Summary
sustaining punitive damages award for breach of contract and fraud claims where music distributor licensee deceptively camouflaged public sales to avoid royalty payments
Summary of this case from TVT Records v. Island Def Jam Music GroupOpinion
August 26, 1993
Appeal from the Supreme Court, New York County (Felice Shea, J.).
The trial record demonstrates that plaintiff music publishing companies, who are the owners of the rights to hundreds of children's songs, are entitled to recover compensatory damages from defendant A.A. Records, Inc., distributor of children's records and the distributor's president Abraham I. Massler, for tortious conduct separate and apart from their claims for breach of contract arising from the concealment and denial of royalty payments due pursuant to a mechanical license agreement. The earlier business dealings between defendant Massler and Arthur Shimkin, the creative head and part owner of the plaintiff companies, created a relationship of trust and confidence, which existed independent of the contractual duties and which was violated by numerous deceptive business practices later devised by Massler to camouflage actual sales of songs and records for which no payments were made (Apple Records v Capitol Records, 137 A.D.2d 50).
The imposition of punitive damages, in the sum of $750,000 on both breach of contract and tort causes of action with the provision for single recovery thereon, was appropriate in the circumstance (see, Airlines Reporting Corp. v Aero Voyagers, 721 F. Supp. 579, 586).
Concur — Rosenberger, J.P., Kupferman, Ross and Kassal, JJ.