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Guest Post 5: Federal Judge Sam Joyner on Polaroid

Several years ago, in Tulsa, Oklahoma, I had the pleasure of making the acquaintance of  Sam Joyner. Sam’s a long-term, serious avocational photographer, good enough to have gallery representation for his work. He’s also a U.S. Magistrate Judge (retired).

As one of the early subscribers to this blog, Sam has followed my posts on the Minnesota Bankruptcy Court’s hearing concerning the fate of the Polaroid Collection. Disturbed, like many of us, by the outcome, he volunteered to review the various posts and news stories, and the documents I’ve been posting along the way. Below you’ll find his opinion. It’s lengthy, though not particularly technical; I think a lay person can grasp it.

The short version: He’s convinced that the Delaware Bankruptcy Court acted wrongly in 2002 in approving transfer of ownership of the Polaroid Collection “Free of liens  . . . and other encumbrances,” and that the Minnesota Bankruptcy Court this past month acted wrongly in releasing the Polaroid Collection to Sotheby’s for sale. He believes that the photographers do have legal recourse in this situation, and he lays out a proposed course of action for them to follow.

Read on. And then go to my new Urgent Photographer Alert #2 for information on how to proceed.

My thanks to Sam for spending the time necessary to prepare such a thorough analysis, which lays the groundwork for putting a halt to the sale of at least the bulk of the Polaroid Collection. I hope my readers will make their appreciation of his efforts known in the comments they send.

A brief professional bio of Sam Joyner appears at the end of his letter.

— A. D. Coleman

_____________________________

September 15, 2009

Dear Allan:

Congrats to you and others for continuing to pursue what must seem like a Quixotian quest regarding the sale of the Polaroid Collection. The law is rife with pickiness, and for that I feel a professional need to apologize. You have done an amazing job of collecting the important documents and raising the correct issues, both legal and moral, from, as you say, your untutored perspective. There must be a latent lawyer somewhere in your soul — possibly a prior incarnation.

I am looking at this matter out of personal interest — not because you have asked me to (which you have not). This said, our friendship and my tremendous respect for your life’s work in photography criticism is always a part of the picture.

I practiced law for 25 years before assuming the bench as a U.S. Magistrate Judge, seated in Tulsa 15 years ago, retiring January of this year. I have been active in the world of fine-art photography, primarily black and white, for some 20 years and am blessed to show work at the M. A. Doran Gallery, a fine gallery in Tulsa. Over that 20 years I have studied with 15-20 wonderful teachers, one of whom is included in the Polaroid Collection. Personal collecting and an interest in the history of photography adds motivation to determine what is happening in the sale of the Polaroid Collection.

From reviewing the documents, here is my take, divided into relevant facts, substantive legal issues and procedural issues.

RELEVANT FACTS:

1. Contributing photographers typically signed a Polaroid Collection Release form which included the following language: “I hereby grant to Polaroid Corporation and its companies, the worldwide non-exclusive rights for exhibition and editorial (non-commercial) publication purposes of the following images in perpetuity.”

2. Contributing photographers to another project which resulted in work entering the collection typically signed a Photographers Release Agreement. This had several variants, one of which included the following language: “For consideration received, I ______________ (Photographer) hereby grant to Polaroid Corporation the right to republish my image(s), as described below, that were submitted by me to Polaroid Corporation for use in the Test Magazine. I understand that my image(s) will be re-published on the worldwide internet via Polaroid’s Home Page, starting September 5, 1995 through May 1996.”

3. The terms of use for the 20×24 stated that Polaroid will select one of the images for the collection. The document concludes, “Collection images are exclusively used for exhibits and editorial (non-commercial) purposes with Polaroid retaining all rights. The photographer does, however, retain access to his/her images for exhibition and publication purposes.”

4. A copy of a standard purchase order used when a photograph was acquired has been obtained. That purchase order states on its face, “Photographs, for exhibition purposes not publicity. All other rights reserved. To be returned, loaned, to artist at any time upon request for her own personal use.”

5. All of the Polaroid assets were sold in a Delaware bankruptcy proceeding in 2002 in which the court entered an order stating that the interests of any third party (which would include the original photographer) is forever barred. The Polaroid Collection was mentioned briefly but not dealt with separately in that proceeding. No notice of this proceeding was given to the original photographers.

6. On August 28, 2009 the Minnesota Bankruptcy Judge entered an order for the sale of the collection and ordered that the interests of anyone (which would include the original photographer) are forever barred. I don’t think individual photographers were given notice of this proceeding.

7. Letters were filed in the Minnesota proceeding by A. D. Coleman, Judy Dater and two other photographers. They were treated as objections to the sale. Polaroid filed a Reply brief on August 27th, the day of the hearing, responding to the letters, in which Polaroid conceded that the photographers retained all copyrights to the images but argued that Polaroid had the right to sell the photographs themselves free and clear of any claims by the photographers.

8. It appears that the restrictive language granting the restrictive license in paragraphs 1-4 above was presented to the court in the Minnesota proceeding in that a sample agreement with the language was attached to the objection letter submitted by Bea Nettles. Unfortunately, Polaroid’s reply brief and the court’s final order did not mention the language or discuss how it would impact the sale. It is my understanding, from those present at and reporting on the hearing, that the language was not fully discussed at the hearing.

SUBSTANTIVE LEGAL ISSUES:

Polaroid’s right to sell the photographs is totally dependent upon the language signed by the parties when they were sold to, donated to and/or bartered with Polaroid. The documents in #1, #2 , #3 and #4 in the facts above consistently state that the images are to be “used for exhibits and (non-commercial) publication purposes.” The 20×24 documents say they may be used exclusively for those purposes. [Note: To view a PDF file of the documents referred to in the preceding paragraphs, click here.]

There is a typical protocol for the donation or sale of artwork, usually involving an invoice, bill of sale, or purchase order. There is no such document in this case stating that the photograph is sold or donated without the limiting license language. There is no document stating that the photographer is transferring all right, title, and interest in the photograph, reserving only the photographer’s copyright interests.

In this case, it appears the parties created a perpetual license for Polaroid to exhibit and publish for non-commercial purposes. They did not have to use that limiting language. But that is the language they chose, and the courts are obligated to enforce that language. The court’s goal should be to carry out the expressed desires of the parties to the contract at the time the contract was executed.

The most disturbing part of the process to me (and the area in which I think the court’s order is most vulnerable) is that Polaroid’s reply brief and the Court’s order never discuss the impact of the license language on Polaroid’s right to sell. They never discuss the contractual language, which is central to the parties’ contracts and to Polaroid’s rights to the collection (unless such discussion was included in verbal pronouncements by the judge at the hearing).

If they had discussed the language, the court should have at least considered the following arguments:

1. THE CONTRACTUAL RIGHTS GRANTED TO POLAROID MAY BE SO PERSONAL TO POLAROID THAT THEY CANNOT BE TRANSFERRED OR ASSIGNED. Most contractual rights owned by a party may be assigned, sold, or transferred to a third party. However, there are some contractual rights that are so personal to the grantee that the grantee cannot sell its rights under the contract. The court should consider whether the parties intended the right to exhibit and publish the image to go to Polaroid only, not to be sold or assigned to third parties. It is possible that Polaroid’s bankruptcy should have caused the images to be returned to the photographer.

2. IF THE COURT FINDS THE LANGUAGE AMBIGUOUS, IT SHOULD LISTEN TO TESTIMONY FROM THE PARTIES TO DETERMINE THEIR ORIGINAL INTENT. Testimony from other institutional collectors may also be relevant to determining the custom of the trade on these issues.

3. THE PURCHASER OF THE PHOTOGRAPHS CAN ONLY ACQUIRE THE RIGHTS THAT POLAROID HAD IN THE PHOTOGRAPHS. In the sales ordered by the bankruptcy court in Delaware in 2002 and in Minnesota in 2009, the purchaser should only be able to acquire the interest in the image that Polaroid had, that being the right to exhibit and publish for non-commercial purposes. There is even an obligation in some documents to return the image to the photographer on loan for exhibit purposes. The 2009 order is very strong in its language that it terminates and bars any claim by any other parties to the photographs. It is possible that the precise language from the documents giving the limited license to Polaroid was not fully brought to the court’s attention.

4. THE SALE OF THE PHOTOGRAPH IS THE USE OF THAT PHOTOGRAPH FOR COMMERCIAL PURPOSES. The language says the photograph can only be used for non-commercial purposes. The sale of the print is obviously using the photograph for commercial purposes. It is using the image to make money from the image, clearly prohibited by the language. Because Polaroid prints are, by definition, one-of-a-kind works, the image cannot be separated from the object.

In summary, I think that the court should have considered the above issues in its order — and it did not. The language from the documents indicates that the court should not have ordered the sale precluding the rights of the photographers clearly set forth in the documents. The above analysis is from reviewing the documents alone. I have done no legal research to determine how other courts have handled similar situations.

PROCEDURAL ISSUES:

REAL PARTY IN INTEREST

There are procedural hurdles to resolve. The biggest hurdle relates to a real party in interest. Any claim in court must be brought by the party that is potentially aggrieved or harmed (normally in the financial sense) by the other party’s actions. As the court found, A. D. Coleman does not have a literal dog in this fight because he did not contribute any of the photographs. Not only is it legally required, but the court will wonder why a substantial number of the other photographers have not joined in the objection.

The biggest elephant missing in the room might seem to be the Ansel Adams Trust or Foundation. Why have they not joined in the objection? Setting aside the question of short deadlines for action on the parts of the photographers and lack of notification to them, the answer would seem to be as follows:

From the historical record, we know that Polaroid prints entered the Polaroid Collection in several different ways. Some were purchased outright, for cash, from photographers, their estates, galleries, or other sources. Some were specifically commissioned and paid for by the Polaroid Corporation under “work made for hire” agreements; for example, this appears to be the case with most if not all of the 600 or so Ansel Adams works in the collection, supplied to the Polaroid Corporation in Adams’s role as a paid consultant testing products and reporting on his results from the late 1940s on.

Assuming that the contracts and letters of agreement relating to these several categories of works acquired for the collection do not contain encumbering or restrictive clauses, as do many of the Polaroid Collection contracts, they may in fact be appropriately released for sale in the present circumstance. The court should determine this by examination of the relevant contracts and letters of agreement covering those purchased or commissioned works.

The third category of works, those of particular concern to us here, are those that entered the collection via a sale, donation, or barter arrangement that prohibited commercial use, reserved for the photographers the right in perpetuity to borrow the works for exhibition and publication purposes, did not specify transfer of ownership, and otherwise contain explicitly or implicitly encumbering language. Here too the court should determine this by examination of the relevant contracts and letters of agreement covering those works, whose sale to buyers not bound by the initial understandings between the Polaroid Corporation and the photographers would in fact constitute breach of contract.

How might photographers who fall into the latter category, and thus have legal standing in this situation, proceed? One way to resolve this problem of “real party in interest” would be to get assignments of the rights of the photographers to one entity or person. That raises lots of other issues. The best resolution, in my opinion, is to get them to join as parties objecting.

DELAWARE 2002 AND MINNESOTA 2009 ORDERS

The other procedural and substantive hurdle is the legal fact the Delaware court in 2002 and the Minnesota court in 2009 entering orders approving the sales and barring any outside claims by anyone.

There are two possible responses to those rulings. The first is to file a notice of appeal of the 2009 ruling. Unfortunately, Rule 8002 sets a 10-day time limit within which to file notice of appeal. The typical appeal time in nonbankruptcy cases is 30 days. Rule 8002(c)(2) says the time may be extended to 30 days EXCEPT in relation to orders for sale of assets. Regardless, a motion to extend the appeal time to 30 days could be filed.

The second option — in my opinion the better option — is to file a Motion for Rehearing or Reconsideration. Both motions could be filed. Bankruptcy Rule 9024 incorporates Federal Rule of Civil Procedure 60, which allows such a motion to be filed within “a reasonable time,” extended in some situations up to one year. The grounds for the Motion for Reconsideration and Motion to Extend the Appeal time should include the following arguments:

  1. Continue to argue that even if the sale is valid, the purchaser gets only the rights that Polaroid had, which severely limits the use of those images. The purchaser cannot say the court found those restrictions on use are barred, since the court never mentioned those restrictions in its order. The basis for the motion for rehearing is that the order used stock language in barring the rights of third parties and never entered specific findings of fact and conclusions of law dealing with the language of the license agreements — thus the need for a new hearing to resolve that issue. The bankruptcy judge may welcome the opportunity to discuss the specific language. If you lose at the rehearing on this issue, you could timely appeal to the District Court, which would be heard by different judge.
  2. Rule 2002 requires notice in writing of the hearing to all parties in interest. A new hearing is needed with notice to all photographers. Their property rights in the images have been terminated without due-process notice.
  3. There is newly discovered evidence that was not presented at the original hearing, which is the language on the various contracts, letters of agreement, and purchase orders.

If the bankruptcy judge overrules your motion for Reconsideration, it is possible you could timely appeal that order. Consultation with a bankruptcy lawyer is needed to ensure compliance with the Bankruptcy Rules.

CONCLUSION:

Obviously the timeline is very short to respond to the August 28th order. The earlier the described motions get filed the better.

The other issue to resolve is the question of the real party in interest. Which photographers, or their successors, are willing to pursue this matter further?

I share your concern that the original intent of the photographers and Polaroid is not being enforced by the court. Legal analysis is necessarily a bit on the arid side. Don’t let that hide my disappointment that, legally and morally, these issues were not fully discussed. Damage to the photographers involved, and to the fine-art photography world in general, could be immense. As a precedent, this case could have serious impact on how the rights of photographers in other cases are handled.

The number of images in the collection with the restrictive language in their related contracts is not now known. Regardless, there is an altruistic need to preserve the rights of photographers — past, present and future. If we champion this cause, it could impact others. At the very least, it will remind parties to be more aware of the language they use in donating and accepting work.

If I can help further, I am happy to do so.

Sam

_________________________

Biographical Note:

The Honorable Sam A. Joyner

United States Magistrate Judge (Retired)

Judge Sam A. Joyner

Judge Sam A. Joyner

The Honorable Sam A. Joyner  was appointed Magistrate Judge of the United States District Court for the Northern District of Oklahoma on June 1, 1995, sitting in Tulsa. Judge Joyner was active on the bench in electronic discovery issues and is the author of the Guidelines for Electronic Discovery currently used in the Northern District. While on the bench he conducted well over 300 mediations.

Judge  Joyner retired from the bench on January 1, 2009.  He is currently available as a mediator, arbitrator and consultant on electronic discovery issues. He earned a  B.A. degree (1963) from George Washington University, Washington, DC and a Juris Doctorate With Honors (1966) and a Master of Liberal Studies (1987) from the University of Oklahoma.

Judge Joyner is a Fellow of the American College of Trial Lawyers, member of the Order of the Coif and the Hudson-Hall-Wheaton chapter of the American Inns of Court. He has taught as  an adjunct professor at the University of Oklahoma College of Law, teaching Professional Responsibility. Prior to becoming a Magistrate Judge in the Northern District, he practiced law for 24 years. He has served as a director of the Federal Magistrate Judge’s Association and a member of the Advisory Committee for the Administrative Office, U.S. Courts.

Judge Joyner served as Editor-in-Chief of the Federal Courts Law Review from 1999 through 2005. See  www.fclr.org. During this tenure he presided over a symposium dedicated to electronic discovery issues and implementation of the new Federal Rules of Civil Procedure on electronic discovery. The symposium generated  excellent articles from academics, judges, and practitioners, and caused the law review to become a seminal resource on electronic discovery. He is a frequent presenter at electronic discovery seminars around the country, including the 2009  ABA White Collar Crime Institute, San Francisco, CA.

Publications include: “Law School and Legal Ethics — A Part of the Illness or the Cure?”, 60  Okla.B.J.743 (1989); “A Planetary Survey of Feminist Jurisprudence: If Men are from Mars and Women are from Venus, Where do Lawyers Come From?”, 33 Tulsa L. Jour.1019 (1998).

He can be reached at samjoyner [AT] mac [DOT] com.

For an index of links to all posts related to this story, click here.

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