Miller v Arnold Worldwide, LLC

[*1] Miller v Arnold Worldwide, LLC 2006 NY Slip Op 51849(U) [13 Misc 3d 1216(A)] Decided on August 28, 2006 Supreme Court, New York County Cahn, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on August 28, 2006
Supreme Court, New York County

Tim Miller, Plaintiff,

against

Arnold Worldwide, LLC, Defendant.



603947/05

Herman Cahn, J.

Plaintiff Tim Miller (Miller), a professional actor, seeks compensatory and punitive damages from, and injunctive relief against, defendant Arnold Worldwide, LLC (Arnold), an advertising agency, concerning Arnold's use of his image in a television commercial.[FN1]

Arnold moves to dismiss the first and third counts of the complaint, and compel arbitration of the second count,[FN2] CPLR 3211 [a] [7] and CPLR 7503 [a]. For the reasons stated below, the motion is granted to the extent that the parties are directed to proceed to arbitration.

It is alleged in the complaint that, on May 12, 2003, Miller, a member in good standing of Screen Actors Guild (SAG), entered into a SAG "extra" contract (Extra Contract) with Arnold pursuant to which he was engaged to perform as "background atmosphere" in a television commercial produced by Arnold (Complaint, ¶ 16-17). Miller alleges that the Extra Contract limited defendant's use of his image to an "extra performance," and that any other use of his image required the parties to enter into a separate SAG "principal" contract (id.). Miller further alleges that as his acting performance in the TV Commercial rose to the level of principal [*2]performance,[FN3] he is entitled, pursuant to the SAG Commercials Contract,[FN4] to enter into a Principal Contract, in lieu of the SAG Extra Contract. Plaintiff asserts that a Principal Contract provides for greater compensation than an Extra Contract.

Miller contends that Arnold used his image, for its commercial benefit, in a manner proscribed by the Extra Contract. He also contends that unless Arnold was filming its first commercial, its conduct was in knowing violation of the SAG Commercials Contract.

Miller claims that after the TV Commercial aired, he filed a complaint with SAG for an upgrade to principal performance, as defined in the SAG Commercials Contract. SAG determined that plaintiff's performance met the criteria in paragraph 6 (c) and (d) of that agreement. Although SAG allegedly made a claim for payment on Miller's behalf, Arnold disputed the claim. Thereafter, Miller asserts upon information and belief, that SAG withdrew the claim because of its backlog of arbitration claims and its fear of pursuing claims in binding arbitration.[FN5] Plaintiff claims that SAG then provided him with its file and advised him that he could pursue his claim in this court.[FN6]

In the first cause of action, plaintiff alleges that defendant's use of his principal performance is in direct violation of New York Civil Rights Law §§ 50 and 51, and that he is entitled to an injunction permanently restraining defendant from the use of his image. In the second, Miller alleges that he has been damaged by defendant's use of his image for purposes other than as background atmosphere, in violation and breach of the parties' written agreement. In the third cause of action, plaintiff seeks the reasonable value of the principal acting services he allegedly provided to defendant. For each cause of action, plaintiff seeks $25,000 in compensatory damages, and $1,000,000 in punitive damages.

Plaintiff alleges, and there is no dispute, that defendant, as producer, contracted with him [*3]for his performance in the TV Commercial, and that this engagement was governed by the terms of the SAG Commercials Contract. In moving to compel arbitration of the contract claim, defendant points out that the Extra Contract states, "[t]his contract is subject to all of the terms and conditions which pertain to Extra Performers in the applicable Commercials Contract" (Hyman Aff., Exh. A, at 1). The parties do not dispute that the "applicable Commercials Contract," referred to in the Extra Contract, is the SAG Commercials Contract, section 57 of which states:

"All disputes and controversies of every kind and nature whatsoever between any Producer and any principal performer and extra performer ("performer") arising out of or in connection with this Contract, and any contract or engagement . . . in the field covered by this Contract as to the existence, validity, construction, meaning, interpretation, performance . . . enforcement [or] breach of this Contract and/or such contract or engagement, shall be submitted to arbitration in accordance with the following procedure.

. . . "The parties agree that the provisions of this Section shall be a complete defense to any suit, action or proceeding instituted in any Federal, State or local court or before any administrative tribunal with respect to any controversy or dispute which arises during the period of this Contract and which is therefore arbitrable as set forth above. The arbitration provisions of this Contract shall, with respect to such controversy or dispute, survive the termination or expiration of this Contract."

(Arbitration Provision).

A broad arbitration provision, such as the one here, "creates a presumption of arbitrability which is only overcome if it may be said with positive assurance that the arbitration clause is not susceptible of an interpretation that covers the asserted dispute" (Bank Julius Baer & Co. Ltd. v Waxfield Ltd., 424 F3d 278, 284 [2d Cir 2005], quoting WorldCrisa Corp. v Armstrong, 129 F3d 71, 74 [2d Cir 1997] [internal quotation marks omitted]). Parties must arbitrate claims if their underlying factual allegations touch issues encompassed by the contract (Oldroyd, 134 F3d at 77; see Brown v V & R Advertising, Inc., 112 AD2d 856, 861 [1st Dept 1985], affd 67 NY2d 772 1986] ["Once the courts have determined that there is a reasonable relationship between the arbitration . . . clause and the subject matter of the dispute . . . the court's inquiry ends"]).

This dispute involves an engagement under the SAG Commercials Contract and the determination of his claims are intertwined with, and necessarily entail interpretation of that agreement. Thus, as stated in Hannafin v Universal Pictures Co. (234 AD2d 24, 24 [1st Dept 1996]), in which the First Department upheld the lower court decision compelling arbitration of an actor's Civil Right §§ 50 and 51 claim, "[a]s a member of [SAG], plaintiff is bound by the collective bargaining agreement reached between that union and the motion picture producers and, specifically the arbitration clause contained in . . . the [SAG] Commercials Contract . . . ."

In opposition, Miller argues that he did not receive adequate notice of the Arbitration Provision. Miller does not claim that the SAG Commercials Contract does not govern here, nor could he reasonably do so in light of the allegations of the complaint, but rather maintains that he should not be bound by the Arbitration Provision because the Extra Contract does not contain [*4]notice of it. An agreement to arbitrate, however, may be found when an arbitration provision is incorporated by reference into an agreement to which the party sought to be compelled agreed (Liberty Mgt & Constr. Ltd. v Fifth Avenue & Sixty-Sixth St. Corp., 208 AD2d 73, 77-78 [1st Dept 1995]; see Thomson-CSF, S.A. v American Arbitration Assn., 64 F3d 773, 777 [2d Cir 1995]). Moreover, where plaintiff both declares that he is a member in good standing of SAG and attempts to use the SAG Commercials Contract as a sword, he will not be heard to complain that he should not be bound by its terms, due to lack of notice, by a specific provision therein.

Miller argues that the court should not enforce the Arbitration Provision because of unspecified public policy issues concerning his Civil Rights Law § 51 claim. This argument, however, has been rejected by the First Department on more than one occasion (Hannafin, 234 AD2d at 25 [stating that "[p]ublic policy considerations are not implicated by arbitration of plaintiff's claims under Civil Rights Law §§ 50 and 51"]; Brown, 112 AD2d at 860 [finding that Civil Rights Law §§ 50 and 51 do not bar arbitration because the statute protects the private rights of an affected individual, and not those of the public at large]).

Plaintiff's unsupported argument that he should not be compelled to arbitrate because he cannot obtain punitive damages in arbitration has also been addressed and rejected by the First Department (Brown,112 AD2d at 860). In addition, Welch v Mr. Christmas, Inc. (57 NY2d 143 [1982]), cited by plaintiff in opposition, involved merely "the unauthorized use of a commercial after the time limitation on plaintiff's consent had concededly expired," and there is no indication that an arbitration agreement was involved (Brown, 112 AD2d at 861).

Finally, plaintiff argues that because of the expense involved, he should not be compelled to arbitrate his claim. In view thereof, and to remedy what he calls a "David and Goliath" situation, plaintiff argues that the court should deny the motion to compel or, alternatively, stay this action, compel arbitration, and order the defendant to pay plaintiff's arbitration costs. Although the court is sympathetic to plaintiff's concerns about costs, the subject of arbitration fees is directly addressed in the Arbitration Provision. In any event, the party opposing arbitration has the burden of proving the probability of incurring prohibitive costs (Green Tree Fin. Corp.-Alabama v Randolph, 531 US 79, 91 [2000]). As plaintiff neither demonstrates that arbitration is, due to its expense, unconscionable in this instance, nor provides another basis for his request, the request is denied.

Accordingly, this action is stayed pending the outcome of the arbitration proceeding. In addition, as the motion to compel arbitration is granted, and this dispute subject to arbitration, it is unnecessary to reach the parties' arguments regarding dismissal.

Accordingly, it is

ORDERED that defendant's motion is granted to the extent of directing that the parties proceed to arbitration; and it is further

ORDERED that the action is stayed pending the decision of the arbitrator(s); and it is further

ORDERED that the plaintiff's request for an order directing defendant to pay his arbitration fees is denied.

Dated: August 28, 2006 [*5]

ENTER:

_________/s/_________________

J.S.C. Footnotes

Footnote 1: Plaintiff states that he seeks an injunction permanently restraining defendant from making any further use of his "principal performance" (Complaint, at 12).

Footnote 2: Plaintiff has withdrawn his fourth cause of action for fraud.

Footnote 3: Miller's contention that he is entitled to a principal performance contract and payment appears to be based on his allegation that during the TV Commercial's filming, he was identifiable and given a direction to react by raising his eyebrows at a principal performer standing behind a deli counter. Miller appears to allege that the version of the TV Commercial in which he raised his eyebrows was aired for 21 months.

Footnote 4: Through their submissions and arguments, the parties make clear that what the plaintiff describes in the complaint as the SAG Commercials Contract is the 2003-2006 Screen Actors Guild Commercials Contract.

Footnote 5: In his brief, Miller complains that SAG is afraid to arbitrate upgrade and downgrade claims, and only arbitrates clear-cut cases. Because of SAG's alleged reluctance to prosecute these types of claims, Miller asserts that agencies have no incentive to pay what is contractually due actors.

Footnote 6: Annexed to the original copy of the complaint filed at the New York County Clerk's Office is a copy of a letter sent by plaintiff's counsel to defendant stating that on May 12, 2003, Miller was employed as a commercial background performer and that the "Screen Actors Guild Employment Contract was executed on that date and limited to said usage . . . . Specifically, Mr. Miller's performance is in the foreground, identifiable . . . as per the [SAG] Commercials Agreement" (Complaint, Exh. F).