xylphil kassidi giustine
Nu Alessio
Plaintiffs TVT Records and TVT Music, Inc. ("TVT") filed a motion for a preliminary injunction on August 28, 2002 seeking to bar defendants The Island Def Jam Music Group ("IDJ") and its principal, Lyor Cohen ("Cohen"), from frustrating the scheduled release of one of TVT's albums (the "CMC Album"); from conduct that would interfere with the contract between TVT and the artists supplying the content of the CMC Album; and from continuing to utilize some of TVT's copyrighted material on an IDJ video disc entitled, "Irv Gotti Presents: The Inc." An evidentiary hearing was held before the Court on September 23-24, 2002. For the reasons stated in the Court's statement on the record at the proceeding on September 30, 2002, a copy of which is attached and incorporated hereto, it is hereby
ORDERED that the portion of TVT's motion for a preliminary injunction seeking to bar IDJ and Cohen from interfering with the scheduled public release of the CMC Album in November 2002 is denied; and it is further
ORDERED that, pending final resolution of this dispute at trial, IDJ be enjoined from releasing a recording entitled "The Last Temptation", featuring the artist known as Ja Rule, in any form incorporating any of the CMC recordings, both old and new, at issue in this action; and it is further
ORDERED that, pending the final resolution of this dispute at trial, IDJ be further enjoined from interfering with TVT's efforts to obtain possession of the contents of the CMC Album from the artists, agents or third parties, as well as from improperly acquiring and releasing the recordings identified as the contents of the CMC Album, provided that TVT itself shall not release the CMC Album pending the determination of its rights thereto at the trial of this matter; and it is hereby finally
ORDERED that, on IDJ's representations that upon TVT's request, it will cease *400 production and distribution of certain CMC material owned by TVT in a video recording entitled, "Irv Gotti Presents: The Inc.," the portion of TVT's motion seeking to enjoin IDJ from continuing to use such material is denied.
This dispute began with a proposed collaboration to produce a music albumreferred to as the "CMC Album"between plaintiffs TVT Records and TVT Music, Inc. ("TVT") and two artists, Jeffrey Atkins, p/k/a Ja Rule ("Ja Rule"), and Irv Gotti("Gotti"), who were under exclusive contract with defendant The Island Def Jam Music Group ("IDJ"). TVT seeks to enjoin IDJ and its principal, Lyor Cohen ("Cohen"), from (1) any conduct frustrating TVT's release of the CMC Album with Gotti and Ja Rule by November 5, 2002; and (2) interfering with TVT's contractual relationships with these artists who are obligated to complete and deliver the CMC Album to the TVT pursuant to a contract dated July 2, 2001.
The governing law in this matter is clear. In order to prevail on a motion for a preliminary injunction, a party must establish irreparable harm and either (1) a likelihood of success on the merits or (2) sufficiently serious questions going to the merits and a balance of hardships tipping decidedly in its favor. See Kamerling v. Massanari, 295 F.3d 206, 214 (2nd Cir. 2002).
Turning to the facts of the present dispute, the Court begins with TVT's breach of contract and fraud claims. On the issue of whether a licensing contract between TVT and IDJ was formed, as a side agreement (the "Side Agreement") to the CMC Album collaboration, under which IDJ consented to the collaboration between TVT and Gotti and Ja Rule, evidence has been presented as to a variety of written and oral communications, to which the parties ascribe differing interpretations.
IDJ's position is that all these communications were just part of the negotiations in the event it ultimately would decide to enter into the Side Agreement and grant TVT, Ja Rule, and Gotti permission to produce the CMC Album. TVT's claim is that the communications indicate that IDJ in fact had agreed to give consent and thus constitute a consummated contract or evidence of a binding oral agreement.
In resolving these differing interpretations, the Court notes that IDJ admits that it was placed in a difficult situation by TVT's offer to market a CMC Album with Gotti and Ja Rule. The difficulty arose in that Gotti's contract with IDJ was set to expire in February of 2002 and IDJ wanted to renew its contract with him. Therefore, IDJ did not want to risk upsetting Gotti or Ja Rule by refusing to consent to their project with TVT. At the same time, however, IDJ did not want to grant a competing label access to these two popular and lucrative artists.
Here, the record points to evidence that Ja Rule and Gotti desired to help further the careers of the other two CMC members. On this point, the Court notes little, if any, compelling evidence of "threats" by TVT to embarrass Ja Rule with old song releases reflecting an outdated image, nor is the Court persuaded that Gotti and Ja Rule went along with TVT only reluctantly, as IDJ claims. In particular, the Court notes that in an email to Shapiro sent on August 3, 2001 at 3:49 PM, Lieberman stated that he was "pushing very hard to get Lyor and Kempler to focus on closing the TVT deal quickly because that is what Irv wants". It seems inconsistent to characterize Gotti's attitude regarding the CMC project as "reluctant," or TVT's inducements as "threats," when one of IDJ's own senior attorneys negotiating the Side Agreement understood that Gotti wanted the CMC Album project to proceed "quickly."
TVT asserts that an oral agreement was reached between it and IDJ. On this issue, the Court notes that Lieberman initialed the Side Letter for Kempler's signature and that Kempler himself executed a copy, one that was never delivered to TVT in the end. This initialing and signing indicates that IDJ, at least through Lieberman, and perhaps, Kempler, understood that an agreement had been reached, at least for a time. Furthermore, Defendants' Exhibit 52, an internal IDJ approval memorandum regarding an amendment to its recording contract with Ja Rule, states at B(4), regarding TVT's anticipated release of the CMC Album, that IDJ "would strongly *402 prefer that TVT not do so." This statement begs the obvious question: If as, IDJ maintains, it never consented to the CMC Album collaboration, such consent being necessary to that project given Gotti and Ja Rule's exclusive employment contracts with IDJ, why would IDJ be in a position to "strongly prefer that TVT not do so"? This statement, then, could be construed as persuasive evidence that as late as mid-August 2002, IDJ may have understood and accepted, though perhaps begrudgingly, that TVT had authority to proceed with the CMC recording.
The Court concludes that on balance this evidence supports a conclusion of a likelihood that TVT will succeed in establishing one or more of its contract claims. At a minimum, the Court recognizes that IDJ admits that it went along with what it terms "negotiations" in a manner that would not dissatisfy Gotti and Ja Rule given their interest in making the CMC Album. IDJ admits, in other words, that it did not expressly withhold its consent to the CMC Album project in light of its desire to renew Gotti's contract, which would expire in February 2002. But in conducting themselves in a manner that would have suggested to Gotti and Ja Rule acquiescence to the TVT venture, it is reasonable to conclude that, in the process, that same impression was conveyed to and formed by TVT, and, further, that TVT's reliance thereon could have been reasonable.
On a related point, the Court notes that IDJ characterizes TVT's negotiations with its two exclusive artists as improper meddling in its business affairs. The Court is not persuaded that it is reasonable to characterize these actions by TVT, which was offering its services as a competitor in the marketplace, as "meddling," despite IDJ's exclusivity contracts with Ja Rule and Gotti, because the evidence indicates that TVT recognized from the start that IDJ's permission would be needed for the project to proceed, secured either by them or the artists.
The Court turns to the second prerequisite for preliminary injunctive relief: irreparable harm. In this regard, despite the meritorious aspects of TVT's presentation, the Court is not persuaded that TVT has established adequate irreparable harm to merit a preliminary injunction that would, in essence, enforce the purported Side Agreement between TVT and IDJ to the CMC Album project. The Court so finds because the evidence indicates that any harm from a delay in the release date of this album pending resolution at trial would not be irreparable. The Court notes the following items in evidence, among others, supporting this conclusion:
For these reasons, despite TVT's persuasive presentation regarding its prospects for success on the merits, TVT has not convinced the Court that the harm it would suffer from having to adjust its CMC Album release date to accommodate *403 a trial is irreparable. For these reasons the Court will order that the portion of TVT's motion for a preliminary injunction seeking to bar IDJ and Cohen from interfering with the scheduled delivery of the anticipated content of the CMC Album is denied.
Turning to TVT's allegations of tortious interference with a contract, TVT asks this Court to enjoin IDJ from releasing its "The Last Temptation" solo Ja Rule album pending resolution of the instant dispute at trial. In considering this portion of TVT's motion, the Court notes, in particular, the following:
If IDJ were to succeed in improperly acquiring the original CMC recordings, that would prevent TVT from ever releasing the CMC Album because this album is intended as a compilation of old and new CMC songs. The same result would follow if IDJ improperly acquired the songs recorded pursuant to the 2001 agreement between TVT and Gotti and Ja Rule. The aggressive marketing of the next Ja Rule release and of his past three hit albums concurrently with the anticipated release of the CMC Album by TVT could have the effect of so stifling TVT's CMC Album prospects as to deter TVT from releasing its album at that time or, indeed, ever, given the market saturation by the actions of IDJ.
c01484d022