I knew there was an organization that collected and distributed orphaned royalties, but wasn’t aware of the legal tussle between the Graphic Artists Guild (GAG) against the Illustrators’ Partnership of America (IPA) – both trying to control the $1.5 million of royalties. A New York Supreme Court has dismissed the case brought by GAG against IPA. I’m posting the press release which can explain things better than I. I should also note that both the AAEC and NCS belong to IPA.
Last week the New York State Supreme Court, New York County, dismissed all claims in a million dollar lawsuit brought by the Graphic Artists Guild (GAG) against the Illustrators’ Partnership of America (IPA) and five named individuals.
In the lawsuit, GAG asserted claims for defamation and interference with contractual relations, alleging that IPA had interfered with a “business relationship” GAG had entered into that enabled GAG to collect orphaned reprographic royalties derived from the licensing of illustrators’ work. GAG alleged that efforts by IPA to create a collecting society to return lost royalties to artists “interfered” with GAG’s “business” of appropriating these orphaned fees.
In her decision, Judge Debra James ruled that statements made by the Illustrators’ Partnership and the other defendants were true; that true statements cannot be defamatory; that illustrators have a “common interest” in orphaned income; and that a “common-interest privilege” may arise from both a right and a duty to convey relevant information, however contentious, to others who share that interest or duty.
Regarding a key statement at issue in the lawsuit: that GAG had taken over one and a half million dollars of illustrators’ royalties “surreptitiously,” the judge wrote:
“Inasmuch as the statement [by IPA] was true, [GAG]’s claim cannot rest on allegations of a reckless disregard of whether it was false or not. Truthful and accurate statements do not give rise to defamation liability concerns.”
And she noted:
“The plaintiff Guild has conceded that it received foreign reproductive royalties and that it does not distribute any of the money to artists.”
Labor Department filings provided as evidence to the court document that between 2000 and 2007, GAG collected at least $1,581,667 in illustrators’ reprographic royalties. GAG admitted to having collected similar royalties since 1996. GAG’s officers have repeatedly refused to disclose how much money their organization has received to date or how the money has been spent.
DUTY AND COMMON INTEREST
The judge concluded that this situation justified an assertion of common interest by IPA. This means that “the party communicating [relevant information] has an interest or has a duty” to convey that information truthfully to others “having a corresponding interest or duty”:
“The duty need not be a legal one, but only a moral or social duty. The parties need only have such a relation to each other as would support a reasonable ground for supposing an innocent motive for imparting the information. Here the plaintiff Guild’s factual allegations demonstrate that the defendants’ statements were both true, and fall within the parameters of the common-interest privilege.”
We hope this decision will end the two and a half years of litigation during which GAG pursued its claims against IPA and artists Brad Holland, Cynthia Turner and Ken Dubrowski of IPA, as well as attorney Bruce Lehman, former Commissioner of the US Patent Office and Terry Brown, Director Emeritus of the Society of Illustrators.