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Conway v. Licata

United States District Court, D. Massachusetts

May 8, 2015

ANDREW CONWAY, et al., Plaintiffs,
v.
SAM LICATA, et al., Defendants

For Andrew Conway, Liana Conway, doing business as Zeke the Zebra, Plaintiffs: Jeffrey S. Baker, LEAD ATTORNEY, Baker & Associates, Boston, MA; Lee E. Rajsich, Rajsich & Associates, P.C., Boston, MA; Patrick M. Groulx, Golman LLP, Boston, MA.

For Sam Licata, also known as Phoenix Stone, Sybil Hall, also known as Sybil Licata, Stonehall Entertainment, LLC, A California Limited Liability Company, Stonehall Merchandise, LLC, a California Limited Liability Company, Stonehall Music Publishing, LLC, a California Limited Liability Company, Stonehall Records, LLC, a California Limited Liability Company, Stonehall Television, LLC, A California Limited Liability Company, Stonehall Touring, LLC, a California Limited Liability Company, Defendants: Daryl DeValerio Andrews, Glen DeValerio, Marie Foley Watson, Berman DeValerio, Boston, MA.

For Sybil Hall, Stonehall Television, LLC, A California Limited Liability Company, Stonehall Entertainment, LLC, A California Limited Liability Company, Stonehall Music Publishing, LLC, a California Limited Liability Company, Stonehall Touring, LLC, a California Limited Liability Company, Stonehall Merchandise, LLC, a California Limited Liability Company, Sam Licata, Stonehall Records, LLC, a California Limited Liability Company, Counter Claimants: Daryl DeValerio Andrews, Glen DeValerio, Berman DeValerio, Boston, MA.

For Andrew Conway, Liana Conway, Andrew Conway, Liana Conway, Counter Defendants: Jeffrey S. Baker, LEAD ATTORNEY, Baker & Associates, Boston, MA; Patrick M. Groulx, Golman LLP, Boston, MA.

For Stonehall Television, LLC, A California Limited Liability Company, Stonehall Entertainment, LLC, A California Limited Liability Company, Stonehall Music Publishing, LLC, a California Limited Liability Company, Stonehall Touring, LLC, a California Limited Liability Company, Counter Claimants: Daryl DeValerio Andrews, Glen DeValerio, Marie Foley Watson, Berman DeValerio, Boston, MA.

ORDER ON PENDING MOTIONS

Leo T. Sorokin, United States District Judge.

This case arises from a soured business relationship between an aspiring recording artist and her father who was investing in her music career on one side, and a husband-wife team acting as the artist's producer and marketing agents on the other. Before the Court is Defendants' Motion for Summary Judgment and Plaintiff's Cross-Motion for Summary Judgment. Defendants have moved for summary judgment on all the counts remaining in Plaintiffs' Complaint, while Plaintiffs have moved for summary judgment on Plaintiffs' claim of copyright infringement. As described below, both Motions are ALLOWED IN PART and DENIED IN PART. Separately, Defendants have moved to compel production of certain documents and exclude evidence, Doc. No. 189, and to stay a related action filed in California state court and enjoin the filing of further actions by Plaintiffs, Doc. No. 220. The Motion to Compel and Exclude is ALLOWED IN PART and DENIED IN PART, and the Motion to Stay and Enjoin is DENIED.

I. STATEMENT OF FACTS[1]

Plaintiff Andrew Conway (" Mr. Conway" ) is a businessman who resides in Massachusetts. SOMF ¶ ¶ 8, 188.[2] Mr. Conway's daughter, Plaintiff Liana Conway (" Ms. Conway" ) was a college student, amateur songwriter, and aspiring recording artist in 2010, when the interactions between the parties first occurred. Id. ¶ 11, 13. Defendant Sam Licata, who performs under the name Phoenix Stone (" Stone" ), is a recording artist, actor, and music producer. Id. ¶ 19. Stone's wife, Defendant Sybil Hall (" Hall" ) has worked in the entertainment and music industries for a number of years. Id. ¶ 18. Together, Stone and Hall own or operate the remaining business entity defendants, all entities containing " Stonehall" in the title, which they use to facilitate their music and entertainment business. Id. ¶ ¶ 23, 185-87.

Plaintiffs and Defendants first came into contact in 2010 through a mutual friend. Id. ¶ ¶ 28-29. Plaintiffs knew Defendants were in the music industry and were interested in establishing a connection with them because of Ms. Conway's interest in a music career. Ex. 1 at 16:5-16.[3] After some initial conversations, Plaintiffs eventually sent Hall an amateur recording of Ms. Conway singing. Ex. 1 at 17:2-22. Defendants, impressed by the recording, suggested that Ms. Conway record some songs with them in California. Ex. 2 at 13:14-20. In June of 2010, Ms. Conway went to California to record four songs with Stone. Id. at 13:23-14:22. Defendants arranged for musicians to prerecord the music and Ms. Conway provided vocals over the music. Id. at 18:3-16. Stone acted as producer and worked with an engineer to produce the master recordings of the songs. Id. at 19:3-9. Some of the compositions sung by Ms. Conway were songs she composed herself, others were songs composed by Stone. Id. at 14:20-15:2. Ms. Conway returned to California in September of that year for a photo shoot organized by Defendants intended to support the songs she recorded. SOMF ¶ 34(a).

The parties remained in contact after that initial recording session and photo shoot. Over the fall of 2010, the parties discussed recording more songs to complete an album and engaging in a marketing campaign with the object of transforming Ms. Conway into a successful commercial recording artist. Ex. 1 at 26:5-28:19. Thereafter, in February 2011, Ms. Conway recorded an additional six songs with Stone and Hall. Ex. 2 at 27:1-28:21. These songs were recorded in the same manner as the previous four, with Ms. Conway providing vocals over prerecorded music and Stone producing. Id. at 29:2-6. The songs recorded in this session included compositions written by Ms. Conway, compositions written by Stone, and joint works where both Stone and Ms. Conway contributed to the music and lyrics. Id. at 28:9-21.

Up to this point, Mr. Conway had been discussing individual projects to promote Ms. Conway's career with Stone and Hall as they arose and agreeing to pay for them on a project-by-project basis. See, e.g., ex. 1 at 24:24-25:10, 37:13-38:10. In June 2011, however, the parties discussed Mr. Conway paying $25,000 monthly for marketing to promote Ms. Conway's career, an arrangement to which Mr. Conway eventually agreed. SOMF ¶ 259. The purposes for which that money was intended and the limitations on its use are the key disputes of this case. Plaintiffs argue that the amounts transferred monthly were to be applied solely to pass-through expenses from third parties and that Defendants were permitted to pay themselves from those amounts only when specifically authorized by Mr. Conway. Defendants contend that the parties' agreement was the $25,000 payments was intended to pay for their services at a discounted rate in addition to paying for the services of third parties. It is undisputed, however, that Defendants invoiced Mr. Conway $25,000 every month beginning in July 2011 and continuing through August 2012[4] and that Mr. Conway paid those invoices. SOMF ¶ 85. In addition to the monthly payments, Mr. Conway would pay separately for certain other expenses; for example, Mr. Conway made separate transfers of funds earmarked for radio promotion of two of Ms. Conway's songs. Id. ¶ ¶ 580, 583.

In 2011, around the same time the parties began discussing the $25,000 monthly payments, Mr. Conway broached the idea of drafting a written agreement with Hall and Stone that would govern the parties' business relationship. Id. ¶ ¶ 43-44. In June 2011, Defendants contacted an attorney in Nashville to draft the agreement that the parties had contemplated, which the parties refer to as the Great Lines Agreement. Id. ¶ 195. Mr. Conway's notes regarding the project reveal that he reviewed drafts of the agreement and communicated with Defendants and the lawyer drafting the agreement about its content. Id. ¶ 50; Ex. 19 at CON0440-52. In January 2012, the lawyer drafting the agreement emailed a copy of the agreement for the parties to execute. Ex. 27. The draft of the agreement contemplated the formation of a limited liability company to promote Ms. Conway's career. Id. It also regulated the ownership of intellectual property born of the relationship, Mr. Conway's capital contributions, and the distribution of profits from Ms. Conway's career. Id. On February 4, 2012, Hall signed the agreement on behalf of Defendants and forwarded the signed copies to Mr. Conway. SOMF ¶ 55. It is undisputed that neither Mr. Conway nor Ms. Conway ever signed the agreement, id ¶ ¶ 199, 202, and that the paperwork was never filed to bring the business entity into existence. Id ¶ 211. Stone and Hall stated they did not know that the agreement was unsigned until after the parties' relationship dissolved in 2013. Id ¶ 50. Conway did not specifically advise them he had not signed it. Id ¶ 61.

Defendants argue that the Great Lines Agreement, as manifested in the January draft, governs even though it is unsigned because the written agreement simply memorialized the parties' agreement as to their relationship. Plaintiffs argue that they never intended that agreement to govern the parties' relationship. Plaintiffs contend that the parties had a separate oral agreement under which Mr. Conway would provide funding and Defendants would provide marketing and production services and would pay third-party vendors from the money Mr. Conway advanced. Id. ¶ 65. Under the purported oral contract, Defendants would only pay themselves from those funds for certain specified services that were " exceptions" to the general rule and would receive a percentage or commission on the revenues Ms. Conway generated once she became a successful recording artist. Id. ¶ 65.

Although the scope, propriety, and necessity of Defendants' services is in dispute, it is undisputed that throughout 2011 and much of 2012, the parties worked together to promote Ms. Conway's career. The record shows Mr. Conway and Defendants to have been in near weekly contact over this period. The parties recorded additional songs, id. ¶ 37, completed photo shoots, id. ¶ 34, and produced videos for at least six of the songs that had been recorded, id. ¶ 35. The parties also worked together to expand Ms. Conway's visibility by arranging performances at a conference of music executives, id. ¶ 102, on a summer camp tour during the summer of 2012, id. ¶ 100, and on various live shows, interviews, and other promotional events. Id. ¶ ¶ 94, 95, 103-05. To facilitate these events and to promote Ms. Conway generally, Defendants worked with numerous third parties, including promoters, publicists, and marketing firms. Id. ¶ ¶ 100, 588, 604. One of the services Defendants procured was purchasing " likes" for Ms. Conway's Facebook account. Id. ¶ 422. The parties' activities culminated in an album release party, held in August 2012 for Ms. Conway's album, which all of the parties attended and were involved in bringing to fruition. Id. ¶ ¶ 106-107.

The parties' relationship was, however, marked at times by conflict in the business and creative aspects of their endeavor. In November 2011, Mr. Conway " [e]xpressed dissatisfaction with diverging efforts and lack of cohesiveness to define Liana's brand and accelerate its appeal." Id. ¶ 298. Around this time, Mr. Conway requested a breakdown of marketing expenditures and Hall obliged with a document that purported to explain how marketing monies were being spent. Ex. 134. Later, in February 2012, Mr. Conway " shut[] down" the project, telling Defendants he would not be making future payments, apparently due to conflict between Ms. Conway and Stone and concerns about financial transparency. SOMF ¶ ¶ 311, 312. In response, Hall sent an email to Mr. Conway providing " a breakdown of where the marketing budget went in January" and stating that " we are continuing to see increases on Twitter, Facebook, You Tube [sic] and sales . . . indicating that the project is moving in a positive direction." Ex. 130. In late February, Mr. Conway restarted the project. SOMF ¶ 346. Concerns persisted, however, regarding " maintaining transparency, providing financial documentation & allowing [Ms. Conway]'s input on aspect[s] of the project." Id. ¶ 347. Issues were coming to a head through the summer of 2012, with Mr. Conway eventually speaking to other individuals in the entertainment industry about the propriety and effectiveness of Defendants' services. Id. ¶ 172. On September 11, 2012, after the album release party, Mr. Conway sent a text message to Hall requesting documentation related to all of the invoices paid as of that date and informing her that no additional funding would be forthcoming except for live performances. Ex. 101. Plaintiffs contend that they never received the documentation requested. The parties did not work together again after that point.

After the parties' active relationship ended, both parties sought to secure the intellectual property that resulted from the relationship. On June 6, 2013, Ms. Conway, through her attorney, registered copyrights to the compositions of the songs she contends that she wrote. Ex. 119. Plaintiffs' counsel also sent letters to Defendants, demanding the return of master recordings and audiovisual works embodying Ms. Conway's performances. Exs. 109, 110. A later letter, dated August 9, 2013, informed Defendants that " any license which may have existed" between Plaintiffs and Defendants regarding musical compositions or recordings was " rescinded, revoked[,] and terminated." Ex. 111. On September 17, 2013, Defendants registered copyrights, in the name of Stonehall Records, in the sound recordings and compositions of nine of the songs recorded by Ms. Conway, including compositions Ms. Conway had registered months earlier. Ex. 98. Around the same time, on September 4, 2013, Plaintiffs filed this action, making numerous allegations of malfeasance against Defendants. Defendants, for their part, have counterclaimed alleging similar wrongdoing by Plaintiffs.

II. LEGAL STANDARD

Summary judgment is appropriate when " the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a). Once a party " has properly supported its motion for summary judgment, the burden shifts to the non-moving party, who 'may not rest on mere allegations or denials of his pleading, but must set forth specific facts showing there is a genuine issue for trial.'" Barbour v. Dynamics Research Corp., 63 F.3d 32, 37 (1st Cir. 1995) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 256, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986)). The Court is " obliged to []view the record in the light most favorable to the nonmoving party, and to draw all reasonable inferences in the nonmoving party's favor." LeBlanc v. Great Am. Ins. Co., 6 F.3d 836, 841 (1st Cir. 1993). Even so, the Court is to ignore " conclusory allegations, improbable inferences, and unsupported speculation." Prescott v. Higgins, 538 F.3d 32, 39 (1st Cir. 2008) (quoting Medina--. A court may enter summary judgment " against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). When cross-motions for summary judgment are presented, the Court " must consider each motion separately" and draw all inferences against each moving party in turn. Reich v. John Alden Life Ins. Co., 126 F.3d 1, 6 (1st Cir. 1997).

III. DISCUSSION

Defendants have moved for summary judgment on all counts of Plaintiffs' Complaint.[5] In resolving this motion, all reasonable inferences are drawn in Plaintiffs' favor. Plaintiffs, in turn, have moved for summary judgment on their copyright infringement count.[6] The Court will address this claim separately and draw all reasonable interferences in Defendants' favor when resolving that motion. After resolving the parties' motions for summary judgment, the Court will address Defendants' other motions.

A. Choice of Law

Defendants argue that Tennessee law applies to all of Plaintiffs' claims because the unexecuted Great Lines Agreement contained a choice of law provision in favor of Tennessee and that, even though unsigned, the agreement represented a memorialization of an enforceable agreement. Alternatively, Defendants argue, Tennessee law should apply as the jurisdiction with the most significant relationship to the parties and the transaction. Plaintiffs counter, correctly, that the Court need not decide the choice of law issue unless a conflict arises between the laws of the applicable jurisdictions. At the hearing on these motions, Defendants conceded that there are no material differences between Massachusetts and Tennessee law for the purposes of resolving the claims at issue here.[7] Given this concession and because the Court discerns no conflict between Massachusetts and Tennessee law on the determinative issues, the Court does not decide the choice of law question.

B. Breach of Contract

Defendants move for summary judgment on Plaintiffs' breach of contract claim. Plaintiffs' contract claim arises not from the Great Lines Agreement but from an oral contract or, alternatively, contracts arising from invoices sent by Defendants to Plaintiffs. Plaintiffs identify no other contract nor advance any other contract theory in opposition to Defendants' Motion for Summary Judgment on this claim. Thus, to resolve summary judgment on this claim, the Court need only address the contracts Plaintiffs seek to enforce.

First, the oral contract. The substance of the oral contract is set forth in Mr. Conway's response to an ...


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