s reversal in Memphis De- dispute.3 put the choice of law issue in velopment, contending Devel- only Factors not contends that New opment collaterally estopped Factors from applicable York law is asserting as the law of the possessed any exclusive publicity place of the wrong, citing to the name and Cousins v. likeness of Instru Presley after his death. Implicitly reject- Flyers, Inc., ment 44 N.Y.2d ing contention, this the District Court 914, N.Y.S.2d 376 N.E.2d (Charles H. Tenney, Judge) granted Fac- (1978) (per curiam), but also asserts that tors’ motion permanent and issued injunc- “significant even if a contacts” test were tion, from which appeal this has been taken. applied, see Babcock Jackson, 12 N.Y. 496 F.Supp. 1090 (S.D.N.Y.1980). 473, 2d 240 N.Y.S.2d 191 N.E.2d (1963), significant contacts of DISCUSSION dispute, e., i. those that “relate to The Court, District exercising its diversi- purpose particular law in con ty jurisdiction, 28 (1976), U.S.C. was flict,” Miller, Miller v. 22 N.Y.2d raising Factors contends that Pro Arts is collaterally estopped that Factors was to assert choice of appeal, law issue for the first possession time on publicity right by Memphis thereby foreclosing opportuni- Factors decision, from an an issue we need not ty develop in the trial court a factual record disposition appeal. resolve in view of our demonstrating significant New York contacts. imagine it is difficult to what New Stevenson, (5th DuBreuil v. 369 F.2d 690 possibly York contacts Factors could marshal 1966). However, Pro Arts did call the support a claim that a New York court District pertinency Court’s attention to the deciding New York law in Tennessee law on the issue of the existence of a rights acquired by pursu- nature of the publicity right (June 19, death. ant to the Boxcar-Factors contract. 23-24). point 1980 tr. urging was made in surprise, 15-16, Somewhat there has been 237 N.E.2d N.Y.S.2d are with New York. Fac- hardly reports appellate mention in in- points tors sale appeals court appropriate deference a fringing poster, which occurred in New give should decision made York, York, but to the fact that New also circuit on the law of a another and the lo- as a center of communications It fre- state within that other circuit. has per- many where the value of cale ap- quently been observed that developed, en- has an interest sonas give peals weight considerable suring against misappropriation a celeb- rulings judges, made by state law district rity’s publicity. Against this rath- circuit, possess familiarity within the who showing, sparse points er Pro Arts out that their with the law the state domiciled, Presley Tennessee is where was 1A Federal district is located. See Moore’s incorporated, agree- Boxcar 0.309(2), (collecting Practice at 3125 n.28 ment between Boxcar and Factors was cases). Supreme expressed Court has agreement spe- latter made. the concerning interpre- law similar views state provides cifically that it is to be construed panel judges whose tations of circuit in accordance with law. We Tennessee Mac- circuit includes the relevant state. likely per- think it that these facts would Co., Gregor v. Mutual Life Assurance State York to to law suade New court look the 607, 280, 86 846 315 U.S. 62 S.Ct. L.Ed. even a New York of Tennessee. But (1942). appears But no ease to have turned apply court New York law in con- would one on whether court of claim, sidering of Factors’ some elements to circuit to the law of a defer another as infringement, as the occurrence an that we feel Tennessee law would state within circuit.4 certain that deciding to in be referred whether Boxcar Memphis Development, deciding In had a name expounding Circuit was Tennessee’s Sixth likeness, death, capa- that was version law. It makes common being ble of contracted for Factors. Cf. to the Court was unable difference (2d) Restatement of Conflict of Laws any guide law find Tennessee decisional 147, (i), noting Comment tort con- it, leaving issue before resolution apply issue flicts rules of conversion it, candidly acknowledged, Judge as Merritt property, property but conflicts rules way predisposition with “no assess” the plaintiff property to whether has title to courts. 616 F.2d at allegedly converted. have lacked sure The Sixth Circuit panel agree All members of the predicting basis what the Tennessee should turn Tennessee law to determine obliged courts do and therefore felt rights what the Boxcar-Factors contract light practi- “in to make its decision find, conveyed to Factors. We as the Sixth considerations, the treatment policy cal and Memphis Development, Circuit concluded in legal system, of other similar statutory law that Tennessee and decisional weight conflicting inter- the relative question. We are affords no answer to pre- parties, moral ests and certain brought thus that divides death, privacy, in- concerning suppositions panel: whether deference should accord- opportunity.” Memphis Development. heritability and economic ed to decision diversity prec- cases have no decisions In v. American Automobile Insurance Waters only Co., (D.C.Cir.1966), edential value determine the Dis- parties.” prepared view has between the This trict Columbia Circuit seemed issues Moore, 1A read Missouri cases to reach a result different been labeled erroneous Professor adopted by Eighth 0.309(2), but from one Practice at 3123 Moore’s Federal H circuits, n.19, ultimately including Eighth, rested decision a recent decision several court, appellate precedential intermediate of their on the force relied point. precisely prior rulings id. 3124-25 In Peterson v. U-Haul on state own Co., cases). (8th (collecting and n.25 expressed Eighth the view that “Federal general Ibid. functioning But this recourse to such consideration of the diversity jurisdiction. considerations did not alter function performing. Circuit was In One distinct shortcoming diversity jur- adjudicating a state-created in the isdiction interruption orderly is the diversity jurisdiction exercise of its the development exposition and authoritative effect, purpose, Court was “for that only by sporadic of state law occasioned another court of the Guaranty State.” adjudications. Except in those few York, 99, 108, Trust Co. v. 326 U.S. jurisdictions permitting a federal court to 1464, 1469, 89 L.Ed. 2079 It had no certify an unsettled of state law to power “to declare substantive rules of com- court,5 highest the state’s a federal court’s law,” mon Erie Railroad v. Tompkins, Co. corrected, decision on state law cannot be L.Ed. litigants partic- the benefit of the in the (1938); it could declare the law of case, by ular the state’s authoritative tribu- “ Tennessee. ‘The commonlaw so far as it is long jurisdiction exists, nal. diversity As State, enforced in a whether called common However, price paid. must op- not, law or is not the generally common law portunities departure for federal court but existing by the law of that State paths development the normal of state law authority of that State Id. at minimum, should be held to a for the bene- 822, quoting S.Ct. at Black and White Taxi- orderly fit of both the development of state cab and Transfer Co. v. Brown and Yellow subject law and fairness to those to state Taxicab and Transfer requirements. Both values are served S.Ct. 72 L.Ed. 681 by recognizing, system, within the federal (Holmes, J., dissenting). the of authoritativeness decisions on the Of course may reasonable minds differ as particular law of a by state rendered preferable course that the common appeals court of for the circuit in which the law of ought Tennessee to follow on the Orderly development state is located. merits of Factors’ claim. The writer would legislature enhanced because the state will probably uphold a pub- know pertinent the decision of the licity, were he serving on the Tennessee appeals court of legal rights, will determine Court, Supreme perhaps if he served on superseded unless by supreme a later state Sixth Circuit when Develop- court knowledge decision. This will focus ment was decided. But the issue for legislative this state appropriate- efforts on the Court is not which view of the merits is statutory change. ness of a Fairness to the whether, policy; wiser it is and under public what promoted by making clear that circumstances, ruling by a a ap- court of single, there is a authoritative answer to peals, interpreting the common law of particular issue, a state law instead circuit, state within its regarded should be leaving subject varying matter to the as by authoritative the other federal courts interpretations appeals of the courts of of the nation. The answer by is illuminated the several circuits.6 If this Court were to 4.61; Fla.App.R. moting g., 5. E. diversity jurisdic- Md.Code Ann. 12- uniform exercise of (1980); Mass.Sup.Jud.Ct.R. system. 3:21. tion within the federal court And the uniformity period achieved for the after the uniformity throughout 6. Even if is achieved pertinent date of the decision of the federal courts, possibility federal appeals worthy remains that the court of ment is not less of achieve- states, obliged simply courts of various prior to consider because to that decision oth- rules, Tennessee law may because of their conflicts er federal courts or courts of other states might predictions reach predictions different of Tennessee have made different course of Tennessee law. The about likely law. We think it possibility more that state courts uniformity would share our departures uniformity, interest in and ac- these unavoidable cept ruling by pertinent just federal court of like decisions of federal or other state appeals, subject qualifications to the same ruling courts rendered before an authoritative adopt by pertinent court, highest ourselves. If in some instances a state’s is an so, might state court did depar- not do lessen but insufficient reason to create a needless appropriateness pro- would not uniformity eliminate the ture from what be an pronouncement legislative from state later view de- disregard the Sixth Circuit’s sources, recognizes judicial g., de- e. Waters v. Ameri- clare that Tennessee publicity, what standard scendible Insurance can Automobile guide residents should Tennessee conduct (D.C.Cir.1966), prior or that state court whether their endeavoring to determine inadvertently overlooked decisions been be valued for a publicity rights appeals. Neither pertinent court of course, lawyers fre- or beyond? lifetime Of Where, case. circumstance exists this concerning quently to advise clients here, pertinent appeals has court law, exercise of but the unsettled issues prediction of the course of essayed its own add to their diversity jurisdiction should not impression of first law on a state uncertainty. jurisdiction, espe- Diversity state, courts oth- within that incarnation, cially post-Erie in its holding, to that er should defer circuits exposi- diversity in the not create needless at least in all situations perhaps always, and though law. Even tion of state substantive when it can said except the rare instance ap- pertinent the decision pertinent court of conviction that the with peals may subsequent revised signals appeals disregarded clear ema- ruling, a state court will supreme court highest point- nating from the state’s normally option making such a have the ing rule. However our toward different ruling only, thereby protecting prospective might lead us to sense of the common law rights bargained for in reliance case were we resolve the merits appeals. pertinent court of Court, Supreme judges of Tennessee little option That would make sense respect to Tennessee “outsiders” ruling came after authoritative state court Schein, Lehman Brothers divergent rulings had been made several 391, 94 40 L.Ed.2d 215 appeals. courts the views of the we should defer to do conclude need not and We point can to clear Sixth Circuit unless we holding pertinent predicting that basis in Tennessee law for automatically binding court of courts, when confronted with the other upon the federal courts all this, conclude that the a case such as would for state law circuits. The ultimate source was incorrect.7 prediction Sixth Circuit’s diversity cases is the law as adjudication in any to such indica- we unable find Since constitution, statutes, or by established law, accept Memphis tion in Tennessee we authoritative court decisions of state. controlling authority and Development as A in another circuit would be federal court death, Presley’s Boxcar conclude that after holding obliged disregard by to state law a name right publicity no of persuaded pertinent appeals court of if superseded convey Factors.8 holding by had been a and likeness to to disposition appeal, period by of of beginning 8. In view our de- after a decision extended the pertinent ferring, appeals of as a matter of stare decisis to the Sixth federal court end- all, only contrary ing, interpretation if at event a of of Tennessee we Circuit’s need not consider by pertinent highest contentions, court decision or state’s Pro Arts’ legislature. judgment which include claims that collaterally estops Memphis Development Fac- Memphis happens, it Devel- right pub- As author asserting a tors licity, distinguished opment is of the Ten- a member applies, if New York that New York law bar, may whose be ex- nessee sense what right, recognize a and that such would federal surely Supreme pected of the Tennessee Court copyright preempts application law surpasses opinion Judge own. But since Merritt’s right. protect purporting a law state any emphatically so disclaims basis for law of a whether the Nor need we consider predicting will the issue how Tennessee resolve publicity recognizing be state merits, prefer on the to determine au- nationwide, partic- within that enforced Memphis thoritativeness of regard cuit, California, 412 U.S. state. Goldstein ular Cf. scope of the Sixth Cir- the territorial 37 L.Ed.2d 93 S.Ct. heritage opinion’s rather than the author. judgment majority proposition For reasons the starts with the these “interpreta- District Court is reversed. that deference is owed to the p. 281) a federal (Maj. by opin., tions” MANSFIELD, Judge (dissenting): juris- court the law of state within its respectfully agree diction, I I with the dissent. principle with which I find no that, assump majority despite contrary However, disagree. need it then states I, parties tion of all in Factors New York that the “issue for this Court ... is wheth- analysis conflict of laws would call for the circumstances, er, ruling under what application of to determine by appeals, interpreting court of the com- Presley’s right survived publicity circuit, mon of a within its However, his death. with the utmost of recognized the other as authoritative respect our distinguished and able col (Maj. opin., federal courts of the nation.” leagues on the I see no war issue p. With statement of rant, merits, disagree if we on for blind disagree. I no must Here there was inter- ly following decision Devel pretation of any Tennessee law the Sixth Etc., opment Inc., Foundation v. Factors Circuit, only what a declaration of (6th Cir.), denied, cert. thought gener- preferable would be a 66 L.Ed.2d 217 al common law rule for that state. The (1980), any more than we would defer therefore, us, before is a fed- whether of any decision other circuit court with appeals, upon eral to antici- called might, which we occurred on numer has pate general what common law rule with occasions, ous disagree or conflict. The rea appro- to a respect legal question might soning Memphis Development is not in priate having for a law whatsoever any way derived local Ten from the law of subject, on adhere diversity must to the nessee. Its result is inconsistent with that decision sister federal court every of nearly other case which con within whose boundaries the state locat- issue,1 including sidered the the Sixth Cir requires ed. Resolution this issue us prior cuit’s preliminary own on the reasoning policy look into behind the issued the district court in majority which the deference Memphis Development opinion and our applied and decide it is to be me- It is whether contrary I. also to all current scholarly chanically geographical views of commentators on the basis is in- subject.2 subject stead limitations. (“Felcher holding II”). 1. Decisions 1126 n.5 Rubin & will deciding reading survive death include Hicks v. Without Casablanca whether or not this (S.D.N.Y.1978); Lugosi justified, Records, Fac F.Supp. clear that any require- tors Inc. v. Etc., Creative Card ment of life is met exploitation fully (S.D.N.Y.1977) (companion 279 Arts to the Pro I, this case. See F.2d Factors 579 at 222 supra, I); case which was in by affirmed us 11; n. note 4 infra. Price Studios, v. Hal Roach Inc., 400 F.Supp. (S.D.N.Y.1975). 836 The of the Cali position g., See, II, e. Felcher & Rubin Felcher supra; fornia Supreme Court is somewhat In unclear. Rubin, & and the Privacy, Publicity, Portrayal Lugosi Pictures, v. Universal 323, 160 Cal.Rptr. Media, of Real 88 Yale L.J. 1577 People by (1979), Guglieimi Spelling- 425, 603 P.2d and v. (1979) (“Felcher I”); Right Rubin The & Pilpel, Goldberg Productions, 352, 160 603 Cal.Rptr. Copyright 27 Bull. 249 Publicity, Soc’y (1979), majority P.2d 454, held Court (“Pilpel”); Lugosi Note, v. Universal rights that involved those Right Pictures: Descent of 29 Publicity, not cases did survive death of the individu Hastings (1978); Right Note, L.J. 751 The suggested als But it has been that question. Figures for Public and Publicity —Protection Lugosi, Guglieimi on which was in (1976); Celebrities, 42 L.Rev. 527 Brooklyn finding based, turn Bela depended Right Comment, Transfer of Publicity: Lugosi right during not had life. exploited Progeny and 22 Dracuia’s Privacy’s Stepchild, Lugosi, (Bird, 603 P.2d at 447 supra, n.33 1103 And addition- U.C.L.A.L.Rev. see dissenting); J.,C. Felcher & The De Rubin, Lugosi, al authorities collected 603 supra, Right scendibility There Is Publicity: (Bird, dissenting). at J., P.2d 446 n.30 C. Commercial Life Death?, Añer 89 L.J. Yale stance, logical it would be more to assume given by higher federal weight that, particular rulings familiarity made federal a state’s courts to state law deference, results from the judges sitting in that state law is to be the standard for a greater familiarity judge for supposed district the West- United States Tennessee, will with the local law and the judge Judge Harry have ern District W. of the state courts. Wellford, methods and tendencies opinion who in a well reasoned Wright As states: Presley’s property right in his held Elvis image purposes name for commercial general proposition,

“As a federal descendible, F.Supp. (W.D. see 441 in a judge particular who sits Tenn.1977), superior expertise with re- its practiced and has before courts spect to Tennessee law. On issue be- complex ques- be better able to resolve MacGregor v. Mutual Life fore us State tions about the law of that than Co., 607, 62 S.Ct. judge Assurance some other federal who no such majority, is of L.Ed. 846 cited personal acquaintance with the law of the there the no assistance for the reason appellate state. For this reason federal “interpre- merely circuit court affirmed frequently reluctance courts have voiced upon purely local law placed tation of the state to substitute their own view long Michigan judge experience,” judge. of the federal As Here, in con- administration, id. at judicial matter of trast, did not affirm Wright, the Sixth Circuit C. Federal seems defensible.” decision, Judge Wellman’s but reversed it. (3d 1976) ed. at 271 Courts 58§ [footnote omitted]. perfectly it is clear that way no Circuit’s decision in fact a federal court of Sixth To lesser extent law methods. conceivably depended on existent local appeals might be considered effort, no opinion a The makes as is some- familiarity have more with the law of done, an- times to determine what other states state within its boundaries than would to, appeals. the Tennessee courts tend to look cf. other federal court of Even this Morrow, (9th 828 n.3 premise open question, how- Yost serious ever, 1959); Wilmington Trust Co. v. Mutual for a of reasons. Unlike a Cir. number (D.Del. Co., state court or a federal district court within Life Insurance analogous state, guided by much less to be single appeals the court of located, cf. Winston principles of Tennessee circuit in which several states are Casualty Corp. disposes diversity appeals only v. Continental Instead, (6th business, expressly like- percentage small of its not that, the outset ly gain special familiarity with the states at one law of of the states within bounda- not addressed “Tennessee courts have instance, physi- ries. The Sixth directly indirectly, and we this issue cally encompasses seven different states. way predisposi- to assess their 1,823 Of filed with it in im- the case is one of first tion. Since average (compared or 11.6% with an ques- pression, we are left to review the 12.5%) diversity for all circuits of were suits light practical policy tion in the originated solely these from Ten- considerations, the treatment but nessee from all seven states. See system, legal similar Director, Report Annual Administra- weight conflicting inter- relative Courts, tive Office of the United States moral parties, the and certain ests of death, priva- Table A-12. concerning presuppositions opportu- inheritability, and economic cy, and, indeed, may These facts weaken nity.” 616 F.2d at 958. assumption that able destroy even the the Theory A special knowledge or on John Rawls’ Sixth Circuit has some It then relies of Torts the Restatement law defer- Justice and expertise in Tennessee to which case, general considerations. evaluating these In for in- paid. ence must be 282), would (Maj. op., p. and the third Clearly, familiarity with Tennessee law and practice consequence so, certainly was of no in the Sixth do I think we should so hold We, Circuit’s endeavor. however much unsupportable rather than retreat behind p. fully are (Maj. op., “outsiders” deferential niceties. qualified effectively to “declare” Tennessee consistency Even the under achieved the law our in such fashion as sister circuit. majority’s rule arbitrary. is fortuitous and If these circumstances were to under we arisen, Memphis Development Had the case bow to the Sixth Circuit’s declaration example, for in the Ninth and Circuit law, it have be Tennessee would circuit, that without reference to Tennessee underlying reasons other than those practice, law or declared that Tennessee given judges usual deference to federal who descendibility, law should not allow would are experienced prac- in the local law and required we follow that version unless tice of states located within their bounda- prove wrong on local we could it some basis ries. majority seeks to find such a Appar- overlooked the Ninth Circuit? “functioning diversity basis in the overall ently the which majority, would “determine (Maj. p. op., 282). jurisdiction” First Memphis Develop- authoritativeness argues recognizing that the authoritative- regard scope ment the territorial ness Sixth Circuit’s would the Sixth (Maj. n.7), Circuit” op., p. 283 “orderly development enhance the state agree would that a Ninth deci- (Maj. law” op. p. But our re- weight sion would be entitled no more fusal bound by the Sixth Circuit persuasive authority than the usual here would affect the development of which, reason, good sister circuit with law Tennessee at all. It is conceded as a might disagree. we The only difference any matter of settled law that Tennessee here, any where the Sixth Circuit eschewed or legislation decision would declaration, Tennessee law basis for its wipe significance out future both physical its geography that includes that Memphis Development and our decision. my logic In state. view lack of behind consistency notion that majority’s reasoning geographical among the better circuits will “focus state further demonstrated that if we fact legislative efforts appropriateness on the holding had stated our I to be statutory 282) change” (Maj. op., p. law, view of declaration Tennessee speculative perhaps at best and ill founded. certainly we done if which would If laboring Tennessee constituents were un- agreed parties had not time der conflicting federal court declarations of governed, York New duties, legislature and would be other circuit have been free to take would likely more to act sooner than if all deci- contrary very view thus in- create the sions were consistent. consistency majority which the seeks to Second, while noting lawyers must avoid. frequently advise concerning clients unset- here, In unusual situation where an law, tled issues of majority argues appeals diversity initial declaration failure to follow way prac- is in no from derived the law promote uncertainty would and “create interprets existing tice of the state no diversity exposition needless in the of state we should feel free reach a (Maj. op., p.

substantive law” 282). This sound recom- different result reasons ignores development the fact that our it, regardless unpersuasive mend lasting formation of rules of common circuit views sister depends heavily healthy on differences of Where, opinion. initial declaration emanated. Soundness must not be sacrificed here, consistency. on the itself had Tennes- altar If two mem- Sixth Circuit panel bers of this “probably uphold see law basis for choice and publicity, [they] persuaded were reasons dictate a con- that other sitting Supreme (or prediction), trary Court” decision there is no maintain, after his To as would to others death. for rule that logical justification did, permit depart Memphis Development “leaving the Circuit’s us to from Sixth basis upon showing of “a clear views good name to one’s is sufficient children the predicting in for individual,” Tennessee law in itself for reward the courts . . . would conclude at is on those who “rather harsh incorrect” prediction was the Sixth Circuit’s name, their in have invested efforts their (p. 283) [emphasis market, added]. and consti- rather than in stock heavy impose on tutes a rather burden merits, principles Turning to the sound II, supra, Felcher at creativity.” & Rubin a different result commend Memphis Development reached right of

issue of whether conjured by parade horrors his publicity survived death.3 Because Memphis Sixth fully in Factors I and addressed First, reasoning mere- resist this is unreal. because the discussion there is consistent Gandhi, being public figure (e. g., Na- ly majority with the vast authorities of other Revere, poleon, or the others mentioned at considering problem, 1 & 2 see notes 959) enough at is to create not ele- supra, length I will not rehash at right property right. That ex- supporting ments I result. The virtue com- only by ists of the individual’s gist reasoning right is that development4 persona his and mercial is publicity involved here in the nature of a Second, products. limited to commercial property right, representing valuable “offices,” analogous to is not “titles” in the fruits of an individual’s investment by the referred to are development commercial the use of his by law the result not alienable and not right of personality. It differs from a mere development any more than commercial purely in nature privacy, personal which is “trust,” “friendship” “enmity,” also re- only protected hence from invasion as Third, by that Id. ferred to court. there long as the individual lives. Where answers Circuit’s are several to the Sixth right through com- publicity developed property over how long concern interest exploitation investment and mercial after the death of the individual and lasts lifetime, be individual it should practical mat- whether it is taxable. As a just intangi- the same treated ability exploit ter the continue most property right ble owned him and commercially developed personalities Further, devisable or descendible at death. through products the sale their public policy providing for incentives most, years will last but a few at death enterprise cap- individual and investment pur- diminishing public because interest energy argues allowing an indi- ital and Further, along pass chasing products vidual to the fruits of his labors will decline. II, appear party claiming supra, "... it would that a Rubin 1132 n.30 it is In Felcher & at suggested must establish that the decedent that the result overall way Development “may justifiable in such a evidence his or her on other acted as to Presley, recognition grounds, commercial however. The it- own the extrinsic statue likeness, self, art, readily being value of his or her name or characterized as merchandise, protected by recognition in some Amend- manifested that manner, overt the First ment, g., making scope e. an inter vivos transfer and is outside the (Factors), posing rights... Replicas con- the name . the statue could gum (see ceivably protected catego- Haelan Laborato fall within the for bubble cards same Inc., ries, Gum, Topps Chewing ry.” Inc. v. denied, Cir.), (2d F.2d 866 cert. (1953)).” L.Ed. 343 4. The this factor is whether or not I, supra, & Rubin at 1613-20 and See Felcher to survival of was reserved essential II, 1130-31, argu- supra, Rubin unnecessary Felcher & I. to the decision in Factors application support of an even sterner require proof ments 579 F.2d at 222 n.l 1. I would supra, requirement. Lugosi, exploitation of this But cf. along of some form of the lines J., Pilpel, (Bird, dissenting); Hicks, 447 n.33 supra, P.2d at C. district outlined court in supra, at 257. at 429: placed Having limits could be on the duration of the concluded that as a matter of right by analogy copyright to the statute. right publici- Tennessee common law the Pictures, Lugosi See v. Universal 603 P.2d ty by asserted Factors in this case should be J., (1979) (Bird, 446-47 dissenting). C. death, Presley’s held to survive I address right Whether the property is taxable to arguments certain of Pro Arts’ other depend individual’s estate will on inter- affirmance, against the majority, be- pretation Code, of the Internal Revenue but cause grounds, decision on deference there is every receipts indication that (Maj. op., p. n.8). does not consider products sale of after death will be Appellees (1) contend that Factors is collat- taxable gross to the seller as income. erally estopped by Memphis Develop- Fourth, speech free would not be inhibited suit; ment maintaining decision from by continuing to restrict the sale of such (2) that copyright preempts federal products only to licensees even after death. area, state law of in this A biography, documentary or news article apparent scope nationwide would not be the kind of merchandise cov- against by issued Pro Arts by ered right publicity.5 Just itas improper. my district court is In view none life, an individual’s can be points of these additional calls for reversal treated with flexibility needed to avoid judgment below. The first claim is genuine conflicts with First Amendment Memphis Development, decided more Compare freedoms. Paulsen v. Personality prior entry than four months Posters, Inc., 59 Misc.2d 299 N.Y.S.2d here, judgment appealed from created a (Sup.Ct.1968) (protecting a Pat Paulsen preclusion against defensive issue Factors poster for President as newsworthy), with dispositive case, because the issue in that as I, supra, Factors 579 F.2d at 222 (rejecting here, is whether under Tennessee law Pres- claim that the In Memory poster privi- ley’s right of publicity, transferred to Fac- leged as celebrating newsworthy event).6 tors, survived his death and this issue was The above reasons make the Factors I decided adversely Sixth Circuit approach appropriate rule for Tennessee Factors after a full and opportunity fair just York, as for New and I am satisfied litigate Factors to the issue. With the they persuade the Tennessee mutuality abandonment of the estoppel courts, issue, if faced with the to follow the York, requirement in New Schwartz Pub- majority rule and hold that Administrator, lic 24 N.Y.2d right of publicity survived his death. Addi- (1969), N.Y.S.2d 246 N.E.2d 725 tionally, it would be rational for the Ten- and in the system, BIonder-Tongue nessee adopt courts to a policy enhancing Laboratories, University Inc. v. of Illinois growth continued of Nashville and Foundation, Memphis as centers the lives and activi- L.Ed.2d 788 Pro Arts asserts ties of industry personalities. music this, Memphis I rule Factors is bound the adverse obviously promotes while Development ruling may relitigate rule not threatens it. it here. Indeed, public even “fictionalized” I uses of “... am sensitive to the fact that enforce- figures’ publicity may names or lives in ment of commercial books or conflict movies, though qualifying biography, expression freedom of in some cases. protected by However, presented the First such a Amendment. conflict is not Hicks, supra; Gugiieimi, J., supra (Bird, challenged this case. Plaintiffs C. Universal’s concurring). licensing Lugosi’s portrayal I leave the merits likeness in of this issue for presents a case which it. Count Dracula connection with the sale objects plastic toy pencil sharpen- of such ers, soap products, target games, candy dis- Lugosi, again reaching In her dissent pensers beverage stirring rods. Such majority, not addressed Chief hardly implicates conduct the First Amend- Judge Bird said: ment." 603 P.2d at 449. contention, Pro Arts’ circumstances, next that in view of Memphis ordinary

Under decided, Development, erroneously even if Memory poster valid copyright in the In might effect. preclusive appli- have a But preempts copyright statute Fac- preclusion against in a cation of issue suit rights, fully tors’ state was publicity automatic; is not it re- parties different rejected by discussed and the district court. considerations, quires weighing policy agree I with conclusion Judge Tenney’s process largely to the left district court’s right protected equivalent here is not Shore, discretion, Hosiery v. Parklane Co. general scope within of federal 651, 645, 99 S.Ct. U.S. preempted by copyright law and so is not (1979); (Second) Restatement L.Ed.2d 552 Act, interpreted the 1909 in Goldstein v. (Tent. 2) (in Judgments Draft No. § 2303, California, determining whether to invoke collateral L.Ed.2d 163 which controls case. against litigant may the court estoppel preempted It would likewise not have been “other take into account circumstances Act, 17 under new 1976 U.S.C. § appropriate party that the make it [which] after 1978. if the had occurred events § issue”). In this relitigate allowed policies behind collateral es- litigation right protects The an interest using toppel Memphis not served interest copyright which not. That does as a bar. Development decision commercially ability the individual’s where the plaintiff This is not a ease persona. exploit maintain his fame and switching simply trying, by adversaries and holder Copyright merely protects the suit, relitigate issues bringing new taking expressions or specific ar lost, a course which is to be discour- already rangements or she had created. The he aged needless because of the waste involved hand, pro right publicity, on the other Indeed, multiple litigation. De- against appropria tects the unauthorized really prior velopment is not determina- very persona of an which tion individual’s present actually tion at all. The ease was gain would result unearned commercial begun proceeded first. Both suits then equiva is not the to another. If this Further, suit simultaneously. present per copyright lent of interest only brought one was the first and (as concedes) it is equally life son’s Pro Arts plaintiffs. Memphis Development equivalent he has died and it not the after sued Foundation thereafter Factors in the courts which have has been devised. Other of Tennessee for a declar- Western District argument in this preemption considered the judgment. atory counterclaimed the same con exact context have reached injunction preliminary the basis of by the clusion as at district that arrived grant- decision. This earlier relief Publishing Co. v. Apigram court here. See injunction ed was even and the affirmed (N.D. Etc., Inc., No. C78-525 changed which its mind Factors Civ. relief permanent grant- had been supra, 603 July 30, 1980); Lugosi, Ohio P.2d ed by the district court Tennessee. Our J., (issue (Bird, dissenting) not at 448 C. having jurisdiction own circuit first by majority opinion). reached having actually adjudi- over issues and limits, I would Finally, certain allow preliminary pur- cated them for the district to extend nation- court’s relief poses, estop- the refusal to collateral the merits is wide. The here on pel cannot below in this case be said to pub- Presley’s right whether or not permit relitigation. the issue Having concluded licity was devisable. pure Ap- here be seen as one law. is, quali- fragmentize I that it would not plication any type estoppel of collateral recognized it is to be fy by holding questionable. an issue is states and only in our 50 certain of Gold, 36 N.Y.2d 369 N.Y. McGrath others, local rule depending on the (1975); S.2d 330 N.E.2d Restatement Goldstein, supra, 88(1) state. Cf. (Second) (Tent. Judgments Draft would be to To do so No. at 2310. promote multiple litigation, the very evil

against estoppel is directed. On the hand, whether certain acts by a de- infringement

fendant amount to an of that might depend in a state on the local jurisdiction

law of the where the wrong See,

occurred. in connection with the tort Summers, competition, unfair Purcell v. (4th 1944); Callman, Competition,

Unfair Trademarks and Mo- 424;

nopolies 93.2 at 1A Pt. 2 Federal

Practice, (“Some Par. at 3170 0.311[1 1]—

state courts will consider the law of each wrong occurred.”) where the I would

therefore allow a defendant to show that

conduct infringing considered to be in one

state would not be so held under the rule of states. The could then be

tailored accordingly. event, In any

practical likelihood of problem such a is not

shown.

For the reasons outlined I believe Factors

did have a valid and enforceable property in the commercialization of Presley’s

persona and would therefore affirm the

judgment of the district court granting it

relief. America,

UNITED STATES of

Plaintiff-Appellee, COMPANY, INC.,

KOPPERS

Defendant-Appellant.

No. Docket No. 80-1362.

United Appeals, States Court of

Second Circuit.

Argued March

Decided June

Case Details

Case Name: Factors Etc., Inc. And Boxcar Enterprises, Inc. v. Pro Arts, Inc. And Stop and Shop Companies, Inc.

Court Name: Court of Appeals for the Second Circuit

Date Published: Jun 29, 1981

Citation: 652 F.2d 278

Docket Number: 503, Docket 80-7692

Court Abbreviation: 2d Cir.