Ninth Circuit Rules In Ghost Hunters Idea Submission Case

This article first appeared in Entertainment Law Matters, a Frankfurt Kurnit legal blog.

Pitch meetings are the red blood cells of the entertainment world, transmitting the ideas and concepts that help to build films, TV shows, plays and other creative work. But pitch meetings can also become the petri dishes where legal disputes grow. And how writers, agents, producers and studios handle scripts and treatments – and the ideas behind them — has been at the core of a long line of so-called idea submission lawsuits.  A recent Ninth Circuit decision seems certain to join the pantheon of notable idea submission cases.

The dispute in Montz v. Pilgrim Films & Television focused on the Sci-Fi Channel show Ghost Hunters, which is about contact between people and spirits in the afterlife. Plaintiff Larry Montz, a parapsychologist, alleged he thought of the idea for a show "that would follow a team of paranormal investigators conducting field investigations" where they would use different devices to smoke out reports of paranormal activity. Montz and his agent say that between 1996 and 2003 they pitched this idea to different producers, including NBC and Sci-Fi channel, presenting screenplays, videos, and other materials. But NBC and Sci-Fi Channel passed.

So when Ghost Hunters aired in 2006 on Sci-Fi Channel, Montz and his agent sued. Among other things, they alleged copyright infringement, and a state law claim for breach of implied-in-fact contract. Plaintiffs specifically alleged:

• "That the Defendants would not ... exploit the Plaintiffs' ideas and concepts without compensation and without obtaining the Plaintiffs' consent"; and
• "That, by accepting the Plaintiffs' disclosure of its concept, the defendants accepted and agreed to abide by the foregoing terms."

The federal district court in California dismissed the state law claims, finding them "preempted" by the federal Copyright Act. (The Copyright Act of 1976 preempts state claims when the creative work "come[s] within the subject matter of copyright" and the state law grants "legal or equitable rights that are equivalent to any of the exclusive rights within the general scope of copyright.") Because the Plaintiffs also voluntarily dismissed their copyright claim, things looked bleak.   

But the Ninth Circuit Court of Appeals reversed. In an animated decision (over a four-judge dissent), the court held that the state law implied-in-fact contract claim "asserted rights qualitatively different from the rights protected by copyright." That claim was therefore not preempted and could proceed. (A California state law claim for "breach of confidence" was also not preempted.)

As with other idea submission cases, much of the discussion focused on whether writers and agents who pitch ideas have sufficient protection in the law, and the court characterized its holding as one that: "recognizes the gap that would otherwise exist between state contract law and copyright law in the entertainment industry. [The implied-in-fact contract claim] serves to give some protection for those who wish to find an outlet for creative concepts and ideas but with the understanding that they are not being given away for free. Without such legal protection, potentially valuable creative sources would be left with very little protection in a dog-eat-dog business." Here (and to our great pleasure) the opinion cited Woody Allen, Crimes and Misdemeanors (Orion Pictures 1989) ("Show business is worse than dog-eat-dog. It's dog-doesn't-return-other dog's-phone-calls."). 

The dissent saw this as a copyright case – not a breach of an agreement to sell an idea: "Montz asserts that Pilgrim produced and broadcast a television program derived from Montz's screenplays, video, and other materials without authorization. These rights are equivalent to the rights of copyright owners under section 106 – namely, the exclusive rights to authorize reproduction, distribution, and display and original works and to authorize preparation for derivative works."  The dissent also appeared concerned that an implied-in-fact contract claim on these facts would constitute an end-run around the Copyright Act: "Montz's implied contract claim would protect [his] rights more broadly because California implied contract law does not require as strict a showing of substantial similarity as federal copyright law."

Writers and agents will continue to pitch, and producers and studios will continue to produce work that may or may not have been inspired by old ideas. And so the battle for whether federal copyright law will preempt state law breach of contract and other claims is sure to continue. In the meantime, dealmakers on both sides would do well to read Montz v. Pilgrim Films & Television before their next pitch meeting

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