Paramount Film Distributing Corp. v. State

Reynolds, J.

This is an appeal and cross appeal from a judgment of the Court of Claims in favor of appellant-respondent and an appeal by the State from an order of the Court of Claims, entered December 18, 1967, which vacated a subpoena duces tecum.

Previously this court affirmed the denial of a motion to dismiss the instant claim for failure to state a cause of action and lateness (27 A D 2d 420). The dissenting members of this court would now reverse the judgment and dismiss the claim on the basis that the Court of Appeals’ declaration of the unconstitutionality of the movie licensing provisions of the Education *227Law (§ 120 et seq.) in Matter of Trans-Lux Distr. Corp. v. Board of Regents of Univ. of State of N. Y. (16 N Y 2d 710) was not retroactive so that the license fees paid by the appellant-respondent were not illegally or wrongfully collected and are thus not now refundable. However, implicit in our former decision upholding the cause of action was a determination that the decision in Trans-Lux was to be applied retroactively. In our majority opinion upholding the cause of action we stated:

‘1 It was only as an incidental happening when the entire statute was struck down that the fee payments also were voided.” (27 A D 2d, at p. 424.) and: To hold otherwise in a case such as the instant one would render a claimant’s vindication of a constitutional right in substantial part a Pyrrhic victory.” (27 A D 2d, at p. 424.) In fact the dissenting opinion in the prior appeal recognized that such a determination was implicit in our upholding of the cause of action (27 A D 2d, at p. 426) and attempted as here to refute it. Accordingly, we adhere to our prior determination and expressly hold that the decision of the Trans-Lux case should as a matter of policy upon the facts of this particular case be applied retroactively to permit a recovery by appellant-respondent. The cases cited by the dissent on this appeal are inapposite and not controlling here.

The trial court, however, awarded appellant-respondent only $29,297 of the total of $128,322.50 in fees paid because the appellant-respondent and its parent corporation, Paramount Pictures, ignored a clause in their contract that all licenses be issued in appellant-respondent’s name and instead took out a vast majority of the licenses in the name of Paramount Pictures. It is evident, however, that while separate corporate entities are involved, $128,322.50 in total fees were paid by appellant-respondent alone and that despite which corporation was issued the license, contractually all licenses were supposed to be exclusively in appellant-respondent’s name. Accordingly, we do not feel that a full recovery should on the instant record be denied on the basis solely of whether the licenses were granted in the name of the parent or appellant-respondent, its wholly owned subsidiary.

Finally, we find no merit in the State’s argument that the subpoena duces tecum was not properly vacated.

The judgment should be modified, on the law and the facts, so as to increase the award from $29,297 to $128,322.50, plus appropriate interest, and, as so modified, affirmed.