Page:M & A Associates v. VCX.pdf/4

 2. VCX, Inc., is a California corporation with its principal place of business in California. At all times pertinent to this action VCX manufactured video tapes for sale and/or distribution.

3. Norman Arno is the president of VCX.

4. “Debbie Does Dallas” was purportedly produced in 1978 by Schoolday Productions, Inc., a New York corporation.

5. The film was created through the cooperative efforts of David Buckley and other individuals. Buckley served as the writer, director, and producer. The other individuals were independent contractors of Schoolday.

6 Buckley, as the sole officer, director, and shareholder of Schoolday, exercised complete control over Schoolday and made all decisions concerning the film.

7. Although there was no contract by which the rights to the film were transferred from Schoolday to Buckley, the written minutes and records of Schoolday recited such a conveyance.

8. Buckley never copyrighted the film.

9. The film opened in October of 1978 at the Pussycat Theatre in New York City.

10. From that time until the present, the film continued to be theatrically shown without a copyright notice.

11. In December of 1978, Buckley conveyed all right, title, and interest in the film to M & A.

12. On or about February 13, 1979, M & A assigned to VCX the right to make video cassette copies of the film. The contract stated in pertinent part as follows:

"This agreement is for the sale of the exclusive video tape, video disc, and any other future, prerecorded video systems rights.

M and A, Inc. … hereby warrants that it is the sole owner of the motion picture, “Debbie Does Dallas” and is authorized to sell the exclusive video rights. Seller further warrants that it has not given said rights to any other entity, and will refrain, upon the completion of this agreement, from selling said rights or authorizing any other entity to distribute said video rights including M and A, Inc.

….

The video rights given to [VCX] by [M & A] are exclusive for world wide distribution.

[M & A] indemnifies [VCX] for any claims by others that [VCX] through this Agreement does not have the sole video rights to said motion picture, and agrees to pay the costs of any litigtion, including attorney’s fees, that arise from claims by others of ownership of this motion picture or ownership of the video rights of “Debbie Does Dallas.”"

13. The contract assigned only the video cassette rights in the film; M & A retained all theatrical rights in the film.

14. The contract is silent as to choice of law.

15. The contract became effective when signed by both parties in Michigan.

16. The contract does not specify the place of performance.

17. M & A’s offices were located in Michigan, where VCX was to send its royalty payments and where M & A’s performance presumably was to occur. VCX had an office in California. No acts by VCX relating to the manufacture, duplication, or sale of cassettes were expected to be performed in Michigan.

18. Arthur Weisberg knew that VCX entered into different types of contracts depending upon the type of rights VCX was acquiring, and that VCX and other companies would pay different amounts depending on whether they were obtaining exclusive or non-exclusive rights.

19. Weisberg testified that the matter of a copyright was neither mentioned nor considered by the parties prior to the time they entered into the contract. Arno testified, however, that he received a print of the film from Weisberg approximately one month after they entered into the contract. According to Arno, he asked Weisberg for “copyright protection” immediately after he received the print.

20. In April of 1979, Arno became aware of unauthorized copying of the film.