United States Court of Appeals
For the First Circuit
No. 03-1801
GAIL ZYLA,
Plaintiff, Appellant,
v.
WADSWORTH, a Division of the Thomson Corporation,
the THOMSON CORPORATION, and MARIE BOYLE STRUBLE,
Defendants, Appellees.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Rya W. Zobel, U.S. District Judge]
Before
Boudin, Chief Judge,
Lynch and Lipez, Circuit Judges.
David J. Fine, with whom Zick Rubin was on brief, for
appellant.
Joshua M. Rubins, with whom Daniel J. Kelly, James F.
Rittinger, and Satterlee Stephens Burke & Burke LLP were on brief,
for appellees.
February 25, 2004
LYNCH, Circuit Judge. This civil case arose out of a
dispute over authorship of the fourth edition of a college
textbook, Personal Nutrition, published in August 2000.
Gail Zyla was a visiting lecturer in nutrition at Tufts
University from 1996 until 2000, when she became an independent
writer. Earlier in the 1990s, she had worked with Professor Marie
Boyle Struble, a professor and director of the graduate program in
nutrition at The College of St. Elizabeth, on the second and third
editions of the textbook. Both were listed as co-authors; Struble
had co-authored the first edition with someone else in 1989 and was
the lead author on all three editions.
In 2001, Zyla sued Struble, her publisher (Thomson
Corporation), and the division of Thomson that published the
textbook (Wadsworth) over the publication of the fourth edition.1
Zyla was unhappy that, in late 1998, Thomson had extended the
authors' original deadline for submission of materials, as well as
the publication date for the fourth edition, in order to
accommodate Struble's busy schedule, instead of adopting Zyla's
proposal to give Zyla a greater share of the work and of the
royalties if the deadline were missed again. Zyla withdrew from
the project in 1999 and notified Thomson and Struble that they had
1
Because the claims and factual allegations that Zyla
raises against Wadsworth are identical to those she raises against
Thomson, we refer to the two defendants collectively as "Thomson,"
for clarity and convenience.
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no permission to use any of the work she had done to date for the
fourth edition. Only when the book was published, she said, did
she learn that her work had been used in the fourth edition without
her permission and without appropriate attribution.2 Zyla
continued to receive 12.5% of the total royalties on the Fourth
Edition (her residuals from earlier editions), but not the 40% she
would have received had she not withdrawn as an author.
Zyla's suit in federal court sought damages and
royalties, asserting seven causes of action: (1) copyright
infringement; (2) violation of the Lanham Act, 15 U.S.C. § 1125(a);
(3) breach of contract by Struble; (4) breach of contract by
Thomson; (5) a petition for a declaration voiding an agreement
signed by Zyla that reduced the royalties to which she was entitled
for the fourth edition to 12.5%; (6) intentional interference with
advantageous relations by Struble; and (7) violation of Mass. Gen.
Laws Ann. ch. 93A, §§ 2 and 11. After discovery, the district
court entered summary judgment for defendants on all claims. Zyla
appeals. We affirm.
I.
2
The defendants replied below and on appeal that any
overlap between Zyla's proposed revisions and the fourth edition
was inadvertent and de minimis and involved mostly material in the
public domain published by the government.
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The facts are described in the light most favorable to
Zyla, the non-moving party. Feliciano de la Cruz v. El
Conquistador Resort & Country Club, 218 F.3d 1, 5 (1st Cir. 2000).
Personal Nutrition is an undergraduate textbook published
originally by West Publishing, and later by its successor, Thomson.
The first edition of the textbook was published in 1989. Struble
and Eleanor Whitney were the co-authors, with Struble acting as
lead author. When Whitney chose not to work on the second edition,
Zyla was brought in to replace her as co-author on that edition.
Although Zyla did not have the college teaching experience,
academic affiliation, or doctoral degree usually preferred for
textbook authors, the editor believed that she could handle the job
because she was an experienced writer in the field of nutrition.
The second edition was published in 1992.
On January 26, 1995, West entered into an agreement with
Struble and Zyla (who are referred to jointly as "Author" in the
contract) to prepare the third edition. This agreement (the "Third
Edition Agreement") stated that it was to be governed by Minnesota
law. It provided for the authors to receive a combined royalty of
15 percent of net paid sales. Zyla was to receive 25 percent of
this total, while Struble was to receive 68.43 percent.3 Section
2 of the agreement provided that:
3
The remainder was divided between Eleanor Whitney and
ESHA Research.
-4-
If the contribution of any one or more Authors is not
delivered to West on or before the Due Date or West
determines that the contribution will not be so delivered
. . . , West may, after consultation with the Authors,
terminate this Agreement with respect to the non-
performing Author(s) and continue this Agreement with the
remaining Author(s) alone or with one or more mutually
acceptable co-authors, or terminate this Agreement.
Section 7 provided that if an author did not participate in
subsequent revised editions of the book,
Author . . . will be paid one-half of Author's
compensation [under the third edition] with respect to
the first revised edition in which Author does not
participate and one-quarter of such compensation with
respect to the second revised edition in which Author
does not participate.
The Third Edition Agreement also contained an assignment of
copyright in Section 3, which provided that:
Author hereby assigns and transfers to West all present
and future copyrights and other rights in the Work
(including revised editions of the Work) and supplements
thereto.
The "Work" was defined in Section 1.1 as the third edition of
Personal Nutrition.
The third edition was published by West in 1996.
Afterwards, Thomson succeeded to West's rights and obligations
under the Third Edition Agreement.
Between late August and early September 1997, Thomson,
Struble, and Zyla signed an addendum to the Third Edition Agreement
to cover the fourth edition (the "Fourth Edition Addendum"). The
addendum changed the royalties allocation provision in the Third
Edition Agreement to give 60% to Struble and 40% to Zyla for the
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fourth edition. It stated that "[s]hould the responsibilities of
the Authors change during the writing of the revision, the
royalties can be adjusted accordingly upon written receipt [by] the
Publisher of a letter from the Authors signed by both Authors
reallocating the royalties." The addendum also set a manuscript
deadline of March 1, 1998, and stated that if this deadline was not
met, "the Publisher may terminate this Agreement or Addendum."
In October 1997, Walter Marshall, the editor whom Thomson
assigned to work on the textbook, became concerned that Struble was
behind in her work and suggested that she turn over some of her
work to Zyla to enable the two authors to meet the March 1
deadline. Struble declined to do so. By early 1998, it became
clear that the authors would not make the deadline. Zyla had
submitted revisions for two of her four assigned chapters and two
of the eleven "Nutrition Action" features that she was to write,
and Struble had sent a new feature entitled "The Savvy Diner" but
no revisions for her seven assigned chapters.
Thomson chose not to exercise its power under Section 2
of the Third Edition Agreement to terminate the agreement with
either author. Instead, in late 1998, Marshall extended the
deadline until April 1, 1999, and then until May 15, 1999. The
parties dispute the motivation for this move, but the dispute may
be more apparent than real. Zyla points to a letter from Struble
to Thomson's in-house counsel, Ken Carson, that stated that the
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fourth edition was "placed on hold so that Marie Boyle [Struble]
could first revise her other text -- Community Nutrition with Diane
Morris." Marshall admitted in his affidavit that he wanted Struble
to finish Community Nutrition first, but said that he wanted
Struble to do so because Community Nutrition was further along and
he believed that Struble worked more effectively when concentrating
on one project at a time. He claimed that his first priority in
extending the deadline was to promote Personal Nutrition, which had
greater revenue value than Community Nutrition. In addition, he
stated that he also based his decision on the belief that author
tardiness was "often manageable" and on his experience working with
Struble, who had previously missed internal deadlines because of
deaths in her family but had been able to catch up with the final
schedule.
Zyla told Marshall that she would agree to the new
deadline, provided that more of the work and royalties would be
assigned to her if Struble again failed to meet the deadline.
Marshall and Struble refused. Marshall stated in his affidavit
that he refused because he was concerned that a reallocation would
lead Struble to withdraw from the project. He believed the
participation of Struble was critical to the book's success, at
least in part because she had been the lead author of the first
edition.
-7-
Zyla then wrote a letter to Marshall on April 12, 1999,
stating that she would not participate further in the fourth
edition and that the revisions that she had submitted to Struble
and Thomson could not be used without her permission. Sixteen days
later, on April 28, Marshall sent Zyla a letter informing her that
Struble had finished the fourth edition and was about to send it
for publication. The letter asked Zyla to sign an agreement, dated
April 10, 2000, indicating her acknowledgment that as agreed under
Section 7 of the Third Edition Agreement, she would receive 12.5%
of the author royalties from the fourth edition. Zyla signed the
agreement (the "April 10 Agreement").
The fourth edition was published in August 2000, with
Struble listed as the sole author. Zyla bought a copy in February
2001 and says that she discovered then, to her surprise, that the
fourth edition copied (1) her line edits to chapters one and two;
(2) her definitions of terms used in those chapters; (3) a section
that she had written on dietary reference intakes; (4) her
revisions to the "Nutrition Action" sections of chapters one and
four; (5) her drawing of a shopping cart; and (6) her caption for
a photograph. Zyla received a copyright registration in those
materials two months later, on April 6, 2001. In her registration
application, she described the materials as a derivative work of
the third edition. After obtaining the registration, Zyla called
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and wrote to Thomson and Struble, telling them that they had
infringed her copyright.
Zyla was also displeased with the acknowledgments section
to the fourth edition, which contained a statement that "I
[Struble] am grateful for the work that Gail Zyla contributed to
the second and third editions of this text; her insights are
reflected in this new edition, still." Zyla felt that this
statement falsely implied that she had made no contribution to the
fourth edition.
On August 23, 2001, Zyla brought suit in federal district
court against Thomson and Struble seeking injunctive relief and
damages. The defendants moved for summary judgment, arguing
principally that they had not violated any copyright held by Zyla
because any copying was de minimis, that Zyla had not shown any
actual confusion from the acknowledgments section, and that Thomson
had no obligation to terminate the agreement with Struble. They
also argued that Zyla had already received money exceeding the
amount that any reasonable jury could award in damages. Thomson
had given Zyla $2,000.00 to defray her expenses in preparing the
fourth edition. She spent approximately $265.00 and never returned
the remainder.
The district court granted summary judgment for the
defendants on all claims. The court found that Zyla had assigned
any copyright in the revisions for the fourth edition to Thomson
-9-
under the Third Edition Agreement and that the Lanham Act did not
apply because no trademark was at issue. Applying Minnesota law to
the breach of contract claims, the court held that no contract was
formed between Struble and Zyla and that Thomson was not in breach
of the contract because Section 2 of the Third Edition Agreement
provided that Thomson "may" terminate a contract with an author who
fails to meet a deadline but imposed no obligation on Thomson to do
so. The court rejected Zyla's petition for a declaration voiding
the April 10 Agreement because the court found that even if that
agreement had somehow been fraudulently obtained, it merely
reiterated the terms of Section 7 of the Third Edition Agreement,
which Zyla had not alleged was obtained fraudulently. The court
also rejected Zyla's claim that Struble intentionally interfered
with advantageous business relations by refusing to allot Zyla more
of the royalties and work, concluding that Struble's actions did
not have the effect of interfering with any existing contractual
relationship. Finally, the court found that Zyla's Mass. Gen. Laws
Ann. ch. 93A claim failed because the claims upon which it was
based -- breach of contract, tortious interference, and fraud --
had already been rejected.
The district court also denied motions by Zyla to amend
her complaint to add a claim for punitive damages and to impose
sanctions on the defendants for discovery misconduct.
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Zyla appeals from the grant of summary judgment and the
denial of those motions. We consider each of her claims in turn.
II.
A. Copyright Claim4
The district court, construing the Third Edition
Agreement and the Fourth Edition Addendum, correctly held that
Thomson was the sole owner of all copyright interests in the fourth
edition.
Zyla cannot claim a copyright interest in her purported
revisions. It is undisputed that under the Third Edition
Agreement, Zyla "assign[ed] . . . all present and future copyrights
in the [third edition (including revised editions of the [third
edition])" to Thomson. By Zyla's own admission in her April 2001
copyright registration application, her revisions are a derivative
work based on, and pervasively incorporating pre-existing material
from, the third edition. Only Thomson, which is the sole owner of
the third edition, may claim a copyright interest in such
derivative works. See 17 U.S.C. § 106(2); Gracen v. Bradford
Exchange, 698 F.2d 300, 302 (7th Cir. 1983) ("Since the copyright
owner's bundle of exclusive rights includes the right to prepare
derivative works based upon the copyrighted work, . . . [the
4
We note that no party asserts that this case involves a
work for hire agreement. See Cleary v. News Corp., 30 F.3d 1255,
1259-60 (9th Cir. 1994).
-11-
creator of the derivative work] could not copyright them" without
permission to incorporate the pre-existing material).5
Furthermore, even if Zyla could claim a copyright
interest in her revisions, she assigned that interest to Thomson as
well. The Third Edition Agreement assigns to Thomson all copyright
interests in the fourth edition, as a "revised edition[]" of the
third edition. Given that the authors of standard textbooks
frequently change over time (as this case illustrates, as Zyla was
not involved in the first edition), this allocation of copyright
interests to the publisher reflects commercial realities.
Zyla argues, however, that it is ambiguous whether this
assignment includes revisions incorporated into the fourth edition
without her authorization, and that under Minnesota law, which
governs the interpretation of the Third Edition Agreement,
ambiguities must be construed against Thomson as the drafting
party. Current Tech. Concepts v. Irie Enters., 530 N.W.2d 539, 543
(Minn. 1995). We see no such ambiguity. The assignment provision
contains no such limitation.
Zyla also argues that the fact that she informed Thomson
in April 1999 that it was not to use her work on the fourth edition
deprived Thomson of any copyright interest. But neither the Third
5
The fact that Zyla registered a copyright in those
revisions does not undermine this conclusion. Although
registration creates a presumption of validity, that presumption is
rebuttable. Lotus Dev. Corp. v. Borland Int'l, 49 F.3d 807, 813
(1st Cir. 1995).
-12-
Edition Agreement nor any communication by Thomson in response to
Zyla's letter indicated an abandonment of Thomson's copyright.
Zyla makes a last argument that regardless of the
contract language, the parties' course of performance confirmed her
ownership of a copyright in her work for the fourth edition. She
bases this argument largely on the fact that Marshall, the editor
whom Thomson assigned to work on the textbook, took the position
that if Struble did some improper copying, then Struble should
compensate Zyla, and that Marshall did not say then that Zyla had
no copyright interest in the materials. This argument mixes apples
and artichokes. A publisher's pragmatic attempt to solve a problem
between two authors, neither of whom owns the copyright in the
published work, is not an abandonment of its own copyright
interest.6
Dismissal of Zyla's copyright claim was appropriate.
B. Lanham Act
Zyla claimed a violation § 43(a) of the Lanham Act, 15
U.S.C. § 1125(a), based on her contention that the acknowledgments
section of the fourth edition falsely credited Struble with
6
Zyla also argues that because the defendants did not
advance the contract interpretation argument to the district court,
the argument should be rejected. The district court nonetheless
reached the argument, and Zyla has had a fair opportunity to
address it with us. In addition, Zyla argues that Thomson's
failure to advance the contract interpretation argument
demonstrates that it has no copyright interest. This argument
confuses court rules on forfeiture of arguments with substantive
rules of abandonment of copyrights.
-13-
authorship to Zyla's detriment. Zyla's argument sets up a
quandary, of course. Zyla expressly withdrew from the fourth
edition, so crediting her with authorship would have itself created
a possible false attribution claim.
The district court dismissed the Lanham Act claim,
essentially for failure to state a claim. Zyla correctly argues
that § 43(a)(1) is not limited to the protection of trademark
holders. The existence of a trademark is not a necessary
prerequisite to a § 43(a) action. See Dastar Corp. v. Twentieth
Century Fox Film Corp., 123 S. Ct. 2041, 2045 (2003) ("While much
of the Lanham Act addresses the registration, use, and infringement
of trademarks and related marks, § 43(a), 15 U.S.C. § 1125(a) is
one of the few provisions that goes beyond trademark protection.").
Section 43(a)(1), as it stands after the 1988 amendments,
reads as follows:
Any person who, on or in connection with any goods or
services, . . . uses in commerce any word, term, name, symbol,
or device, or any combination thereof, or any false
designation of origin, false or misleading description of
fact, or false or misleading representation of fact, which --
(A) is likely to cause confusion, or to cause mistake, or to
deceive as to the affiliation, connection, or association of
such person with another person, or as to the origin,
sponsorship, or approval of his or her goods, services, or
commercial activities by another person, or
(B) in commercial advertising or promotion, misrepresents the
nature, characteristics, qualities, or geographic origin of
his or her or another person's goods, services, or commercial
activities,
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shall be liable in a civil action by any person who believes
that he or she is or is likely to be damaged by such act.
Zyla's claim, as we understand it, is that the acknowledgments
section "is likely to cause confusion . . . as to the origin . . .
of . . . goods." Although Zyla admits that Struble was the lead
author of the fourth edition, she argues that the acknowledgments
section made an implicit representation that none (or at least very
little) of the new work in that edition was Zyla's, when in fact,
according to Zyla, significant portions of the fourth edition
copied her original work.7
The Supreme Court has determined, however, that §
43(a)(1)(A) does not apply to the type of claim that Zyla raises.
In Dastar Corp. v. Twentieth Century Fox, the plaintiffs had
contracted for exclusive rights to manufacture and distribute
videos of "Crusade in Europe," a television series about World War
II. 123 S. Ct. at 2044. (The copyright in the original television
series had expired.) When Dastar released a video set based on the
"Crusade" series, which was now in the public domain, without
giving credit to the plaintiffs, they sued under § 43(a)(1)(A),
claiming false designation of origin. Id. The Court rejected the
7
This is not a claim that Zyla's work was substantially
changed and altered by Thomson without her permission. See, e.g.,
Choe v. Fordham Univ. Sch. of Law, 920 F. Supp. 44, 47 (S.D.N.Y.
1995), aff'd 81 F.3d 319 (2d Cir. 1996); Gilliam v. Am. Broad. Co.,
538 F.2d 14, 24 (2d Cir. 1976). Nor is this an assertion that
Zyla's own name constituted a service mark. See, e.g., Patsy's
Brand, Inc. v. I.O.B. Realty, Inc., 317 F.3d 209, 216-19 (2d Cir.
2003).
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plaintiffs' claim, holding that the term "origin" applies only to
"the producer of the tangible goods that are offered for sale, and
not to the author of any idea, concept, or communication embodied
in those goods." Id. at 2050. The Court found that no false
designation of origin had occurred because Dastar accurately
identified itself as the manufacturer of the physical video, even
if it had not accurately credited others for the creative content
of the video. Id. Claims of false authorship, the Court reasoned,
should be pursued under copyright law instead. Id. at 2048-49. We
conclude that Dastar controls here and bars Zyla's Lanham Act
claim.8
C. Breach of Contract
The Third Edition Agreement provided that Minnesota law
applies to the contract. The district court's application of that
law and its conclusions were correct.
1. Contract Claim Against Struble
The district court correctly dismissed the contract claim
against Struble, Zyla's co-author, on the basis that the Agreement
created no contract between Zyla and Struble. Zyla incorrectly
argues that the district court "missed the point." The point, she
8
The Court in Dastar left open the possibility that some
false authorship claims could be vindicated under the auspices of
§ 43(a)(1)(B)'s prohibition on false advertising. See 123 S. Ct.
at 2050. But to make out such a claim, Zyla must show that the
acknowledgments section was a form of "commercial advertising or
promotion," and she has not alleged the facts necessary to support
that conclusion.
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says, is that "every contract" under Minnesota law "includes an
implied covenant of good faith and fair dealing requiring that one
party not unjustifiably hinder the other party's performance of the
contract." In re Hennepin County 1986 Recycling Bond Litig., 540
N.W.2d 494, 502 (Minn. 1995) (internal quotation marks omitted).
But there was no contractual relation running between Struble and
Zyla. Under Minnesota law, the existence of a contract is a
prerequisite to the implied covenant of good faith and fair
dealing. See id. at 503 ("In Minnesota, the implied covenant of
good faith and fair dealing does not extend to actions beyond the
scope of the underlying contract."). We do not understand
Minnesota law to impose a free-standing implied covenant between
two parties who happen to have a contractual relationship with a
third party, and Zyla has cited no case supporting that
proposition.
2. Contract Claim Against Thomson
Zyla also asserts a breach of contract claim against
Thomson. Pointing to Thomson's extension of the deadlines for the
fourth edition, Zyla makes two arguments: (1) that Thomson's
failure "to take appropriate actions, in light of Ms. Struble's
delinquency and obstinacy, to enable Ms. Zyla to obtain the benefit
of her work" violated the contract; and (2) that Thomson's
extension of the deadline for the fourth edition was a violation of
the contract in light of Thomson's interest in having Struble
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complete work on the second edition of another of its books,
Community Nutrition, thereby delaying the fourth edition of
Personal Nutrition to Zyla's detriment. The argument on appeal is
that the district court, relying on the contract's express terms,
failed to consider how this conduct comprised a breach of the
implied covenant of good faith and fair dealing.
The Third Edition Agreement gives Thomson the right to
determine the scope and timing of the release of new editions.
Under Section 1.4, Thomson "may, after consulting with Author,
extend the Due Date" for the revised edition. Further, under
Section 2, it was Thomson's prerogative to decide how to deal with
the failure of an author to submit materials by a particular due
date. The Fourth Edition Addendum did not revise either of those
provisions.
Zyla is correct, nonetheless, that Thomson must assert
its contractual powers in a way that does not transgress the
implied covenant of good faith and fair dealing under Minnesota
law. No reasonable jury could find here that Thomson violated that
covenant. On the summary judgment record,9 Thomson had entirely
9
Zyla argues that a jury need not accept Thomson's
explanation for its decisions and so there is a dispute of fact.
The explanation does not on its face appear implausible, defy
common sense, or otherwise raise an inference of untruthfulness.
To the contrary, the explanation is inherently reasonable and
credible. There is no evidence even suggesting the explanation was
false, and absent such evidence, mere unsupported claims to the
contrary are not enough to support a plaintiff's verdict or defeat
summary judgment. See Quintana-Ruiz v. Hyundai Motor Corp., 303
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valid business reasons both for revising the schedule and for
rejecting Zyla's proposal. Thomson acted reasonably in deciding to
delay the fourth edition of Personal Nutrition in favor of Struble
first finishing her work on another of its books, Community
Nutrition, so she could then turn her full attention to Personal
Nutrition, the book in which Thomson had a larger financial stake.
Moreover, Thomson acted reasonably in sticking with its original
allocations of work to Struble because it believed that her
continued participation, as the original and lead author of
Personal Nutrition and its later editions, was essential to the
edition's success. The implied covenant does not require Thomson
to elevate Zyla's interests over its own.10
D. Tortious Interference With Advantageous Business Relations
Zyla claimed that Struble committed a tort when she
declined Zyla's proposal to reallocate a portion of her work and
royalties to Zyla.
Because the laws of Massachusetts and of Minnesota are
sufficiently similar on this issue, we need not decide which
F.3d 62, 75 (1st Cir. 2002).
10
One might wonder why, if Zyla's work was indeed used in
the fourth edition, she did not sue in quantum meruit. The answer
may be that she was advanced $2,000.00 for expenses in anticipation
of her work on the fourth edition. She had actual expenses of only
$265.00 and did not return the rest. Further, her withdrawal
caused Struble to hire two others to assist with the work that Zyla
was to have done. Struble paid, out of her own pocket, those two
persons the sums of $2,000.00 and $750.00, respectively.
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state's law governs. Under Minnesota law, a plaintiff may recover
from one who intentionally or improperly interferes with the
plaintiff's prospective contractual relationships by inducing or
causing a third person not to enter into or continue the
prospective relationship or by preventing the plaintiff from
acquiring or continuing the prospective relationship. United Wild
Rice, Inc. v. Nelson, 313 N.W.2d 628, 633 (Minn. 1982) (citing
Restatement (Second) of Torts § 766B (1979)). Massachusetts law is
consistent. Buster v. George W. Moore, Inc., 783 N.E.2d 399, 414
(Mass. 2003) (plaintiff must show "that the defendant knowingly and
for an improper purpose or by improper means induced a party to
breach a contract or not to enter into or continue a business
relationship, resulting in damage").
Struble's refusal to give up her own contractual rights
with Thomson in order to accommodate Zyla's desire for more work
and more money, to Struble's own detriment, cannot constitute a
tort. Struble's reasons, as outlined in her affidavit, were
perfectly sound: her experience was that "textbooks often undergo
schedule delays but are ultimately published with success," and she
"had no reason whatsoever to believe that any such reallocation was
necessary to ensure the successful publication of [the fourth
edition]." There was no intent to interfere shown by the record.
Again, Zyla's legal theory is simply inapposite.
E. Declaratory Judgment Claim To Void the April 10 Agreement
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After Zyla withdrew from the fourth edition, she signed
the April 10 Agreement, which reduced her share of the royalties
from 40% (what she would have received under the Fourth Edition
Addendum if she had fully participated in the fourth edition) to
12.5%. She now sues to be excused from this agreement, claiming
that the April 10 Agreement was induced by misrepresentations that
her work would not be used in the fourth edition.
The district court rejected Zyla's claim because it found
the April 10 Agreement immaterial. The court held that Zyla would
receive the same royalty allocation under Section 7 of the Third
Edition Agreement, which gave her one-half of her 25% royalty on
the third edition if she did not participate in the fourth edition.
Zyla responds that the district court impermissibly overlooked the
Fourth Edition Addendum, which allocated 40% of the royalties to
Zyla and 60% to Struble and provided that if the responsibilities
of the authors changed, this allocation could be altered "upon
written receipt [by] the Publisher of a letter from the Authors
signed by both Authors reallocating the royalties." Thus, Zyla
argues, the validity of the April 10 Agreement must be considered.
Accepting arguendo the premises of Zyla's argument, her
claim still fails to survive summary judgment. There is no
evidence of fraud in the inducement of the April 10 Agreement. To
demonstrate such fraud, Zyla must show (1) that Thomson or Struble
made knowingly false statements; (2) that those statements were
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made with the intent to deceive; (3) that those statements were
material to her decision to sign the April 10 Agreement; (4) that
she reasonably relied on those statements; and (5) that she was
injured as a result of her reliance. Kenda Corp. v. Pot O'Gold
Money Leagues, Inc., 329 F.3d 216, 225 (1st Cir. 2003) (applying
Massachusetts law); see also Exeter Bancorporation v. Kemper Sec.
Group, 58 F.3d 1306, 1310-11 (8th Cir. 1995) (applying a similar
standard under Minnesota law). Zyla has not shown that Thomson or
Struble knowingly made false statements or intended to deceive
Zyla. There is no evidence that either Thomson or Struble intended
to use Zyla's work in the fourth edition at the time the April 10
Agreement was signed.11
F. Mass. Gen. Laws Ann. ch. 93A
Zyla claims that any use of her work on the fourth
edition without appropriate credit and compensation was an unfair
and deceptive trade practice under Mass. Gen. Laws Ann. ch. 93A, §§
2 and 11.
11
The only evidence to which Zyla points is a November 1999
e-mail exchange among Zyla and two lower-level editors in which
Zyla stated that because she had selected a particular New Yorker
cartoon to be used in the fourth edition, Thomson could not use the
cartoon now that she had withdrawn from the project. But even
assuming Marshall and Struble were aware of this e-mail exchange,
nothing about it suggests that Thomson or Struble intended to use
Zyla's revisions. Struble states in her affidavit that, although
she was aware that Zyla had chosen the cartoon, she made an
independent choice to use it over several other options yielded in
a search for "fast food" in a cartoon database. Zyla has not
presented evidence controverting this account.
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The district court viewed Zyla as having narrowed her ch.
93A claims to (1) the defendants' breach of contract, (2) Struble's
interference with Zyla's advantageous relations, and (3) the
defendants' allegedly fraudulent inducements to Zyla to sign the
April 10 Agreement. Because these claims failed, the district
court reasoned, the ch. 93A claim failed. Even if a broader
reading of the ch. 93A claim were appropriate (after all, one might
have an unfair trade practice without a breach of contract, see,
e.g., Peggy Lawton Kitchens, Inc. v. Hogan, 466 N.E.2d 138, 140
(Mass. App. Ct. 1984) (theft of trade secrets)), the claim would
still fail.
Thomson published the fourth edition without any prior
notice from Zyla that Struble's work made unauthorized use of
Zyla's work. There was no evidence that Thomson had any earlier
reason to be aware that Struble had (allegedly) made unauthorized
use of Zyla's work or that it failed in any of its duties. Its
conduct on this score could not be unfair or deceptive. Nor could
its prior conduct in extending deadlines, which was authorized by
contract.
As to Struble, she cannot be held liable under § 11
unless the allegedly wrongful conduct occurred "primarily and
substantially" in Massachusetts. Mass. Gen. Laws Ann. ch. 93A, §
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11.12 This is a question of law, which we review de novo. Roche
v. Royal Bank, 109 F.3d 820, 827 (1st Cir. 1997). Under § 11,
Struble bears the burden of proof on this issue. It is undisputed
that Struble is a resident of New Jersey and that Thomson's place
of business in the United States is in Connecticut. Struble stated
in her affidavit that all her work on the fourth edition was
carried out in New Jersey, that she neither works nor does business
in Massachusetts, and that there is no connection between
Massachusetts and the preparation of the fourth edition other than
the fact that Zyla lives in Massachusetts. Zyla has not presented
evidence controverting this statement. Nor has she alleged in her
complaint any actions taken by Struble in Massachusetts. Zyla's
93A claim against Struble was properly dismissed. See Garshman Co.
v. GE, 176 F.3d 1, 7 (1st Cir. 1999) (conduct did not occur
"primarily and substantially in Massachusetts" under ch. 93A where
the plaintiff resided in Massachusetts and thus suffered the loss
there, but most of the defendants' conduct occurred out of state).
G. Denial of Motions To Amend and To Impose Sanctions
The district court correctly denied Zyla's motion to
amend her complaint to bring a claim for punitive damages under
Minnesota law. The motion came too late and was, in any event,
futile.
12
We also assume arguendo that Struble was herself engaged
in "the conduct of any trade or commerce." M.G.L. c. 93A § 2.
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Zyla complains about the conduct of the defendants during
a deposition. It was well within the discretion of the district
court to decide that the situation did not warrant its intervention
or any form of sanction.
III.
Entry of judgment for defendants is affirmed. Costs are
awarded to the defendants. So ordered.
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