EXPERIENCE HENDRIX LLC v (1) PPX ENTERPRISES INC (2) EDWARD CHALPIN [2002] EWHC 1353 (QB)

IN THE HIGH COURT OF JUSTICE
QUEENS BENCH DIVISION
[2002] EWHC 1353 (QB)Case No Case No: 01/TLQ/1370Venue Royal Courts of Justice, Strand, London, WC2A 2LL
Between
EXPERIENCE HENDRIX LLCClaimant(1) PPX ENTERPRISES INC (2) EDWARD CHALPINDefendants
Before
Mr Justice BuckleyPhilip Jones (instructed by Eversheds) for the ClaimantAndrew Green (instructed by Harbottle & Lewis) for the DefendantsHearing dates : 7th, 8th, 9th, 10th, 13th and 15th May 2002Date 5 July 2002
[1]Mr Justice BUCKLEY : Background Jimi Hendrix was born in Seattle, USA on 27th November 1942. By the time he died in London in 1970, at the age of 27, he had achieved worldwide fame as a rock instrumentalist, vocalist and composer of popular songs.[2]He was persuaded to come to London in 1966 where he formed a group known as “The Jimi Hendrix Experience”. The group’s debut single “Hey Joe” was released in December that year. Further singles were recorded and released in March and April 1967. In June the group’s first album “Are You Experienced” was released. It was these recordings that first took Jimi Hendrix to international stardom.[3]Prior to his arrival in London he had played as a sideman to Curtis Knight, a vocalist. In particular, he played guitar with the group “Curtis Knight and the Squires”. The first Defendant (“PPX”) had recorded numerous tracks of such performances both in its Studio 76 and at live performances. Curtis Knight and Jimi Hendrix signed recording contracts with PPX. Jimi Hendrix’s contract was dated 15th October 1965. By that contract he agreed to produce, play and or sing exclusively for PPX for three years in return for a 1% royalty on the retail selling price of records sold. The agreement also provided that PPX should have exclusive rights to all master recordings produced.[4]When the second Defendant, Mr. Chalpin, the owner and president of PPX, learned of the successful releases of “The Jimi Hendrix Experience” records he instituted proceedings in New York and in 1967 in London, based on the 1965 agreement. Notwithstanding these proceedings and to Mr. Chalpin’s surprise, Jimi Hendrix turned up at his recording studio in July 1967 and played guitar during further recording sessions with Curtis Knight. The London Proceedings[5]The London proceedings were eventually settled in 1973. After many days of evidence the parties finally reached agreement on 7th March 1973. The terms of their agreement which, were embodied in recitals to the Order that the court was asked to make, were read to the Judge. He was handed a copy of the draft order to which was attached a Schedule A. The Order was drawn up and sealed by the court on 22nd March 1973 and Schedule A was attached. There were various parties to the London proceedings including Alan Leighton Davis, Attorney for the Administrator of the Estate of the late Jimi Hendrix.[6]The present Claimant, Experience Hendrix LLC (“EHL”), is a company incorporated in the State of Washington, USA, and is owned and controlled by the family of the late Jimi Hendrix. It is the successor in title to the estate. It owns and administers most of the rights relating to Jimi Hendrix’s music, recordings, songs and performances apart from certain recordings made by him as sideman with other groups, including those already mentioned with Curtis Knight.[7]It is the terms of settlement of the London proceedings (“the 1973 Agreement”), in particular Schedule A, which gives rise to the present proceedings. I would add, without further detail, that there have been other legal actions arising out of disputes concerning the Jimi Hendrix legacy and involving the parties behind these proceedings. Because the terms of the 1973 Agreement are fundamental to these proceedings, I set them out:
“AND UPON 1. The Plaintiff and Edward Chalpin undertaking through their Counsel to the Court that no action upon the Contract between Plaintiff and the original 1st Defendant dated 15th October 1965 shall be brought against anyone anywhere EXCEPT (a) Actions against any licensee of the Plaintiff relating to the masters specified in Schedule A hereto in respect of any breach or threatened breach of the terms of the relevant licence (a list of the licences now subsisting in respect of such masters to be supplied by Mr. Chalpin to the 1st Defendant within 10 days hereof) OR (b) . . . . . . . . . . 2. . . . . . . . . . 3. (a) Defendants agree that the Plaintiff is entitled to the masters of the titles listed in Schedule A hereto being masters now in the possession of the Plaintiff and all rights of all kinds in respect of those masters and the copyright therein and the performances recorded thereon PROVIDED THAT in respect of any new licences or any extension or variation of any existing licence relating thereto (i) The estate of Jimi Hendrix shall be entitled to a royalty of 2% of the retail selling price of records sold based upon the same formula as applied to the royalty rate payable to the Plaintiff but (ii) Should the Plaintiff receive thereunder a royalty of 6% or less then the estate shall be paid only 1% and (iii) There shall be an account of all such royalties and payment of what is due on the last day of March, June, September and December in each year. (b) Defendants further agree that the Plaintiff is entitled to honour, carry out and comply with any existing contract or licence relating to titles not listed in Schedule A full particulars of which and of the contracts and licences relating thereto shall be supplied by Mr. Chalpin to the first Defendant within 10 days hereof PROVIDED (a) No extension or renewal of such contracts or licences shall be granted without the consent of the first Defendant (b) No further or other records, tapes or cassettes or other form of recording shall be issued or released except those specifically covered by such contracts or licences. 4. The Plaintiff and Edward Chalpin and Studio 76 Inc. will deliver up to the first Defendant all masters of recordings (not hereinbefore referred to) on which Hendrix performed in any capacity whatsoever now in the possession of any of them or to which any of them is entitled and same shall thereupon be destroyed.”
[8]After those and other recitals the Order itself was brief and essentially provided that there should be no Order for Costs but that the Plaintiff should pay the Defendants £50,000 on or before 6th April 1973.[9]Although not all the above was originally accepted by Mr. Chalpin in his witness statement, I understood it to be agreed at the trial. For the avoidance of doubt, I find it as fact. The Present Proceedings[10]It is now agreed that at various times since 1973 and contrary to the terms of the 1973 Agreement, PPX has licensed various masters which do not appear in Schedule A; further, that it did not deliver up all the masters called for by paragraph 4. In particular, PPX granted a licence in 1995 to a German company CBH Records and in 1999 a licence to Nippon Crown. The former was terminated by PPX in 1996.[11]EHL presently claims, in summary: i. An injunction to restrain both Defendants from exploiting masters other than those in Schedule A; ii. Delivery up of the Clause 4 masters; iii. Damages and or an account of royalties.[12]The Defendants submit that Schedule A was varied and as varied permitted the exploitation that has taken place; alternatively EHL has waived any rights it had; has by conduct granted an implied licence for the exploitation or is now estopped from asserting its rights. In any event, EHL should now be refused equitable relief because of acquiescence or laches. PPX counter-claims for a declaration that it is entitled to exploit certain masters in addition to Schedule A. Variation of Schedule A[13]Mr. Green, Counsel on behalf of the Defendants, submitted that between 10th March and 2nd April 1973 the parties had agreed that PPX was entitled to continue to exploit 50 masters identified in the list attached to a letter dated 19th March 1973 from PPX to Mr. Branton in California. Mr. Branton was then acting as attorney to the estate. He submitted that the 19th March letter constituted the offer to vary the 1973 Agreement by extending Schedule A and an acceptance was to be found in three further letters: i. Mr. Howard (another attorney then acting for the estate) to Mr. Chalpin dated 23rd March 1973. ii. Goodman Derrick (solicitors then acting for the estate) to Rowe and Maw (solicitors then acting for Mr. Chalpin) dated 2nd April 1973, and iii. Mr. Binks, a partner in Harold Stern and Co. (solicitors also advising Mr. Chalpin) to Rowe and Maw dated 2nd April 1973. In support of the above Mr. Green further submitted that since the lists provided with the 19th March letter did not correspond with those called for by the 1973 Agreement it must constitute an offer to vary and that it was supported by other contemporaneous messages between Mr. Chalpin and Mr. Binks which clearly showed that Mr. Chalpin’s intention was to extend Schedule A. He also submitted that the three letters mentioned spoke for themselves and evidenced an acceptance. He also prayed in aid Mr. Binks’ oral evidence that had he not secured agreement to Mr. Chalpin’s instructions at a so-called completion meeting on 29th March 1973, he would not have completed but “come running back to get further instructions, but I did not”.[14]I regard those submissions as untenable. Even if PPX’s letter dated 19th March could fairly be construed as an offer to vary the Agreement, which without more, I doubt, I cannot construe the other three letters to which Mr. Green referred as an acceptance. Mr. Howard to Mr. Chalpin, 23rd March 1973[15]Mr. Green sought to rely upon the words “we will accept these lists”, but from a reading of the letter as a whole it is reasonably clear that any acceptance was that the lists would be acceptable as a compliance with the terms of the 1973 Agreement, provided that the further copies of licensing agreements were provided. I cannot construe this as an acceptance of an offer to vary the substance of the 1973 Agreement, not least because as Mr. Jones, Counsel of EHL, pointed out, the variation canvassed would have required not only extending Schedule A by a new list of titles but redrafting the 1973 Agreement itself, in particular, the other recitals to the court Order which I have quoted above. Goodman Derrick’s letter to Rowe and Maw dated 2nd April 1973[16]This letter clearly refers to compliance with the court Order, by which is meant the 1973 Agreement embodied in the recitals. It refers to 1.(a) and 3.(b) which are the very clauses calling for delivery of a list and further particulars from Mr. Chalpin. Admittedly, clause 4 did not call for a list of the masters to be delivered up but obviously it was sensible for the parties to seek to identify them. In neither of these two letters nor in PPX’s letter dated 19th March was there any reference to Schedule A or any amendment or enlargement of it or the substance of the 1973 Agreement. I can see no basis for finding that any of that was implied.[17]As to Mr. Binks’ letter to Rowe and Maw dated 2nd April 1973 : whilst this might be some evidence of what happened at the completion meeting on 29th March, it cannot constitute an acceptance of anything. It is not an interparty letter. In any event, I would consider it extraordinary if there had indeed been a fundamental variation of the 1973 Agreement, to find Mr. Binks simply referring to Goodman Derrick’s confirmation that “the Schedule (obviously a reference to the lists) . . . . . were correct and in compliance with the requirements of the Order”.[18]Unsurprisingly, most of the witnesses who were asked about the turn of events in 1973, protested that they could not now remember; none more firmly than Mr. Binks. He said that even re-reading the documents had not refreshed his memory. Insofar as Mr. Binks was suggesting that he must have secured Mr. Chalpin’s instructions and that those were to amend the 1973 Agreement, I cannot accept that. Firstly, because Mr. Binks himself insisted that he had no independent recollection and secondly, I do not place that interpretation on the contemporaneous documents. It is also contrary to Mr. Perrot’s evidence. Mr. Perrot was a solicitor at Goodman Derrick assisting in this matter. In fairness to Mr. Binks, I believe he was intending to convey that if his instructions were to secure a particular result he would not have simply completed without doing so or without recourse to Mr. Chalpin. But by the time that Mr. Binks came into the matter, the 1973 Agreement was in place. Mr. Chalpin was bound to pay the £50,000 and supply the lists. Mr. Chalpin had sought Mr. Binks’ advice because he was unhappy with the agreement or settlement that he felt he had been pressured into. I say a little more about this later. I find that Mr. Binks’ concern at that time was to secure Goodman Derrick’s agreement that Mr. Chalpin had complied with the terms of the 1973 Agreement by providing the lists called for or their equivalent and also to deal with the release of the £50,000. Further light is thrown on the events by other contemporaneous correspondence and messages. These are relevant not just to lend support to my rejection to the plea of variation, but to throw some light on Mr. Chalpin’s state of mind and knowledge at the time, which in turn is relevant to various other pleas raised by the parties.[19]As I have already indicated, the solicitors most directly involved were Rowe and Maw for Mr. Chalpin and Goodman Derrick for the estate. Mr. Binks came in to advise Mr. Chalpin after the settlement had been agreed and read out to the court. There is no reference by any of the solicitors in the contemporaneous exchanges that took place, to any agreed variation of Schedule A or of the 1973 Agreement itself. It seems that Mr. Chalpin had a costs indemnity from Decca Records, who had an interest in the litigation and certainly a concern of Mr. Chalpin’s was not to lose that indemnity. However that may be, it is apparent that he was not happy with the 1973 Agreement and considered the possibility of upsetting it, even after the court Order. In a letter to Mr. Maw of Rowe and Maw dated 19th March 1973 Mr. Binks wrote:
“I think I’m bound to add finally that according to my instructions Mr. Chalpin was given only a very few minutes to consider the terms of the compromise agreement before it was mentioned in the court and his original instructions to me were to take steps to apply to have it set aside. He has no wish now to do so on the basis that the costs are being paid by LRI but his interests must nevertheless be fully protected.”
In a later letter dated 8th August 1973 to Mr. Chalpin Mr. Binks wrote as follows:
“You were given firm advice by Counsel and solicitors that you should settle upon the terms which in fact you did, and these as you know involve the payment by Decca of the costs of both sides. It must have been a possibility that if events had emerged during trial which would have given Decca the right to refuse to honour their indemnity, you would then have been on risk as to all the costs of both sides if you had gone on and lost. The implication behind your present request for advice is that Messrs. Rowe and Maw were not acting in your best interests because they had conflicting obligations to you and Decca . . . . . . . When you first came to see me you said that the compromise had been entered into without your having the opportunity of considering it fully or getting full and proper advice and at that stage you were nervous that Decca might even then refuse to pay the costs. Had you wished to go to the court and ask for the compromise to be set aside on the basis that those representing you were acting without your full instructions, then that was the time to do it. In the event you decided that once the Decca situation was clarified to accept the deal once you knew that your liability for costs would be dealt with. In my view you would be too late in any event to re-open it now . . . . . . I unhesitatingly advise you to let the matter drop.”
That letter was in reply to one from Mr. Chalpin to Mr. Binks dated 3rd August which was not disclosed. If Mr. Binks had accepted instructions to attempt to amend Schedule A and or the 1973 Agreement as a whole and believed he had succeeded before or at the so-called completion meeting, I find it extraordinary that there is no reference to such a fundamental matter in this letter. Mr. Perrot, whilst accepting that he now had no independent recollection of events, had to an extent been able to refresh his memory from the documents. In evidence he was quite sure that Goodman Derrick would never have agreed to the amendment of Schedule A to the Agreement which had been negotiated. He rejected Mr. Chalpin’s assertion in his witness statement that Goodman Derrick had indeed agreed to such an amendment. I accept Mr. Perrot’s evidence on that.[20]Mr. Jones submitted that Mr. Chalpin’s evidence was at best disingenuous and that he had in 1973 deliberately set out to confuse the situation, being dissatisfied with the 1973 Agreement that he felt he had been pressured into accepting. I do not need to decide that, it is enough to find, as I do, that Mr. Chalpin was fully aware of the terms of the 1973 Agreement including Schedule A, that he knew it had not been expanded to entitle him to exploit all the masters he had by then licensed and that he determined to go his own way. By that I mean that thereafter he took the calculated risk of licensing masters, other than those in Schedule A, in the belief that either Mr. Branton and the estate would not bother to sue him or that if they did, he would be able to reach some accommodation. In the event he was correct. It is clear that Mr. Branton knew of Mr. Chalpin’s exploitation of non-Schedule A masters and decided, as he said in evidence, that it was not a commercial proposition then to get involved in litigation concerning those particular masters.[21]In addition to suggesting that Goodman Derrick had agreed to his suggested expansion of Schedule A, Mr. Chalpin maintained that Mr. Branton had also agreed it with him. Mr. Branton firmly denied that in evidence. No oral variation was pleaded or relied on by Mr. Green in his closing submissions but I would not have found one in any event on the evidence before me. Events Since 1973[22]The Claimant limits its claim for royalties and/or damages to the licences granted by PPX to CBH and Nippon Crown in 1995 and 1999, which it alleges were in breach of the 1973 Agreement. Its claim to an injunction is to restrain further breaches. In the event which has occurred, namely, that I have rejected the plea of variation, the Defendants rely upon an implied licence, estoppel or waiver as justifying any apparent breaches and in order to resist the claims. Further, they point to the delay in seeking equitable relief. It is thus necessary to summarise events since 1973. Happily these are largely agreed; it is the interpretation of them which has given rise to debate.[23]It is common ground that since 1973 Mr. Chalpin, through PPX, has granted licences to others to produce records from his masters and has thus exploited non-Schedule A masters. I need not go into details; it is agreed that numerous such licences were granted and many, or copies, have survived and were disclosed. The first was in November 1973. It is now clear that the licences covering various parts of the world outside the USA were granted by PPX upto the early 1980’s. It is also clear that Mr. Branton knew this at least in general terms. In his witness statement he said:
“On a few occasions during the 1970’s or 1980’s I became aware from third parties that PPX had released Curtis Knight-Jimi Hendrix albums overseas which appeared to violate the 1973 Court Order and which were poor in quality, but having experienced prior litigation with PPX it was my opinion that the cost of litigating with PPX over these marginal albums would exceed any possible financial benefit to be derived from removing them from the market.”
In evidence Mr. Branton also said that he had been told by a Mr. Douglas, who was working for the estate, what Mr. Chalpin was doing and that he was also openly advertising Hendrix recordings at MEDAM which is an association through which music is presented. The defendants disclosed copies of two letters dated 21st November 1973 and 21st February 1974 addressed to Mr. Branton and enclosing copies of licensing agreements entered into. They were signed by Janet Facher who was then Mr. Chalpin’s secretary. Mr. Jones put to Miss Facher, who gave evidence via video link, certain unsatisfactory aspects of those documents, but stopped short of suggesting they were not genuine. Her best recollection was that copies of licences generally were sent to Mr. Branton. In the event the issue concerning these two letters is not crucial. I find they were probably sent, although they were not traced in Mr. Branton’s files.[24]By letter dated 7th April 1983 Diane Toop wrote to Mr. Branton on behalf of Coudert Bros., attorneys who were then involved in litigation with PPX on behalf of CBS. She referred to a discussion with Mr. Branton and enclosed various PPX licence agreements which had been disclosed in the CBS litigation together with a list of records which they had discovered in New York stores. Again I need not rehearse details, the letter and its enclosures clearly brought to Mr. Branton’s attention that PPX had been granting licences in breach of the 1973 Agreement. To be precise 12 such licences were enclosed with the letter.[25]It was also the Defendants’ case that royalties had been paid to the estate in respect of these various licences. Mr. Chalpin could produce no documentary evidence at all to support the contention and neither did Mr. Branton’s files, which otherwise appear to have been fairly comprehensive and did contain other royalty records, contain any evidence of such payments. In evidence Mr. Chalpin sought to maintain that he had arranged for the licensees to pay the estate directly. I am afraid I found the suggestion wholly unconvincing and not supported by the licence agreements produced, despite Mr. Chalpin’s interesting approach to construction. In the context of implied licence or estoppel, the evidential burden of establishing payment of royalties is on the Defendants and in the absence of any supporting documentation for Mr. Chalpin’s bare assertion, I find they failed to discharge it. In fact, on the evidence as a whole I would reject the submission wherever the burden fell.[26]Mr. Branton’s evidence as to why he took no action on behalf of the estate despite his knowledge of PPX’s actions was, as I have already mentioned, that he did not consider it worthwhile. It is clear that Mr. Chalpin is not shy of litigation, as he accepted in evidence. I accept Mr. Branton’s evidence that he did not wish to become embroiled in litigation with him. It also appears to have been Mr. Branton’s view that the PPX recordings were, at least mainly, sideman recordings and not a great threat to the estate’s mainstream releases.[27]On 5th March 1983 Mr. Branton wrote to Mr. Chalpin about some negotiations the estate was involved in with Moss Music. It seems Mr. Chalpin had threatened Moss with a law suit. The letter contains this passage:
“You and I had a dispute concerning whether or not you had any remaining rights whatsoever, and that is a matter that we will have to settle sometime in the near future. In the meantime, I wanted to make clear to you that you’ve absolutely no right to interfere with the Hendrix Estate or its successors in interest in putting out any Hendrix product, and in this position you apparently agreed. If there is any question about your agreement with this position, please let me know in writing immediately the basis of any possible objection that you might have to such activity on our part.”
[28]On the evidence as a whole I find that up to this date Mr. Chalpin had exploited numerous masters in his possession, contrary to the 1973 Agreement; that he did so for commercial reasons knowing that his actions were contrary to the 1973 Agreement and that he knew the estate did not agree to or approve of his actions but believed it would probably not litigate. I should mention that in Mr. Chalpin’s second witness statement he says:
“Mr. Branton had been bad-mouthing me for years and had alleged that I had no rights to any Jimi Hendrix recordings.”
Mr. Chalpin there appears to be referring to 1993 but the reference expressly goes back “for years”. It is certainly consistent with the 5th March 1983 letter.[29]There appears then to have been a gap in Mr. Chalpin’s exploitation activities, at least on the evidence before me. However, an exchange of letters between Mr. Branton and Mr. Chalpin in 1994 is of interest. November 10th, 1994 - Mr. Branton to Mr. Chalpin: “”Ed, because of our past relationship and because of some of your recent conduct, I do not care to have any discussions with you personally about any claim that you feel you might have. Therefore, I suggest you submit to me in writing any claim that you feel you have and support it with whatever documentation is available and I will reply thereto in writing. Your telephone message indicated that you wanted to “avoid a law suit”. I cannot imagine what kind of law suit you could file. You have continually over the years violated both the spirit and substance of the Court Order that was made against you in England in as much as you have continued to sell Hendrix product abroad. In any event, If you want to let me know what your claims are, please do as I have suggested above.” December 8th, 1994 - Mr. Chalpin to Mr. Branton: “In so far as your accusation of a continued violation of the spirit of the British settlement which you prefer to call the “Court Order”, this is your self-serving statement which has no validity You should be the last man to talk about violations in light of your past acts against me and Hendrix. For years you embark on a campaign to unjustly ruin my name and discredit my masters. Recent events disclose your motive. It appears justice may yet prevail. As you well know I’ve been in this area with the same telephone for approximately 35 years, before you even heard of Jimi Hendrix who you never met. As such, if you felt I violated the “spirit and or substance” of any “Court Order” you had ample opportunity if not an obligation to act. In the meantime I want to know if you wish to settle the above issues without litigation.” The reference to “above issues” was to matters outside the ambit of the present dispute. I regard those letters as some further support for the general findings I have made. It is reasonably clear to me, and I so find, that Mr. Chalpin felt and still feels strongly that he, in a sense, discovered Jimi Hendrix and is the owner of the copyright in many early recordings (even if they are not mainstream recordings). He was and is determined to exploit “his” recordings and to an extent feels aggrieved that attempts he has made in the past to become more involved with the estate have been rebuffed. Unfortunately, from his point of view, the 1973 Agreement severely restricted the entitlement he would otherwise have had to exploit those early recordings. If correct these findings go some way to explain his activities.[30]The Defendants also rely upon conversations between Mr. Chalpin and Mr. Douglas, on behalf of the Estate, in July 1989 and May 1991. Those conversations were tape-recorded. I do not find them very helpful. They do seem to indicate that various Jimi Hendrix, or alleged Jimi Hendrix, recordings were appearing in the market from unauthorised sources to the irritation of both parties. Mr. Green submitted that the references in those conversations to the estate needing to clear or make a deal with PPX concerning two masters in particular: “Drivin’ South” and “I’m A Man”, which were not in Schedule A to the 1973 Agreement but were in the list of masters already used by PPX at the time of the 1973 Agreement, supported the Defendants’ case. He so submitted because there was no suggestion that PPX were not entitled to exploit them and the references to “doing a deal” also supported an implied licence. I find the conversations too muddled to be a safe basis for any finding. Even the reference to “doing a deal” on the two masters mentioned could be explained because PPX did indeed own the copyright. The 1973 Agreement prevented PPX from exploiting that copyright, but if the estate was otherwise able to exploit those tracks, presumably having obtained a recording elsewhere, it would still be infringing PPX’s copyright. I find no support in these confused conversations for either side.[31]That is a summary of the evidential highlights and my findings on them. I now turn to the issues arising from it all. Implied Licence[32]Mr. Green referred to two cases in particular: Godfrey v. Lees (1995) EMLR 307 and Hadley v. Kemp (1999) EMLR 589. Godfrey v. Lees is a case in which the court found that the copyright owner had by his conduct given rise to an implied licence to another to exploit certain works as their own. Mr. Green submitted that it should be easier to imply a licence in the present case because PPX was itself the owner of the copyright. The facts I have found in this case seem to me clearly to point the other way. In particular, Mr. Chalpin knew that he was not entitled to grant further licences as he did. He did so for the reasons I have given. The estate, through Mr. Branton, may not have taken legal action and in that sense accepted his activities, but Mr. Branton clearly conveyed his view that PPX were not entitled to act as they did. The estate was not bound to litigate. I have found it did not receive royalties, which has been an important factor in most of the cases on implied licence in the context of copyright.[33]Mr. Green sought to neutralise the effect of Mr. Branton’s “bad-mouthing” of Mr. Chalpin’s activities and assertions that he had no rights, by submitting they were insufficient in context, did not amount to a clear assertion of the estate’s rights and in any event were wrong, PPX did have some rights, viz, the copyright. However, it is plain to me, as I have found, that Mr. Chalpin knew the position and Mr. Branton’s attitude to it. The failure formally to put objections in writing or to litigate cannot in the circumstances of this case begin to constitute an implied licence.[34]As Mr. Jones submitted, all that has occurred here is that PPX, the copyright owner of certain master recordings, gave up its right to exploitation in the 1973 Agreement. Thereafter it has acted in clear breach of it. Estoppel/Waiver[35]These pleas fail, in my judgment, for similar reasons. I can find no clear representation, no convention or any other circumstances that would make it unfair for the estate to seek to hold PPX to its contractual obligations (delay apart). The fact that the estate chose not to litigate with Mr. Chalpin in respect of his activities up to the early 1980’s, cannot in the circumstances prevent it from relying on its contractual rights when, in 1995 and 1998 PPX again granted licences in breach of the 1973 Agreement. Laches/Aquiesance/Equitable Remedies[36]Notwithstanding the above, the question remains whether in all the circumstances of this case, the court ought to grant injunctive relief or specific performance (clause 4, delivery up of masters).[37]As to an injunction, Mr. Jones submitted that in the absence of an appropriate estoppel, past breaches have little relevance to future breaches; the Claimants are seeking a prohibitory injunction, which the courts traditionally have granted almost as a matter of course, in aid of a legal right. As I understand the Claimant’s case it is that Mr. Chalpin’s conduct in the past has manifested an intention not to pay any heed to the 1973 Agreement and although it (Claimant) saw fit not to take action in the 1970’s or early 1980’s, since Mr. Chalpin has more recently granted two licences it is now appropriate for the court to prevent him yet again acting in flagrant breach of the 1973 Agreement.[38]Mr. Green submitted that acquiescence, laches or even delay itself should be a bar to the equitable relief sought. He cited De Bussche v. Alt (1878) 8 Ch D 286 at 314 (CA):
“If a person having a right, and seeing another person about to commit, or in the course of committing, an act infringing that right, stands by in such a manner as really to induce the person committing the act, and who might otherwise have abstained from it, to believe that he assents to it being committed, he cannot afterwards be heard to complain of the act.”
As the editors of Chitty (see paragraph 29-139) and the judgment in De Bussche itself point out, acquiescence in this sense amounts to a waiver or raises an estoppel. In view of the findings I have made I cannot see that acquiescence is made out. In particular, I have found that Mr. Chalpin knew he was acting contrary to the 1973 Agreement, the estate, through Mr. Branton, did not assent to his actions and Mr. Chalpin knew that.[39]As to laches Mr. Green again cited Chitty (paragraph 29-140):
“. . . . in a narrower sense, the essence of the doctrine of laches is that if the Claimant has not been reasonably diligent in seeking relief, and in consequence the position of the Defendant has been prejudiced or it would now be unjust or unreasonable to grant relief, the Claimant will be debarred from pursuing his remedy of the ground of laches.”
He further cited Lord Selbourne in Lindsay Petroleum Co. v. Hurd (1874) LR 5 PC 221 at 239:
“Now the doctrine of laches in Courts of Equity is not an arbitrary or a technical doctrine. Where it would be practically unjust to give a remedy, either because the party has, by his conduct, done that which might be fairly regarded as equivalent to a waiver of it, or where by his conduct and neglect he has, though perhaps not waiving that remedy, yet put the other party in a situation in which it would not be reasonable to place him if the remedy were afterwards to be asserted, in either of these cases, lapse of time and delay are most material. But in every case, if an argument against relief which otherwise would be just, is founded on mere delay, that delay of course not amounting to a bar by any Statute of Limitations, the validity of that defence must be tried upon principles substantially equitable. Two circumstances always important in such cases, are, length of the delay and the nature of the acts done during the interval, which might affect either party and cause a balance of justice or injustice in taking the one course or the other, so far as relates to the remedy.”
Here again it seems that the interparty position is to be considered. In other words what effect on the one party the other’s delay has had and how that may affect the justice of the situation. Again on the findings I have made it does not seem to me that this doctrine should of itself preclude a remedy in this case.[40]Nowadays the courts are inclined to adopt a broader approach as exemplified by the judgment of Nourse LJ. in Gafford v. Graham The Times, 1st May 1998):
“Thus here the enquiry must be whether, in all the circumstances, it would be unconscionable for the Plaintiff to continue to seek to enforce the rights which he undoubtedly had in 1986 to complain of the conversion of the bungalow and the extension to the barn.”
[41]The question remains whether mere delay can prevent a party claiming an equitable remedy and if so whether it should in this case. In support of his submission that it should Mr. Green cited Cluett Peabody v. McIntyre Hog Marsh (1958) RPC 335 in which case Mr. Justice Upjohn, as he then was, held that a 30 year delay barred a claim to injunctive relief for trademark infringement in the circumstances of the case from which he inferred a mutual policy of “live and let live”. “The remedy sought is after all equitable, a delay on the part of the Plaintiffs of great length with full knowledge of the facts must in principle affect the Plaintiffs’ rights to relief.” Mr. Justice Upjohn cited the passage already set out from Lindsay v. Hurd and then continued:
“A stronger set of facts, and no doubt a very much longer delay, will be required before a Plaintiff can be said to have lost his rights to an injunction in aid of a legal right than in the case of purely equitable rights . . . . While falling short of estoppel, in my judgment the behaviour of the Plaintiffs, coupled with the long delay, really amounted to an acknowledgement by them of the Defendants’ right to continue the use of their (the Defendants’) marks, and to a waiver of the Plaintiffs’ right to sue for infringement by such continued user. I accept the Defendants’ submission that really the course of conduct between the parties showed a mutual policy of restraint to one another, or, putting it more colloquially, a mutual agreement to live and let live.”
Again, however, it is apparent that the learned Judge was drawing on the circumstances of the case as a whole from which it would not be too difficult to spell out a representation or at least convention that the one party would not insist on its legal rights, at the very least conduct which would make it unjust to grant a remedy.[42]The question to which the facts of this case give rise is whether long delay in circumstances where it has not unfairly affected the interparty position should of itself bar a claim to an equitable remedy. It arises here because I have found that Mr. Chalpin acted with his eyes open, he knew the estate did not assent to his conduct and I have no real evidence of any detriment to the Defendants other than that to which they expressly agreed by the 1973 Agreement. It has been said that “nothing can call forth this court into activity but conscience, faith and reasonable diligence; when these are wanting the court is passive and does nothing.” Mr. Branton’s attitude in 1983, when informed of Mr. Chalpin’s activities by Mr. Douglas was “it’s Chalpin up to his old tricks”. From this and his evidence generally I have already found that Mr. Branton’s attitude upto that date was simply that it was not commercially worthwhile to bother with Mr. Chalpin.[43]It appears that Mr. Branton ceased to act as attorney to the estate sometime in 1993. There was a law suit referred to as the “Seattle Law Suit” which included a claim on behalf of the estate against Mr. Branton for misappropriation of funds. All I know about it is that according to Mr. Branton it was settled amicably. However, new attorneys were acting for the estate by 1995 and Mr. Chalpin wrote to them on August 17th stating that “none of my material has been out for years and the recordings made prior to his stardom (1965/66) were never released in the USA and have been off the market outside the USA since the 1970’s”.[44]Mr. Wasson is an Attorney admitted to practice in the State of Washington and New York and has since about 1993 been retained, as I understand it, exclusively to deal with matters relating to the estate. Mr. Wasson, whose evidence I accept, said in his witness statement that it was spring 1997 that the Claimant, through New York counsel, learned from sources in London that CBH Records had released CD albums of the PPX sideman recordings apparently under licence from PPX. After further investigation the Claimant sought to persuade MCA Records Inc. (MCA), the major record label to whom the Claimant had licensed certain recordings, to take legal action against PPX, but failed. In June 1998 the London firm of solicitors Eversheds was retained to investigate the matter and to seek to enforce the 1973 Agreement. Proceedings were commencing in April 1999 but foundered because of lack of title. However, the matter was rectified and the present proceedings were then commenced in June 2001. Meanwhile of course, in July 1999 the Nippon Crown licence had been granted.[45]This is not the easiest question to answer. Mr. Green points to the three decades of delay whereas Mr. Jones points to a legal right which is undoubtedly now threatened again. The overall delay to which Mr. Green refers and upon which he strongly relies is, to an extent, misleading. Mr. Branton’s laissez-faire attitude between about 1973 and the early 1980’s was at least understandable. He did not consider the Claimant’s masters to be a real threat to the Claimant’s featured recordings of Jimi Hendrix. Nor did he consider litigation against that background as commercially worthwhile or in the estate’s best interest. There then followed a quiet period until the 1995 and 1999 licences came to light. The present Claimant and successor in title to the Hendrix estate has a legitimate interest in seeking to rationalise the situation. It has never consented to any extension of Schedule A or exploitation of non Schedule A masters by the Defendants. No royalties have ever been paid to the estate in respect of the Defendants’ exploitation. I do not consider it unconscionable that the Claimant should now seek to prevent yet further exploitation contrary to the express terms of the 1973 Agreement. Nor do I consider that this is a case, even assuming that such might exist, in which the court should refuse to grant an injunction simply because of the passage of time. I think it would be very difficult and probably undesirable, to attempt to define a category of case in which mere delay would preclude the grant of equitable relief. A case in which there was no apparent reason for the delay other than indifference to the particular state of affairs and no sufficient reason for the sudden decision to seek a remedy would be likely to qualify. Delivery Up of Clause 4 Masters[46]Clause 4 of the 1973 Agreement is plain. The Defendants should have delivered up all masters of recordings not covered by Schedule A or 3.(b) of the 1973 Agreement. The factual position became less clear as the trial proceeded. At the outset the Claimant’s case was simply that no masters had been delivered. The Defendants’ case was that the masters were delivered in about June 1973. One of the lists attached to the letter, previously mentioned, dated 19th March 1973, identified 19 masters to be delivered up. The 1973 Agreement did not call for a list of those masters, but as suggested earlier, it was obviously sensible for the parties to agree the masters to be delivered. Mr. Jones did not seek to challenge that and I proceed on the basis that the 19 masters then identified were the ones to be delivered. By letter dated 19th June 1973 Mr. Howard wrote to Mr. Chalpin calling for delivery of the masters. No further letter from Mr. Howard or anyone else representing the Claimant has been produced. A letter to Mr. Howard dated 21st June 1973 signed by Miss Facher on behalf of the Defendants suggests that the tapes were being sent that day by messenger. Neither Mr. Howard nor Mr. Branton could now recall receiving the tapes or destroying them. By their amended Defence the Defendants admitted that there were five masters which should have been delivered up but were not. In 1991 Mr. Chalpin wrote to Mr. Douglas, in another context, and referred to PPX’s library of tapes. As a result of cross-examination it became clear that the Defendants had retained either the original masters or copies of all the 19 masters that should have been delivered. In evidence, Mr. Chalpin said that he thought that he had delivered up tapes which were of no use or value pursuant to his agreement with Mr. Branton. It is impossible after so long to be sure now what happened in 1973. With some hesitation I find that the Defendants did deliver up recordings to the Claimant save for the five which they admitted they did not. However, I also find, effectively on Mr. Chalpin’s own evidence, that the material delivered up comprised virtually useless copies or masters and that Mr. Chalpin retained better versions. As Mr. Green submitted the Claimant faces some difficulties with the claim under this head. On its primary case that no masters were delivered, the Claimant knew that at the time and has thus since 1973 taken no action. I could only infer from those bare facts that it, and its predecessors, did not consider the matter worth pursuing. On that basis I would be disinclined now to grant any relief.[47]Mr. Jones did not seek to develop any argument to the effect that the delivery up of virtually useless material by the Defendant in 1973, was itself a breach of Clause 4. Perhaps because even on that view of the facts the Claimant has taken no action since 1991 when it became aware that the Defendant had retained recordings.[48]On the other hand Mr. Chalpin’s subterfuge, for such I regard it, in keeping the best and usable masters and copies (in my view a clear breach of Clause 4) is unhelpful to his cause. However, on this issue I do not think that the Claimant has helped itself and is guilty of undue delay. The evidence indicates indifference, at best, to what if anything was delivered up in purported compliance with Clause 4 and, in any event, no action at all between 1991 and these proceedings. In those circumstances I am not moved to grant an Order for delivery up. I would accept the Defendants’ offered undertakings not to exploit or cause or permit others to exploit any of this material but I will hear counsel as to whether such undertaking would serve any purpose in view of the injunction which I am prepared to grant and which appears to me to cover this material. Damages[49]The Claimant limited its claim to damages to those in respect of the grant of the licences in 1995 and 1999. This was, presumably, in recognition of limitation difficulties if he sought to go back further. Mr. Jones accepted that it would be impossible to assess damages for those breaches on a traditional basis. I refer to paragraph 113 of his closing submissions:
“On a “traditional” assessment of damages, it would be necessary for EHL to establish how many more albums of Hendrix Featured Recordings would have sold without the PPX non-schedule A recordings on the market than in fact were sold or the extent to which the value of the Hendrix Featured Recordings has diminished by reason of PPX’s exploitation of the non-schedule A masters. Such an assessment would, from a practical point of view, be impossible.”
And at paragraph 114 he submitted:
“If this is the only basis on which EHL would be entitled to damages then it is accepted that there should be no assessment of damages. EHL claims, that it is entitled to have the damages assessed on one of two alternative basis. Which is the correct basis will be a matter for the assessor of damages.”
Mr. Jones’ first alternative was “the Wrotham Park Estates basis.” That is a reference to Wrotham Park Estate Co. Ltd. v. Parkside Homes Ltd. (1974) 1 WLR 798. Mr. Jones accepted that the claim for damages in that case was a claim for equitable damages in lieu of an injunction under what was known Lord Cairns’ Act, now provided for in Section 50, Supreme Court Act 1981. Whilst accepting that he could not realistically claim such equitable damages the damages awarded in Wrotham Park Estates could equally be regarded as compensatory damages and awardable at common law. He referred to Jaggard v. Sawyer (1995) 1 WLR 281-2 per Sir Thomas Bingham MR and at 291 per Millett LJ. He also referred to certain passages of Lord Nicholls’ speech in AG v. Blake (2001) 1 AC 268 at 278D - 279C and 282A - 283D. His second alternative was based on his submission that this was an appropriate case to assess damages as being equal to the entire profit made by PPX from its exploitation of non-schedule A masters by granting licences in respect of those recordings to CBH and Nippon Crown.[50]I do not consider this case analogous to the Wrotham Park case but, in any event, no real foundation has been laid for damages to be assessed on the basis of what the market would pay for a release of the Claimant’s contractual right to restrain exploitation of any non-schedule A master. To assess compensatory damages on the basis that the Claimant had lost a valuable asset, namely its contractual control over the Defendants’ activities, arising out of the 1973 Agreement, it would be necessary first to conclude that the right had a substantial value and that it had been lost. The grant of the injunction in this action demonstrates that the right has not been lost in a general sense. Nevertheless, the court is asked to award damages in respect of the 1995 and 1999 licences on the basis that by their grant, the Claimant was deprived of its right to prevent the grant of those licences and to exact some payment for a release to enable the Defendants to act as they did. In this context, the right was only valuable to the Claimant if they might realistically have done a deal with the Defendants concerning those licences. On the evidence as a whole, in particular the evidence of Mr. McDermott and Mr. Wasson, it is plain to me that the Claimant would never have agreed to the Defendants’ exploitation of these poor quality recordings which do not feature Jimi Hendrix, and which, according to the Claimant, confuse the buying public. Whilst I appreciate that an assessment of damages could, in theory, be conducted on the basis of what a hypothetical party might have paid the Claimant for the right to exploit these recordings, the evidence as a whole demonstrates that that would be a wholly fictional approach. Further, on the evidence as a whole I could not begin to compare this case with AG v. Blake . I decline to order an assessment of damages, either on a compensatory approach or an assessment of profit basis. Royalties[51]Again any claim to royalties is limited to the 1995 and 1999 licences. However, Mr. Jones did not invite me to make any order in this respect but made the point that under the 1973 Agreement royalties would be payable on sales not on the basis of payments made to the Defendants. Undertakings have been offered in respect of these two licences and again I will hear Counsel if, contrary to my present understanding, any further order is sought. Mr. Chalpin[52]Finally, an issue arose as to whether it would be appropriate to grant an injunction against Mr. Chalpin personally as opposed to or in addition to PPX Enterprises Inc. In view of the fact that Mr. Chalpin personally was a party to the 1973 Agreement and the finding I make on the evidence as a whole that he is clearly the moving force behind PPX I consider that it would be appropriate for the injunction to go against both Defendants.[53]The counter claim fails.[54]The claim succeeds to the limited extent that I have indicated. It only remains to thank Counsel for their invaluable assistance in this extraordinary case. - 0 - 0 - 0 - 0 -

Cited in 1 later judgment