Michael Baisden v. I'm Ready Productions, Inc., et

Case: 11-20290 Document: 00511972868 Page: 1 Date Filed: 08/31/2012

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT United States Court of Appeals

Fifth Circuit

FILED

August 31, 2012

No. 11-20290 Lyle W. Cayce

Clerk

MICHAEL BAISDEN,

Plaintiff–Appellant Cross–Appellee

v.

I’M READY PRODUCTIONS, INC.; IMAGE ENTERTAINMENT, INC.;

A.L.W. ENTERTAINMENT INC.; GARY SHERRELL GUIDRY;

JE’CARYOUS FRANKNEQUE JOHNSON,

Defendants–Appellees Cross–Appellants

Appeals from the United States District Court for the

Southern District of Texas

Before KING, PRADO, and HAYNES, Circuit Judges.

KING, Circuit Judge:

Plaintiff-Appellant Michael Baisden appeals an adverse judgment in his

suit against various defendants for copyright infringement, breach of contract,

and tortious interference. Defendants-Appellees I’m Ready Productions, Inc.,

Image Entertainment, Inc., A.L.W. Entertainment Inc., Gary Sherrell Guidry,

and Je’caryous Frankneque Johnson cross-appeal the denial of attorneys’ fees.

For the following reasons, we AFFIRM the judgment of the district court in all

respects.

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I. FACTUAL AND PROCEDURAL BACKGROUND1

Michael Baisden is the host of a nationally syndicated radio show and the

author of several books. Gary Guidry and Je’Caryous Johnson are the co-

founders of I’m Ready Productions, Inc. (“IRP”), a theatrical production company.

In early 2001 Baisden entered into discussions with Johnson and Guidry to

adapt one of his novels, Men Cry in the Dark, into a stage play.2 The parties

entered into an agreement on March 9, 2001 (the “2001 Men Cry Agreement”)

whereby IRP agreed to create an original screenplay based on the novel Men Cry

in the Dark.

The 2001 Men Cry Agreement included two provisions relating to

ownership rights. First, the agreement provided that the author, IRP, would

“retain copyrights to the STAGEPLAY, as copyright is limited to the play script

created by [IRP].” Second, Baisden also “agree[d] that all interest in any

creative production, staging, design, or writing aspects of the PLAY are exclusive

property of [IRP].” The agreement also provided that IRP would own exclusive

merchandising rights from, but not limited to, clothing, posters, programs, mugs,

CDs, or tapes. Baisden would receive a 40% share of net profits from all such

merchandising sales connected with the live performance of the stage play, but

not including profits from novels written by him and sold at such performances.

Baisden also agreed to compensate IRP with a 40% share of net profits from all

novels, videos, or other works created by him in connection with the live

performance of the stage play. Finally, royalties or other proceeds generated as

a result of future agreements with third parties relating to the stage play or its

1

Because Baisden challenges the sufficiency of the evidence supporting the jury’s

verdict, this court accepts the facts in the light most favorable to the prevailing party. Snyder

v. Trepagnier, 142 F.3d 791, 795 (5th Cir. 1998).

2

Men Cry in the Dark is described as “an urban perspective of how four men relate to

the unique women in their lives” while confronting issues such as “racism in corporate

America, fidelity vs. casual sex, and the bonds of friendship.”

2

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production would be split evenly. The 2001 Men Cry Agreement was to last

three years, but could be extended for the life of any future third-party

merchandise agreement associated with the stage play.

IRP adapted Baisden’s novel into a stage play (“Men Cry”). IRP then took

Men Cry on a national tour beginning in January of 2002. During the tour,

Baisden sold a number of different products at the shows, including three books

and two videos on relationships. IRP, for its part, sold programs and t-shirts. In

the spring of 2002, Baisden and IRP agreed to orally modify the merchandising

provisions in the 2001 Men Cry Agreement to reflect that each party would keep

100% of the profits from its own products.

In July of 2002 the parties entered into a second contract to adapt another

of Baisden’s novels, The Maintenance Man, into a stage play (the “2002

Maintenance Man Agreement”).3 This agreement contained provisions

substantially identical to those in the original 2001 Men Cry Agreement. As

before, IRP produced a stage play (“Maintenance Man”). But prior to taking that

production on tour, the parties modified the agreement in December of 2002 to

compensate IRP $300,000 in the event Baisden conveyed motion picture rights

in The Maintenance Man to a motion picture company and gave it the right to

make full use of the IRP-created screenplay.

Around the same time, in September of 2002, IRP filmed a live production

of Men Cry and Maintenance Man and sold copies of those recordings in video

and DVD format through A.J. Productions. Baisden learned of these recordings,

at the latest, in April of 2003 when he ordered 500 copies of the Men Cry

recording.4 Baisden handed out between sixty and seventy copies of the

3

The Maintenance Man follows the lives of four primary characters, but focuses on

Malcolm Tremell, “a high-priced gigolo who . . . finally meets the woman of his dreams.”

4

Baisden disputes that he ordered the DVDs. However, evidence adduced at trial

shows that his employee, Yvonne Gilliam, ordered the recordings on his behalf, shipped them

3

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recording at a promotional event at which he provided one to every person who

purchased a copy of his Men Cry in the Dark novel. Baisden’s website also sold

the DVD for a time, and, eventually, listed it as “sold out.”

In the Summer of 2005, Baisden asked IRP to retour Men Cry. The parties

orally agreed that the second tour would be governed by the same terms as the

2001 Men Cry Agreement, except that Baisden would be entitled to 3% royalties

from gross revenues of seats sold per show (the “2005 Men Cry Agreement”).

Baisden appeared at some of these shows and autographed copies of the Men Cry

and Maintenance Man DVDs. The second Men Cry tour concluded on November

20, 2005. Pursuant to their agreement, IRP sent Baisden a check for $44,145,

which he cashed on December 29, 2005.

On November 15, 2005, a few days before the second Men Cry tour ended,

IRP entered into a contract with Image Entertainment (“Image”) to distribute

DVDs of both plays. In January of 2007, Baisden remarked on the poor timing

of the DVDs, and that he did not like the look of the video. The DVD was

released on February 7, 2007. On May 4, 2007, Baisden sent IRP a cease and

desist letter alleging that IRP was infringing his copyrights. On June 14, 2007,

an entity known as the Farcor Baisden Partnership, L.L.C.—of which Baisden

was presumably a part—entered into an option contract with Behave

Productions, Inc., to turn The Maintenance Man into a movie. As part of that

contract, Baisden agreed to use his best efforts to cause IRP to “cease

distribution of the unauthorized picture.”

Baisden filed suit on February 7, 2008, alleging that IRP, Image, A.L.W.

Entertainment Inc., Guidry, and Johnson (collectively, “Defendants”) infringed

his copyright in The Maintenance Man and breached the 2002 Maintenance Man

Agreement by failing to compensate him for DVD sales. Baisden added similar

to his address, and billed them to his account.

4

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claims with respect to the Men Cry DVD in November of 2008. Defendants then

moved for summary judgment. On recommendation by a magistrate judge, the

district judge granted Defendants’ motion with respect to Baisden’s claim for

tortious interference, as well as those parts of his copyright infringement and

breach of contract claims that fell outside the statutory limitations period.

The remaining claims proceeded to a nine-day jury trial. The jury

returned a 33-question special verdict in Defendants’ favor.5 Baisden moved for

judgment as a matter of law or, alternatively, a new trial, which the district

court denied. The district court then entered a final take-nothing judgment as

to all parties. The court also entered a number of declarations clarifying the

parties’ rights. Finally, the court denied Defendants’ request for attorneys’ fees.

Baisden appealed the judgment, and Defendants cross-appealed the denial of

attorneys’ fees.

II. DISCUSSION

Baisden raises numerous issues on appeal. These require us to address,

first, whether Defendants infringed Baisden’s copyrights; second, whether the

district court’s declarations improperly expanded IRP’s copyrights; third,

whether the district court erred in denying Baisden’s motion for a new trial;

fourth, whether the district court erred in granting summary judgment against

Baisden’s tortious interference claim; and, fifth, whether the district court erred

in denying Defendants’ request for attorneys’ fees.

A. Standard of Review

A district court must deny a motion for judgment as a matter of law

“unless the facts and inferences point ‘so strongly and overwhelmingly in the

movant’s favor that reasonable jurors could not reach a contrary conclusion.’”

Flowers v. S. Reg’l Physician Servs. Inc., 247 F.3d 229, 235 (5th Cir. 2001)

5

The jury did not find in IRP’s favor on its counterclaims. These claims have not been

appealed.

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(citation omitted). Although we review de novo the denial of a motion for

judgment as a matter of law, we apply the same legal standard as the district

court. Id. We will consider all of the evidence, drawing all reasonable inferences

and resolving all credibility determinations in the light most favorable to the

non-moving party. Navigant Consulting, Inc. v. Wilkinson, 508 F.3d 277, 282

(5th Cir. 2007). “[O]ur standard of review with respect to a jury verdict is

especially deferential.” SMI Owen Steel Co., Inc. v. Marsh USA, Inc., 520 F.3d

432, 437 (5th Cir. 2008). This court “cannot reverse a denial of a motion for

judgment as a matter of law unless the jury’s factual findings are not supported

by substantial evidence, or if the legal conclusions implied from the jury’s verdict

cannot in law be supported by those findings.” Am. Home Assurance Co. v.

United Space Alliance, LLC, 378 F.3d 482, 488 (5th Cir. 2004).

B. Copyright Infringement

Baisden presents a host of arguments in support of his copyright

infringement claim. These include that the oral agreement allegedly made in

2005 was not a work-for-hire agreement and was thus invalid, was contrary to

the parties’ intentions, had to be in writing pursuant to 17 U.S.C. § 204(a), and

was in violation of the statute of frauds. Defendants respond that they had

exclusive or implied licenses to distribute DVDs of both stage productions.

To prove copyright infringement a party must show that “(1) he owns a

valid copyright and (2) the defendant copied constituent elements of the

plaintiff’s work that are original.” Positive Black Talk Inc. v. Cash Money

Records, Inc., 394 F.3d 357, 367 (5th Cir. 2004), abrogated on other grounds by

Reed Elsevier, Inc. v. Muchnick, 130 S. Ct. 1237 (2010). The second element is

met where a plaintiff proves “(1) factual copying and (2) substantial similarity.”

Id. But regardless of whether a plaintiff can meet these elements, “the existence

of a license authorizing the use of copyrighted material is an affirmative defense

to an allegation of infringement.” Carson v. Dynegy, Inc., 344 F.3d 446, 451 n.5

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(5th Cir. 2003). Such a license may be either exclusive or non-exclusive; if

exclusive, it must be in writing. See id. Throughout, the burden remains on the

defendant to prove the existence of a license. Id.

Here, two works based on two separate novels are at issue. Accordingly,

this court separately considers whether Defendants have demonstrated the

existence of a license as to each of them. Because we agree that the facts of this

case support the creation of an exclusive license as to the first, and an implied

nonexclusive license as to the second, we affirm the jury’s verdict that

Defendants did not infringe Baisden’s copyrights.6

1. 2002 Maintenance Man Agreement

The parties’ 2002 Maintenance Man Agreement granted Defendants a

license to distribute DVDs of the plays.7 The agreements could be extended if

IRP entered into a merchandising deal with a third party during the 2002

Maintenance Man Agreement’s three-year duration. Such an agreement would

extend the duration of the merchandising provision for the life of that

agreement.

At trial, the jury concluded that the parties had executed a revision of the

2002 Maintenance Man Agreement in December of 2002. The jury further found

that IRP and Image had entered into a licensing agreement for distribution of

Maintenance Man video recordings at some point prior to the expiration of that

agreement. Baisden has not challenged these findings. Accordingly, we will not

6

Having found that the jury’s verdict can be upheld on the basis of an implied

nonexclusive license, this court does not reach the question of whether the screenplays were

substantially similar to the novels.

7

The agreement includes broad language that “merchandise” includes, but is not

limited to, “clothing, posters, programs, mugs, CDs or tapes.” Given the expansive language

of the provision, this court has no difficulty in finding that DVDs are sufficiently analogous

to “CDs or tapes” to be included in the agreements.

7

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overturn the jury’s verdict that Defendants did not infringe Baisden’s copyright

as to this work. Am. Home Assurance Co., 378 F.3d at 488-89.

2. 2005 Men Cry Agreement

Defendants were contractually entitled to distribute copies of the Men Cry

DVDs for the three-year duration of the 2001 Men Cry Agreement. This meant

that if Defendants wished to extend the life of this arrangement they had until

approximately March 2005 to negotiate an extension or finalize a merchandise

agreement with a third party. The 2001 Men Cry Agreement would then be

extended for the life of that third-party contract. IRP, however, did not enter

into such an agreement with Image until November 15, 2005, several months

after the three-year period had expired.

The jury nonetheless found that Defendants had not infringed Baisden’s

copyright. Instead, it found that IRP and Baisden entered into an oral

agreement in 2005 renewing or extending the 2001 Men Cry Agreement. It is

this finding that is, in Baisden’s words, the “fulcrum of this appeal.”

According to Baisden, it was improper for the district court to submit the

question of oral modification or agreement to the jury. He advances a number

of arguments in support. His primary focus is 17 U.S.C. § 204(a), which provides

that “[a] transfer of copyright ownership . . . is not valid unless an instrument

of conveyance, or a note or memorandum of the transfer, is in writing and signed

by the owner of the rights conveyed.” Baisden contends that Defendants can

point to no written instrument which conveyed his copyrights to IRP. We agree.

The only writing IRP presents is a royalty check for the second Men Cry

tour. That check merely states that it was for “Men Cry in the Dark Fall 2005

Royalties (Paid in Full).” The check does not expressly refer to an assignment

of copyrights. See Playboy Enters., Inc. v. Dumas, 53 F.3d 549, 564 (2d Cir.

1995) (applying clearly erroneous standard and deferring to district court’s

determination that check for past “assignment . . . of all rights, title and

8

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interest” was insufficient to transfer copyrights). Nor is there any other writing

that would support the check’s transfer of copyrights. See Johnson v. Tuff-n-

Rumble Mgmt., Inc., No. 99-1374, 2000 WL 1145748, at *6 (E.D. La. Aug. 14,

2000) (holding § 204(a)’s writing requirement satisfied by check stating

“assignment of [plaintiff’s] copyrights to [defendant] agreement dated June 17,

1997,” where there was also an unsigned contract referring to check). We thus

agree that IRP cannot show that the royalties check was a transfer of copyright.

But although this precludes Defendants from proving the existence of an

exclusive license, it remains possible that IRP held an implied nonexclusive

license.

Consent for an implied license may take the form of permission or lack of

objection. Lulirama Ltd., Inc. v. Axcess Broad. Servs., Inc., 128 F.3d 872, 879

(5th Cir. 1997) (“Lulirama”). During the 2005 Men Cry Tour, Baisden attended

showings of the stage play, and autographed copies of the DVDs. Baisden also

acted dismissively during a conversation in January of 2007 with Johnson and

Guidry, describing the DVD sales as small and behind him, and that he did not

like their look. Most importantly, the jury heard, and found credible, testimony

by Johnson and Guidry that Baisden and IRP orally agreed to continue their

relationship under the terms of the 2001 Men Cry Agreement. This was more

than sufficient for the jury to find that Baisden had granted IRP a nonexclusive

license to continue engaging in the sale of DVDs.8 Accordingly, the evidence was

sufficient for a jury to conclude that IRP was granted an implied nonexclusive

8

Defendants point to several other events to support their claim for an implied license.

These include that Baisden already knew that DVDs were being produced from the staged

productions in April of 2003, and did not object until May 4, 2007. Baisden also ordered copies

for himself and used them as a promotional tool, and sold the DVDs on his website. These acts

all occurred while the 2001 Men Cry Agreement was still in effect. As we have already

observed, the written agreements provided IRP the right to sell recordings of the stage plays.

Therefore, these facts cannot support a finding that IRP retained the right after the written

agreements expired.

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license. See Meredith v. La. Fed’n of Teachers, 209 F.3d 398, 403-04 (5th Cir.

2000) (plaintiff’s testimony and corroborating circumstances constituted

substantial evidence to support jury’s finding of oral contract).

Baisden resists this conclusion on a number of grounds. Of these, the

majority are raised in his reply brief. “It is well-settled that, generally, we will

not consider issues raised for the first time in a reply brief.” United States v.

Jackson, 50 F.3d 1335, 1340 n.7 (5th Cir. 1995). Although we find the majority

of Baisden’s arguments on implied nonexclusive license waived, we address them

to clarify and reaffirm our holding in Lulirama.

In Lulirama, plaintiff contracted with defendant to create advertising

jingles. Although the original contract was in writing, the parties later orally

extended it beyond the written end date. 128 F.3d at 874-75. We observed that

§ 101 of the Copyright Act expressly excludes nonexclusive licenses from §

204(a)’s writing requirement, and affirmed the district court’s holding that the

parties’ conduct granted defendant a nonexclusive license in the jingles by

implication. Id. at 879. In so doing, we held that “[w]hen the totality of the

parties’ conduct indicates an intent to grant such permission, the result is a legal

nonexclusive license . . . .” Id. (quoting 3 MELVILLE B. NIMMER & DAVID NIMMER,

NIMMER ON COPYRIGHT § 10.03[A], at 10-41 (1997)).

Contrary to this holding, Baisden argues that an implied license can only

arise in the context of a work-for-hire agreement. He argues that the relevant

test in Lulirama requires that “(1) a person (the licensee) request[ ] the creation

of a work, (2) the creator (the licensor) make[ ] the particular work and deliver[ ]

it to the licensee who requested it, and (3) the licensor intend[ ] that the licensee-

requestor copy and distribute the work.” Id. But Baisden ignores that those

elements were prefaced by our remark that “[o]ther circuits have held that an

implied nonexclusive license arises” when these three elements are met. Id.

(emphasis added). To be sure, we applied those three elements in Lulirama.

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But we have never held that an implied license could not arise in other

circumstances where the totality of the parties’ conduct supported such an

outcome. Id.; see also Food Consulting Grp., Inc. v. Azzalino, 270 F.3d 821, 826

n.9 (9th Cir. 2001) (correctly stating test in Fifth Circuit). Other decisions

support this conclusion. See Carson, 344 F.3d at 451-53 (considering whether

nonexclusive license was created despite defendant not having asked plaintiff

to create a product); see also Falcon Enters., Inc. v. Publishers Serv., Inc., 438 F.

App’x 579, 581 (9th Cir. 2011) (unpublished opinion) (affirming district court’s

finding of a nonexclusive license while acknowledging that licensee had not

asked copyright owner to produce copyrighted material); John G. Danielson, Inc.

v. Winchester-Conant Props., Inc., 322 F.3d 26, 41 (1st Cir. 2003) (considering

nonexclusive license defense where third party, not defendant, requested

production of copyrighted work).

Baisden’s remaining arguments do not alter this conclusion. He argues

that because the prior 2001 Men Cry Agreement conferred an exclusive license,

the parties could not now have agreed to a nonexclusive license. But at the time

the 2005 Men Cry Agreement was made, the previous 2001 Men Cry Agreement,

which was to last only three years, had already expired. It thus could not keep

the parties from reaching a new agreement.

Also unpersuasive is Baisden’s contention that the parties could not have

intended to create an implied nonexclusive license because IRP entered into an

exclusive agreement with Image for production of the DVDs. A similar

argument was rejected by the Eleventh Circuit in Jacob Maxwell, Inc. v. Veeck,

110 F.3d 749 (11th Cir. 1997). There, plaintiff argued that “it was error for the

court to infer the creation of a nonexclusive license from the parties’ conduct

when they had explicitly agreed, albeit in an unenforceable oral exchange, to an

exclusive license.” Id. at 752 (emphasis in original). The court held that “while

it may well be that the parties in their initial negotiations contemplated an

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exclusive license” this did not mean that plaintiff could not have “granted to the

[defendant] the sort of lesser, nonexclusive license to [use the copyrighted work]

that federal law recognizes may result from a purely oral transaction.” Id. at

753. Applying the same reasoning, we rejected the plaintiff’s argument in

Lulirama that the parties’ intent to transfer an exclusive license for the jingles

foreclosed the creation of a nonexclusive license. 128 F.3d at 879-80.

Similarly here, we reject Baisden’s argument that Image’s intent to enter

into an exclusive agreement prevented Baisden and IRP from establishing an

implied nonexclusive license. There is nothing to suggest that IRP would not

have entered into the 2005 Men Cry Agreement absent exclusivity. Indeed, the

2001 Men Cry Agreement, on which the later agreement was based, included a

clause providing that “[i]n the event that any provision of this Agreement shall

be held invalid or unenforceable, it shall not in any way invalidate, impair or

affect the remaining provisions of this Agreement.”

Alternatively, Baisden argues that extensions to the 2001 Men Cry

Agreement had to be in writing. In relevant part, that agreement stated that

“[t]he period of this Agreement may be extended for a second three (3) year

period upon PRODUCER’S written notice received by AUTHOR at least thirty

(30) days prior to the expiration of the TERM.” Baisden seeks to infer from this

language that the agreement could only be renewed or extended in writing.

Baisden’s argument is wrong, first, because, even assuming that his

interpretation was correct, the 2001 Men Cry Agreement had expired by the time

the parties reached an oral agreement to run a second tour of Men Cry. The

terms of the expired contract could not prevent the parties from reaching a new

agreement structured on the same provisions as the old one. Second, the

agreement itself nowhere states that an extension or renewal had to be in

writing. The agreement uses the permissive term “may” to indicate that written

notice is only one of the means the agreement could be extended. See

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Retractable Techs. Inc. v. Abbott Labs. Inc., 281 F. App’x 275, 276 (5th Cir. 2008)

(per curiam) (interpreting contractual provision that disputes “may” be resolved

by arbitration as permissive rather than mandatory). Baisden also seems to

ignore that the quoted provision goes on to say that the fee for this three year

extension would be negotiated “at the time of the option notice.” Thus, Baisden’s

extension clause was really only a means by which the parties could enter into

negotiations to renew the contract. The parties remained free to reach an

alternate agreement.

Baisden also argues that the 2005 Men Cry Agreement is invalid under the

Texas Statute of Frauds. Section 26.01(a) of the Texas Business and Commerce

Code provides that “[a] promise or agreement described in Subsection (b) of this

section is not enforceable unless the promise or agreement . . . is (1) in writing;

and (2) signed by the person to be charged with the promise or agreement.”

Absent from Baisden’s argument is which part of subsection (b) applies to the

agreement. Only in his reply brief does Baisden elaborate that three subparts

apply. Of these, two—contracts conveying exclusive rights under § 204(a) and

modifications to contracts under § 204—do not actually appear in the Texas

Statute of Frauds. The third refers to subpart (b)(6), “an agreement which is not

to be performed within one year from the date of making the agreement.” Tex.

Bus. & Com. § 26.01(b)(6). Contracts for an indefinite term that could be

performed within one year do not fall within the statute of frauds. Floors

Unlimited, Inc. v. Fieldcrest Cannon, Inc., 55 F.3d 181, 186 (5th Cir. 1995); see

also Abatement Inc. v. Williams, 324 S.W.3d 858, 860 (Tex. App.—Houston [14th

Dist.] 2010, pet. denied) (“For the one-year provision to apply, performance

within one year must be impossible.”). In any event, performance takes this case

out of the statute of frauds. It is undisputed that the 2005 Men Cry Agreement

was performed within one year. The parties entered into the 2005 Men Cry

Agreement in the Summer of 2005, and the final performance of Men Cry was

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on November 20, 2005. As a result of this second tour, IRP paid Baisden over

$44,000. This is sufficient to preserve the parties’ agreement and remove it from

the statute of frauds. See Matter of Fairchild Aircraft Corp., 6 F.3d 1119, 1128-

29 (5th Cir. 1993) (discussing partial and full performance exceptions to the

statute of frauds).

Having addressed Baisden’s many arguments, and finding them

unpersuasive, we return to our original conclusion that the jury’s verdict was

supported by substantial evidence and affirm that Defendants did not infringe

Baisden’s copyrights.

C. Declaratory Judgments

Following the jury’s verdict, the district court entered a final judgment

including several declarations setting forth the parties’ respective rights.

Baisden challenges the following two declarations as improperly expanding IRP’s

copyrights.

[1.] Pursuant to ¶ II.3 of the December 2002 The

Maintenance Man Agreement, IRP owns the sole

and exclusive copyright . . . to The Maintenance

Man stage play script, associated music, and

lyrics.

[2.] Pursuant to ¶ II.3 of the Men Cry in the Dark

Agreement, IRP owns the sole and exclusive

copyright . . . to the script for its Men Cry in the

Dark stage play.

The cited agreement provisions provide, in turn, that IRP “shall retain the

copyright to the [Men Cry] STAGEPLAY, as copyright is limited to the play

script created by [IRP]” and that IRP “shall retain the sole and exclusive

copyright to the [Maintenance Man] Stageplay,” but that “[t]his copyright is

limited to the play script with associated music and lyrics created by [IRP].”

The issue is whether these declarations deprive Baisden of his copyright

in the novels. The central difficulty arises from the fact that whereas the 2001

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Men Cry Agreement and the 2002 Maintenance Man Agreement contain

language that explicitly limit IRP’s copyright to the stage play it created, the

district court’s declarations could be read to mean that IRP has a copyright to

the entire stage play, including parts taken directly from Baisden’s novels.9

Defendants fail to recognize, or ignore, this distinction and argue that

“[a]lthough the script might have been considered a derivative work in the

absence of such contractual provisions, Baisden chose to convey to IRP the

copyright to the entire script as part of the consideration in the parties’

agreement.” Baisden understandably fears that the district court’s declarations

will result in a judicial transfer of copyrights not originally envisioned in the

agreements.

Upon review, we do not agree with Baisden that the district court’s

declarations transferred any copyright that had not already been conveyed to

IRP. But nor do we agree with IRP’s interpretation that the original agreements

granted it rights in material it did not create. The district judge’s declarations

follow the language of the original agreements. They explicitly reference the

specific parts of the agreements on which they were based. Under those

agreements, Baisden only conveyed a copyright for the play scripts IRP created.

Contrary to its assertion, IRP’s copyright does not extend to the “entire script,”

but only to those parts for which it was responsible. It is clear that the district

court shared this understanding because the declarations do not give Defendants

the unrestricted right to distribute DVDs through whomever they choose, for as

long as they please. Instead, IRP was limited to distributing DVDs of Men Cry

and Maintenance Man “throughout the duration of the Image licensing

agreement.” Similarly, although IRP owed Baisden no royalties relating to

future distributions of the stage play recordings, this too was limited to the

9

According to Johnson, less than 1% of the dialogue in Maintenance Man and less than

10% of the dialogue in Men Cry came from the related novel.

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Image licensing agreement. Had IRP truly been awarded the copyright to every

part of the stage play, IRP’s rights would not have been so constrained, and it

would have been free to pursue additional marketing agreements.

So understood, the district court’s declaratory judgment is affirmed. The

rights recognized through the district court’s declarations are co-extensive with

those present in the original agreement. Those clearly limited IRP’s copyright

to material it created, and preserved Baisden’s copyrights in the novels,

including whatever parts were taken from them and incorporated into the stage

plays.

D. Motion for New Trial

The trial in this case lasted nine days and left the jury to consider a 33-

question, 29-page, verdict form. On appeal, Baisden now claims various defects

in the jury charge, verdict form, and trial proceedings. A district court’s denial

of a motion for new trial is reviewed for abuse of discretion. Alaniz v. Zamora-

Guezada, 591 F.3d 761, 770 (5th Cir. 2009). In reviewing such a denial, “all the

factors that govern our review of [the trial court’s] decision favor affirmance, and

we must affirm the verdict unless the evidence—viewed in the light most

favorable to the jury’s verdict—points so strongly and overwhelmingly in favor

of one party that the court believes that reasonable men could not arrive at a

contrary [conclusion].” Id. This court separately considers each of Baisden’s

objections.

1. Jury Instructions

Alleged defects in a district court’s jury instructions are reviewed for abuse

of discretion. Wright v. Ford Motor Co., 508 F.3d 263, 268 (5th Cir. 2007). We

apply a two-part test to review challenges to particular instructions. Navigant

Consulting, Inc., 508 F.3d at 293. First, an appellant must “demonstrate that

the charge as a whole creates substantial and ineradicable doubt whether the

jury has been properly guided in its deliberations.” Id. (internal quotation

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marks omitted). Second, even where a jury instruction was erroneous, we will

not reverse the district court if we find that, in light of the entire record, “the

challenged instruction could not have affected the outcome of the case.” Id.

(internal quotation marks omitted).

Baisden argues that the district court erred in not giving the jury two of

his proposed jury instructions.10 “[T]he district court’s refusal to give a

requested jury instruction constitutes reversible error only if the instruction 1)

was a substantially correct statement of law, 2) was not substantially covered

in the charge as a whole, and 3) concerned an important point in the trial such

that the failure to instruct the jury on the issue seriously impaired the [party’s]

ability to present a given [claim].” Kanida v. Gulf Coast Med. Pers. LP, 363 F.3d

568, 578 (5th Cir. 2004) (internal quotation marks omitted, alterations in

original).

Baisden’s first requested instruction stated, in relevant part, that “[a]s a

result of the Court’s findings, you are instructed that pursuant to the Court’s

rulings, the sales of the Men Cry in the Dark DVD’s constitute an infringement

of Plaintiff’s Men Cry in the Dark copyright.” The second instruction provided

that “[a]s a result of [IRP and Image’s] admissions and the Court’s findings, you

are instructed that pursuant to the Court’s rulings, the Defendants’ failure to

provide Plaintiff with an accounting of the sales of the video recordings or pay

him royalties from those sales constitutes a breach of contract.” Both

instructions are outcome-determinative on the issues of infringement and breach

of contract. Had the district court issued those instructions there would have

10

Baisden also asserts that the jury should have been instructed that IRP could be

foreclosed from asserting rights under the parties’ agreement if IRP had itself breached it.

Because the jury concluded that IRP did not breach the agreements, we do not reach this

challenge. Similarly, Baisden challenges the district court’s instruction on implied license.

As discussed, supra, that instruction accurately stated the law in this circuit.

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been a real question why these matters were not resolved at the summary

judgment stage.

The proposed instructions highlight a point Baisden frequently returns to,

and that we address here, namely, the preclusive effect of the district court’s

summary judgment holding. In the proceedings below, Defendants moved for

summary judgment and the district judge referred the motion to a magistrate

judge. The magistrate judge recommended that Defendants’ motion be granted

as to conduct occurring outside the statute of limitations, as well as to Baisden’s

claim for tortious interference. The district court adopted the magistrate judge’s

recommendations in full.

Baisden now argues that, having accepted the magistrate judge’s

recommendation, the district court made certain findings which should not have

been submitted to the jury under the “law of the case doctrine.”11 Thus, Baisden

points out that the magistrate judge found “[n]o evidence suggest[ing] that

extensions were sought for either of the contracts at issue” and that “each

contract terminated three years after signing.”

Ignoring whether these passages actually preclude a jury from finding an

implied license, “the law-of-the-case doctrine does not operate to prevent a

district court from reconsidering prior rulings.” Zarnow v. City of Wichita Falls,

Tex., 614 F.3d 161, 171 (5th Cir. 2010). In Zarnow we observed that “[a]n order

denying summary judgment is interlocutory, and leaves the trial court free to

reconsider and reverse its decision for any reason it deems sufficient, even in the

absence of new evidence or an intervening change in or clarification of the

11

Chief among these is Baisden’s contention that the district court ruled that the novels

and the stage play were substantially similar. Although we reject this argument for the same

reasons we reject Baisden’s law of the case argument, we do not reach it, having already

concluded that any infringement claim would be precluded by the grant of an implied

nonexclusive license.

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substantive law.” Id. (internal quotation marks omitted). Baisden’s argument

that the district court was somehow prevented from doing so is without merit.

2. Verdict Form.

Baisden next challenges the verdict form. As with jury instructions, we

review verdict forms for abuse of discretion. Travelers Cas. & Sur. Co. of Am. v.

Ernst & Young L.L.P., 542 F.3d 475, 489 (5th Cir. 2008); Barton’s Disposal Serv.,

Inc. v. Tiger Corp., 886 F.2d 1430, 1434 (5th Cir. 1989) (“Generally, a trial court

is afforded great latitude in the framing and structure of the instructions and

special interrogatories given to the jury, so much so since we are loath to disturb

that discretion absent a showing of abuse of discretion.”).

Baisden challenges the verdict form’s first question, which asked: “Do you

find that IRP or Image directly infringed copyrights owned by the Plaintiffs in

the novels Men Cry in the Dark and The Maintenance Man? Answer ‘Yes’ or ‘No’

as to each alleged act of infringement.” The question then lists IRP and Image

and provides separate response lines for Maintenance Man video sales, Men Cry

in the Dark video sales, and the second Men Cry tour. The jury responded “No”

as to each defendant and all infringing acts.

Baisden now contends that this question had the effect of conflating the

question of license (an affirmative defense on which Defendants bore the burden

of proof) with that of infringement (a claim on which Baisden carried the

burden). The alleged effect of this question was thus to confuse jurors and

prejudice Baisden by burdening him with showing that Defendants did not have

a license.

We agree that the form of the question is not a model of clarity.

Nevertheless, the mere fact that issues of liability and affirmative defense were

combined into a single question is not grounds for a new trial. See Sikes v.

Gaytan, 218 F.3d 491, 494 (5th Cir. 2000) (holding that district court did not

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abuse its discretion in combining issues of liability and qualified immunity into

single interrogatory). Two observations further buttress our conclusion.

First, Baisden failed to timely object to the form of the question. Where

a proper objection to a verdict form is not made, we limit review to plain error.

See Jimenez v. Wood Cnty., Tex., 660 F.3d 841, 845 (5th Cir. 2011) (en banc). To

demonstrate plain error, an appellant must show 1) an error 2) that is clear or

obvious 3) that affected the appellant’s substantial rights. Puckett v. United

States, 556 U.S. 129, 135 (2009). If such a showing is made, a court may, in its

discretion, remedy the error. Id.

The district judge reviewed the proposed instruction on license with the

parties on February 24, 2011, including three of Baisden’s proposed questions

asking the jury whether IRP had a license for Men Cry in the Dark, The

Maintenance Man, and the 2005 Men Cry stage play. The district judge gave

Baisden the opportunity to explain why he would be prejudiced by the verdict

form’s question. But on February 28, 2011 when the district judge again spoke

with the parties, Baisden raised no objection to this part of the verdict form. In

his supplemental objections to the district court’s final jury charge there also

was no objection to the verdict form’s first question. Even in his motion for new

trial, Baisden did not address errors relating to this interrogatory. Thus, to the

extent there is any error in the verdict form, it would only warrant a new trial

if it were clear and obvious and affected Baisden’s substantial rights.

Second, a review of the record shows that the plain error standard was not

met. The district judge’s instructions make clear that the jury would not have

been confused by the form of the question. It instructed the jurors, in relevant

part, that:

A claim for copyright infringement is barred if a

defendant has an express or implied license authorizing

use of the copyrighted work. Defendants contend that

Baisden gave them a license to use the copyrighted

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works . . . . The burden is on Defendants to prove the

existence of a license by a preponderance of the evidence.

If Defendants satisfy this burden then in order for

Baisden to prevail, Baisden must prove by a

preponderance of the evidence that Defendants’ copying

was not authorized by the license.

(emphasis added).

Provided this instruction, we do not believe the jury would have been so

confused by the question as to necessitate a new trial. The district judge

correctly instructed the jurors on the parties’ respective burdens. “[J]uries are

presumed to follow their instructions.” Zafiro v. United States, 506 U.S. 534, 540

(1993). Baisden has presented nothing to convince us that this jury did

otherwise. As a result, Baisden cannot show that his substantial rights were

affected and has therefore failed to show plain error.12

Baisden also contends that the jury’s verdict was inconsistent or,

alternatively, not supported by sufficient evidence. He takes issue with its

finding that IRP and Image entered into an agreement after IRP’s corporate

franchise had lapsed. But forfeiture of a corporate charter does not extinguish

a corporate entity. Hinkle v. Adams, 74 S.W.3d 189, 193-94 (Tex.

App.—Texarkana 2002, no pet.). A charter and corporate privileges can be

retroactively reinstated provided a corporation pays whatever taxes it owes, in

which case “it is as though the forfeiture never existed.” Id. at 194. Here, the

jury found that IRP’s corporate franchise lapsed between April 9, 2004 and May

12

While arguing that the district court should have broken up the first interrogatory,

he also complains that the district court then asked too many questions on contractual and

equitable defenses. Having found no infringement in the first question, the jury did not reach

these other questions and left them blank. Accordingly, they had no adverse impact on

Baisden sufficient to warrant a new trial.

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24, 2006. From May 24, 2006 onwards it was reinstated, and retroactively

revived for the period in lapse.13, 14

3. Evidentiary Issues

Baisden also raises a series of evidentiary issues that he believes entitle

him to a new trial. Generally, any error in admitting or excluding evidence is

not grounds for a new trial. Fed. R. Civ. P. 61. We review the admission or

exclusion of evidence for abuse of discretion. Tompkins v. Cyr, 202 F.3d 770, 779

(5th Cir. 2000). Should we find that a district court has abused its discretion we

review the error under the harmless error doctrine, and will affirm the ruling

unless it “affected substantial rights of the complaining party.” Bocanegra v.

Vicmar Servs., Inc., 320 F.3d 581, 584 (5th Cir. 2003).

Baisden’s principal objection is that he was not allowed to read the novels

Men Cry in the Dark and The Maintenance Man into the record, nor show the

entirety of the Maintenance Man DVD. Baisden provides no authority for the

proposition that a jury must be read or shown every part of a disputed work

during a copyright infringement trial. Here, the novels were each over 300

pages long. The DVDs were both over two hours long. The district court made

a reasoned decision that granting Baisden’s request would be cumulative and

would significantly draw out an already lengthy trial. Importantly, the district

court permitted extensive testimony on the works. Both Baisden and Johnson

testified and were cross-examined on the similarities between the novels and the

13

Baisden contends that there is a conflict between the jury finding both that the

parties entered into written agreements providing for certain merchandise royalty terms and

that IRP did not breach those terms despite having failed to comply with them. This

argument is without merit because the jury also found that the parties entered into an

agreement whereby each would keep its own merchandise revenues.

14

Baisden’s argument that the agreement between IRP and Image did not go into effect

until IRP completed delivery of various items required under the contract, including a

certificate of incorporation and chain of title, is without merit. The agreement clearly states

that it was effective November 15, 2005.

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stage plays. That testimony covered each story’s concept, plot, characters, and

dialogue. The district court also permitted the jury to watch the entirety of the

Men Cry DVD. The jury also had both the novels and DVDs during deliberations

and was properly instructed that a “side-by-side comparison must be made

between the original and the copy to determine whether the intended audience

would view the two works as substantially similar.”15 This obviated any need to

read the novels into the record or have the jury watch another two-hour DVD.

In any case, because we uphold the jury’s verdict on the basis of an implied

nonexclusive license, any errors relating to whether the works were

substantially similar would not mandate a new trial.

Baisden also complains that the admission of IRP’s derivative copyrights

confused the jury’s understanding of what rights a derivative copyright holder

could transfer.16 It is unclear how the jury would have been confused simply by

the admission of the copyrights. Baisden has also not made clear how the jury’s

verdict would have differed had the copyrights been excluded.

Finally, Baisden argues that statements made by Defendants’ counsel

were “designed to have a negative impact on the jury’s perception” of him. He

singles out counsel’s questions on the overlap between his marriage and his

authoring the book, Never Satisfied: How and Why Men Cheat, other aspects of

his family life, and that he only “stopped in Houston, Texas on his way from the

South Side of Chicago by way of Dallas.”

15

Less clear is whether the jury had access to a DVD player during deliberations. As

the parties’ briefs do not address this issue, and because we find that Baisden did grant an

implied license, this court will not speculate on this point further.

16

A derivative copyright is a copyright to a “work based upon one or more preexisting

works, such as a translation, musical arrangement, dramatization, fictionalization, motion

picture version, sound recording, art reproduction, abridgment, condensation, or any other

form in which a work may be recast, transformed, or adapted.” 17 U.S.C. § 101. Such a

copyright “extends only to the material contributed by the author of such work, as

distinguished from the preexisting material employed in the work, and does not imply any

exclusive right in the preexisting material.” 17 U.S.C. § 103(b).

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A motion for new trial premised on improper arguments by counsel should

only be granted when “improper closing argument irreparably prejudices a jury

verdict or if a jury fails to follow instructions.” Nissho-Iwai Co., Ltd. v.

Occidental Crude Sales, Inc., 848 F.2d 613, 619 (5th Cir. 1988). We will not

reverse a grant or denial of a new trial unless the district court abused its

discretion. Id. We also recognize that “[a] trial judge is generally better able

than an appellate court to evaluate the prejudice flowing from improper jury

arguments.” Caldarera v. E. Airlines, Inc., 705 F.2d 778 (5th Cir. 1983).

Although Baisden alleges prejudice now, he raised no objection to the

statements at trial. Baisden has thus waived his objection to these statements,

and this court need not consider them. See Colburn v. Bunge Towing, Inc., 883

F.2d 372, 376 (5th Cir. 1989) (where defendant failed to move for mistrial on

basis of remarks, court would “not now entertain [defendant’s] argument that

[plaintiff’s] trial tactics are grounds for a new trial”); Nissho-Iwai Co., Ltd., 848

F.2d at 619.17

Accordingly, we affirm the district court’s denial of Baisden’s motion for

a new trial.

17

Baisden has also made no effort to show how these statements would have affected

the outcome at trial. Moreover, none of the statements rise to the level of severity that would

require a new trial to avoid a miscarriage of justice. See McClaran v. Plastic Indus., Inc., 97

F.3d 347, 359-60 (9th Cir. 1996) (repeated references to manufacturer’s wealth and power,

plaintiff’s hard-working nature and difficult financial circumstances, appeal to regional bias,

attempt to coach witness with baseless objections, and repeated questions about inflammatory

subjects not sufficiently severe to warrant new trial).

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E. Tortious Interference18

In addition to his claims for copyright infringement and breach of contract,

Baisden also brought a claim for tortious interference. Baisden’s claim was

premised on an option contract between Farcor Baisden Partnership, L.L.C. and

Behave Productions, Inc., to develop a Maintenance Man movie. The district

court granted Defendants’ motion for summary judgment as to this claim for lack

of standing. The district court based its decision on the fact that Baisden was

not a party to the contract at issue, and that Farcor Baisden Partnership, L.L.C.

was not named as a party in this action. On appeal, Baisden renews his

argument that he was an intended third-party beneficiary because the contract

directed that payments be made directly to him and that he provide chain of

title.

We agree with the district court that this claim was properly dismissed for

lack of standing. Baisden was not a party to the contract and thus cannot assert

a claim for tortious interference. See Nauslar v. Coors Brewing Co., 170 S.W.3d

242, 250 (Tex. App.—Dallas 2005, no pet.) (“A partner has no individual,

separate cause of action for losses suffered by reason of tortious interference

with a contract between the partnership and a third party: damages for loss in

value of the partnership interest or employment losses are subsumed in the

partnership’s causes of action.”); Hill v. Baylor Univ. Med. Ctr., No. 05-97-00238,

2000 WL 31795, at *1-*3 (Tex. App.—Dallas Jan. 18, 2000, pet. denied)

(unpublished opinion) (holding that plaintiff, who signed contract at issue as

president of each of two contracting parties but who sued for tortious

interference in only his personal capacity, lacked standing “[b]ecause the cause

18

Baisden also appears to argue that the district court erred in not entering judgment

as a matter of law in favor of his breach of contract claim. But while including this in his

argument summary he fails to include it in his principal brief. “A party that asserts an

argument on appeal, but fails to adequately brief it, is deemed to have waived it.” United

States v. Scroggins, 599 F.3d 433, 446 (5th Cir. 2010).

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of action for tortious interference is recognized for ‘a party to a contract’”). The

cases Baisden relies on in opposition are inapposite. See Stine v. Stewart, 80

S.W.3d 586, 589 (Tex. 2002) (discussing third-party beneficiary status in context

of breach of contract claim).19

F. Attorneys’ Fees

Defendants’ sole point of error is the district court’s decision not to award

them attorneys’ fees. Pursuant to § 505 of the Copyright Act, a court may award

reasonable attorneys’ fees to the prevailing party in a copyright dispute. 17

U.S.C. § 505. We review a district court’s decision to deny attorneys’ fees for

abuse of discretion. Positive Black Talk Inc., 394 F.3d at 380.

The district court considered the arguments Defendants renew on appeal

and concluded that Baisden’s suit was neither frivolous nor unreasonable. The

district court reached its conclusion by correctly applying the factors discussed

in Fogerty v. Fantasy, Inc., 510 U.S. 517, 534 (1994). The court took particular

note of the fact that Baisden’s suit survived several pretrial motions and

resulted in a nine-day jury trial. Finding no error in the district court’s

reasoning and agreeing with its assessment of Baisden’s claims, we hold that the

district court did not abuse its discretion. The district court’s decision to deny

attorneys’ fees is affirmed.

19

In his reply brief, Baisden argues, for the first time, that Farcor Baisden Partnership,

L.L.C. has dissolved, leaving him to bring a suit for tortious interference. However, “[w]hile

the proof required to establish standing increases as the suit proceeds, the standing inquiry

remains focused on whether the party invoking jurisdiction had the requisite stake in the

outcome when the suit was filed.” Davis v. Fed. Election Comm’n, 554 U.S. 724, 734 (2008)

(citations omitted); Carr v. Alta Verde Indus., Inc., 931 F.2d 1055 (5th Cir. 1991) (“As with all

questions of subject matter jurisdiction except mootness, standing is determined as of the date

of the filing of the complaint . . . .”). Baisden thus had to establish standing at the time his

suit was filed. Having failed to do so, his claim for tortious interference was properly

dismissed.

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III. CONCLUSION

For the aforementioned reasons, the district court’s judgment is

AFFIRMED in all respects.

27