Preminger v. Columbia Pictures Corp.
49 Misc. 2d 363, 267 N.Y.S.2d 594 (1966)
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Rule of Law:
When a contract grants broad television exhibition rights for a motion picture but is silent on the specific issue of editing, the agreement is deemed to incorporate the established custom and practice of the television industry, which permits minor cuts and interruptions for commercials. To prevent such alterations, a party must explicitly reserve that right in the contract.
Facts:
- Otto Preminger, a producer and director, and Carlyle Productions, the owner, entered into a series of agreements with Columbia Pictures Corporation for the distribution of the motion picture 'Anatomy of a Murder.'
- The contract granted Preminger the right to make the 'final cutting and editing of the Picture' (Article VIII).
- The contract also granted Columbia the exclusive right to exhibit the film on television 'by any other means, method or device whatsoever,' a clause that did not reserve any cutting or editing rights for Preminger (Article X).
- Columbia, through its subsidiary Screen Gems, licensed the film to television stations, granting them the right to make minor cuts and insert commercials.
- Inserting commercials and making minor cuts to fit time slots was a long-standing and well-known custom in the television industry when the contract was signed.
- In two prior contracts for different films ('Man With The Golden Arm' and 'The Moon Is Blue'), Preminger had explicitly included clauses requiring his approval for any television cuts.
Procedural Posture:
- Preminger and Carlyle Productions (plaintiffs) sued Columbia Pictures and Screen Gems (defendants) in a New York trial court, seeking a permanent injunction and damages.
- Plaintiffs moved for a preliminary injunction to stop defendants from permitting cuts and commercials during television broadcasts.
- The trial court generally denied the motion but granted a consensual preliminary injunction based on the defendants' agreement not to cut the film, while preserving their right to insert commercials pending the outcome of the case.
- The court subsequently granted a motion to sever the legal issues, separating the request for a permanent injunction from the claims for money damages.
- The case proceeded to trial solely on the issue of the plaintiffs' right to a permanent injunction.
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Issue:
Does a contract granting a producer 'final cutting and editing' rights for a film, but which also grants a distributor broad and separate television exhibition rights without mentioning editing, prohibit the distributor from licensing the film for television broadcast with minor cuts and commercial interruptions consistent with industry custom?
Opinions:
Majority - Arthur G. Klein, J.
No. The contract does not prohibit the distributor from allowing minor cuts and commercial interruptions for television broadcast because the parties are deemed to have adopted the prevailing industry custom where the contract is silent on the matter. The court reasoned that the specific clause granting broad television rights (Article X) governs over the general clause giving plaintiffs 'final cut' rights (Article VIII), limiting the latter's application to the original theatrical version of the film. Evidence overwhelmingly showed a consistent industry custom of making minor deletions and interrupting for commercials, a practice plaintiff Preminger was aware of, as evidenced by his explicit prohibition of such acts in prior contracts for other films. By failing to include a similar prohibition in this contract, the plaintiffs are considered to have accepted that the standard industry practice would apply. The court noted, however, that extensive cutting that amounts to 'mutilation' of the film would not be permissible and could be grounds for future injunctive relief.
Analysis:
This decision solidifies the principle that industry custom and practice are powerful tools for contract interpretation, particularly when a contract is silent on a specific issue. It places a significant burden on creators and producers to be vigilant and explicit in contract negotiations if they wish to protect their work from standard industry alterations, such as editing for television broadcast. The court's distinction between permissible 'minor cuts' and impermissible 'mutilation' creates a flexible standard but leaves the precise boundary undefined, inviting potential future litigation to determine where that line is drawn for different works.
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